Intellicheck Announces Fourth Quarter and Full-Year 2021 Financials

SaaS Revenues Grew 38% Year Over Year

Fourth Quarter SaaS Revenues Grew 23%

MELVILLE, NY – March 9, 2022 - Intellicheck, Inc. (Nasdaq: IDN), an industry-leading identity company delivering on-demand digital and physical identity validation solutions, today announced its financial results for the fourth quarter and full-year ended December 31, 2021. Total revenue for the fourth quarter ended December 31, 2021 grew 27% to $3,902,000 compared to $3,078,000 in the same period of 2020. Quarter-over-Quarter SaaS revenue grew 23% and totaled $3,715,000 compared to $3,012,000 in the same period of 2020 and grew 14% sequentially over the third quarter of 2021.

“We made a number of significant changes in 2021 to move the Company forward. We have launched Platform 2.0 featuring additional multinational ID and KYC capabilities. We are also seeing results from our emphasis on increasing brand awareness with an increase in inbound leads for the age-restricted market. We believe these initiatives will drive our continued growth and will promote additional opportunities with both new and existing clients,” said Intellicheck CEO Bryan Lewis.

Gross profit as a percentage of revenues was 92.0% for the three months ended December 31, 2021 compared to 92.6% in the same period in 2020.

Operating expenses for the three months ended December 31, 2021, which consist of selling, general and administrative expenses and research and development expenses, were $4,987,000 for the fourth quarter of 2021 compared to $2,389,000 for the same period of 2020. The Company is always looking for synergistic opportunities including merger and acquisition opportunities. Included within operating expenses are $454,000 of costs incurred related to this activity. Also included within operating expenses are $797,000 of non-cash equity compensation expense. In addition, the company incurred higher personnel, consulting, and marketing expenses.

Net loss for the three months ended December 31, 2021 was ($1,396,000) or ($0.07) per diluted share compared to Net income of $1,260,000 or $0.07 per diluted share for the same period in 2020.

Adjusted EBITDA (earnings before gains on debt forgiveness, interest and other income, income taxes, depreciation, amortization, equity compensation expense and certain non-recurring charges) was ($557,000) for the fourth quarter of 2021 as compared to $635,000 for the same period of 2020. A reconciliation of adjusted EBITDA to net income (loss) is provided in this release.

Total revenue for the full year ended December 31, 2021 grew 53% to $16,393,000 compared to $10,735,000 in the same period of 2020. Year-over-year SaaS revenue grew 38% and totaled $12,970,000 compared to $9,373,000 in the same period of 2020.

Gross profit as a percentage of revenue was 78.6% for the year ended December 31, 2021 compared to 86.7% in the same period of 2020. The decrease in gross profit percentage was driven by a $2,741,000 hardware order from one of our financial institution customers in 2021 which they are deploying in their bank branches to integrate our software into their workflow. Excluding hardware sales and related costs, our gross profit as a percentage of revenues was 93.2% and 92.1% for the years ended December 31, 2021 and 2020, respectively. The increase in this percentage is primarily due to continued growth of our SaaS revenue.

Operating expenses for the year ended December 31, 2021 were $17,044,000 compared to $9,569,000 for the same period of 2020. Included within these operating expenses are the previously mentioned $454,000 of costs related to merger and acquisition opportunities and $3,068,000 of non-cash equity compensation expense. In addition, the company incurred higher personnel costs, consulting, and marketing expenses.

Net loss for the year ended December 31, 2021 was ($4,146,000) or ($0.22) per diluted share compared to net income of $558,000 or $0.03 per diluted share in the same period of 2020. Adjusted EBITDA (earnings before gains on debt forgiveness, interest and other income, income taxes, depreciation, amortization, equity compensation expense and certain non-recurring charges) was approximately ($925,000) for the year ended December 31, 2021 compared to $329,000 for the same period of 2020. A reconciliation of adjusted EBITDA to net income (loss) is provided in this release.

As of December 31, 2021, Cash totaled $13.7 million, and stockholders’ equity totaled $21.2 million.

The financial results reported today do not consider any adjustments that may be required in connection with the completion of the Company’s audit process and should be considered preliminary until Intellicheck files its Form 10-K for the fiscal year ended December 31, 2021.

Q1 2022 Outlook
We have learned that one of our financial services clients has begun a project that will enable them to extend credit to tens of thousands of additional merchants. This required the financial services client to put a code freeze on all other development, which meant multiple retailers that had been expected to go live in the first half of the year will not. The above-described project should be an interim delay to our short-term growth as they expect to resume integrations in the September timeframe. We believe this short-term pain now represents a likely long-term gain as these additional applications will now need validations. This is very likely going to impact our Q1 results and although we still have a few weeks remaining in the quarter we currently anticipate our first quarter SaaS revenues will be in the range of $3.2 to $3.35 million.

Conference Call Information

The Company will hold an earnings conference call on March 9th at 4:30 p.m. ET/1:30 p.m. PT to discuss operating results. To listen to the earnings conference call, please dial 877-407-8037. For callers outside the U.S., please dial 201-689-8037.

A replay of the conference call will be available shortly after completion of the live event. To listen to the replay, please dial 877-660-6853 and use conference identification number 13726737. For callers outside the U.S., please dial 201-612-7415 and use conference identification number 13726737. The replay will be available beginning approximately two hours after the completion of the live event and will remain available until March 16, 2022.