Intellicheck Mobilisa Announces 2012 Third Quarter Financial Results

PORT TOWNSEND, Wash. --(Business Wire)--

Intellicheck Mobilisa (NYSE MKT: IDN), a leader in ID verification and wireless technology, has released its financial results for the third quarter ended September 30, 2012.

Revenues for the quarter ended September 30, 2012, decreased to $2.123 million compared to $3.595 million in the same period of the previous year. Net loss for the three months ended September 30, 2012 was ($381,000) or ($0.01) per diluted share compared to a net income of $306,000 or $0.01 per diluted share for the three months ended September 30, 2011. Adjusted EBITDA was ($102,000) for the third quarter of 2012 compared to $610,000 for the third quarter of 2011. A reconciliation of GAAP net income to adjusted EBITDA is provided below. The Company's backlog, which represents non-cancelable sales orders for products not yet shipped and services to be performed, was approximately $300,000 at September 30, 2012, compared to $3.300 million at September 30, 2011.

Steve Williams, CEO of Intellicheck Mobilisa, commented, "Our top line revenues are not where we want them to be and we are taking measures to correct. We are focusing our attention to increase sales, create a larger backlog, and up sell our existing high profile clients."

Conference Call Information

IDN will host a conference call for members of the investment community at the time referenced at the beginning of this release. Interested parties should dial (877) 407-8037 approximately 10 minutes before the scheduled beginning. For callers outside the U.S., please dial (201) 689-8037. The slides may be viewed at: http://www.investorcalendar.com/IC/CEPage.asp ID=169797 and will also be available on our website www.icmobil.com under Investor Relations. For those unable to participate in the live conference, a recording will be available for 48 hours after the call. The recording can be accessed by dialing (877) 660-6853 and (201) 612-7415 for international callers. The replay ID is 401050. After the 48-hour window, please visit the Investor Relations portion of our website at www.icmobil.com for rebroadcast.

About Intellicheck Mobilisa

Intellicheck Mobilisa (ICMOBIL) is a leading technology company that is engaged in developing and marketing wireless technology and identity systems for various applications, including mobile and handheld access control and security systems for the government, military and commercial markets. ICMOBIL's products include the Fugitive Finder system, an advanced ID card access control product currently protecting approximately 100 military and federal locations; ID Check, a patented technology that instantly reads, analyzes, and verifies encoded data in magnetic stripes and barcodes on government-issued IDs from U.S. and Canadian jurisdictions, designed to improve the Customer Experience for the financial, hospitality and retail sectors; and Aegeus, a wireless security buoy system for the government, military and oil industry.

For more news and information on ICMOBIL, please visit www.icmobil.com.

Safe Harbor Statement

Certain statements in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. When used in this press release, words such as "will," "believe," "expect," "anticipate," "encouraged," and similar expressions, as they relate to the company or its management, as well as assumptions made by and information currently available to the company's management identify forward-looking statements. Actual results may differ materially from the information presented here. Additional information concerning forward-looking statements is contained under the heading of risk factors listed from time to time in the company's filings with the SEC. We do not assume any obligation to update the forward-looking information.

Adjusted EBITDA

Intellicheck Mobilisa uses Adjusted EBITDA as a non-GAAP financial performance measurement. Adjusted EBITDA is calculated by starting with net income (loss) and adding back interest, income taxes, impairments of long-lived assets and goodwill, depreciation, amortization and stock-based compensation expense. Adjusted EBITDA is provided to investors to supplement the results of operations reported in accordance with GAAP. Management believes that Adjusted EBITDA provides an additional tool for investors to use in comparing Intellicheck Mobilisa financial results with other companies that also use Adjusted EBITDA in their communications to investors. By excluding non-cash charges such as impairments of long-lived assets and goodwill, amortization, depreciation and stock-based compensation, as well as non-operating charges for interest and income taxes, investors can evaluate the Company's operations and compare its results on a more consistent basis to the results of other companies. In addition, adjusted EBITDA is one of the primary measures that management uses to monitor and evaluate financial and operating results.

Intellicheck Mobilisa considers Adjusted EBITDA to be an important indicator of the Company's operational strength and performance of its business and a useful measure of the Company's historical operating trends. However, there are significant limitations to the use of Adjusted EBITDA, because it excludes interest income and expense, impairments of long-lived assets and goodwill, and stock based compensation expense, all of which impact the Company's profitability, as well as depreciation and amortization related to the use of long term assets, which benefit multiple periods. Intellicheck Mobilisa believes that these limitations are compensated by providing Adjusted EBITDA only as a supplement to GAAP net income (loss) and clearly identifying the difference between the two measures. Consequently, Adjusted EBITDA should not be considered in isolation or as a substitute for net income (loss) presented in accordance with GAAP. Adjusted EBITDA as defined by the Company may not be comparable with similarly named measures provided by other entities. A reconciliation of Adjusted EBITDA to GAAP net income (loss) is included in the enclosed schedule.

INTELLICHECK MOBILISA, INC.

