Intelligent Systems Corporation [NYSE American: INS], the leading
provider of innovative credit technology solutions and processing
services to the financial technology and services market, announced
today its financial results for the quarter ended December 31,
2020.
“I am pleased to report that our fourth quarter
and full-year results were in-line with initial expectations and,
despite volatile market conditions, we completed crucial
investments in our infrastructure, setting the stage for future
growth. These investments enable CoreCard to take on new customers
while ensuring it continues to exceed both current and future
customer needs,” said Leland Strange, CEO of Intelligent Systems.
“In the fourth quarter, we achieved revenues of $9.6 million, a 7%
decline relative to the fourth quarter of 2019. However, we
recognized revenues of $35.9 million in fiscal year 2020, a 5%
increase from fiscal year 2019. While we expected 2020 to be a
building year relative to an incredibly strong 2019, we did not
anticipate COVID-19 and resulting impact on our planned work force
expansion and development efforts. I am pleased with the strong
performance the team has achieved and the strong financial and
operational position Intelligent Systems maintains. As we enter
fiscal 2021, we are confident in our ability to leverage the
investments we made in 2020 to deliver top-line growth of 15% to
25% for the year.”
Financial Highlights for the three and
twelve months ended December 31, 2020
Total revenue for the fourth
quarter of $9,623,000 was down 7% year over year. Revenue of
$35,873,000 for full fiscal year 2020 was up 5% from fiscal year
2019.
In the following table, revenue is disaggregated by type of
revenue for the three and twelve months ended December 31, 2020 and
2019:
|
|
Three Months Ended |
|
Twelve Months Ended |
|
December 31, |
|
December 31, |
(in
thousands) |
|
2020 |
2019 |
|
2020 |
2019 |
License |
|
$ |
2,000 |
|
$ |
2,000 |
|
|
$ |
3,600 |
|
$ |
5,725 |
|
Professional services |
|
|
4,783 |
|
|
5,998 |
|
|
|
20,610 |
|
|
19,203 |
|
Processing and
maintenance |
|
|
2,412 |
|
|
1,879 |
|
|
|
10,228 |
|
|
7,650 |
|
Third
party |
|
|
428 |
|
|
426 |
|
|
|
1,435 |
|
|
1,725 |
|
Total |
|
$ |
9,623 |
|
$ |
10,303 |
|
|
$ |
35,873 |
|
$ |
34,303 |
|
Income from operations was
$2,732,000 for the fourth quarter compared to income from
operations of $3,979,000 in the comparable prior year quarter. Full
year 2020 income from operations was $11,295,000 compared to
$13,382,000 in the comparable prior year.
Net income was $2,119,000 for
the fourth quarter compared to net income of $3,697,000 in the
prior comparable quarter in 2019. Full year 2020 net income was
$8,161,000 compared to $10,969,000 in the comparable prior
year.
Earnings per diluted share was
$0.24 for the quarter ended December 31, 2020 compared to $0.41 in
the comparable prior year quarter. Full year 2020 earnings per
diluted share was $0.91 compared to $1.22 in the comparable prior
year.
Share Repurchases were
approximately $1,639,000 at an average price of $37.62 per share
for the quarter ended December 31, 2020.
Investor Conference Call
Today
The company is holding an investor conference
call today, February 11, 2021, at 11 A.M. Eastern Standard Time.
Interested investors are invited to attend the conference call by
dialing (877) 407-0890 or by viewing the webcast at
https://www.webcast-eqs.com/INS20210211/en. A transcript of the
call will be posted on the company’s website at www.intelsys.com as
soon as available after the call.
The company will file its Form 10-K for the
period ended December 31, 2020 with the Securities and Exchange
Commission in early March. As part of the conference call
Intelligent Systems will be conducting a question and answer
session where participants are invited to email their questions to
fax@intelsys.com prior to the call. For additional information
about reported results, investors will be able to access the Form
10-K on the company’s website at www.intelsys.com or on the SEC
site, www.sec.gov.
About Intelligent Systems
CorporationFor over thirty-five years, Intelligent Systems
Corporation [NYSE American: INS] has identified, created, operated
and grown technology companies. The company’s principal operations
are CoreCard Software, Inc. (www.corecard.com) and its affiliate
companies. CoreCard provides prepaid and credit card processing
services using its proprietary software solutions that it also
licenses to others. CoreCard has designed and developed a
comprehensive suite of software solutions that corporations,
financial institutions, retailers and processors use to manage
credit and debit cards, prepaid cards, private label cards, fleet
cards, loyalty programs, and accounts receivable and small loan
transactions. CoreCard’s flexible and proven processing platform is
being utilized in many countries in addition to the United States
including Australia, Canada, China, the United Arab Emirates,
France, Italy, Mexico, New Zealand, Singapore, South Africa and the
United Kingdom. Further information is available on the company’s
website at www.intelsys.com or by calling the company at
770-381-2900.
In addition to historical information, this news
release may contain forward-looking statements relating to
Intelligent Systems Corporation and its subsidiary and affiliated
companies. These statements include all statements that are not
statements of historical fact regarding the intent, belief or
expectations of Intelligent Systems Corporation and its management
with respect to, among other things, results of operations, product
plans, and financial condition. The words “may,” “will,”
"anticipate,” “believe,” “intend,” “expect,” “estimate,” “plan,”
“strategy” and similar expressions are intended to identify
forward-looking statements. Prospective investors are cautioned
that any such forward-looking statements are not guarantees of
future performance and involve risks and uncertainties and that
actual results may differ materially from those contemplated by
such forward-looking statements. The company does not undertake to
update or revise any forward-looking statements whether as a result
of new developments or otherwise, except as required by law. Among
the factors that could cause actual results to differ materially
from those indicated by such forward-looking statements are
instability in the financial markets, delays in product
development, undetected software errors, competitive pressures,
changes in customers’ requirements or financial condition, market
acceptance of products and services, the impact of new or changes
in current laws, regulations or other industry standards, risks
relating to unauthorized access to confidential information due to
criminal conduct, attacks by hackers, employee or insider
malfeasance and/or human error and declines in general economic and
financial market conditions, particularly those that cause
businesses to delay or cancel purchase decisions.
