ICx Technologies, a developer of advanced sensor technologies for homeland security, force protection and commercial applications, announced its operating and financial results for the fourth quarter and full year ended Dec. 31, 2008.
For the quarter ended Dec. 31, 2008, the Company reported revenues of US$53.1 million, compared to $41.5 million for the quarter ended Dec. 31, 2007, representing a 28 percent increase year-over-year. The company achieved its second consecutive positive quarter, showing adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) profits of $2.4 million, an improvement of $4.7 million over the fourth quarter loss in 2007. Funded backlog increased to $94 million at the end of 2008, up 114 percent from the $44 million reported last year.
Growth was driven by high demand in government markets for the company's surveillance and solutions business offerings.
"We are proud that, in what is a tough environment for many, we continue our strong organic growth with record revenues and record adjusted EBITDA based on strong demand for our sensors and solutions. While the change in administration pushed out some of our revenues, we view that as temporary, and were able to partially make it up through tight cost control and increased operational synergies,” said Hans Kobler, ICx Chairman and CEO.
"We go into 2009 with a record beginning-of-the-year backlog, a strong position and pipeline on several strategically important programs, and confined exposure to the commercial markets. We believe we are well positioned to benefit from both the pent-up demand from the change in administration as well as the incoming stimulus funds. While we are taking a conservative stand in predicting the impact of those funds, we are continuing to adjust our operating costs accordingly to strengthen our overall position and target adjusted EBITDA profitability for the year.”
Key Fourth-Quarter Highlights
*ICx started development under the J2 program to provide the joint forces with an advanced tool kit for future CBRNE reconnaissance teams. The company is evaluating expansion options in the Baltimore area to better serve this program, which has a contract value of up to $711 million.
*ICx won JFPASS, a $9 million fully funded development program to provide the joint forces with the next generation of integrated force protection systems, and launched its first successful test at Eglin Air Force base.
*ICx Analytical Instruments won a multi-year design and development contract for next generation mass spectroscopy sensors with the South Korean military. The contract will initially be for a $2 million, two-year design and development phase followed by multi-year procurement of up to $40 million in total.
*ICx Transportation won a $12 million contract with Caltrans to provide an advanced fog warning and detection system for a 13-mile stretch on Highway 99 near Fresno. The system will rely on ICx sensor fusion software and will leverage solar and green power technologies to support the system.
*ICx Solutions, fueled by the success of our Transportation business, grew its revenues by 58 percent year-over-year and achieved a record quarter with $11.7 million in sales.
*ICx Surveillance continued its strong performance on the BETSS-C program, resulting in record sales of $19.1 million, a 49 percent increase over the same quarter in the prior year.
*ICx Detection was impacted by delays in government business, in particular the DHS market, which we partially attribute to the change in administration, and achieved sales of $22.3 million, a 5 percent decrease over the same quarter in the prior year.
*With the success of our program efforts with DoD, DHS and the Transportation markets our unfunded backlog increased to $508 million.
Year-End Financial Results
For the year ended Dec. 31, 2008, the Company's revenue grew by 26 percent to $171.7 million, as compared to $136.2 million in 2007. Adjusted EBITDA loss for 2008 was ($7.6) million, an improvement by $8.4 million over the ($16) million loss last year.
Revenue and Earnings Outlook for 2009
ICx also announced guidance for 2009. Considering the current market conditions and possible delays associated with the change of administration and roll-out of the stimulus package, the company takes a conservative stance on growth and expects revenue in 2009 to be in the range of $196 million to $206 million, reflecting organic growth of between 14 percent and 20 percent as compared with 2008, and resulting adjusted EBITDA in the range of $2 to $7 million.