SAINT PAUL, Minn. , July 29 /PRNewswire-FirstCall/ -- Image Sensing
Systems, Inc. (Nasdaq: ISNS), announced today record financial results for its
second quarter ended June 30, 2008 .
Net income for the quarter ended June 30, 2008 was $1.2 million ($0.30 per
fully diluted share) compared to $702,000 ($0.18 per fully diluted share) for
the same period in 2007. Net income for the first half of 2008 was $2.3
million ($0.57 per diluted share) compared to $1.3 million ($0.32 per diluted
share) for the same period in 2007.
Revenue for the second quarter was $6.7 million compared to $3.0 million
for the same period a year ago, while revenue for the first half of 2008 was
$12.6 million compared to $5.7 million for the same period a year ago.
Revenue from royalties increased 46% to $3.4 million from $2.3 million in the
second quarter of 2007 and 36% to $6.3 million in the first half from $4.6
million in the first half of 2007, reflecting the continued success of our
North American distributor, Econolite Control Products, Inc. (ECPI), in
selling Autoscope(R) products in the United States and Canada . North American
sales, which are sales of RTMS(R) in North America , were $1.9 million for the
second quarter and $3.5 million for the first half of 2008. International
sales, which include both Autoscope and RTMS sales outside of North America ,
were $1.4 million in the second quarter, a 96% increase over $736,000 in the
same period in 2007, and $2.8 million in the first half, a 157% increase over
$1.1 million in the same period of 2007. Sales of RTMS world-wide for the
quarter were $2.4 million. We acquired the RTMS family of products in
December 2007 .
On a non-GAAP basis for the second quarter, excluding intangible asset
amortization net of tax, net income increased 91% to $1.3 million ($0.34 per
fully diluted share) and operating income increased 140% to $1.9 million as
compared to the comparable quarter of 2007. On a non-GAAP basis for the first
half, net income increased 101% to $2.5 million ($0.63 per fully diluted
share) and operating income increased 150% to $3.6 million as compared to the
same period of 2007.
Ken Aubrey , CEO, said, "We completed a strong first half of 2008. We
began shipping RTMS G4 in Q2 and saw continued growing acceptance of the
Autoscope Terra platform. All in all, we believe the integration of the EIS
asset purchase and final Terra transition matters are progressing on
Follow-on Offering Update
We have received a comment letter from the Securities and Exchange
Commission (SEC) on our Form S-1 registration statement that was originally
filed in May. We expect that upon making the changes requested by the SEC in
an amendment we would be in position to have the offering declared effective.
However, given our recent share price range, we believe that proceeding with
an offering at this time is not in the best interests of our shareholders.
Additionally, we do not view current stock market conditions as favorable nor
do we foresee the need for increased working capital at present. We continue
to believe there are significant benefits to a follow-on offering and
contemplate pursuing an offering when market conditions change. Please see
the disclaimer below.
Auction Rate Security Update
We continue to hold $5.4 million in face value of student loan backed
auction rate securities (ARS), substantially all of which are Federal
government backed under the Federal Family Education Loan Program. All
auctions since mid-February involving our ARS have failed. We believe that
the underlying credit quality of the ARS is excellent and that the main
problem remains illiquidity. Our updated analysis of the ARS fair value
indicates there is a temporary impairment of $318,000 ($210,000 net of tax).
The ARS are classified as long-term assets at June 30, 2008 . This unrealized
loss does not flow through our income statement, rather it is recorded
directly to shareholders' equity as a component of accumulated other
comprehensive income/loss. There is uncertainty in the ARS market and, should
circumstances change, we may deem the impairment to be other than temporary or
otherwise adjust our analysis.
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