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WISeKey Announces H1 2022 Results; Reports Total Revenue of $12.6 Million, an Increase of Over 27% from H1 2021 and Net Income Attributable to WISeKey of $2.4 Million
Revenue Increase was Mainly due to Higher Demand on Semiconductors / IoT; WISeKey’s H1 2022 Semiconductor Revenue Increased 48% to $10.7 Million from $7.2 Million in H1 2021
Reports Record Backlog of $39 Million for IoT Semiconductors Products Stretching into 2023 and Pipeline of Opportunities Totals $75 million
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ZUG, Switzerland – September 15, 2022: Ad-Hoc announcements pursuant to Art. 53 of SIX Listing Rules – WISeKey International Holding Ltd (NASDAQ: WKEY / SIX: WIHN) (“WISeKey” or the “Company”), a leading Swiss cybersecurity and IoT company announced today its auditor-reviewed financial results for the six-month period ended June 30, 2022 (“H1 2022”).
Carlos Moreira, WISeKey’s Founder and CEO, noted, “IoT, Semiconductors and NFT are entering a new cycle of growth driven by in-car electronics, smart routers, AI-IoT devices, cloud processing, automation, IoT Satellites, 5G and connectivity features that make the world safer, connected and contribute to sustainability. WISeKey’s business strategy continues to focus on developing cybersecurity IoT solutions and NFTs that enable our customers’ success and drive long-term growth despite the slowdown in delivery of components. To meet these strategic objectives and its goal of refocusing on the core business on Cybersecurity and IoT, in H1 2022 WISeKey completed the divestiture of arago GmbH (“arago”) which came as a result of arago’s margins and total performance being below expectations, despite significant investment by WISeKey to streamline the business. Regardless, following the divestiture, WISeKey will maintain a partnership with arago to consider potential added value brought on by AI capabilities.”
WISeKey’s strong financial position of $23 million cash at the end of H1 2022 allows the Company to support investments in new products, IP, and faster growing IoT/cybersecurity markets. Since the beginning of 2022, WISeKey has made significant investments in R&D and new microchips design, in order to maintain its leading-edge technology position and the competitive advantage of product offerings. Specifically, WISeKey is working on the following projects:
ADDITIONAL FINANCIAL & OPERATIONAL DATA
H1 FY 2022 Key Financials - WISeKey Group(Million US$) 6 months ended June 30,US GAAP20222021Operating loss as reported(6.6)(8.3)Net income attributable to WISeKey as reported2.4(4.3) Non-GAAP20212020Total revenue12.69.9Total gross profit5.63.6EBITDA(6.5)(7.7)Adjusted EBITDA(5.5)(7.1) As at June 30,
2022 As at December 31,
2021Total Cash and restricted cash22.934.3
Consolidated Statements of Comprehensive Income/(Loss) [as reported] 6 months ended June 30, 6 months ended June 30,USD'0002022 (unaudited) 2021 (unaudited) Net sales10,840 7,802Cost of sales(6,305) (4,304)Depreciation of production assets240 (390)Gross profit4,775 3,108 Other operating income33 114Research & development expenses(1,699) (2,128)Selling & marketing expenses(3,556) (3,227)General & administrative expenses(6,156) (6,174)Total operating expenses(11,378) (11,415)Operating loss(6,603) (8,307) Non-operating income2,795 6,781Debt conversion expense(603) -Interest and amortization of debt discount(134) (455)Non-operating expenses(2,083) (877)Loss before income tax expense(6,628) (2,858) Income tax income / (expense)(1) (1)Loss from continuing operations, net(6,629) (2,859)
Discontinued operations: Net sales from discontinued operations1,805 2,142Cost of sales from discontinued operations(978) (1,679)Total operating and non-operating expenses from discontinued operations(5,274) (3,769)Income tax recovery from discontinued operations25 57Gain on disposal of a business, net of tax on disposal11,801 -Income / (loss) on discontinued operations7,379 (3,249) Net income / (loss)750 (6,108) Less: Net income / (loss) attributable to noncontrolling interests(1,685) (1,767)Net income / (loss) attributable to WISeKey International Holding AG2,435 (4,341) Earnings per share from continuing operations Basic(0.07) (0.04)Diluted(0.07) (0.04)Earnings per share from discontinued operations Basic0.07 (0.05)Diluted0.07 (0.05) Earning per share attributable to WISeKey International Holding AG Basic0.02 (0.07)Diluted0.02 (0.07) Other comprehensive income / (loss), net of tax: Foreign currency translation adjustments(3,218) (777)Change in unrealized gains related to available-for-sale debt securities- (5,564)Reclassifications out of the OCI arising during period1,156 -Defined benefit pension plans: Net gain (loss) arising during period90 140Other comprehensive income / (loss)(1,972) (6,201)Comprehensive income / (loss)(1,222) (12,309) Other comprehensive income / (loss) attributable to noncontrolling interests(969) 80Other comprehensive income / (loss) attributable to WISeKey International Holding AG(1,002) (6,281) Comprehensive income / (loss) attributable to noncontrolling interests(2,655) (1,687) Comprehensive income / (loss) attributable
to WISeKey International Holding AG1,433 (10,622)
The notes are an integral part of our consolidated financial statements.
