IPIX Reports Results for Second Quarter 2005
Reston, VA. - August 5 , 2005– IPIX Corporation (NASDAQ:IPIX - News), a premier supplier of 360-degree, immersive imaging technologies for visual intelligence applications, announced financial results for the three and six months ended June 30, 2005 and comparable prior year results:
Three Months Ended Six Months Ended
June 30, June 30,
----------------------- ------------------------
2005 2004 2005 2004
----------- ----------- ------------ -----------
Revenue $1,432,803 $1,012,575 $ 2,101,032 $1,488,810
Operating expenses $6,705,313 $2,508,013 $11,633,827 $4,493,878
Loss from continuing
operations $5,988,822 $2,063,613 $10,510,569 $3,867,205
Loss from
discontinued
operations, net of
taxes $ - $1,339,107 $ 1,359,726 $2,745,533
Net loss per common
share, basic and
diluted $ 0.27 $ 0.23 $ 0.54 $ 0.58
Revenue increased 42% and 41%, respectively for the three and six months ended June 30, 2005, compared to the same periods in the prior year, primarily due to sales of 360-degree cameras from the immersive video product line. Gross profit for both the three and six months ended June 30, 2005 increased to 47% as compared with 42% and 41% for the three and six months ended June 30, 2004. The increase in gross margin was due to sales of higher margin immersive video products in 2005.
Included in operating expenses in the three and six months ended June 30, 2005 is $1,819,388 of restructuring charges resulting from the plan management executed in the second quarter to abandon certain assets and a leased facility in conjunction with the sale of the AdMission business unit. IPIX completed the sale of its AdMission business unit on February 11, 2005, which was reported as discontinued operations in the first quarter of 2005 and prior years.
Increases in operating expenses were related to sales and marketing expenditures focused on building a direct sales force and an indirect channel sales team for the immersive video product line as well as related increases in marketing and trade show activity. As a result, the company made sales within the prison, education, law enforcement and retail markets during the second quarter, 2005.
General and administrative expenses increased as a result of additional personnel for general and administrative and information technology. Also contributing to the increase in general and administrative expenses were accounting, legal and consultant fees related to the Sarbanes-Oxley compliance and reporting of discontinued operations. Research and development expenses increased due to additions to IPIX's engineering resources focused on the integration of the IPIX IP camera into a variety of digital video recording (DVR) devices utilized in the surveillance market that IPIX addresses.
"Recent terror-related events worldwide have clearly demonstrated the need for more cameras and more sophisticated, intelligent video surveillance solutions, particularly for at-risk public and private institutions and critical infrastructures," said IPIX President and CEO Clara Conti. "As a leader in the emerging digital video marketplace, IPIX is positioned to stay at the technology forefront, as evidenced by our recent Defense Advanced Research Projects Agency (DARPA) contract to develop the world's highest resolution video camera and the investments we are making in research and development."
About IPIX Corporation
IPIX Corporation is a premium provider of immersive imaging products for government and commercial applications. We combine experience, patented technology and strategic partnerships to deliver visual intelligence solutions worldwide. Our immersive, 360-degree imaging technology has been used to create high-resolution digital still photography and video products for surveillance, visual documentation and forensic analysis. www.ipix.com
This press release may contain forward-looking information within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and is subject to the safe harbors under those sections. In some cases, you can identify forward-looking statements by terminology such as "expect," "believe," "may," "will," "plans" and "anticipate," or the negative of such terms or comparable terminology. Forward-looking statements appearing herein include statements concerning operating and profitability plans and goals and restructuring efforts, and are based on current expectations.
Actual results may differ materially from those projected in the forward-looking statements based upon a number of factors including:
- - changes in the demand for our products and services,
- - our third-party supplier's ability to deliver high quality components to us in a timely fashion,
- - our ability to control or effect reductions in costs,
- - uncertainty regarding our ability to continue as a going concern,
- - our ability to raise capital and fund our operations,
- - our ability to attract and retain highly qualified personnel,
- - our ability to design, manufacture and deliver high quality products in a timely fashion,
- - the burdens and costs of defending against potential infringement claims,
The matters discussed in this press release also involve risks and uncertainties described from time to time in documents filed with the Securities and Exchange Commission, including but not limited to Form 10-Ks, Form 10-K/As, Form 10-Qs, Form S-3s and Form 8-Ks ().
