Senstar Technologies Reports First Quarter 2023 Financial Results
RAMAT GAN, Israel, June 6, 2023 /PRNewswire/ -- Senstar Technologies (NASDAQ: SNT), a leading international provider of comprehensive physical, video and access control security products and solutions, today announced its financial results for the three months ended March 31, 2023. Management will hold an investors' conference call later today (at 10 a.m. Eastern Time) to discuss the results.
Business Highlights:
- Achieved double-digit, year-over-year revenue growth in the U.S in Q1 2023 primarily in the corrections market, one of the Company's four target market verticals.
- Awarded a new strategic project in Europe in one of our four key vertical markets.
- Appointed Fabien Haubert as Interim Chief Executive Officer.
Mr. Fabien Haubert, Interim Chief Executive Officer of Senstar Technologies, stated, "Our first quarter financial results are in-line with our expectations and reflect the seasonality of our business. Gross margin of 56% of revenue this quarter reflects product mix as compared to the same period last year, while the modest increase in operating expenses was the result of investments that we made in the first quarter in sales and marketing and new product launches to drive future growth. We are advancing several new business opportunities that have the potential to scale our business in our targeted verticals of energy, utilities, corrections and logistics."
Mr. Fabien Haubert continued, "Our primary objective is to expand our market share within our focus high-value verticals with the goal of maintaining gross margin above the industry average. We are developing next-generation sensors and differentiated products that align directly with market demand. Importantly, the vertical markets we are targeting seek high-value solutions and present attractive growth opportunities where Senstar already has an established presence and brand recognition. We are increasingly encouraged by the opportunities for growth in 2023 and beyond and our ability to capture new market share."
First Quarter 2023 Results Summary
Revenue for the first quarter of 2023 was $6.4 million, a decrease of 5.0% compared with $6.8 million in the first quarter of 2022. First quarter gross profit was $3.6 million, or 55.7% of revenue, compared with $4.5 million, or 65.8% of revenue, in the year ago quarter. The decrease in gross margin was primarily due to a shift in the mix of products sold during the quarter.
Operating expenses were $5.3 million, an increase of 3.6% compared to the prior year's first quarter operating expenses of $5.1 million. The increase in operating expenses is primarily attributable to increases in selling and marketing expenses compared to the 2022 period.
Operating loss for the first quarter of 2023 was ($1.7) million compared to an operating loss of ($0.7) million in the year-ago period.
Financial income was $40,000 compared to financial expense of ($239,000) in the first quarter last year.
Net loss in the first quarter of 2023 was ($1.9) million or ($0.08) per share versus a net loss of ($1.1) million, or ($0.05) per share in the first quarter of last year.
EBITDA loss for the first quarter of 2023 was ($1.4) million versus an EBITDA loss of ($0.3) million in the first quarter of 2022.
The Company had cash and cash equivalents and short-term bank deposits of $14.8 million, or $0.64 per share, as of March 31, 2023, compared with $15.0 million, or $0.65 per share, at December 31, 2022.
Earnings Conference Call Information:
The Company will host a conference call later today, June 6, 2023. The call will begin promptly at 10:00 am Eastern Time; 5:00 pm Israel Time; 3:00 pm UK Time. The Company requests that participants dial in 10 minutes before the conference call commences and use the conference ID number 13737922.
Participant Dial-in Numbers: Toll Free: 1-877-407-9716
Toll/International: 1-201-493-6779
Israel Toll Free: 1 809 406 247
UK Toll Free: 0 800 756 3429
The conference call is also available via a live webcast at: https://viavid.webcasts.com/starthere.jsp?ei=1618068&tp_key=655ad2ce49
Replay Dial-in Numbers: Toll Free: 1-844-512-2921
Toll/International: 1-412-317-6671
Replay Pin Number: 13737922
About Senstar Technologies
With innovative perimeter intrusion detection systems (including fence sensors , buried sensors , and above ground sensors ), intelligent video-management , video analytics , and access control , Senstar offers a comprehensive suite of proven, integrated solutions that reduce complexity, improve performance and unify support. For 40 years, Senstar has been safeguarding people, places and property for organizations around the world, with a special focus in utilities , logistics , correction facilities, and energy markets.
For more information, visit the Company's website at www.senstartechnologies.com.
Use of Non-GAAP Financial Information
The Company reports financial results in accordance with U.S. GAAP. To supplement the consolidated financial statements presented in accordance with GAAP, the Company presents the Non-GAAP presentation of EBITDA. This non-GAAP measure is not in accordance with, nor is it a substitute for, a GAAP measure. The Company uses EBITDA to evaluate and manage the Company's operations internally. The Company is also providing this information to assist investors in performing additional financial analysis. Reconciliation between the Company's results on a GAAP and non-GAAP basis is provided in a table below.
Forward Looking Statements
This press release contains forward-looking statements, which are subject to risks and uncertainties. Such statements are based on assumptions and expectations which may not be realized and are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, financial and otherwise, may differ from the results discussed in the forward-looking statements. A number of these risks and other factors that might cause differences, some of which could be material, along with additional discussion of forward-looking statements, are set forth in the Company's Annual Report on Form 20-F filed with the Securities and Exchange Commission. In addition, there is uncertainty about the spread of the COVID19 virus and the impact it will have on the Company's operations, the demand for the Company's products, global supply chains and economic activity in general.