Intelligent Systems
CorporationCONSOLIDATED STATEMENTS OF
OPERATIONS(unaudited, in thousands, except share and per
share amounts)
|
Three Months EndedDecember
31, |
Twelve Months EndedDecember
31, |
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Revenue |
|
|
|
|
Services |
$7,623 |
|
$8,303 |
|
$32,273 |
|
$28,578 |
|
Products |
|
2,000 |
|
|
2,000 |
|
|
3,600 |
|
|
5,725 |
|
Total net revenue |
|
9,623 |
|
|
10,303 |
|
|
35,873 |
|
|
34,303 |
|
Cost of revenue |
|
|
|
|
Services |
|
4,009 |
|
|
3,314 |
|
|
15,427 |
|
|
11,759 |
|
Products |
− |
|
− |
|
− |
|
− |
|
Total cost of revenue |
|
4,009 |
|
|
3,314 |
|
|
15,427 |
|
|
11,759 |
|
Expenses |
|
|
|
|
Marketing |
|
38 |
|
|
27 |
|
|
132 |
|
|
151 |
|
General and administrative |
|
1,168 |
|
|
1,101 |
|
|
3,866 |
|
|
3,495 |
|
Research and development |
|
1,676 |
|
|
1,882 |
|
|
5,153 |
|
|
5,516 |
|
Income from operations |
|
2,732 |
|
|
3,979 |
|
|
11,295 |
|
|
13,382 |
|
Investment income (loss) |
|
193 |
|
|
(224 |
) |
|
(1,044 |
) |
|
34 |
|
Other income |
|
66 |
|
|
109 |
|
|
378 |
|
|
99 |
|
Income before income taxes |
|
2,991 |
|
|
3,864 |
|
|
10,629 |
|
|
13,515 |
|
Income taxes |
|
872 |
|
|
167 |
|
|
2,468 |
|
|
2,546 |
|
Net income |
$2,119 |
|
$3,697 |
|
$8,161 |
|
$10,969 |
|
Earnings per
share: |
|
|
|
Basic |
$0.24 |
|
$0.41 |
|
$0.91 |
|
$1.24 |
|
Diluted |
$0.24 |
|
$0.41 |
|
$0.91 |
|
$1.22 |
|
Basic weighted average common shares outstanding |
|
8,900,524 |
|
|
8,913,655 |
|
|
8,919,602 |
|
|
8,873,071 |
|
Diluted weighted average common shares outstanding |
|
8,998,293 |
|
|
9,014,032 |
|
|
9,014,985 |
|
|
8,967,901 |
|
Intelligent Systems
CorporationCONSOLIDATED BALANCE SHEETS(in
thousands, except share and per share amounts)
As of December 31, |
|
2020 |
|
|
2019 |
|
ASSETS |
|
|
Current assets: |
|
|
Cash |
$37,956 |
|
$26,415 |
|
Accounts receivable, net |
|
3,270 |
|
|
8,759 |
|
Other current assets |
|
1,263 |
|
|
905 |
|
Total current assets |
|
42,489 |
|
|
36,079 |
|
Investments |
|
1,921 |
|
|
3,081 |
|
Notes and interest receivable |
|
2,681 |
|
|
1,795 |
|
Property and equipment, at cost less accumulated depreciation |
|
6,914 |
|
|
2,177 |
|
Other long-term assets |
|
3,020 |
|
|
1,108 |
|
Total assets |
$57,025 |
|
$44,240 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
Current liabilities: |
|
Accounts payable |
$714 |
|
$403 |
|
Deferred revenue, current portion |
|
1,322 |
|
|
689 |
|
Accrued payroll |
|
1,901 |
|
|
2,503 |
|
Accrued expenses |
|
321 |
|
|
153 |
|
Income tax payable |
|
954 |
|
|
1,100 |
|
Other current liabilities |
|
4,850 |
|
|
1,345 |
|
Total current liabilities |
|
10,062 |
|
|
6,193 |
|
Deferred revenue, net of current portion |
|
– |
|
|
23 |
|
Deferred tax liability |
|
818 |
|
|
275 |
|
Long-term lease obligation |
|
1,994 |
|
|
460 |
|
Total noncurrent liabilities |
|
2,812 |
|
|
758 |
|
Stockholders’ equity: |
|
Common stock, $0.01 par value: Authorized shares - 20,000,000; |
|
Issued shares - 8,929,368 and 8,924,988 at December 31, 2020 and
2019, respectively; |
|
Outstanding shares - 8,885,797 and 8,924,988 at December 31, 2020
and 2019, respectively |
|
89 |
|
|
89 |
|
Additional paid-in capital |
|
15,836 |
|
|
15,450 |
|
Treasury stock, 43,571 and 0 shares as of December 31, 2020 and
2019, respectively, at cost |
|
(1,639 |
) |
|
– |
|
Accumulated other comprehensive loss |
|
(140 |
) |
|
(94 |
) |
Accumulated income |
|
30,005 |
|
|
21,844 |
|
Total stockholders’ equity |
|
44,151 |
|
|
37,289 |
|
Total liabilities and stockholders’ equity |
$57,025 |
|
$44,240 |
|
For further information, callMatt White,
770-564-5504 or email matt@intelsys.com
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