Intellicheck(US:IDN)2019-08-04 16:43Financial Data and Key Metrics Changes - Revenue for Q2 2019 grew 57% to $1.558 million compared to $1.001 million for the same period last year [48] - SaaS revenue was approximately $1.121 million for Q2 2019, representing a 79% increase from $625,000 in Q2 2018 and a 30% sequential increase from approximately $861,000 in Q1 2019 [48] - Gross profit as a percentage of revenue was 85.9% for Q2 2019, down from 91.8% in Q2 2018 [49] - The company reported a net loss of $874,000 for Q2 2019, an improvement from a net loss of $1.1 million in Q2 2018 [50] Business Line Data and Key Metrics Changes - SaaS revenue increased significantly, indicating a shift in focus towards financial services as the primary target market [9][10] - The company onboarded 86 new clients in the age-restricted product market, representing a 10% increase in sales over Q1 2019 [42] Market Data and Key Metrics Changes - Total scan volumes for financial services were up 13% sequentially comparing Q2 2019 to Q1 2019, and there was an 8% year-over-year increase comparing Q2 2019 to Q2 2018 [41] - The company has signed four of the top 10 banks as clients, indicating strong market penetration [25] Company Strategy and Development Direction - The company has shifted its focus to financial services to combat identity theft, which is seen as a significant pain point for financial institutions [10][11] - A new pricing model based on a per-scan approach has been implemented to better align with the transactional nature of banking [21][22] - The company aims to expand its technology into bank branches and mobile apps, indicating a broader application of its services [44][45] Management's Comments on Operating Environment and Future Outlook - Management believes the market is increasingly recognizing the need for authentication solutions due to rising identity theft incidents [11][12] - The company anticipates that changes in legislation regarding age-restricted products could lead to significant growth opportunities [42][43] - Management expressed confidence in the company's ability to capitalize on the growing demand for fraud prevention solutions [45] Other Important Information - The company has a revolving credit facility with Citibank allowing for maximum borrowings of $2 million, which is currently untapped [53] - As of June 30, 2019, the company had cash of $3.1 million and total assets of $13.4 million [51] Q&A Session Summary Question: Clarification on the implementation pipeline - Management confirmed that the listed clients are committed to the system and are at various stages of implementation [56] Question: One-time payment amount for implementation - The one-time payment for implementation was confirmed to be approximately $185,000 [57] Question: Customer retention rate - Management stated that customer retention remains at nearly 100%, with losses only occurring if a client goes out of business [60] Question: Potential revenue ranking of banks - Management indicated that it is difficult to rank banks by potential revenue without analyzing their specific programs [61] Question: Impact of data breaches on business - Management noted that data breaches create a heightened demand for their services, as they make identity theft easier [67][69] Question: Future use of driver's license verification - Management acknowledged that there is potential for increased use of driver's license verification in securing data [71] Question: Timeline for FDA-related opportunities - Management believes that legislation requiring authentication could happen soon, as discussions are ongoing [82]