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Classified in: Science and technology, Business
Subject: ERN

SuperCom Reports $1.6 EPS, $3.1 Non-GAAP EPS, and Positive Free Cash Flows for the First Nine Months of 2024


Q3 2024: Revenue $6.9 million; Free Cash Flows of $1.2 million; EBITDA $1.1 million

TEL AVIV, Israel, Nov. 14, 2024 /PRNewswire/ -- SuperCom (NASDAQ: SPCB), a global provider of secured solutions for the e-Government, IoT, and Cybersecurity sectors, today reported financial and operating results for the three and nine months ended September 30, 2024. 

 

SuperCom Logo

 

First Nine Months Ended September 30, 2024, Financial Highlights (Compared to First Nine months of 2023)

Third Quarter Ended September 30, 2024, Financial Highlights (Compared to the Third Quarter of 2023)

Recent Business Highlights:

Management Commentary:

"We are pleased to announce another quarter of significant achievements, showcasing the continued strength and resilience of our business," commented Ordan Trabelsi, President and CEO of SuperCom. "Our financial results for the third quarter and the first nine months of 2024 reflect the successful execution of our strategic initiatives, which have been driving revenue growth, improving profitability, and enhancing cash flow. Year-to-date, revenue increased to $21.3 million, gross profit surged by 35% to $10.7 million, and our gross profit margin improved dramatically to 50.1% from 37.7% in the prior year period."

"This quarter was particularly exciting as we solidified our leadership position with key contract wins, including the prestigious National Israeli Electronic Monitoring project. We also expanded into new regions, including New York, West Virginia, and Maryland, further strengthening our footprint in the U.S. market. These wins not only reflect the exceptional value of our technology but also help position us for sustained expansion in the years ahead," Ordan continued.

"Our commitment to financial discipline, operational efficiencies, and technology innovation has translated into tangible results: an improvement in net income to $2.52 million for the nine-month period, compared to a net loss of $2.48 million in the prior year. Free cash flow generation of $1.2 million in this quarter and a cash balance of $6.23 million at the end of it underscore these tangible results along with an ability to support further potential growth opportunities," he added.

"Looking ahead, we remain focused on executing our strategy by delivering cutting-edge solutions, deepening relationships with existing clients, and entering new markets. With a pipeline of opportunities, continued technology advances, and a track record of operational excellence, we are well-positioned to drive shareholder value," Ordan concluded.

Conference Call
SuperCom will hold a conference call today (Thursday, November 14, 2024) at 10:00 a.m. Eastern time (7:00 a.m. Pacific time; 5:00 p.m. Israel time) to discuss the company's financial and operating results for the three and nine months ended September 30, 2024, followed by a question and answer session.

Conference Call Dial-In Information:

Date:                           Thursday, November 14, 2024
Time:                           10 a.m. Eastern time (7 a.m. Pacific time)
U.S. toll-free:              888-506-0062
Israel toll-free:           1-809-423-853
International:             973-528-0011
Access Code:            SuperCom
Link:                           https://www.webcaster4.com/Webcast/Page/2259/51654 

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization.

About SuperCom
Since 1988, SuperCom has been a global provider of traditional and digital identity solutions, providing advanced safety, identification and security solutions to governments and organizations, both private and public, throughout the world. Through its proprietary e-Government platforms and innovative solutions for traditional and biometrics enrollment, personalization, issuance and border control services, SuperCom has inspired governments and national agencies to design and issue secure Multi-ID documents and robust digital identity solutions to its citizens and visitors. SuperCom offers a unique all-in-one field-proven RFID & mobile technology and product suite, accompanied by advanced complementary services for various industries including healthcare and homecare, security and safety, community public safety, law enforcement, electronic monitoring, livestock monitoring, and building and access automation.