CONSOLIDATED BALANCE SHEETS

ASSETS

	September 30,			December 31,
	2012			2011
	(Unaudited)
CURRENT ASSETS:
Cash and cash equivalents	$	2,737,506		$	1,394,148
Accounts receivable, net of allowance of $4,884 and $4,884 as of September 30, 2012 and December 31, 2011, respectively		1,883,042			3,058,788
Inventory		117,867			11,894
Other current assets		116,369			108,770
Total current assets		4,854,784			4,573,600

PROPERTY AND EQUIPMENT, net		378,936			439,736
GOODWILL		12,308,661			12,308,661
INTANGIBLE ASSETS, net		4,858,384			5,551,149
OTHER ASSETS		72,006			72,006

Total assets	$	22,472,771		$	22,945,152

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
Accounts payable	$	317,739		$	221,019
Accrued expenses		578,252			675,907
Deferred revenue, current portion		1,314,460			1,692,881
Total current liabilities		2,210,451			2,589,807

OTHER LIABILITIES
Deferred revenue, long-term portion		445,362			405,190
Deferred rent		189,151			194,759
Total liabilities		2,844,964			3,189,756

STOCKHOLDERS' EQUITY:
Common stock - $.001 par value; 40,000,000 shares authorized; 27,724,267 and 27,462,504 shares issued and outstanding, respectively		27,724			27,462
Additional paid-in capital		100,876,604			100,699,156
Accumulated deficit		(81,276,521	)		(80,971,222	)
Total stockholders' equity		19,627,807			19,755,396

Total liabilities and stockholders' equity	$	22,472,771		$	22,945,152

INTELLICHECK MOBILISA, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012			2011

REVENUES	$	2,123,403		$	3,595,303		$	8,274,841		$	9,616,300
COST OF REVENUES		(556,265	)		(1,275,292	)		(2,519,753	)		(3,412,306	)
Gross profit		1,567,138			2,320,011			5,755,088			6,203,994

OPERATING EXPENSES
Selling		370,208			478,095			1,231,566			1,466,178
General and administrative		1,051,901			940,108			3,080,224			3,049,606
Research and development		526,325			592,185			1,748,597			1,956,532
Total operating expenses		1,948,434			2,010,388			6,060,387			6,472,316

Income (loss) from operations		(381,296	)		309,623			(305,299	)		(268,322	)

OTHER INCOME (EXPENSE)
Interest income		-			9			-			37
Interest expense		-			(3,667	)		-			(8,667	)
Other expense		-			-			-			-
		-			(3,658	)		-			(8,630	)

Net (loss) income	$	(381,296	)	$	305,965		$	(305,299	)	$	(276,952	)

PER SHARE INFORMATION
Net (loss) income per common share -
Basic	$	(0.01	)	$	0.01		$	(0.01	)	$	(0.01	)
Diluted	$	(0.01	)	$	0.01		$	(0.01	)	$	(0.01	)

Weighted average common shares used in computing per share amounts -
Basic		27,523,587			27,409,630			27,482,865			27,175,909
Diluted		27,523,587			27,703,484			27,482,865			27,175,909

INTELLICHECK MOBILISA, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
For the nine months ended September 30, 2012
(Unaudited)

				Additional
	Common Stock			Paid-in		Accumulated
	Shares	Amount		Capital		Deficit			Total

BALANCE, January 1, 2012	27,462,504	$	27,462	$	100,699,156	$	(80,971,222	)	$	19,755,396

Stock-based compensation expense	-		-		47,262		-			47,262
Exercise of stock options	261,763		262		130,186		-			130,448
Net loss	-		-		-		(305,299	)		(305,299	)

BALANCE, September 30, 2012	27,724,267	$	27,724	$	100,876,604	$	(81,276,521	)	$	19,627,807

INTELLICHECK MOBILISA, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

	Nine months ended September 30,
	2012			2011

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(305,299	)	$	(276,952	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		824,589			847,654
Provision for doubtful accounts		-			3,233
Noncash stock-based compensation expense		47,262			11,997
Amortization of debt discount		-			6,667
Changes in assets and liabilities:
(Increase) decrease in accounts receivable		1,175,746			(473,841	)
(Increase) decrease in inventory		(105,973	)		(30,045	)
(Increase) decrease in other current assets		(7,599	)		12,598
(Increase) decrease in other assets		-			1,045
(Decrease) increase in accounts payable and accrued expenses		(935	)		439,745
(Decrease) increase in deferred revenue		(338,249	)		(567,599	)
(Decrease) increase in deferred rent		(5,608	)		70,148
Net cash provided by operating activities		1,283,934			44,650

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment		(71,024	)		(45,630	)
Net cash used in investing activities		(71,024	)		(45,630	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of notes payable		-			(200,000	)
Net proceeds from issuance of common stock from exercise of stock options		130,448			226,755
Net cash provided by financing activities		130,448			26,755

Increase in cash and cash equivalents		1,343,358			25,775

CASH AND CASH EQUIVALENTS, beginning of period		1,394,148			1,488,904

CASH AND CASH EQUIVALENTS, end of period	$	2,737,506		$	1,514,679

SUPPLEMENTAL CASH FLOW INFORMATION

Cash paid during the period for:
Income taxes	$	6,000		$	-
Interest	$	-		$	2,000

INTELLICHECK MOBILISA, INC.

A reconciliation of GAAP net (loss) income to Adjusted EBITDA follows:

	(Unaudited)
	Three Months Ended					Nine months ended
	September 30,					September 30,
	2012			2011		2012			2011
Net (loss) income	$	(381,296	)	$	305,965	$	(305,299	)	$	(276,952	)
Reconciling items:
Interest - net		-			3,658		-			8,630
(Benefit) provision for income taxes		-			-		-			-
Depreciation and amortization		273,125			280,948		824,589			847,654
Stock-based compensation costs		5,986			19,582		47,262			11,997
Adjusted EBITDA	$	(102,185	)	$	610,153	$	566,552		$	591,329