0001181431-14-013515.txt : 20140320 0001181431-14-013515.hdr.sgml : 20140320 20140320160206 ACCESSION NUMBER: 0001181431-14-013515 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20140320 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20140320 DATE AS OF CHANGE: 20140320 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IDENTIVE GROUP, INC. CENTRAL INDEX KEY: 0001036044 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 770444317 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-29440 FILM NUMBER: 14706841 BUSINESS ADDRESS: STREET 1: 1900 CARNEGIE AVENUE STREET 2: BUILDING B CITY: SANTA ANA STATE: CA ZIP: 92705 BUSINESS PHONE: 949-250-8888 MAIL ADDRESS: STREET 1: 1900 CARNEGIE AVENUE STREET 2: BUILDING B CITY: SANTA ANA STATE: CA ZIP: 92705 FORMER COMPANY: FORMER CONFORMED NAME: SCM MICROSYSTEMS INC DATE OF NAME CHANGE: 19970319 8-K 1 rrd405999.htm EARNING 8-K Q4 2013 Prepared By R.R. Donnelley Financial -- Form 8-K
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
Form 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported):  03/20/2014
 
Identive Group, Inc.
(Exact name of registrant as specified in its charter)
 
Commission File Number:  000-29440
 
Delaware
  
77-0444317
(State or other jurisdiction of
  
(IRS Employer
incorporation)
  
Identification No.)
 
39300 Civic Center Drive, Ste 160
Fremont, CA 94538
(Address of principal executive offices, including zip code)
 
949-250-8888
(Registrant’s telephone number, including area code)
 
1900-B Carnegie Avenue
Santa Ana, CA 92705
(Former name or former address, if changed since last report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[  ]   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ]   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ]   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[  ]   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 

 
Item 2.02.    Results of Operations and Financial Condition
 
The following information, including the attached exhibits to this Form 8-K, is furnished pursuant to Item 2.02 of Form 8-K, "Results of Operations and Financial Condition."
The information contained in Item 2.02 of this Current Report, including Exhibit 99.1, is being furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information contained in this Current Report shall not be incorporated by reference into any registration statement or other document or filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

On March 20, 2014, Identive Group, Inc. (the "Company") issued a press release announcing financial results for its 2013 fiscal fourth quarter and year ended December 31, 2013, and held a conference call with investors to discuss those financial results.

 
 
Item 9.01.    Financial Statements and Exhibits
 
(d)         Exhibits.

99.1        Press Release dated March 20, 2014 announcing financial results for the 2013 fiscal fourth quarter and year ended December 31, 2013.

 

 

SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
           
Identive Group, Inc.
 
 
Date: March 20, 2014
     
By:
 
/s/    Brian
               
Brian
               
 
 
           
Identive Group, Inc.
 
 
Date: March 20, 2014
     
By:
 
/s/    Brian Nelson
               
Brian Nelson
               
Chief Financial Officer and Secretary
 
 

 

EXHIBIT INDEX
 
Exhibit No.
  
Description
EX-99.1
  
Press Release dated March 20, 2014 announcing financial results for the 2013 fiscal fourth quarter and year ended December 31, 2013.
EX-99 2 rrd405999_40534.htm PRESS RELEASE DATED MARCH 20, 2014 ANNOUNCING FINANCIAL RESULTS FOR THE 2013 FISCAL FOURTH QUARTER AND YEAR ENDED DECEMBER 31, 2013. DC14265.pdf -- Converted by SEC Publisher 4.2, created by BCL Technologies Inc., for SEC Filing

IDENTIV REPORTS FOURTH QUARTER AND FISCAL 2013 RESULTS

Q4 highlights include improved gross profit margin, positive adjusted EBITDA and stronger balance sheet

FREMONT, Calif., March 20, 2014 – Identive Group, Inc. (NASDAQ: INVE) reports its financial results for the fourth quarter (Q4) and year ended December 31, 2013.