For more information:
Senstar Technologies: Tomer Hay Chief Financial Officer Tel: +972-74-794-5200 | IR Contact: Kim Rogers Managing Partner Hayden IR +1 541-904-5075 |
-- Tables follow --
SENSTAR TECHNOLOGIES | |||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||
(All numbers except EPS expressed in thousands of US$) | |||||
Three Months | |||||
2023 | 2022 | %Change | |||
Revenue | 6,445 | 6,785 | (5) | ||
Cost of revenue | 2,852 | 2,318 | 23 | ||
Gross profit | 3,593 | 4,467 | (20) | ||
Operating expenses: | |||||
Research and development, net | 1,040 | 1,095 | (5) | ||
Selling and marketing | 2,446 | 2,299 | 6 | ||
General and administrative | 1,840 | 1,745 | 5 | ||
Total operating expenses | 5,326 | 5,139 | 4 | ||
Operating loss | (1,733) | (672) | |||
Financial income (expense), net | 40 | (239) | |||
Loss before income taxes | (1,693) | (911) | |||
Taxes on income | 182 | 186 | |||
Net loss attributable to Senstar's shareholders | (1,875) | (1,097) | |||
Basic and diluted net loss per share | ($0.08) | ($0.05) | |||
Weighted average number of shares used in computing basic and | 23,309,987 | 23,301,931 | |||
SENSTAR TECHNOLOGIES | |||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||
(All numbers except EPS expressed in thousands of US$) | |||
Three Months | |||
2023 | 2022 | ||
% | % | ||
Gross margin | 55.7 | 65.8 | |
Research and development, net as a % of revenues | 16.1 | 16.1 | |
Selling and marketing as a % of revenues | 38.0 | 33.9 | |
General and administrative as a % of revenues | 28.5 | 25.7 | |
Operating margin | - | - | |
Net margin | - | - | |
SENSTAR TECHNOLOGIES | |||
RECONCILIATION OF EBITDA TO NET INCOME (LOSS) | |||
(All numbers expressed in thousands of US$) | |||
Three Months | |||
2023 | 2022 | ||
GAAP Net loss | (1,875) | (1,097) | |
Less: | |||
Financial income (expenses), net | 40 | (239) | |
Taxes on income | 182 | 186 | |
Depreciation and amortization | (323) | (408) | |
EBITDA | (1,410) | (264) | |
SENSTAR TECHNOLOGIES | |||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | |||
(All numbers expressed in thousands of US$) | |||
March 31, | December 31, | ||
2023 | 2022 | ||
CURRENT ASSETS: | |||
Cash and cash equivalents | $14,727 | $14,937 | |
Short-term bank deposits | 113 | 110 | |
Restricted cash and deposits | 5 | 5 | |
Trade receivables, net | 6,540 | 9,973 | |
Unbilled accounts receivable | 424 | 350 | |
Other accounts receivable and prepaid expenses | 1,468 | 1,441 | |
Inventories | 9,867 | 8,443 | |
Total current assets | 33,144 | 35,259 | |
Long term ASSETS: | |||
Deferred tax assets | 2,034 | 1,981 | |
Operating lease right-of-use assets | 941 | 987 | |
Total long-term assets | 2,975 | 2,968 | |
PROPERTY AND EQUIPMENT, NET | 1,593 | 1,651 | |
INTANGIBLE ASSETS, NET | 1,141 | 1,142 | |
GOODWILL | 10,879 | 10,866 | |
Total assets | $49,732 | $51,886 | |
SENSTAR TECHNOLOGIES | ||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
(All numbers expressed in thousands of US$) | ||||
March 31, | December 31, | |||
2023 | 2022 | |||
CURRENT LIABILITIES: | ||||
Trade payables | $2,070 | $2,408 | ||
Customer advances | 212 | 239 | ||
Deferred revenues | 2,742 | 2,866 | ||
Other accounts payable and accrued expenses | 4,974 | 4,749 | ||
Short-term operating lease liabilities | 273 | 248 | ||
Total current liabilities | 10,271 | 10,510 | ||
LONG-TERM LIABILITIES: | ||||
Deferred revenues | 1,375 | 1,463 | ||
Deferred tax liabilities | 868 | 865 | ||
Accrued severance pay | 321 | 330 | ||
Long-term operating lease liabilities | 697 | 757 | ||
Other long-term liabilities | 265 | 274 | ||
Total long-term liabilities | 3,526 | 3,689 | ||
SHAREHOLDERS' EQUITY | ||||
Share Capital: Ordinary shares of NIS 1 par value - | ||||
Authorized: 39,748,000 shares at March 31, 2023 and December 31, 2022; | 6,799 | 6,799 | ||
Additional paid-in capital | 30,519 | 30,503 | ||
Accumulated other comprehensive loss | (667) | (758) | ||
Foreign currency translation adjustments (stand-alone financial statements) | 9,670 | 9,654 | ||
Accumulated deficit | (10,386) | (8,511) | ||
TOTAL SHAREHOLDERS' EQUITY | 35,935 | 37,687 | ||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $49,732 | $51,886 | ||
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SOURCE Senstar Technologies Ltd.
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