Exhibit 99.1

 

 

 

Lantronix Reports Third Quarter Fiscal 2019 Net Revenue of $12.3M

--Achieves $0.04 of GAAP Earnings per Share & $0.05 of Non-GAAP Earnings per Share--

 

 

Irvine, CA – April 25, 2019

– Lantronix, Inc. (NASDAQ: LTRX), a global provider of secure data access and management solutions for the industrial Internet of Things (IoT) today reported results for the third quarter fiscal 2019 that ended March 31, 2019.

 

Financial Highlights

Net revenue of $12.3 million, an increase of 6% from the third quarter of fiscal 2018
Net revenue growth of 10% for the nine months ended March 31, 2019
Gross profit margin of 57.4%, compared with 56.8% for the third quarter of fiscal 2018
GAAP net income of $857,000, or $0.04 per share, compared to GAAP net income of $344,000, or $0.02 per share for the third quarter of fiscal 2018, a 150% increase in GAAP earnings
Non-GAAP net income of $1,295,000, or $0.05 per share, compared to non-GAAP net income of $767,000, or $0.04 per share for the third quarter of fiscal 2018, a 69% increase in non-GAAP earnings

 

Operational and Product Highlights

Paul Pickle joined the Company as its new President and CEO in April 2019. Prior to joining Lantronix, Mr. Pickle served as the President and COO of the Microsemi Corporation, a leading provider of semiconductor and system solutions, from November 2013 until Microsemi was acquired by Microchip Technology Inc. in May 2018 for an enterprise value of $10.15 billion. 
In March, the company announced a new release of its award winning ConsoleFlow™, a centralized IT infrastructure management and monitoring software optimized for out-of-band networks, at Cisco Live Australia.
In February, the company introduced its latest wireless embedded IoT gateway innovation for the industrial IoT applications, the xPico® 270, at Embedded World in Germany.
In January, the company expanded its distribution agreement with Ingram Micro. Under the terms of the new agreement, Ingram Micro is now providing advanced logistics, product delivery, and distribution services for Lantronix products in China.

 

“I am pleased with our third quarter results and delivering both sequential and year-over-year revenue growth with increased gross and operating margins.” said Jeremy Whitaker, Lantronix CFO “Furthermore, I would like to welcome Paul Pickle as our new president and CEO. I look forward to how Paul’s leadership and experience will help drive the execution of the Company’s growth strategy.”

 

“I am excited to be joining Lantronix. Based on the Company’s recent results, its talented team, and innovative products, I believe the Company is well positioned to take advantage of future growth opportunities” said Paul Pickle, Lantronix CEO.

 

Conference Call and Webcast

Lantronix will host an investor conference call and audio webcast today at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time) to discuss its results for the third quarter of fiscal 2019 that ended March 31, 2019. To access the live conference call, investors should dial 1-844-802-2442 (US) or 1-412-317-5135 (international) and indicate that they are participating in the Lantronix Q3 FY 2019 call. The webcast will be available simultaneously via the investor relations section of the Company’s website at www.lantronix.com.

 

Investors can access a replay of the conference call starting at approximately 5:00 p.m. Pacific Time today at www.lantronix.com. A telephonic replay will also be available through April 25, 2019 by dialing 1-877-344-7529 (US) or 1-412-317-0088 (international) and entering passcode 10130426.

 

 

 

 1 

 

 

About Lantronix

 

Lantronix, Inc. is a global provider of secure data access and management solutions for the Internet of Things (IoT) assets. Our mission is to be the leading supplier of IoT solutions that enable companies to dramatically simplify the creation, deployment, and management of IoT projects while providing secure access to data for applications and people.

 

With more than two decades of experience in creating robust machine to machine (M2M) technologies, Lantronix is an innovator in enabling our customers to build new business models and realize the possibilities of the Internet of Things. Our connectivity solutions are deployed inside millions of machines serving a wide range of industries, including industrial, medical, security, transportation, retail, financial, environmental and government.

 

Lantronix is headquartered in Irvine, California. For more information, visit www.lantronix.com.

 

Learn more on the Lantronix blog, www.lantronix.com/blog, featuring industry discussion and updates. To follow Lantronix on Twitter, please visit www.twitter.com/Lantronix. View our video library on YouTube at www.youtube.com/user/LantronixInc or connect with us on LinkedIn at www.linkedin.com/company/lantronix.

