UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT 1934
DATE OF REPORT: AUGUST 4, 2003
---------------
I.D. SYSTEMS, INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 001-15087 22-3270799
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation or organization) Identification No.)
ONE UNIVERSITY PLAZA
HACKENSACK, NJ 07601
201-996-9000
--------------------------------------------------------------------------
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits
99.1 Press Release dated August 4, 2003 - I.D. Systems, Inc. Reports
Second Quarter Financial Results
ITEM 12. REGULATION FD DISCLOSURE
On August 4, 2003, the Company issued a press release announcing its
results of operations and financial condition for the three and six months ended
June 30, 2003. The full text of the press release is set forth in Exhibit 99.1
attached hereto.
Information contained in this report (including exhibits hereto) shall
not be deemed "filed" for purposes of Section 18 of the Exchange Act of 1934, as
amended, or otherwise subject to the liability of that section and shall not be
deemed incorporated by reference in any filing under the Securities Act of 1933,
as amended, or the Exchange Act of 1934, as amended.
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
I.D. SYSTEMS, INC.
By: /s/ Jeffrey M. Jagid
----------------------------
Jeffrey M. Jagid
Chief Executive Officer and President
By: /s/ Ned Mavrommatis
----------------------------
Ned Mavrommatis
Chief Financial Officer
Dated: August 14, 2003
3
EXHIBIT 99.1
I.D. SYSTEMS, INC. REPORTS SECOND QUARTER FINANCIAL RESULTS
Hackensack, NJ, August 4, 2003
I.D. Systems, Inc. (NASDAQ: IDSY), announced today its financial results for the
second quarter ended June 30, 2003. Revenues increased to $2,125,000, up 80%
over the second quarter a year ago and 32% over the preceding quarter, as the
company's Wireless Asset Net(TM) system for tracking and managing fleets of
industrial equipmenT continued to gain market share. Gross profit margins for
the quarter remained strong and stable at 49%. Net loss for the three months
decreased 48% to $211,000, or $.03 per basic and diluted share, compared to the
net loss of $405,000, or $.06 per basic and diluted share, in the second quarter
of 2002.
For the six-month period ended June 30, 2003, revenues increased 86% to
$3,734,000, compared to $2,009,000 for the same period a year ago. Net loss for
the six months decreased 44% to $596,000, compared to $1,062,000 for the same
period last year.
"I.D. Systems continues to meet its short-term objectives and adhere to its
long-term strategic plan," said Jeffrey Jagid, Chairman and Chief Executive
Officer of I.D. Systems. "We are increasing the market penetration of our
patented wireless technology and demonstrating a compelling return on investment
for our customers while delving into new applications. We are reporting
year-over-year and sequential revenue growth, and achieving robust gross profit
margins. We are particularly gratified that in a challenging economic
environment, I.D. Systems continues both to build business with existing
customers and add new Fortune 500 customers, which we believe reflects a growing
acceptance of our technology as a best practice for safety improvements and
operating cost reductions."
"I.D. Systems' financial condition remains strong," added Chief Financial
Officer Ned Mavrommatis. "At June 30, 2003, the company's cash, cash
equivalents, and investments totaled $8,327,000, with $8,105,000 in working
capital."
Selling, general and administrative (SG&A) expenses for the quarter ended June
30, 2003, were $1,105,000, compared to $814,000 for the three months ended June
30, 2002. As a percentage of revenues, SG&A expenses decreased to 52% from 69%
in the second quarter of 2002. Research and development (R&D) expenses were
$219,000 for the three months ended June 30, 2003, compared to $271,000 for the
same period last year. As a percentage of revenues, R&D expenses decreased to
10% for the quarter, compared to 23% a year ago.
Highlights in the second quarter of 2003 included:
o Ford Motor Company (NYSE: F) accelerated its corporate-wide deployment of
I.D. Systems' wireless Industrial Vehicle Electronic Control System
(IVECS). The accelerated plan calls for more than 20 Ford assembly and
stamping plants in North
4
America to implement IVECS on a significant portion of their material
handling vehicles by the end of 2003.
o The U.S. Postal Service (USPS) ordered I.D. Systems' Wireless Asset Net for
a fleet of industrial vehicles at the USPS Buffalo, New York, Processing
and Distribution Center, the eighth USPS facility to acquire the system.
o Walgreen Co. (NYSE: WAG), the largest U.S. drugstore chain with 4,029
stores and fiscal 2002 sales of $28.7 billion, ordered the Wireless Asset
Net for material handling fleets at two distribution centers. Walgreens
represents I.D. Systems' first opportunity in the retail drug market and is
a key addition to the company's growing base of Fortune 500 customers.
o American Axle & Manufacturing Holdings, Inc. (NYSE: AXL) ordered an initial
deployment of I.D. Systems' Wireless Asset Net technology at one of its
Michigan plants. American Axle, a Tier One automotive driveline systems
supplier with 2002 revenues of $3.5 billion, joins Ford, DaimlerChrysler,
Toyota, and other automotive industry leaders as an I.D. Systems customer.
o I.D. Systems continued to work together with Avis Rent A Car System, Inc.,
a wholly owned subsidiary of Cendant Corporation (NYSE: CD), to implement
the Wireless Asset Net system on Avis' 2,000-vehicle rental fleet in Puerto
Rico. The deployment is designed to automate various aspects of the car
rental and return process, improving customer service and increasing the
efficiency of fleet operations. Avis and its subsidiaries operate the
world's second largest general-use car rental brand, with more than 1,700
locations worldwide.
