SuperCom Reports 69% YoY Quarterly Revenue Growth for the Fourth Quarter 2022

Q4 Non-GAAP Net Profit of $2.2 million; Q4 Non-GAAP EPS of $0.53; Q4 EBITDA of $0.77 Million – Positive for 2nd Consecutive Quarter; Annual Revenue Increased 44% to $17.7 million

TEL AVIV, Israel, April 20, 2023 /PRNewswire/ -- SuperCom (NASDAQ: SPCB), a global provider of secured solutions for the e-Government, IoT, and Cybersecurity sectors, today reported results for the twelve months and fourth quarter, ended December 31, 2022.   

Financial Highlights for Fourth Quarter 2022 Ended December 31, 2022 (Compared to the Fourth Quarter of 2021)

• Revenue increased 69% to $5.1 million from $3.0 million.
• Operating Loss improved significantly to $2.0 million loss compared to $4.6 million Operating Loss
• Net Loss in 2022 improved to $0.1 million loss compared to $5.4 million Net Loss
• Non-GAAP Net Profit significantly increased to $2.2 million from a ($0.2) million Net Loss
• Non-GAAP EPS of $0.53 compared to Negative EPS of ($0.1)
• EBITDA of $0.77 million

Financial Highlights for Twelve-Months Ended December 31, 2022 (Compared to the Prior Year Period)

• Annual Revenue increased by 44% to $17.7 million from $12.3 million, marking a second consecutive year of revenue growth
• Revenue from European countries increased by 230% to $9.6 million from $2.9 million
• IoT Segment Revenue increased by 75% to 15.6 million from $8.9 million
• Operating Loss in 2022 improved to $6.0 million compared to $6.7 million
• Net Loss in 2022 improved to a $7.5 million loss compared to a $10.1 million Net Loss
• Net cash used by operating activities was $4.7 million in 2022 compared to $9.4 million, mainly due to positive cash flow from multi-year government projects
• Working Capital at end of 2022 increased slightly to $21.1 million from $20.5 million
• Cash and cash equivalents and restricted cash at end of 2022 reached $4.5 million from $4.6 million
• Non-GAAP EPS improved to $(0.61) compared to $(0.71)

Business Highlights:

• The Company was awarded and launched a $33 Million national EM project in Romania. The project's first phase and delivery of the initial order, valued at over $8 million, was completed successfully. Subsequently, a follow-on order valued at approximately $7.1 million was received and expected to be delivered within the first half of 2023. This project includes deploying SuperCom's PureSecurity EM Suite for domestic violence monitoring, GPS Tracking of offenders, and a home detention monitoring program.
• In November 2022, SuperCom's subsidiary, LCA, won a $4.25 million contract to provide adult reentry services in a Northern California county. The project launched in the first quarter of 2023. LCA has been providing adult day reporting services and electronic monitoring in this county for many years. The new project expands LCA's reentry services to encompass jail-based sites in addition to several community-based sites. The project focuses on reentry services such as case management, substance abuse education, job preparedness, and criminogenic risk reduction.
• In March 2023, the Company launched a $3.6 Million national EM Project with the national government of Finland to deploy its PureSecurity EM Suite The nationwide project is planned to cover all EM offender programs in Finland for four years and simultaneously include at least 1,000 enrollees, with potential for expansions.
• Successfully finalized the development and deployment of a new proprietary product, PureProtect – a life-saving domestic violence monitoring solution. This groundbreaking product has undergone rigorous testing and has already been successfully implemented in multiple projects, significantly expanding the Company's addressable market.
• Successfully launched a new proprietary product, PureOne, an all-in-one GPS tracking ankle-bracelet monitoring solution that integrates comprehensive monitoring capabilities into a single device. With its lightweight design, high precision, and future-proof features, PureOne offers a more efficient and effective electronic monitoring solution, facilitating the rapid expansion of SuperCom into the US market.
• In the fourth quarter of 2022, Safend, SuperCom's data protection and cybersecurity subsidiary, received two orders totaling approximately $870,000.
• In September 2022, the Company secured a new $1.7 million contract with an existing customer of its e-Government division.
• In May 2022, the Company launched a national EM project with the Ministry of Justice and Administration of Croatia to deploy its PureSecurity EM Suite.
• In May 2022, the Company secured a new contract for Sweden's Juvenile national EM project.
• In January 2022, the Company launched a new $1 Million project in Central Coast California.