“We have made excellent progress in Q4 to simplify and focus the business as we lay the foundation for growth in 2014,” said Jason Hart, chief executive officer of Identiv. “We have transformed from a group of separate businesses to a single, unified company focused on delivering high-growth trust solutions for the Internet of Things. The divestment of underperforming and non-core activities in addition to consolidating the remaining operations has eliminated over $12 million of debt from our balance sheet and reduced headcount by nearly 25 percent.”

Quarterly Review (Q4 2013 compared with Q4 2012)

Note: financial results contained in this release reflect the continuing operations of Identiv only and exclude discontinued operations of non-core businesses sold in December 2013 and January 2014.

  • Total revenues for continuing operations were in line with guidance at $19.9 million, compared to $21 million. The quarter over quarter change is primarily a result of the October 2013 U.S. government shutdown.
  • Trust solutions for information grew, with sales of cloud-based credential provisioning and management services increasing 21 percent and smart card reader shipments increasing 11 percent. Sales of trust solutions for everyday items (RFID and NFC products) increased 13 percent to meet demand for electronic game toys and other Internet of Things applications.
  • GAAP gross profit margin improved to 44 percent, compared to 42 percent, primarily due to improving margins for RFID and NFC products arising from higher sales volumes and increased capacity utilization.
  • Identiv signed two new substantial sales partners: a global telecommunications and business solutions provider, and one of the largest global security distributors. As an early indication of success with these partners, initial product orders to support a government e-health program were received in Q4, with the bulk of delivery in 2014 and 2015.
  • Base operating expenses, which include research and development, sales and marketing, and general and administrative costs, were $9.2 million, compared with $8.6 million. During Q4 the Company hired
    additional sales and marketing personnel and began to build a global organization to oversee product management and deliver new marketing and lead generation programs.
  • Identiv achieved its second consecutive quarter of positive adjusted EBITDA, which was $0.4 million, compared with $0.9 million. Including impairment charges and restructuring costs totaling $5.2 million, GAAP loss from continuing operations was $(5.7) million, or $(0.09) per share, compared with GAAP gain from continuing operations of $1.2 million, or $0.01 per share in the comparable prior year period.
  • Cash and cash equivalents were $5.1 million at December 31, 2013, compared with $7.5 million at September 30, 2013, which excludes $2.0 million of temporary concession receipts from a divested business that were remitted to caterers at the beginning of October.

Fiscal Year 2013 Highlights

  • Total revenue was $75.6 million in 2013, up 4 percent from $72.4 million in 2012. Sales of trust solutions for everyday items grew more than 50 percent, driven by strong demand as Identiv delivered more than 100 million RFID tags for electronic game toys. Sales of trust solutions for information grew as shipments of smart card reader products increased 10 percent, and sales of cloud-based credential services climbed 68 percent with the receipt of first significant long-term contracts. The U.S. budget sequester and government shutdown contributed to a 29 percent decrease in sales of trust solutions for premises.
  • Adjusted EBITDA in 2013 was $(1.1) million, compared with $(2.9) million in 2012.
  • Identiv signed an OEM relationship with one of North America’s largest security system integrators.

Hart added, “Q4 was the first full quarter for the new management team as we focused on simplifying the business and addressing the cost structure. The significant shift in costs from G&A to sales, marketing and engineering represent an investment in growth. We will shortly launch our new corporate vision which embraces the strengths of our people and technology as we align to the high growth trust solutions for the rapidly expanding connected world.”

Guidance

The company is providing guidance for fiscal year 2014 of revenue between $80 million and $90 million and adjusted EBITDA positive on an annual basis.

Page 2 of 7

Conference Call and Webcast Information

Identiv will host a conference call and audio webcast today at 5:00 PM Eastern Time, which can be accessed by dialing 888.771.4371 (toll free within the U.S.) or +1 847.585.4405 (for international callers) and using passcode 36855924. A webcast of the call can be accessed by visiting the investor relations section of the Company’s website at www.identiv.com, and by clicking on “Presentations & Webcasts,” where it also will be archived for 30 days. An audio replay of the call also will be available for one week and can be accessed by dialing 888.843.7419 (toll free within the U.S.) or +1 630.652.3042 (for international callers) and using passcode 36855924.