For more information, visit https://www.supercom.com/

SuperCom Investor Relations:
[email protected]

Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements preceded or followed by or that otherwise include the words "believes", "expects", "anticipates", "intends", "projects", "estimates", "plans", and similar expressions or future or conditional verbs such as "will", "should", "would", "may" and "could" are generally forward-looking in nature and not historical or current facts. These forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ materially from the statements made. Examples of these statements include, but are not limited to, statements regarding business and economic trends, the levels of consumer, business and economic confidence generally, the adverse effects of these risks on our business or the market price of our ordinary shares, and other risks and uncertainties described in the forward looking statements and in the section captioned "Risk Factors" in our Annual Report on Form 20-F for the year ended December 31, 2023, filed with the U.S. Securities and Exchange Commission (the "SEC") on April 22, 2024, our reports on Form 6-K filed from time to time with the SEC and our other filings with the SEC. Except as required by law, we not undertake any obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise, after the date of this press release.

Results presented in this press release are based on management's estimated unaudited analysis of financial results for the presented periods. SuperCom's independent registered accounting firm has not audited the financial data discussed in this press release. During the course of SuperCom's quarter- and fiscal year-end closing procedures and review process, SuperCom may identify items that would require it to make adjustments, which may be material, to the information presented in this press release. As a result, the estimate financial results constitute forward-looking information and are subject to risks and uncertainties, including possible adjustments to such results.

 Use of Non-GAAP Financial Information
In addition to disclosing financial results calculated in accordance with the generally accepted accounting principles in the United States ("GAAP"), this release also contains non-GAAP financial measures, which SuperCom believes are the principal indicators of the operating and financial performance of its business.

Management believes the non-GAAP financial measures provided are useful to investors' understanding and assessment of SuperCom's ongoing core operations and prospects for the future, as the charges eliminated are not part of the day-to-day business or reflective of the core operational activities of the company. Management uses these non-GAAP financial measures as a basis for strategic decisions, forecasting future results and evaluating the Company's current performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation from, or as a substitute for, or superior to, operating loss and or net income (loss) or any other performance measures derived in accordance with GAAP or as an alternative to net cash provided by operating activities or any other measures of our cash flows or liquidity.

Non-GAAP EPS is defined as earnings before amortization and other non-cash or one-time expenses divided by weighted average outstanding shares.

EBITDA is defined as earnings before interest, taxes, depreciation, amortization, and other non-cash or one-time expenses.

[Tables to follow]

 

   

SUPERCOM LTD.

CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands)















As of


As of




September 30,
2024

December 31,
2023



Unaudited

Unaudited







CURRENT ASSETS





     Cash and cash equivalents

6,229


5,206


     Restricted bank deposits

347


371


     Trade receivable, net

14,887


13,357


     Patents


5,283


5,283


     Other accounts receivable and prepaid expenses

2,257


1,742


     Inventories, net

2,725


2,503








     Total current assets

31,728


28,462








LONG-TERM ASSETS





     Deferred tax long term

919


501


     Other intangible assets, net

5,099


5,576


     Operating lease right-of-use assets

923


487


     Goodwill


7,026


7,026


     Property and equipment, net

3,071


2,701








          Total long-term assets

17,038


16,291








Total Assets

48,766


44,753




















CURRENT LIABILITIES




     Short-term loans and credit

765


792


     Trade payables

1,990


1,883


     Employees and payroll accruals

1,131


1,015


     Related parties

-


100


     Accrued expenses and other liabilities

333


485


     Operating lease liabilities

877


401


     Deferred revenues ST

576


726








     Total current liabilities

5,672


5,403








LONG-TERM LIABILITIES










     Long-term loan

29,530


33,952


     Deferred tax liability 

170


170


     Deferred revenues 

49


305


     Long-term operating lease liabilities

-


108








     Total long-term liabilities

29,749


34,535








SHAREHOLDERS' EQUITY:




     Ordinary shares

21,970


9,094


     Additional paid-in capital

95,803


102,670


     Accumulated deficit

(104,428)


(106,948)








     Total shareholders' equity

13,345


4,816








Total liabilities and equity

48,766


44,754








 

 

SUPERCOM LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands)



 

Three months ended





September 30,
2024

September 30,
2023



          Unaudited                 Unaudited






REVENUES



6,911

6,778

COST OF REVENUES



(3,758)

(2,751)






GROSS PROFIT



3,153

4,027






OPERATING EXPENSES:





   Research and development



933

774

   Selling and marketing



625

531

   General and administrative



1,474

1,093

     Other expenses



90

793






Total operating expenses



3,122

3,191






OPERATING PROFIT



31

836

FINANCIAL EXPENSES, NET



(474)

(690)






PROFIT (LOSS) BEFORE INCOME TAX



(443)

146

INCOME TAX EXPENSE



-

-






NET PROFIT (LOSS) FOR THE PERIOD



(443)

146









 

 

SUPERCOM LTD.

