Market Overview

Interlink Electronics Reports Fourth Quarter and Full Year 2018 Results

Share:

Interlink Electronics, Inc. (OTC:LINK), a world-leading trusted advisor
and technology partner in the advancing world of human-machine interface
(HMI) and force-sensing technologies, today announced its financial
results for the fourth quarter and full-year 2018. GAAP net income for
the full-year 2018, was $622 thousand or $0.09 per share, reflecting a
decrease of approximately 51% over the prior year's results. GAAP net
income in the fourth quarter of 2018 was $46 thousand, versus a $5
thousand net loss reported in the fourth quarter of 2017.

Consolidated Financial Highlights

(Amounts in thousands except per share data and percentages)

             
Three months ended December 31, Year ended December 31,
Consolidated Financial Results 2018 2017 $ ∆ % ∆ 2018 2017 $ ∆ % ∆
 
Net revenue $ 1,728 $ 2,356 $ (628 ) (26.7 ) % $ 8,904 $ 11,153 $ (2,249 ) (20.2 ) %
Gross profit $ 897 $ 1,402 $ (505 ) (36.0 ) % $ 4,904 $ 6,856 $ (1,952 ) (28.5 ) %
Gross margin 51.9 % 59.5 % 55.1 % 61.5 %
 
Income from Operations $ (2 ) $ 237 $ (239 ) N/A $ 750 $ 2,139 $ (1,389 ) (64.9 ) %
 
Net income (loss) $ 46 $ (5 ) $ 51 N/A $ 622 $ 1,260 $ (638 ) (50.6 ) %
Earnings per share (basic and diluted) $ 0.01 $ (0.00 ) $ 0.09 $ 0.17
 
EBITDA $ 73 $ 253 $ (180 ) (71.1 ) % $ 999 $ 2,275 $ (1,276 ) (56.1 ) %

EBITDA margin1

4.2 % 10.7 % 11.2 % 20.4 %
 

1 EBITDA margin is EBITDA divided by net revenue.

  • Revenue in the fourth quarter of 2018 decreased approximately 27% to
    $1.7 million from $2.4 million in the same year-ago period, primarily
    due to market challenges existing in many of the industries we serve.
    In addition, we lost a major customer in 2017 and developing
    replacement revenue is a slow process that has been felt throughout
    2018. For the full-year 2018, revenue decreased approximately 20% to
    $8.9 million from $11.2 million in the comparable period of 2017.
  • In spite of decreased revenues, gross margin remained strong at 52% in
    the fourth quarter of 2017 and 55% for the full year. Generally gross
    margin decreased from comparable periods in 2017 consistent with the
    decrease in revenues, as less revenue was available to cover fixed
    costs and production overhead costs.
  • In the fourth quarter of 2018, net income increased to $46 thousand or
    $0.01 per basic and diluted share, versus a near break-even in the
    same year-ago period. During the fourth quarter of 2017, the Company
    recorded a non-cash and non-recurring charge of $169 thousand related
    to a remeasurement of the deferred tax assets and liabilities as a
    result of the enactment of the 2017 Tax Cut and Jobs Act, which was
    signed into law on December 22, 2017. For the full year, net income
    was $622 thousand or $0.09 per basic and diluted share compared to net
    income of $1.3 million or $0.22 per basic and diluted share in the
    comparable period of 2017.
  • The Company generated approximately 1.0 million of EBITDA in 2018,
    compared with $2.3 million in the comparable period ending December
    31, 2017.
  • At December 31, 2018, the company had $6.1 million in cash and cash
    equivalents, and no debt.

"We were pleased to finish 2018 on solid ground despite a challenging
market bubble that converged upon us," stated Steven N. Bronson, CEO of
Interlink Electronics, Inc. "Between the unexpected loss of a major
customer in 2017, the scheduled expiration of existing long-term
contracts, and unprecedented tariffs placed on several of our products
that are manufactured in China, the perfect storm depressed revenues and
profits throughout the year."

In February, 2019, subsequent to year-end, the Company finalized
intentions to voluntarily delist its common stock from the NASDAQ
Capital Market and deregister its common stock under the Securities
Exchange Act of 1934 and suspend its public reporting obligations. "The
resulting reduction in operating expenses will allow us to invest
greater amounts towards research and development and sales, which is a
superior use of our limited resources," Mr. Bronson stated.

