Exhibit 99.1
 
(aware logo) 
 
FOR IMMEDIATE RELEASE

Contact:
Rick Moberg
Aware, Inc.
781-276-4000

Aware, Inc. Reports Fourth Quarter and 2014
Financial Results
 
BEDFORD, MASS. – February 10, 2015 –
Aware, Inc. (NASDAQ: AWRE), a leading supplier of biometrics software and services, today reported financial results for its fourth quarter and year ended December 31, 2014.

Revenue for the fourth quarter of 2014 was $4.3 million, a decrease of 24% compared to $5.6 million in the same quarter last year. Operating income in the fourth quarter of 2014 was $0.2 million compared to $0.8 million in the fourth quarter of 2013. Lower revenue and operating income in the fourth quarter of this year versus last year was primarily due to lower hardware sales.

Net income in the fourth quarter of 2014 was $0.2 million, or $0.01 per diluted share, which compares to $1.6 million, or $0.07 per diluted share, in the same period a year ago.  Net income in the year ago quarter included $1.1 million, or $0.05 per diluted share, of income from discontinued operations.

For the year ended December 31, 2014, revenue increased 23% to $23.7 million, compared to $19.4 million in the same period a year ago.  Operating income for 2014 was $7.1 million compared to $5.3 million in 2013. Higher operating income in 2014 was primarily due to: i) a $0.4 million increase in operating income before patent related income; and ii) a $1.4 million increase in income from patent related activities.  The $0.4 million increase in operating income before patent related income was driven by higher hardware and services revenue in 2014.
 
Aware, Inc.  •  40 Middlesex Turnpike  •  Bedford, MA  USA  01730-1432
Tel: (781) 276-4000  •  Fax: (781) 276-4001  •  E-mail: IR@aware.com
 
 
 

 

 
Aware, Inc. Reports Fourth Quarter and 2014 Financial Results
Page 2
 
Net income for the year ended December 31, 2014 was $4.6 million, or $0.20 per diluted share. These results compared to net income of $2.6 million, or $0.11 per diluted share in 2013. Net income in 2013 included a $1.2 million loss, or $0.05 per diluted share, from discontinued operations.
 
Rick Moberg, Aware’s co-chief executive officer and chief financial officer, said “While financial results for the fourth quarter did not meet our expectations, results for the full year did.  Our biometrics business achieved its best year of financial and operational results since its inception more than 20 years ago.  We go into 2015 with the most complete product portfolio we’ve ever enjoyed, a strengthened engineering organization, an experienced sales staff, and a solid balance sheet.  We believe we have the products and people to continue our success in this industry.”
 
About Aware
Aware is a leading provider of biometrics software products and development services to governments, system integrators, and solution providers globally. Our products include SDKs, software components, workstation applications, and a modular, centralized, service-oriented platform. They fulfill a broad range of functions critical to biometric authentication and search, including face, fingerprint, and iris autocapture, image quality assurance, data compliance, capture hardware peripheral abstraction, centralized data processing and workflow, subsystem connectivity, and biometric matching algorithms. The products are used to enable identity-centric security solutions with biometrics for applications including border management, credentialing and access control, intelligence and defense, and law enforcement. Aware is a publicly held company (Nasdaq: AWRE) based in Bedford, Massachusetts.
 
See Aware’s website for more information about our biometrics software products.
 
Safe Harbor Warning
Portions of this release contain forward-looking statements regarding future events and are subject to risks and uncertainties, such as estimates or projections of future revenue and earnings, and the growth of the biometrics markets. Aware wishes to caution you that there are factors that could cause actual results to differ materially from the results indicated by such statements.

Risk factors related to our business include, but are not limited to: i) our operating results may fluctuate significantly and are difficult to predict; ii) we derive a significant portion of our revenue from government customers, and our business may be adversely affected by changes in the contracting or fiscal policies of those governmental entities; iii) we derive a significant portion of our revenue from third party channel partners; iv) we face intense competition from other biometrics solution providers; v) our business is subject to rapid technological change; vi) our software products may have errors, defects or bugs which could harm our business; vii) our business may be adversely affected by our use of open source software; viii) our intellectual property is subject to limited protection; ix) we may be sued by third parties for alleged infringement of their proprietary rights; x) we must attract and retain key personnel; xi) we rely on single sources of supply for certain components used in our hardware products; xii) our business may be affected by government regulations and adverse economic conditions; and xiii) we may make acquisitions that could adversely affect our results.