About Identiv

Identiv is a global security technology company that establishes trust in the connected world, including premises, information and everyday items. CIOs, CSOs and product departments rely upon Identiv’s Trust Solutions to reduce risk, achieve compliance and protect brand identity. Identiv Trust Solutions are implemented using standards-driven products and technology, such as digital certificates, mobility and cloud services. For more information, visit www.identiv.com.

Non-GAAP Financial Measures (Unaudited)

This release includes financial information that has not been prepared in accordance with GAAP, including non-GAAP gross profit margin, adjusted EBITDA and non-GAAP net income (loss) and net income (loss) per share. Identiv uses these non-GAAP financial measures internally in analyzing our financial results and believes they are useful to investors, as a supplement to GAAP measures, in evaluating our ongoing operational performance. We believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends. The non-GAAP financial results discussed above exclude items detailed in the reconciliation table and accompanying footnotes contained within this release. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures as detailed in this release.

Note Regarding Forward Looking Information:

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements can be identified by words such as “anticipates,” “believes,” “plans,” “will,” “intends,” “expects,” and similar references to the future. Examples of such statements include, without limitation, statements regarding our expectations for additional revenue from new sales partnerships; our ability to establish a stable financial platform on which to execute our strategy to deliver trust solutions; our expectations from increased investments in sales, marketing and engineering; and our ability to achieve the level of revenues and adjusted EBITDA results in 2014 for which we have provided guidance. Readers should not unduly rely on these forward-looking statements, which are not a guarantee of future performance and are subject to a number of risks and uncertainties, many of which are outside our control, which could cause our actual business and operating results to differ. Factors that could cause actual results to differ materially from those in the forward-looking statements include our ability to realize cost savings from the restructuring of our operations; our ability to increase revenues through new sales and marketing programs and sales partnerships; our ability to successfully develop and commercialize new products and solutions that satisfy the evolving and increasingly complex requirements of customers; our ability to finance continued investments in technology,

Page 3 of 7

products and manufacturing capacity to develop products and solutions for the market; whether the markets in which we participate or target may grow, converge or standardize at anticipated rates or at all, including the markets that we are targeting; our ability to successfully compete in the markets in which we participate or target; our ability to meet our sales forecasts; our ability to meet financial covenants of our loan agreement; our ability to meet growing demand for our products; and general global political and economic factors which are beyond our control but may unduly impact our markets and our business. For a discussion of further risks and uncertainties related to our business, please refer to our public company reports, including our Annual Report on Form 10-K for the year ended December 31, 2012 and subsequent reports filed with the U.S. Securities and Exchange Commission. All forward-looking statements are based on information available to us on the date hereof, and we assume no obligation to update such statements.

###

Note: Identiv and the Identiv logo are trademarks of Identive Group, Inc., registered in many jurisdictions worldwide. All other company, product or service names may be trademarks or registered trademarks of others and are the property of their respective owners.

Investor Contact:     Media Contacts: 
Darby Dye     Lesley Sullivan/Joann Wardrip 
949-553-4251     MSL Group 
ddye@identiv.com     781-684-0770 
     identivegroup@mslgroup.com 
 
 
 
    – FINANCIALS FOLLOW – 

Page 4 of 7

                                                                                                               IDENTIVE GROUP, INC.                         
                                                                                         Consolidated Statements of Operations                     
(In thousands, except per share data)                         
        (Unaudited)                                 
 