IPIX CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, December 31,
2005 2004
------------- -------------
(unaudited) (1)
ASSETS
Current assets:
Cash and cash equivalents $ 13,541,951 $ 12,784,058
Restricted cash and short-term
investments 630,000 550,000
Short-term investments 1,469,788 895,254
Accounts receivable 592,757 413,873
Inventory, net of reserves of $292,150
and $346,132 2,169,763 2,334,271
Prepaid and other current assets 1,144,085 1,511,392
Assets held for sale for discontinued
operations - 321,384
------------- -------------
Total current assets 19,548,344 18,810,232
Computer hardware, software and other,
net 1,444,842 715,663
Restricted cash and other long-term
assets 111,564 718,343
------------- -------------
Total assets $ 21,104,750 $ 20,244,238
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 1,366,145 $ 1,042,979
Accrued liabilities 3,266,615 3,376,775
Deferred revenue 219,254 84,100
Liabilities held for sale for
discontinued operations - 164,112
Capital lease obligations - 219,977
------------- -------------
Total current liabilities 4,852,014 4,887,943
Long-term restructuring liabilities 482,812 141,675
------------- -------------
Total liabilities 5,334,826 5,029,618
------------- -------------
Stockholders' equity:
Preferred stock, $0.001 par value,
5,001,100 authorized, 290,347 shares
issued and outstanding (aggregate
liquidation value: $7,555,704 and
$7,325,335) 290 290
Common stock, $0.001 par value, 50,000,000
authorized, 26,588,363 and 21,539,058
shares issued and outstanding 26,588 21,539
Additional paid-in-capital 546,079,023 533,658,473
Accumulated deficit (530,335,977) (518,465,682)
------------- -------------
Total stockholders' equity 15,769,924 15,214,620
------------- -------------
Total liabilities and stockholders'
equity $ 21,104,750 $ 20,244,238
============= =============
(1) The December 31, 2004 balances were derived from the audited
consolidated financial statements.
IPIX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended Six Months Ended
June 30, June 30,
------------------------- --------------------------
2005 2004 2005 2004
------------ ------------ ------------- ------------
Revenue:
Hardware $ 1,024,261 $ 594,657 $ 1,340,883 $ 807,752
License and
other 408,542 417,918 760,149 681,058
------------ ------------ ------------- ------------
Total revenue 1,432,803 1,012,575 2,101,032 1,488,810
Cost of revenue:
Hardware 559,163 439,260 729,742 584,419
License and
other 196,154 145,387 392,024 297,690
------------ ------------ ------------- ------------
Total cost of
revenue 755,317 584,647 1,121,766 882,109
Gross profit 677,486 427,928 979,266 606,701
Operating
expense:
Sales and
marketing 1,972,415 1,073,319 3,687,275 1,920,418
General and
administrative 2,254,028 924,617 4,547,829 1,617,281
Research and
development 659,482 510,077 1,325,977 956,179
Restructuring
charges 1,819,388 - 1,819,388 -
Loss on
impairment of
asset - - 253,358 -
------------ ------------ ------------- ------------
Total
operating
expenses 6,705,313 2,508,013 11,633,827 4,493,878
Operating loss (6,027,827) (2,080,085) (10,654,561) (3,887,177)
Interest and
other (expenses)
income, net 39,005 16,472 143,992 19,972
------------ ------------ ------------- ------------
Loss from
continuing
operations (5,988,822) (2,063,613) (10,510,569) (3,867,205)
Loss from
discontinued
operations, net
of taxes - (1,339,107) (1,359,726) (2,745,533)
------------ ------------ ------------- ------------
Net loss (5,988,822) (3,402,720) (11,870,295) (6,612,738)
Preferred stock
dividends (115,821) (223,736) (230,369) (624,168)
------------ ------------ ------------- ------------
Net loss
available to
common
stockholders $(6,104,643) $(3,626,456) $(12,100,664) $(7,236,906)
============ ============ ============= ============
Basic and diluted
loss per share:
Continuing
operations $ (0.27) $ (0.14) $ (0.48) $ (0.36)
Discontinued
operations - (0.09) (0.06) (0.22)
------------ ------------ ------------- ------------
Net loss per
share to common
stockholders
(basic and
diluted) $ (0.27) $ (0.23) $ (0.54) $ (0.58)
============ ============ ============= ============
Weighted average
common shares
(basic and
diluted) 22,794,321 15,894,427 22,366,171 12,397,576
============ ============ ============= ============
About IPIX
IPIX Corporation ("IPIX") is a premium provider of immersive imaging products for government and commercial applications. We combine experience, patented technology and strategic partnerships to deliver visual intelligence solutions worldwide. Our immersive, 360° imaging technology has been used to create high-resolution digital still photography and video products for surveillance, visual documentation and forensic analysis. www.ipix.com.
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| IPIX Media Contact Jean Watterson IPIX Corporation 703-674-4150 Jean.Watterson@ipix.com |
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