We refer you to the documents Aware files from time to time with the Securities and Exchange Commission, specifically the section titled Risk Factors in our annual report on Form 10-K for the fiscal year ended December 31, 2013 and other reports and filings made with the Securities and Exchange Commission.

Aware is a trademark or registered trademark of Aware, Inc.
Any other trademarks appearing herein are the property of their respective owners.
 
 
 

 

 
Aware, Inc. Reports Fourth Quarter and 2014 Financial Results
Page 3
 
AWARE, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
 (unaudited)

   
Three Months Ended
December 31,
   
Year Ended
December 31,
 
   
2014
   
2013
   
2014
   
2013
 
Revenue:
                       
    Software licenses                                                                                   
    $1,778       $1,382       $8,537       $8,241  
    Software maintenance                                                                                   
    1,069       952       4,351       3,866  
    Services                                                                                   
    1,242       1,068       5,173       3,148  
    Hardware                                                                                   
    120       2,053       4,933       3,182  
    Royalties                                                                                   
    100       182       726       920  
         Total revenue                                                                                  
    4,309       5,637       23,720       19,357  
                                 
Costs and expenses:
                               
    Cost of hardware                                                                                   
    82       1,551       3,485       2,365  
    Cost of services                                                                                   
    662       468       2,359       1,503  
    Research and development                                                                                   
    1,445       1,043       5,505       4,085  
    Selling and marketing                                                                                   
    928       879       3,741       3,344  
    General and administrative                                                                                   
    949       942       3,668       3,522  
       Total costs and expenses                                                                                   
    4,066       4,883       18,758       14,819  
                                 
Patent related income                                                                                   
    -       -       2,127       780  
                                 
Operating income                                                                                   
    243       754       7,089       5,318  
Other income (expense)                                                                                   
    -       (3 )     (59 )     23  
Interest income                                                                                   
    43       88       225       328  
Income from continuing operations before income taxes
    286       839       7,255       5,669  
Provision for income taxes                                                                                   
    47       314       2,672       1,917  
Income from continuing operations
    239       525       4,583       3,752  
Income (loss) from discontinued operations, net of income taxes
    -       1,060       -       (1,156 )
                                 
Net income                                                                                   
    $239       $1,585       $4,583       $2,596  
                                 
Basic net income per share:
                               
   Basic net income per share from continuing operations 
    $0.01       $0.02       $0.20       $0.17  
   Basic net income (loss) share from discontinued operations 
    -       0.05       -       (0.05 )
Basic net income per share                                                                                   
    $0.01       $0.07       $0.20       $0.12  
                                 
Diluted net income per share:
                               
   Diluted net income per share from continuing operations 
    $0.01       $0.02       $0.20       $0.16  
   Diluted net income (loss) per share from discontinued operations 
    -       0.05       -       (0.05 )
Diluted net income per share                                                                                   
    $0.01       $0.07       $0.20       $0.11  
                                 
                                 
Weighted-average shares – basic                                                                                   
    22,806       22,572       22,703       22,543  
Weighted-average shares - diluted                                                                                   
    22,892       22,693       22,787       22,641  
 
 
 

 

 
Aware, Inc. Reports Fourth Quarter and 2014 Financial Results
Page 4
 
AWARE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(unaudited)

   
December 31,
2014
   
December 31,
2013
 
             
ASSETS
           
     Cash and investments
    $45,413       $75,414  
     Accounts receivable, net
    3,619       4,582  
     Inventories
    2       1,601  
     Property and equipment, net
    5,289       5,582  
     Deferred tax assets
    972       1,145  
     Other assets, net
    598       1,005  
                 
     Total assets
    $55,893       $89,329  
                 
LIABILITIES AND STOCKHOLDERS’ EQUITY
               
                 
     Total current liabilities
    $3,430       $4,161  
     Long-term deferred revenue
    74       18  
     Total stockholders’ equity 
    52,389       85,150  
                 
     Total liabilities and stockholders’ equity
    $55,893       $89,329  
 
###
 
Aware, Inc.  •  40 Middlesex Turnpike  •  Bedford, MA  USA  01730-1432
Tel: (781) 276-4000  •  Fax: (781) 276-4001  •  E-mail: IR@aware.com
 
 

 

 

The following information was filed by Aware Inc (AWRE) on Tuesday, February 10, 2015 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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