        Three Months Ended            Twelve Months Ended 
    December 31,    September 30,    December 31,    December 31,    December 31, 
        2013        2013        2012        2013        2012 
Net revenue    $    19,912     $    21,203    $    21,043    $    75,610    $    72,361 
Cost of revenue        11,162        11,189        12,203        41,970        40,358 
Gross profit        8,750        10,014        8,840        33,640        32,003 
Operating expenses:                                         
       Research and development        1,071        1,642        1,515        6,277        6,965 
       Selling and marketing        4,951        4,541        4,170        18,969        19,124 
       General and administrative        3,154        3,856        2,946        14,189        14,880 
       Re-measurement of contingent consideration        -        -        -        -        (5,463) 
       Impairment of long-lived assets        -        178        -        178        13,410 
       Impairment of goodwill        4,637        10,935        17        15,572        17,027 
       Restructuring and severance        518        1,252        47        1,770        325 
Total operating expenses        14,331        22,404        8,695        56,955        66,268 
Gain (loss) from operations        (5,581)        (12,390)        145        (23,315)        (34,265) 
Other income (expense)        -        -        28        -        (108) 
Interest expense, net        (566)        (387)        (485)        (2,169)        (1,077) 
Foreign currency gain, net        249        283        393        710        296 
Gain (loss) from continuing operations before income                                         
taxes and non-controlling interest        (5,898)        (12,494)        81        (24,774)        (35,154) 
Income tax (provision) benefit        209        (363)        1,099        (47)        5,755 
Gain (loss) from continuing operations        (5,689)        (12,857)        1,180        (24,821)        (29,399) 
Gain (loss) from discontinued operations, net of income        3,488        (12,678)        (711)        (10,977)        (24,169) 
taxes                                         
Consolidated net gain (loss)        (2,201)        (25,535)        469        (35,798)        (53,568) 
Less: Net gain (loss) attributable to noncontrolling                                         
interest        (775)        1,322        (292)        933        3,232 
Net gain (loss) attributable to Identive Group,                                         
Inc.stockholders' equity    $    (2,976)       $    (24,213)    $    177    $    (34,865)    $    (50,336) 
Basic and diluted loss per share attributable to Identive                                         
Group, Inc. stockholders' equity:                                         
     Gain (loss) per share from continuing                                         
     operations    $    (0.09)       $    (0.18)    $    0.01    $    (0.36)    $    (0.44) 
     Gain (loss) per share from discontinued                                         
     operations    $    0.05       $    (0.19)     $    (0.01)    $    (0.17)    $    (0.40) 
     Net loss per share    $    (0.04)       $    (0.37)    $    0.00    $    (0.53)    $    (0.84) 
Weighted average shares used to compute basic and                                         
diluted loss per share        74,132        65,518        60,165        66,327        59,623 

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IDENTIVE GROUP, INC.                 
Consolidated Balance Sheets             
(In thousands; unaudited)             
 
    December 31,    December 31, 
        2013        2012 
ASSETS                 
Current assets:                 
               Cash and cash equivalents    $    5,095     $    6,109 
               Accounts receivable, net of allowances        13,289        13,842 
               Inventories        9,098        7,609 
               Prepaid expenses        957        976 
               Other current assets        1,766        2,064 
               Current assets of discontinued operations        2,624        6,590 
Total current assets        32,829        37,190 
Property and equipment, net        5,876        5,889 
Goodwill        8,991        24,664 
Intangible assets, net        10,196        11,676 
Other assets        867        1,671 
Long-term assets of discontinued operations        ---        23,815 
               Total Assets    $    58,759    $    104,905 
LIABILITIES AND STOCKHOLDERS’ EQUITY                 
Current liabilities:                 
               Accounts payable    $    9,353       $    9,805 
               Liability to related party        1,073        1,098 
               Financial liabilities        2,971        2,842 
               Deferred revenue        729        641 
               Accrued compensation and related benefits        3,383        2,503 
               Other accrued expenses and liabilities        5,239        3,948 
               Current liabilities of discontinued operations        1,630        16,481 
                             Total current liabilities        24,378        37,318 
Long-term liability to related party        5,648        6,177 
Long-term financial liabilities        3,051        6,167 
Other long-term liabilities        938        721 
Long-term liabilities of discontinued operations        ---        4,932 
               Total liabilities        34,015        55,315 
               Total stockholders’ equity        24,744        49,590 
               Total liabilities and stockholders’ equity    $    58,759    $    104,905 

