IDEX Biometrics interim report for the nine months ended 30 September 2023
Oslo, Norway – 9 November 2023 – The interim report of IDEX Biometrics for the nine months ended 30 September 2023 is attached to this notice (link below). The interim report is also available on the IDEX Biometrics website: www.idexbiometrics.com/investors/interim-results/
A webcast presentation of the interim report will be held by Vince Graziani, Chief Executive Officer, and Catharina Eklof, Chief Commercial Officer, today, 9 November 2023, at 09:00 CET. The webcast presentation can be viewed at the following link:
The presentation slides are attached to this notice (link below).
During the third quarter, IDEX added more manufacturing partners that are quickly mobilizing to take our biometrics payment card platform, IDEX Pay, to the market. This was happening in conjunction with IDEX receiving the critical Mastercard certification for the IDEX Pay platform, on August 30.
The strategy with IDEX Pay is showing early success as demonstrated by one of the major global card manufacturers who already achieved their final biometric card certification based on the IDEX platform. Several other card manufacturing partners are now leveraging this fast-track route to certification and we expect more Letters of Approval to be granted during the fourth quarter.
Market availability of biometric smart card solutions continues to expand globally with several new card-based solutions coming to market for payment, cyber security, and identity manage¬ment. In all, IDEX now has more than 20 card manufacturing partners and solutions providers who have either launched or are in commercialization to launch biometric card solutions.
In the payments space we are seeing strong initial demand in the premium segment including metal cards. With three of the leading global metal card manufacturers committed to IDEX Pay, we observe a growing number of opportunities among card issuers and are well positioned to take advantage of this market momentum particularly in Asia where metal card is growing at + 30% CAGR.
Third Quarter Financial Performance
For the first three quarters of 2023 revenues grew 21% when compared to the same period of 2022 driven primarily from sales in the Payment Card market. For the third quarter, year-over-year product revenue increased 12%. In the third quarter of 2023, revenue declined compared to the second quarter of this year reflecting the timing of shipments to our largest customers in the payment card segment, and the delayed certification of IDEX Pay which was caused by external factors, beyond the control of the company. Our IDEX Pay platform was certified by Mastercard in August, and we now have our first manufacturer to complete their card certifications to begin volume manufacturing. This gives us confidence that other manufacturers will be receiving their card certifications in the near term as well.
Gross profit margin on products was 23% for the third quarter of 2023 compared to 22% in the second quarter of 2023. The margin for the first nine months of 2023 was 24%, up from 16% in the corresponding period of 2022. Gross margin improvement relates to product and production costs normalization.
Cost reduction initiatives impacted the costs positively in the third quarter, reducing the operating expenses of the organization by $0,7 million from $7.3 million in the previous quarter to $6.6 million in the third quarter. Further cost reduction effect from the optimization of the organization is on track to reach full effect by the end of the year.
On 6 November, we entered into a non-binding term sheet with a new institutional investor to issue a senior convertible bond of up to NOK 100 million to fund our commercialization efforts. Note 14 to the financial statements, events after the balance sheet date, contains further details regarding the convertible bond disclosed on 7 November 2023.
For further information contact:
Marianne Bøe, Head of Investor Relations
Tel: + 47 918 00186
About IDEX Biometrics
IDEX Biometrics ASA (OSE: IDEX)) is a global technology leader in fingerprint biometrics, offering authentication solutions across payments, access control, and digital identity. Our solutions bring convenience, security, peace of mind and seamless user experiences to the world. Built on patented and proprietary sensor technologies, integrated circuit designs, and software, our biometric solutions target card-based applications for payments and digital authentication. As an industry-enabler we partner with leading card manufacturers and technology companies to bring our solutions to market. For more information, visit www.idexbiometrics.com.
IDEX, IDEX Biometrics and the IDEX logo are trademarks owned by IDEX Biometrics ASA. All other brands or product names are the property of their respective holders.
About this notice
This notice was published by Erling Svela, Vice president of finance, on 9 November 2023 at 08:00 CET on behalf of IDEX Biometrics ASA. The information shall be disclosed according to section 5‑6 of the Norwegian Securities Trading Act (STA) and in accordance with section 5‑12 of the STA.