Consolidated Balance Sheets [as reported] As at June 30, As at December 31,USD'0002022 (unaudited) 2021ASSETS Current assets Cash and cash equivalents22,818 34,201Restricted cash, current105 110Accounts receivable, net of allowance for doubtful accounts30,344 2,979Notes receivable from employees and related parties66 68Inventories4,189 2,710Prepaid expenses792 1,198Current assets held for sale- 689Other current assets927 555Total current assets59,241 42,510 Noncurrent assets Notes receivable, noncurrent182 190Deferred income tax assets1 1Deferred tax credits1,073 848Property, plant and equipment net of accumulated depreciation743 573Intangible assets, net of accumulated amortization103 105Finance lease right-of-use assets130 171Operating lease right-of-use assets2,661 2,941Goodwill8,317 8,317Equity securities, at cost460 501Equity securities, at fair value1 1Noncurrent assets held for sale- 32,391Other noncurrent assets241 256Total noncurrent assets13,912 46,295TOTAL ASSETS73,153 88,805 LIABILITIES Current Liabilities Accounts payable13,482 14,786Notes payable4,193 4,206Convertible note payable, current800 -Deferred revenue, current199 92Current portion of obligations under finance lease liabilities4 55Current portion of obligations under operating lease liabilities567 595Income tax payable7 11Current liabilities held for sale- 4,567Other current liabilities331 439Total current liabilities19,583 24,751 Noncurrent liabilities Bonds, mortgages and other long-term debt393 458Convertible note payable, noncurrent31 9,049Deferred revenue, noncurrent37 100Operating lease liabilities, noncurrent2,197 2,468Employee benefit plan obligation4,669 4,769Other deferred tax liabilities59 62Noncurrent liabilities held for sale- 5,712Other noncurrent liabilities3 57Total noncurrent liabilities7,389 22,675TOTAL LIABILITIES26,972 47,426 Commitments and contingent liabilities SHAREHOLDERS' EQUITY Common stock - Class A400 400CHF 0.01 par value Authorized - 40,021,988 and 40,021,988 shares Issued and outstanding - 40,021,988 and 40,021,988 shares Common stock - Class B5,334 4,685CHF 0.05 par value Authorized - 144,589,261 and 138,058,468 Issued - 100,294,518 and 88,120,054 Outstanding - 99,837,254 and 80,918,390 Treasury stock, at cost (457,264 and 7,201,664 shares held)(371) (636)Additional paid-in capital277,376 268,199Accumulated other comprehensive income / (loss)1,312 1,407Accumulated deficit(235,724) (238,160)Total shareholders' equity attributable to WISeKey shareholders48,327 35,895Noncontrolling interests in consolidated subsidiaries(2,146) 5,484Total shareholders' equity46,181 41,379TOTAL LIABILITIES AND EQUITY73,153 88,805
The notes are an integral part of our consolidated financial statements.
Non-GAAP Financial Measures
In managing WISeKey's business on a consolidated basis, WISeKey management develops an annual operating plan, which is approved by our Board of Directors, using non-GAAP financial measures. In measuring performance against this plan, management considers the actual or potential impacts on these non-GAAP financial measures from actions taken to reduce costs with the goal of increasing our gross margin and operating margin and when assessing appropriate levels of research and development efforts. In addition, management relies upon these non-GAAP financial measures when making decisions about product spending, administrative budgets, and other operating expenses. We believe that these non-GAAP financial measures, when coupled with the GAAP results and the reconciliations to corresponding GAAP financial measures, provide a more complete understanding of the Company’s results of operations and the factors and trends affecting WISeKey’s business. We believe that they enable investors to perform additional comparisons of our operating results, to assess our liquidity and capital position and to analyze financial performance excluding the effect of expenses unrelated to operations, certain non-cash expenses related to acquisitions and share-based compensation expense, which may obscure trends in WISeKey's underlying performance. This information also enables investors to compare financial results between periods where certain items may vary independent of business performance and allows for greater transparency with respect to key metrics used by management.
