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OMNIQ First Quarter 2020 Revenue Shows Sequential Increase of 21% Compared to Fourth Quarter 2019
SALT LAKE CITY, May 14, 2020 (GLOBE NEWSWIRE) -- OMNIQ Corp. (OMQS) (“OMNIQ” or “the Company”), a provider of Supply Chain and Artificial Intelligence (AI)-based solutions, announced its financial results for the three month period ended March 31, 2020. Shai Lustgarten, CEO, commented, “Our first quarter revenue demonstrated 21% sequential growth over our fourth quarter 2019 revenue, with a run rate slightly below 2019 full year revenues of $57.7 million. Along with the rest of the world, we are feeling the impact of the COVID-19 pandemic and we attribute our relative success to our diversified end markets and our strength in the food and drug industry. These sectors have maintained ongoing operations which drove accelerated demand for our supply chain solutions. In other verticals like Smart City, Public Safety and Parking that require travelling, face-to- face meetings and our physical involvement in installations, we encountered order delays but thus far have not received any project cancellations. We expect purchase orders to pick up soon, as economies begin to more fully open after the COVID-19 shutdown. Given the challenging environment, while first quarter 2020 revenue grew sequentially and was higher than fourth quarter 2019, it came in below our particularly strong 2019 first quarter. Toward the close of the first quarter through the start of the second quarter, we announced several purchase orders totaling approximately $6.8 million, which adds to our confidence that we will exit the COVID-19 situation with solid positioning in the marketplace. We are enthusiastic about the opportunities ahead to drive our strategy to develop and market innovative, industry-changing AI-Machine Vision technologies. “The current situation with the COVID-19 virus highlights the importance of accessible, hands-free, automated solutions. As the world intensifies its efforts around public safety with the goal of protecting both employees and customers, there is a strong desire for ‘contactless’ transport of items such as produce, from warehouse to point of sale. Our products and solutions heighten the ability of organizations to embrace ‘touch free’ supply chain management. We believe our proprietary AI-based solutions can contribute significant value to the Supply Chain vertical and we are well-positioned as a resource for the Smart City, Public Safety and Traffic Control industries as they transition to relying more and more on automated solutions for enhanced operations.” Despite the challenging worldwide economic environment, during and after the close of the first quarter of 2020, OMNIQ recorded several major achievements:
Mr. Lustgarten concluded, “This is an unprecedented time, and we are mindful of balancing the implications of the evolving economic landscape while also staying focused as we pursue the opportunities we’re seeing in the markets in which we operate. We continue to see strong and growing interest in our AI-Machine vision solutions, particularly as the world looks to transition to hands-free, automated alternatives. Our ability to provide efficient and cost-saving solutions to enhance supply chain and public safety operations is a competitive advantage, especially as companies and municipalities focus more intently on ‘touchless’ transactions and technology. We remain focused on strengthening our capabilities and expanding the reach of our solutions as we move through 2020.” First Quarter 2020 Financial Results: OMNIQ reported revenue of $13.8 million for the quarter ended March 31, 2019, as compared to $18.6 million in the comparable 2019 period. Sequentially, revenue increased 21% as compared to fourth quarter 2019 revenue of $11.4 million. The revenue decrease for the quarter ended March 31, 2020 was primarily related to the COVID-19 effect on the sales of our AI-based solutions and strong fulfillment and deliveries by the Company’s subsidiary HTS Image Processing in first quarter 2019. The change in the product mix sold in first quarter 2020 resulted in a gross margin that was better than fourth quarter 2019 but lower than first quarter 2019. Total operating expenses for the first quarter of 2020 were $5.1 million as compared to $4.5 million in the first quarter of 2019. The increase in operating expenses was largely related to non-cash stock-based compensation and professional fees. Net loss for the quarter was $2.9 million, compared to $0.6 million, for the first quarter of last year. Adjusted EBITDA (Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization) for the first quarter of 2020 was a loss of ($0.8) million compared to Adjusted EBITDA of $1.1 million in first quarter 2019. Conference Call Information OMNIQ will host a conference call and webcast on Friday, May 15, 2020 at 11:00 a.m. Eastern Time to provide an update on the quarter ended March 31, 2020. To access the live webcast, go to the Company’s website at www.questsolution.com, and click on the Investor Relations tab. To participate in the call by phone, dial (877) 407-9210 approximately five minutes prior to the scheduled start time. International callers please dial (201) 689-8049. A replay of the teleconference will be available until June 15, 2020 and may be accessed by dialing (877) 481-4010. International callers may dial (919) 882-2331. Callers should use conference ID: 34850. About OMNIQ, Corp. OMNIQ’s customers include government agencies and leading Fortune 500 companies from several sectors, including manufacturing, retail, distribution, food and beverage, transportation and logistics, healthcare, and oil, gas, and chemicals. Since 2014, annual revenues have grown to more than $50 million from clients in the USA and abroad. The Company currently addresses several billion-dollar markets, including the Global Safe City market, forecast to grow to $29 billion by 2022, and the Ticketless Safe Parking market, forecast to grow to $5.2 billion by 2023. “Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995. Statements in this press release relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments, and other statements that are not descriptions of historical facts may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. This release contains “forward-looking statements” that include information relating to future events and future financial and operating performance. The words “anticipate”, “may,” “would,” “will,” “expect,” “estimate,” “can,” “believe,” “potential” and similar expressions and variations thereof are intended to identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which that performance or those results will be achieved. Forward-looking statements are based on information available at the time they are made and/or management’s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause these differences include, but are not limited to: fluctuations in demand for the Company’s products particularly during the current health crisis , the introduction of new products, the Company’s ability to maintain customer and strategic business relationships, the impact of competitive products and pricing, growth in targeted markets, the adequacy of the Company’s liquidity and financial strength to support its growth, the Company’s ability to manage credit and debt structures from vendors, debt holders and secured lenders, the Company’s ability to successfully integrate its acquisitions, and other information that may be detailed from time-to-time in OMNIQ Corp.’s filings with the United States Securities and Exchange Commission. Examples of such forward looking statements in this release include, among others, statements regarding revenue growth, driving sales, operational and financial initiatives, cost reduction and profitability, and simplification of operations. For a more detailed description of the risk factors and uncertainties affecting OMNIQ Corp., please refer to the Company’s recent Securities and Exchange Commission filings, which are available at http://www.sec.gov. OMNIQ Corp. undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless otherwise required by law. Information about Forward-Looking Statements Financial Tables Follow OMNIQ CORP.
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OMNIQ Corp.
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