Identiv(US:INVE)2022-03-03 06:07Financial Data and Key Metrics Changes - In 2021, total revenues increased by over 19% to a record $103.8 million, with Q4 2021 revenues at $28.5 million, up 15% compared to Q4 2020 [9][32] - Gross profit margins for Q4 2021 were 33% (GAAP) and 34% (non-GAAP), down from 35% and 36% in Q4 2020, while full year 2021 margins were 36% (GAAP) and 37% (non-GAAP), compared to 39% and 40% in 2020 [33][34] - The company reported a GAAP net loss of $1.9 million in Q4 2021, compared to a loss of $0.7 million in Q4 2020, but a full year net income of $1.6 million compared to a loss of $5.1 million in 2020 [37][38] Business Line Data and Key Metrics Changes - The Identity business saw a 23% year-over-year revenue growth, totaling $64.7 million for the full year 2021, driven by higher sales of RFID transponder products [12][39] - The Premises business generated $39 million in revenue for 2021, a 14% increase from 2020, with Q4 2021 revenues at $11 million, up 22% from Q4 2020 [12][42] - Software and services revenue increased by 20% in Q4 2021 compared to Q4 2020 [25] Market Data and Key Metrics Changes - Total backlog at the end of 2021 was over $30 million, up 45% from the end of 2020, indicating strong demand and growth expectations [13][46] - New orders booked in January 2022 were $12 million, up 43% year-over-year, providing visibility into current business momentum [46] Company Strategy and Development Direction - The company aims for 25% to 30% overall growth in 2022, led by 40% to 50% growth in RFID, focusing on design wins, customer growth, and technology partnerships [29][48] - Strategic priorities include RFID growth, federal government growth, and expanded software services and recurring revenues [49][62] - The company is committed to a long-term gross margin target of 40% to 45% and aims to manage financials effectively during growth phases [34][41] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning for strong growth in 2022, emphasizing the importance of execution and maintaining leadership in the RFID and NFC markets [66] - The company has implemented stricter financial controls and policies to manage accounts receivable and ensure operational efficiency [36][28] Other Important Information - The company has charged off aged accounts receivable from the public transit industry as a one-time non-cash expense, which impacted Q4 results but is not expected to recur [26][27] - The company remains debt-free with a strong working capital position, exiting Q4 2021 with $28.6 million in cash [45] Q&A Session Summary Question: Recovery of gross margins in 2022 - Management expects a gradual recovery of gross margins throughout 2022, with improvements anticipated in Q1 due to reduced freight costs [69][70] Question: Customer pricing and volume discounts - Some customers may receive price discounts as volumes increase, but the company aims to maintain margins by enhancing product complexity and value over time [75][76] Question: Impact of transformational deals on backlog growth - The backlog includes some contributions from existing customers, but many transformational deals are not yet reflected in the current backlog [78]