These non-GAAP financial measures are provided in addition to, and not as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. The presentation of these and other similar items in WISeKey’s non-GAAP financial results should not be interpreted as implying that these items are non-recurring, infrequent, or unusual. Reconciliations of these non-GAAP measures to the most comparable measures calculated in accordance with GAAP are provided in the financial statements portion of this release in a schedule entitled “Financial Reconciliation of GAAP to non-GAAP Results (unaudited).”
Non-GAAP to GAAP ReconciliationsFinancial Reconciliation of GAAP to non-GAAP Results (unaudited)6 months to June 30,6 months to June 30,(Million US$)20222021Net sales as reported10.87.8Net sales from discontinued operations as reported1.82.1Total revenue12.69.9Gross profit as reported4.83.1Gross profit from discontinued operations as reported0.80.5Total gross profit5.63.6Operating loss as reported(6.6)(8.3)Non-GAAP adjustments from continuing operations: Depreciation expense0.10.5Amortization expense on intangibles-0.1EBITDA(6.5)(7.7)Non-GAAP adjustments from continuing operations: Expenses settled in equity0.1-M&A-related legal fees0.80.6M&A-related professional fees0.1-Adjusted EBITDA(5.5)(7.1)GAAP to Non-GAAP Cash and Cash Equivalents (Million US$) As at
June 30,
2022 As at December 31,
2021Cash and cash equivalents as reported22.834.2Restricted cash, current as reported0.10.1Total Cash and restricted cash22.934.3* Rounded up
About WISeKey:
WISeKey (NASDAQ: WKEY / SIX Swiss Exchange: WIHN) is a leading global cybersecurity platform company currently deploying large scale digital identity ecosystems for people and objects respecting the Human as the Fulcrum of the Internet. The WISeKey IoT technology stack includes a range of technologies such as Semiconductors, eIDs, Blockchain, NFTs, Post Quantum, Pico Satellites and Trust acting seamlessly as a platform which secures the simple connection of objects to the Internet to the most complex applications that use these connected objects, the data they gather and communicate and the different steps needed to power these applications.
The WISeKey Semiconductors Secures the pervasive computing shaping today’s Internet of Everything. WISeKey IoT has an installed base of over 1.5 billion microchips in virtually all IoT sectors (connected cars, smart cities, drones, agricultural sensors, anti-counterfeiting, NFTs, smart lighting, servers, computers, mobile phones, crypto tokens etc.)
Our technology is Trusted by the OISTE/WISeKey’s Swiss based cryptographic Root of Trust (“RoT”) provides secure authentication and identification, in both physical and virtual environments, for the Internet of Things. The WISeKey RoT serves as a common trust anchor to ensure the integrity of online transactions among objects and between objects and people. For more information, visit www.wisekey.com.
Press and investor contacts: WISeKey International Holding Ltd
Company Contact: Carlos Moreira
Chairman & CEO
Tel: +41 22 594 3000
info@wisekey.com WISeKey Investor Relations (US)
Contact: Lena Cati
The Equity Group Inc.
Tel: +1 212 836-9611
lcati@equityny.com
Disclaimer:
This communication expressly or implicitly contains certain forward-looking statements concerning WISeKey International Holding Ltd and its business. Such statements involve certain known and unknown risks, uncertainties and other factors, which could cause the actual results, financial condition, performance or achievements of WISeKey International Holding Ltd to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. WISeKey International Holding Ltd is providing this communication as of this date and does not undertake to update any forward-looking statements contained herein as a result of new information, future events or otherwise.
This press release does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, and it does not constitute an offering prospectus within the meaning of article 652a or article 1156 of the Swiss Code of Obligations or a listing prospectus within the meaning of the listing rules of the SIX Swiss Exchange. Investors must rely on their own evaluation of WISeKey and its securities, including the merits and risks involved. Nothing contained herein is, or shall be relied on as, a promise or representation as to the future performance of WISeKey.