INVESTOR CONFERENCE CALL
I.D. Systems will be holding a conference call for investors and analysts at
4:45 p.m. Eastern Daylight Time on August 4, 2003. Jeffrey Jagid, Chairman and
CEO, Kenneth Ehrman, President and COO, Ned Mavrommatis, CFO and Rick Muntz, EVP
of Sales & marketing, will discuss the results of the quarter and recent
corporate developments. After opening remarks, there will be a question and
answer period. The conference call will be broadcast live over the Internet via
the Investors section of the company's web site at www.id-systems.com. To listen
to the live call, go to the web site at least 10 minutes early to download and
install any necessary audio software.
ABOUT THE COMPANY
Based in Hackensack, New Jersey, I.D. Systems, Inc. is a leading provider of
wireless solutions for corporate asset management. I.D. Systems' customers
include Archer Daniels Midland, DaimlerChrysler, Deere & Co., Ford Motor
Company, Hallmark Cards, Target Corporation, Walgreen Co., the U.S. Department
of Homeland Security, the U.S. Navy, and the U.S. Postal Service, among others.
Using local area networks, wide area networks, and the Internet, the company's
systems enable management to control and track the location and status of their
assets-- from letters and containers to forklifts and railcars-- in real time.
For more information on I.D. Systems, Inc., visit www.idsystems.com.
5
Wireless Asset Net and the I.D. Systems, Inc. logo are trademarks of I.D.
Systems, Inc.
"Safe Harbor" statement under the Private Securities Litigation Reform Act of
1995: This press release contains forward looking statements that are subject to
risk and uncertainties, including, but not limited to, the impact of competitive
products, product demand and market acceptance risks, fluctuations in operating
results and other risks detailed from time to time in I.D. Systems' filings with
the Securities and Exchange Commission. These risks could cause I.D. Systems'
actual results for the current fiscal year and beyond to differ materially from
those expressed in any forward looking statements made by, or behalf of, I.D.
Systems.
6
I.D. SYSTEMS, INC.
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
2002 2003 2002 2003
----------- ----------- ----------- -----------
Revenues $ 1,178,000 $ 2,125,000 $ 2,009,000 $ 3,734,000
Cost of Revenues 593,000 1,076,000 968,000 1,831,000
----------- ----------- ----------- -----------
Gross Profit 585,000 1,049,000 1,041,000 1,903,000
Selling, general and administrative expenses 814,000 1,105,000 1,697,000 2,188,000
Research and development expenses 271,000 219,000 551,000 451,000
----------- ----------- ----------- -----------
Loss from operations (500,000) (275,000) (1,207,000) (736,000)
Interest income 95,000 79,000 146,000 165,000
Interest expense -- (15,000) (1,000) (25,000)
----------- ----------- ----------- -----------
NET LOSS $ (405,000) $ (211,000) $(1,062,000) $ (596,000)
=========== =========== =========== ===========
NET LOSS PER SHARE - BASIC AND DILUTED $ (0.06) $ (0.03) $ (0.16) $ (0.09)
=========== =========== =========== ===========
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING -
BASIC AND DILUTED LOSS PER SHARE
6,797,000 6,833,000 6,622,000 6,819,000
=========== =========== =========== ===========
7
I.D. SYSTEMS, INC.
CONDENSED BALANCE SHEETS
JUNE 30, 2003
December 31, 2002 (UNAUDITED)
----------------- -------------
ASSETS
Cash and cash equivalents $ 3,758,000 $ 3,264,000
Investments 3,031,000 2,991,000
Accounts receivable, net 1,114,000 1,833,000
Unbilled receivables -- 449,000
Inventory 1,471,000 911,000
Investment in sales type leases 159,000 34,000
Interest receivable 73,000 104,000
Officer loan 10,000 10,000
Prepaid expenses and other current assets 147,000 206,000
------------ ------------
Total current assets 9,763,000 9,802,000
Investments 968,000 2,072,000
Fixed assets, net 679,000 656,000
Investment in sales type leases 522,000 77,000
Installment receivable - non-current portion 867,000 785,000
Officer loan 41,000 36,000
Deferred contract costs -- 121,000
Other assets 107,000 108,000
------------ ------------
$ 12,947,000 $ 13,657,000
============ ============
LIABILITIES
Accounts payable and accrued expenses $ 1,205,000 $ 1,265,000
Long term debt - current portion -- 199,000
Line of credit 137,000 137,000
Deferred revenue 26,000 46,000
Other current liabilities 100,000 50,000
------------ ------------
Total current liabilities 1,468,000 1,697,000
Long term debt -- 727,000
Deferred revenue -- 156,000
Deferred rent 66,000 77,000
------------ ------------
1,534,000 2,657,000
------------ ------------
STOCKHOLDERS' EQUITY
Preferred stock; authorized 5,000,000 shares, $.01 par value;
none issued Common stock; authorized 15,000,000 shares,
$.01 par value; issued and outstanding 6,799,000 shares and
6,863,000 shares 68,000 69,000
Additional paid-in capital 22,042,000 22,226,000
Treasury stock; 40,000 shares at cost (113,000) (113,000)
Accumulated deficit (10,584,000) (11,182,000)
------------ ------------
11,413,000 11,000,000
------------ ------------
$ 12,947,000 $ 13,657,000
============ ============
8