Reconciliation Table of GAAP to Non-GAAP Figures and EBITDA to Net Income

(U.S. dollars in thousands)



Three months ended




September 30, 2024

 September 30, 2023



Unaudited

Unaudited






GAAP gross profit



3,153

4,027

Amortization of intangible assets



88

88

Non-GAAP gross profit



3,241

4,115






GAAP Operating profit



31

836

  Amortization of intangible assets



540

446

  Foreign currency loss



159

111

  One-time expense



90

899

Non-GAAP operating profit



820

2,292






GAAP net profit (loss)



(443)

146

  Amortization of intangible assets



540

446

  One-time expense



90

899

  Foreign currency loss



159

111

Non-GAAP net profit



346

1,602

Non-GAAP EPS



0.17

4.8






Net profit (loss) for the period



(443)

146

    Financial expenses, net



474

690

    Depreciation and Amortization



797

822

   One-time expense



90

899

    Foreign currency loss



159

111

EBITDA *



1,077

2,668

* EBITDA is a non-GAAP financial measure generally defined as earnings before interest, taxes, depreciation and amortization and
other non-cash or one-time expenses.

 

 

SUPERCOM LTD.


CONSOLIDATED STATEMENTS OF OPERATIONS


(U.S. dollars in thousands)




 

Nine months ended





September 30, 2024

September 30, 2023




 Unaudited

 Unaudited







REVENUES



21,308

20,902


COST OF REVENUES



(10,625)

(13,027)








GROSS PROFIT



10,683

7,875








OPERATING EXPENSES:






   Research and development



2,833

2,436


   Selling and marketing



1,835

1,659


   General and administrative



4,222

3,467


   Other expenses, net



660

1,198








Total operating expenses



9,550

8,760








OPERATING PROFIT (LOSS)



1,133

(885)


FINANCIAL EXPENSES, NET



(969)

(1,559)








PROFIT (LOSS) BEFORE INCOME TAX



2,112

(2,444)


INCOME TAX BENEFIT



418

-








NET PROFIT(Loss) FOR THE PERIOD



2,520

(2,444)











 

 

SUPERCOM LTD.

Reconciliation Table of GAAP to Non-GAAP Figures and EBITDA to Net Income

(U.S. dollars in thousands)





Nine months ended




September 30, 2024

September 30, 2023




Unaudited

Unaudited

GAAP gross profit



10,683

7,875

Amortization of intangible assets



265

265

Non-GAAP gross profit



10,948

8,140






GAAP Operating Profit (Loss)



1,133

(885)

  Amortization of intangible assets



1,604

1,429

  One-time expenses



660

1,687

  Foreign currency loss



512

1,009

Non-GAAP operating profit



3,909

3,240






GAAP net Profit (Loss)



2,520

(2,444)

  Amortization of intangible assets



1,604

1,429

  One-time expenses



660

1,687

 Foreign currency loss



512

1,009

  Income Tax Benefit



(418)

-

Non-GAAP net profit



4,878

1,681

Non-GAAP EPS



3.05

6.2






Net Profit (Loss) for the period



2,520

(2,444)

    Financial expenses (income), net



(969)

1,559

    Income Tax Benefit



(418)

-

    Depreciation and Amortization



2,293

2,129

    One-time expenses



512

1,687

    Foreign currency loss



660

1,009

EBITDA *



4,598

3,940

* EBITDA is a non-GAAP financial measure generally defined as earnings before interest, taxes, depreciation and
amortization and other non-cash or one-time expenses.

 

Logo: https://mma.prnewswire.com/media/1717536/SuperCom_Logo.jpg

 

SOURCE SuperCom


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