EX-99.1 2 dex991.htm PRESS RELEASE Press Release

EXHIBIT 99.1

 

For more information, contact:

   

Cogent Systems, Inc.

  The Blueshirt Group, Investor Relations  

Paul Kim

  Chris Danne, Jill Isenstadt  

Chief Financial Officer

  (415) 217-7722  

626-325-9600

  chris@blueshirtgroup.com  

www.cogentsystems.com

  jill@blueshirtgroup.com  

Cogent Systems Announces Second Quarter Financial Results

Pasadena, CA – August 4, 2009 - Cogent Systems (Nasdaq: COGT) today announced financial results for the second quarter ended June 30, 2009.

Second quarter 2009 revenues were $31.8 million, an increase of 22% over revenue of $26.0 million in the same year ago period. Net income on a GAAP basis for the second quarter of 2009 was $8.5 million, or $0.09 per diluted share. This compares to GAAP net income of $7.2 million, or $0.08 per diluted share in the same year ago period.

Cogent’s second quarter of 2009 GAAP results included $1.0 million of non-cash share-based compensation charges. Excluding the effects of share-based compensation and the net tax effect, non-GAAP net income for the second quarter of 2009 was $9.1 million, or $0.10 per diluted share. This compares to non-GAAP net income of $7.7 million, or $0.09 per diluted share, in the same year ago period.

“During the quarter revenues grew slightly, with product revenues up 4% over the prior quarter,” commented Ming Hsieh, President and Chief Executive Officer of Cogent. “We also generated $24 million in cash and investments and have generated $51 million so far in 2009. We believe this is a testament to the underlying strength of our business model, especially in a more difficult economy. We are pleased with our results for the first half of the year and believe we are on track to achieve our financial goals for 2009. Beyond our current orders and backlog, we anticipate decisions on several key awards over the next six months, and continue to pursue new opportunities as the demand for biometric solutions continues to grow worldwide.”

The Company will host a conference call at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time) on Tuesday, August 4 to discuss these results. For parties in the United States and Canada, call 877-941-4774 to access the conference call. International parties can access the call at 480-629-9760.

Cogent will offer a live webcast of the conference call, accessible from the “Investor Relations” section of the Company’s website (www.cogentsystems.com). The webcast will be archived for a period of 15 days. A telephonic replay of the conference call will also be available 2 hours after the call and will run for 2 days. To hear the replay, parties in the United States and Canada should call 800-406-7325 and enter pass code 4106258. International parties should call 303-590-3030 and enter pass code 4106258.

Note Regarding Use of Non-GAAP Financial Measures

Certain of the information set forth herein, including non-GAAP net income and earnings per share, may be considered non-GAAP financial measures. Cogent believes this information is useful to investors because it provides a basis for measuring Cogent’s available capital resources, the operating performance of Cogent’s business and Cogent’s cash flow, excluding share-based


compensation that would normally be included in the most directly comparable measures calculated and presented in accordance with Generally Accepted Accounting Principles. Cogent’s management uses these non-GAAP financial measures along with the most directly comparable GAAP financial measures in evaluating Cogent’s operating performance, capital resources and cash flow. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP, and non-financial measures as reported by Cogent may not be comparable to similarly titled amounts reported by other companies.

About Cogent Systems

Cogent is a global biometric identification solutions provider to governments, law enforcement agencies, and commercial enterprises. Cogent provides the highest quality identification systems, products and services with leading technology, accuracy and speed. Cogent’s Automated Fingerprint/Palmprint Identification Systems, or AFIS, enable customers to capture fingerprint and palm print images electronically, encode prints into searchable files, and accurately compare a set of fingerprints/palm prints to a database containing potentially millions of prints in seconds. For more information, please visit www.cogentsystems.com

Forward-Looking Statements

This press release contains, in addition to historical information, forward-looking statements. Such statements are based on management’s current estimates and expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements. Cogent is providing this information as of the date of this press release, and expressly disclaims any duty to update information contained in this press release.

Forward-looking statements in this press release include, without limitation, express and implied statements regarding anticipated financial results, contract awards and market developments. These forward-looking statements involve risks and uncertainties which could cause actual results to differ materially from those expressed or implied here. Readers are referred to Cogent’s Annual Report on Form 10-K for the year ended December 31, 2008 and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2009 filed by Cogent with the Securities and Exchange Commission which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements, including but not limited to: changes in government policies; uncertain political conditions in international markets; deriving a significant portion of revenues from a limited number of customers; deriving a significant portion of revenues from the sale of solutions pursuant to government contracts; failure of the biometrics market to experience significant growth; failure of Cogent’s products to achieve broad acceptance; potential fluctuations in quarterly and annual results; changes in Cogent’s effective tax rate; failure to successfully compete; failure to comply with government regulations; failure to accurately predict financial results due to long sales cycles; negative publicity and/or loss of clients due to security breaches resulting in the disclosure of confidential information; loss of export licenses or changes in export laws; failure to manage projects; rapid technology change in the biometrics market; loss of a key member of management team; termination of backlog orders; loss of limited source suppliers; negative audits by government agencies; failure to protect intellectual property; exposure to intellectual property and product liability claims; difficulty in integrating acquisitions; and failure to achieve the expected benefits of acquisitions. The information contained in this press release is a statement of Cogent’s present intention, belief or expectation and is based upon, among other things, existing industry conditions, market conditions, the economy in general and Cogent’s assumptions. Cogent may


change its intention, belief or expectation, at any time and without notice, based upon any changes in such factors, in its assumptions or otherwise. Cogent undertakes no obligation to review or confirm analysts’ expectations or estimates or to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. By including any information in this press release, Cogent does not necessarily acknowledge that disclosure of such information is required by applicable law or that the information is material.