 

Discussion of Non-GAAP Financial Measures

 

Lantronix believes that the presentation of non-GAAP financial information, when presented in conjunction with the corresponding GAAP measures, provides important supplemental information to management and investors regarding financial and business trends relating to the company’s financial condition and results of operations. Management uses the aforementioned non-GAAP measures to monitor and evaluate ongoing operating results and trends to gain an understanding of our comparative operating performance. The non-GAAP financial measures disclosed by the company should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations of the non-GAAP financial measures to the financial measures calculated in accordance with GAAP should be carefully evaluated. The non-GAAP financial measures used by the company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. The company has provided reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures.

 

Non-GAAP net income (loss) consists of net income (loss) excluding (i) share-based compensation and the employer portion of withholding taxes on stock grants, (ii) depreciation and amortization, (iii) interest income (expense), (iv) other income (expense), (v) income tax provision (benefit), and (vi) severance and restructuring charges.

 

Forward-Looking Statements

 

This news release contains forward-looking statements, including statements concerning our sales expansion efforts, our product development efforts, and our projected operating and financial performance. These forward-looking statements are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. We have based our forward-looking statements on our current expectations and projections about trends affecting our business and industry and other future events. Although we do not make forward-looking statements unless we believe we have a reasonable basis for doing so, we cannot guarantee their accuracy. Forward-looking statements are subject to substantial risks and uncertainties that could cause our results or experiences, or future business, financial condition, results of operations or performance, to differ materially from our historical results or those expressed or implied in any forward-looking statement contained in this news release. Some of the risks and uncertainties that may cause actual results to differ from those expressed or implied in the forward-looking statements are described in “Risk Factors” in our Annual Report on Form 10-K filed with the Securities and Exchange Commission, or SEC, as well as in our other filings with the SEC. In addition, actual results may differ as a result of additional risks and uncertainties of which we are currently unaware or which we do not currently view as material to our business. For these reasons, investors are cautioned not to place undue reliance on any forward-looking statements. The forward-looking statements we make speak only as of the date on which they are made. We expressly disclaim any intent or obligation to update any forward-looking statements after the date hereof to conform such statements to actual results or to changes in our opinions or expectations, except as required by applicable law or the rules of the NASDAQ Stock Market, LLC. If we do update or correct any forward-looking statements, investors should not conclude that we will make additional updates or corrections.

 

Lantronix Investor Relations Contact:

Shahram Mehraban

VP, Marketing

investors@lantronix.com
949-453-7175

 

© 2019 Lantronix, Inc. All rights reserved. Lantronix and XPort are registered trademarks, and ConsoleFlow is a trademark, of Lantronix, Inc.

 

# # #

 

 

 

 2 

 

 

LANTRONIX, INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

   

 

   March 31,   June 30, 
   2019   2018 
Assets          
Current assets:          
Cash and cash equivalents  $18,212   $9,568 
Accounts receivable, net   8,351    4,244 
Inventories, net   9,809    8,439 
Contract manufacturers' receivable   506    649 
Prepaid expenses and other current assets   817    370 
Total current assets   37,695    23,270 
Property and equipment, net   1,353    1,036 
Goodwill   9,488    9,488 
Other assets   53    61 
Total assets  $48,589   $33,855 
           
Liabilities and stockholders' equity          
Current liabilities:          
Accounts payable  $5,012   $3,942 
Accrued payroll and related expenses   1,808    2,808 
Warranty reserve   110    99 
Other current liabilities   3,956    2,877 
Total current liabilities   10,886    9,726 
Other non-current liabilities   228    316 
Total liabilities   11,114    10,042 
           
Commitments and contingencies          
           
Stockholders' equity:          
Common stock   2    2 
Additional paid-in capital   225,024    212,995 
Accumulated deficit   (187,922)   (189,555)
Accumulated other comprehensive income   371    371 
Total stockholders' equity   37,475    23,813 
Total liabilities and stockholders' equity  $48,589   $33,855 

 

 

 

 

 3 

 

 

LANTRONIX, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

   

 