Page 6 of 7

    IDENTIVE GROUP, INC.                         
                                                     Reconciliation of GAAP and Non-GAAP Financial Information                 
        (In thousands)                         
        (unaudited)                             
 
                         Three months ended            Twelve months ended 
    December 31,    September 30,    December 31,    December 31,    December 31, 
        2013        2013        2012        2013        2012 
Reconciliation of GAAP and non-GAAP gross                                         
profit margin                                         
GAAP cost of revenue       $    11,162    $    11,189     $    12,203    $    41,971    $    40,358 
Reconciling items included in GAAP cost of                                         
   revenue:                                         
   Stock-based compensation        (12)        (18)        (11)        (68)        (47) 
   Transition and integration costs        -        -        (1)        -        (168) 
   Amortization and depreciation        (359)        (332)        (281)        (1,371)        (1,601) 
Total reconciling items included in GAAP cost of                                         
   revenue        (371)        (350)        (293)        (1,439)        (1,816) 
Non-GAAP cost of revenue       $    10,791    $    10,839     $    11,910    $    40,532    $    38,542 
Non-GAAP gross profit margin        46%        49%        43%        46%        47% 
 
Reconciliation of GAAP and non-GAAP                                         
operating expenses                                         
GAAP operating expenses       $    14,331    $    22,404     $    8,695    $    56,955    $    66,268 
Reconciling items included in GAAP operating                                         
   expenses:                                         
   Impairment of long-lived assets        -        (178)        -        (178)        (13,410) 
   Impairment of goodwill        (4,637)        (10,935)        (17)        (15,572)        (17,027) 
   Stock-based compensation        (313)        (236)        (336)        (1,352)        (1,275) 
   Re-measurement of contingent consideration        -        -        -        -        5,463 
   Pension expenses        143        (25)        (17)        68        (17) 
   Gain/Loss on disposal of fixed assets        (28)        1        (59)        (27)        (74) 
   Amortization and depreciation        (365)        (338)        (463)        (1,625)        (2,101) 
   Acquisition costs        -        -        -        (13)        (240) 
   Transition and integration costs        77        (72)        470        (267)        (579) 
   Restructuring and severance        (518)        (1,252)        (47)        (1,770)        (325) 
Total reconciling items included in GAAP                                         
   operating expenses        (5,641)        (13,035)        (469)        (20,736)        (29,585) 
Non-GAAP operating expenses       $    8,690    $    9,369     $    8,226     $    36,219    $    36,683 
Reconciliation of GAAP net loss to Adjusted                                         
EBITDA                                         
Net loss attributable to Identive Group, Inc.       $    (2.976)    $    (24,213)     $    177     $    (34,865)     $    (50,336) 
Reconciling items included in GAAP net loss:                                         
   Provision (benefit) for income taxes        (209)        363        (1,099)        47        (5,755) 
   Net loss attributable to noncontrolling interest        775        (1,322)        292        (933)        (3,232) 
   Gain(loss) from discontinued operations, net of                                         
income taxes        (3,488)        12,678        711        10,976        24,169 
   Foreign currency losses (gains), net        (249)        (283)        (393)        (710)        (296) 
   Interest expense (income), net        566        387        485        2,169        1,077 
   Other expense (income), net        -        -        (28)        -        108 
   Impairment of long-lived assets        -        178        -        178        13,410 
   Impairment of goodwill        4,637        10,935        17        15,572        17,027 
   Stock-based compensation        325        254        347        1,420        1,322 
   Re-measurement of contingent consideration        -        -        -        -        (5,463) 
   Pension expenses        (143)        25        17        (68)        17 
   Amortization and depreciation        724        670        744        2,996        3,702 
   Acquisition costs        -        -        -        13        240 
   Transition and integration costs        (77)        72        (469)        267        747 
   Gain/loss on disposal of fixed assets        28        (1)        59        27        74 
   Restructuring and severance        518        1,252        47        1,770        325 
Total reconciling items included in GAAP net loss        3,407        25,208        730        33,724        47,472 
Adjusted EBITDA       $    431    $    995     $    907     $    (1,141)    $    (2,864) 

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