Conference call transcript at this link:
vcall.com
Reading it, one theme comes through. Identix management believes it has now made buying its products easy for the customer by creating a distribution network, for many customers, easing systems integration via a Novell solution. Not discussed, but obvious nonetheless, is the fact that IDX has the lowest-priced, proven biometric systems out there today.
Not all the work has been completed on this front. For instance, it would help a lot if IDX had a deal with Microsoft in Windows 2000 similar to what it has in Novell's NMAS. And we are waiting to see what Motorola can develop in the way of new products.
Further, I think that IDX has a very good idea of what the next six months will look like for their IT division revenues. All they have to do is figure out how many DFRs have shipped into their channels in the past six months, because if there is the market pull they said there is, there won't be unsold inventory and software returns. I believe that the past two quarter revenue figures for the IT division were about $850K and $1.4M. I'll assume about $500K a quarter is government IT sales, leaving reader revenues of about $350K and $900K in the past two quarters. That is ramping up.
If IDX has shipped into channels (not to end users) the 250K they mentioned not long ago, and if they have been getting on the order of $15 per reader shipped and sold, then they may have already received the revenues on (350K+900K/15) units . . . or about 83K units. (Actually, the timing issue distorts this analysis -- there would be fewer than 83K software sales, but more than 83K hardware sales. But consider this analysis to estimate software/hardware unit equivalents.) This leads me to estimate that IDX can expect upcoming IT DFR-300 revenues to be on the order of about double the rate of the last six months (i.e., only about one third of the 250K shipped has been recognized in revenues so far). Actually, with sales ramping up, hardware royalties should boost the unit numbers a bit more.
So here's my 6 month forecast for the IT division: Another $1M in government sales; another (170K units * $15/unit) or about $2.5M for hardware/software equivalents, and I'll guess another $500K @ $2/unit for hardware-only revenues shipped into channels. Grand IT revenues totals predicted for the rest of this fiscal year: $4M. And it will increase nicely the first two quarters of next fiscal year, as the DFR-300 software royalties come back to IDX. The reason it won't be higher this year, I'm afraid, is that there was probably a slowdown in DFR-200 sales in anticipation of the DFR-300's arrival.
If my numbers prove to be very low, you'll know the market is really taking off. |