   Three Months Ended   Nine Months Ended 
   March 31,   December 31,   March 31,   March 31, 
   2019   2018   2018   2019   2018 
Net revenue  $12,344   $12,114   $11,601   $36,737   $33,543 
Cost of revenue   5,254    5,453    5,017    16,245    15,051 
Gross profit   7,090    6,661    6,584    20,492    18,492 
Operating expenses:                         
Selling, general and administrative   3,867    4,159    4,241    12,498    12,400 
Research and development   2,385    2,279    1,964    6,962    6,059 
Total operating expenses   6,252    6,438    6,205    19,460    18,459 
Income (loss) from operations   838    223    379    1,032    33 
Interest income (expense), net   91    60    (5)   147    (14)
Other income (expense), net   (12)   8    (1)   (14)   1 
Income (loss) before income taxes   917    291    373    1,165    20 
Provision for income taxes   60    14    29    114    92 
Net income (loss)  $857   $277   $344   $1,051   $(72)
                          
Net income (loss) per share - basic  $0.04   $0.01   $0.02   $0.05   $(0.00)
Net income (loss) per share - diluted  $0.04   $0.01   $0.02   $0.05   $(0.00)
                          
Weighted-average common shares - basic   22,270    22,091    18,210    21,237    18,050 
Weighted-average common shares - diluted   23,304    23,442    19,118    22,632    18,050 

 

 

 

 4 

 

 

LANTRONIX, INC.

UNAUDITED RECONCILIATION OF NON-GAAP ADJUSTMENTS

(In thousands, except per share data)

 

   Three Months Ended   Nine Months Ended 
   March 31,   December 31,   March 31,   March 31, 
   2019   2018   2018   2019   2018 
                     
GAAP net income (loss)  $857   $277   $344   $1,051   $(72)
Non-GAAP adjustments:                         
Cost of revenue:                         
Share-based compensation   22    23    14    62    40 
Depreciation and amortization   51    45    53    144    168 
Total adjustments to cost of revenue   73    68    67    206    208 
Selling, general and administrative:                         
Share-based compensation   213    337    237    950    688 
Employer portion of withholding taxes on stock grants   4    2    4    12    9 
Depreciation and amortization   50    48    47    144    138 
Total adjustments to selling, general and administrative   267    387    288    1,106    835 
Research and development:                         
Share-based compensation   96    91    44    248    149 
Employer portion of withholding taxes on stock grants                   1 
Depreciation and amortization   21    21    10    53    30 
Total adjustments to research and development   117    112    54    301    180 
Severance and related charges           (21)   323    506 
Total non-GAAP adjustments to operating expenses   384    499    321    1,730    1,521 
Interest (income) expense, net   (91)   (60)   5    (147)   14 
Other (income) expense, net   12    (8)   1    14    (1)
Provision for income taxes   60    14    29    114    92 
Total non-GAAP adjustments   438    513    423    1,917    1,834 
Non-GAAP net income  $1,295   $790   $767   $2,968   $1,762 
                          
                          
Non-GAAP net income per share - diluted  $0.05   $0.03   $0.04   $0.13   $0.09 
                          
Denominator for GAAP net income (loss) per share - diluted   23,304    23,442    19,118    22,632    18,050 
Non-GAAP adjustment   893    824    541    655    1,420 
Denominator for non-GAAP net income per share - diluted   24,197    24,266    19,659    23,287    19,470 
                          
GAAP operating expenses  $6,252   $6,438   $6,205   $19,460   $18,459 
Non-GAAP adjustments to operating expenses   (384)   (499)   (321)   (1,730)   (1,521)
Non-GAAP operating expenses  $5,868   $5,939   $5,884   $17,730   $16,938 

 

 

 5 

 

 

LANTRONIX, INC.

UNAUDITED NET REVENUES BY PRODUCT LINE AND REGION

(In thousands)

     

 

   Three Months Ended   Nine Months Ended 
   March 31,   December 31,   March 31,   March 31,   March 31, 
   2019   2018   2018   2019   2018 
IoT  $8,935   $9,070   $9,235   $26,972   $25,654 
IT Management   3,210    2,888    1,964    9,199    6,971 
Other   199    156    402    566    918 
   $12,344   $12,114   $11,601   $36,737   $33,543 

 

   Three Months Ended   Nine Months Ended 
   March 31,   December 31,   March 31,   March 31,   March 31, 
   2019   2018   2018   2019   2018 
Americas  $6,866   $6,182   $5,832   $19,962   $17,821 
EMEA   3,757    4,080    4,055    11,357    10,391 
APJ   1,721    1,852    1,714    5,418    5,331 
   $12,344   $12,114   $11,601   $36,737   $33,543 

 

 

 

 

 

 

 6 


The following information was filed by Lantronix Inc (LTRX) on Thursday, April 25, 2019 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-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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