Management Commentary:

"2022 was a great year for SuperCom. We extended our business across Europe by winning significant new contracts, typically awarded through a competitive RFP process. We won the largest industry award of the year, valued at $33 million in Romania, and other new projects in Finland, Sweden, and Croatia. In 2022, our revenue from Europe reached $9.6 million, representing 230% YoY growth. We've also been working hard to increase our business presence in the U.S., where we have continued to make progress towards our goals by launching our new proprietary PureOne product and by securing multiple project wins in California, Idaho, Texas, and Wyoming," commented Ordan Trabelsi, President and CEO of SuperCom.

"We grew our teams in the recent couple years to strengthen our sales and R&D initiatives in preparation for wider market expansion and larger projects. Consequently, our strategic plan yielded positive results already in the third and fourth quarters, as evidenced by the impressive YoY revenue growth of 102% and 69%, respectively. Furthermore, we were proud to return to positive EBITDA and achieve EBITDA of $0.4 million and $0.77 million in these two quarters, which resulted from targeted spending and high YoY increases in revenue."

"SuperCom is highly regarded in the IoT tracking space. Many of these projects are for juvenile and domestic violence offenders, where SuperCom's proprietary technology, scalable infrastructure, and rehabilitative features stand out. Once we launch one successful project with a client, we can easily add more project types, leveraging our infrastructure to provide more value and deepen the customer relationship. Additionally, our ability to customize our solutions to address our client's specific needs while delivering outstanding results has also built SuperCom's reputation."

"We have full confidence in our ability to consistently secure a robust pipeline of new projects and wins in the market. To put things into perspective, while the global electronic monitoring market growth was approximately 10% in 2022, SuperCom IoT revenues achieved a staggering 76% growth during the same period. This growth is a testament to the fact that the market prefers our solution over the alternatives. As we continue to gain market share and expand our presence, displacing legacy industry leaders time and time again, we improve our positioning towards future success. We plan to maintain our technology leadership and sales momentum and to grow and build on the growing reputation for excellence that SuperCom has achieved globally," concluded Mr. Trabelsi.

Conference Call

The Company will hold a conference call on April 20, 2023, at 10:00 a.m. Eastern Time (5:00 p.m. Israel time) to discuss the fourth quarter and year end 2022 results, followed by a question and answer session.

Conference Call Dial-In Information:

Date:                               Thursday, April 20, 2023

Time:                               10:00 a.m. Eastern Time / 7:00 a.m. Pacific Time

U.S. toll-free:                   877-545-0523

Israel toll-free:                 1-809-423-853

International:                   973-528-0016

Access Code:                  SuperCom

Link:                                 https://www.webcaster4.com/Webcast/Page/2259/48122

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 www.supercom.com.

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 pace of recovery following the COVID-19 outbreak, the effect on our supply chain, our ability to implement cost containment and business recovery strategies, financial condition and results of operations, , 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, 2022, filed with the U.S. Securities and Exchange Commission (the "SEC") on April 20, 2023, 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 United States generally accepted accounting principles (GAAP), this release of operating results 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 the Company's on-going 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. However, such measures should not be considered in isolation or as substitutes for results prepared in accordance with GAAP. Reconciliation of the non-GAAP measures to the most comparable GAAP measures are provided in the schedules attached to this release.

SuperCom Investor Relations:
[email protected]
Kirin Smith
PCG Advisory
[email protected]

SOURCE SuperCom