On the research and development front, in 2018 Interlink completed the
first phase of a state-of-the-art engineering facility in Singapore. In
addition, the Company is in the process of creating a new wholly-owned
subsidiary, Medtech Sensors Pte Ltd., which will be a Singapore based
corporate innovation accelerator and technology venture arm of Interlink
Electronics, Inc. Mr. Bronson continued, "We will pursue synergistic
collaboration programs on technology and product development as well as
scientific / PhD talent development with key strategic partners
including funding agencies, venture capital, corporate labs and research
organizations."

Interlink makes available its annual financial statements, quarterly
financial statements, and other significant reports and amendments to
such reports, free of charge, on its website as soon as reasonably
practicable after such reports are prepared. Please visit www.interlinkelectronics.com
to view the Company's 2018 financial results in more detail.

About Interlink Electronics, Inc.

Interlink Electronics is a world-leading trusted advisor and technology
partner in the advancing world of human-machine interface (HMI) and
force-sensing technologies. Interlink Electronics has led the printed
electronics industry in its commercialization of its patented
Force-Sensing Resistor (FSR®) technology, which has enabled rugged and
reliable HMI solutions. For over 30 years, Interlink Electronics'
solutions have focused on handheld user input, menu navigation, cursor
control, and other intuitive interface technologies for the world's top
electronics manufacturers. Interlink Electronics has a proven track
record of supplying HMI solutions for mission-critical applications in a
wide range of markets, including, but not limited to, consumer
electronics, automotive, industrial, and medical devices. Interlink
Electronics serves a world-class customer-base from its our corporate
headquarters in Westlake Village, California (greater Los Angeles area),
our global research and development center in Singapore, our
printed-electronics manufacturing facility in Shenzhen, China and our
global distribution and logistics center in Hong Kong. We also maintain
technical and sales offices in Japan and at various locations in the
United States. For more information, please see our website at www.interlinkelectronics.com.

Forward Looking Statements

This release contains forward-looking statements. Forward-looking
statements include, but are not limited to, the Company's views on
future financial performance and are generally identified by phrases
such as "thinks," "anticipates," "believes," "estimates," "expects,"
"intends," "plans," and similar words. Forward-looking statements are
not guarantees of future performance and are inherently subject to
uncertainties and other factors which could cause actual results to
differ materially from the forward-looking statement. These statements
are based upon, among other things, assumptions made by, and information
currently available to, management, including management's own knowledge
and assessment of the Company's industry, R&D initiatives, competition
and capital requirements. Other factors and uncertainties that could
affect the Company's forward-looking statements include, among other
things, the following: our success in predicting new markets and the
acceptance of our new products; efficient management of our
infrastructure; the pace of technological developments and industry
standards evolution and their effect on our target product and market
choices; the effect of outsourcing technology development; changes in
the ordering patterns of our customers; a decrease in the quality and/or
reliability of our products; protection of our proprietary intellectual
property; competition by alternative sophisticated as well as generic
products; continued availability of raw materials for our products at
competitive prices; disruptions in our manufacturing facilities; risks
of international sales and operations including fluctuations in exchange
rates; compliance with regulatory requirements applicable to our
manufacturing operations; and customer concentrations The Company
undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.

Non-GAAP Financial Information

A non-GAAP financial measure is a numerical measure of a company's
performance, financial position, or cash flows that either excludes or
includes amounts that are not normally excluded or included in the most
directly comparable measure calculated and presented in accordance with
generally accepted accounting principles, or GAAP. Non-GAAP measures are
not in accordance with, nor are they a substitute for, GAAP measures.
Other companies may use different non-GAAP measures and presentation of
results.

In addition to financial results presented in accordance with GAAP,
this press release presents EBITDA and EBITDA margin, each of which is a
non-GAAP measure. EBITDA is determined by taking net income and adding
interest, income taxes, depreciation and amortization, and EBITDA margin
is determined by dividing EBITDA by net revenue.
Interlink
believes that these non-GAAP measure, viewed in addition to and not in
lieu of net income and gross margin, provide useful information to
investors by providing more focused measures of operating results. These
metrics are an integral part of Interlink's internal reporting to
evaluate its operations and the performance of senior management. A
reconciliation of EBITDA to net income, the most comparable GAAP
measure, is available in the accompanying financial tables below. The
non-GAAP measures presented herein may not be comparable to similarly
titled measures presented by other companies.

View Comments and Join the Discussion!
 
Lightning Fast
Market News Service
$199 Free 14 Day Trial