COGENT, INC.

CONDENSED BALANCE SHEET

June 30, 2009 and December 31, 2008

(in thousands)

 

     Balance at
6/30/2009
   Balance at
12/31/2008

ASSETS:

     

Cash and investments

   $ 530,505    $ 479,896

Accounts receivable, net

     16,045      30,767

Unbilled accounts receivable

     734      1,110

Inventories

     22,446      18,528

Property and equipment, net

     37,628      37,192

Deferred income taxes

     39,935      41,068

Other assets

     10,758      11,570
             

Total assets

   $ 658,051    $ 620,131
             

LIABILITIES & EQUITY:

     

Accounts payable, accrued liabilities and income taxes payable

   $ 33,198    $ 25,681

Deferred revenue

     85,102      74,978

Total stockholders’ equity

     539,751      519,472
             

Total liabilities & equity

   $ 658,051    $ 620,131
             


COGENT, INC.

CONDENSED STATEMENT OF INCOME

Three and Six Months Ended June 30, 2009 and 2008

(in thousands, except per share data)

 

     Three months ended
June 30,
    Six months ended
June 30,
 
     2009    2008     2009    2008  

Revenues:

          

Product revenues

   $ 21,472    $ 17,394      $ 42,138    $ 34,798   

Maintenance and services revenues

     10,299      8,647        20,667      15,874   
                              

Total revenues

     31,771      26,041        62,805      50,672   
                              

Cost of revenues:

          

Cost of product revenues (1)

     7,727      5,618        13,280      10,599   

Cost of maintenance and services revenues (1)

     3,732      3,733        7,993      6,294   
                              

Total cost of revenues

     11,459      9,351        21,273      16,893   
                              

Gross profit

     20,312      16,690        41,532      33,779   
                              

Operating expenses:

          

Research and development (1)

     3,453      3,376        7,180      6,546   

Selling and marketing (1)

     3,360      2,992        6,515      5,683   

General and administrative (1)

     2,753      2,669        5,773      5,613   

Income from settlement of lawsuit

     —        —          —        (10,000
                              

Total operating expenses

     9,566      9,037        19,468      7,842   
                              

Operating income

     10,746      7,653        22,064      25,937   

Interest income

     2,736      4,093        5,992      9,063   

Other, net

     155      (165     200      (202
                              

Income before income taxes

     13,637      11,581        28,256      34,798   

Income tax provision

     5,150      4,371        10,819      13,160   
                              

Net income

   $ 8,487    $ 7,210        $17,437    $ 21,638   
                              

Net income per share:

          

Basic

   $ 0.09    $ 0.08      $ 0.19    $ 0.24   

Diluted

   $ 0.09    $ 0.08      $ 0.19    $ 0.24   

Number of shares used in per share computations:

          

Basic

     89,631      89,329        89,605      90,418   

Diluted

     90,554      90,482        90,545      91,599   

(1) Share-based compensation expense was allocated as follows:

          

Cost of product revenues

   $ 133    $ 103      $ 271    $ 212   

Cost of maintenance and services revenues

     166      127        331      263   

Research and development

     249      218        499      440   

Selling and marketing

     236      224        466      476   

General and administrative

     189      197        382      399   
                              

Total share-based compensation expense

   $ 973    $ 869      $ 1,949    $ 1,790   
                              


COGENT, INC.

Non-GAAP Earnings per Share Reconciliation

Three Months Ended June 30, 2009 and 2008

(in thousands, except per share data)

 

     Three months ended
June 30,

2009
    Three months ended
June 30,

2008
 

Earnings for per share calculations

    

GAAP Net Income

   $ 8,487      $ 7,210   

GAAP Income tax provision

     5,150        4,371   

Share-based compensation expense

     973        869   

Tax effect (1)

     (5,552     (4,731
                

Non-GAAP Net income

   $ 9,058      $ 7,719   
                

Earnings per share

    

GAAP Diluted EPS

   $ 0.09      $ 0.08   

GAAP Income tax provision

     0.06        0.05   

Share-based compensation expense

     0.01        0.01   

Tax effect (1)

     (0.06     (0.05
                

Non-GAAP Diluted EPS

   $ 0.10      $ 0.09   
                

 

(1) Tax rates as follows:

- 38% for three months ended June 30, 2009 and June 30, 2008