Press Releases

I.D. Systems, Inc. Reports First Quarter Financial Results

HACKENSACK, N.J., May 7, 2009 (GLOBE NEWSWIRE) -- I.D. Systems, Inc. (Nasdaq:IDSY) today announced its financial results for the first quarter of 2009. Revenues for the three months ended March 31, 2009 were $2.9 million, compared to $4.3 million for the three months ended March 31, 2008. Gross margin increased to 54.2%, compared to 48.8% for the corresponding period in 2008. Net loss for the quarter was $3.1 million, or ($0.28) per basic and diluted share, compared to net loss of $2.0 million, or ($.19) per basic and diluted share, for the first quarter of 2008.

Non-GAAP net loss for the first quarter of 2009 was $2.5 million, or ($0.23) per basic and diluted share, compared to non-GAAP net loss of $1.2 million, or ($0.11) per basic and diluted share, for the first quarter of 2008. Non-GAAP results were calculated by adjusting GAAP net results for the impact of stock-based compensation, which was $559,000 for the first quarter of 2009 and $785,000 for the first quarter of 2008. A table entitled "Reconciliation of GAAP to Non-GAAP Financial Measures" is included in this press release.

"With the global economy in recession, many organizations are slowing their technology acquisitions. In the first quarter, this economic climate manifested itself in both our core customers and prospects in our sales pipeline," said Jeffrey Jagid, I.D. Systems' chairman and chief executive officer. "The U.S. Postal Service's spending cutbacks, in particular, affected our revenue this quarter. However, we continue to aggressively pursue our primary strategic goals -- diversifying our customer base and expanding our product applications. To that end, we are trying to leverage our competitive advantages, including the effectiveness of our technology, our financial resources, and our proven experience delivering a significant return on investment for customers. Our mission remains to drive rapid customer adoption and expansion of our solutions, open new applications and markets for our technology, maintain our technical and market leadership, and ultimately deliver shareholder value."

Selling, general and administrative expenses for the three months ended March 31, 2009 were $4.2 million, including $430,000 in stock-based compensation, essentially flat compared to $4.3 million, including $649,000 in stock-based compensation, for the first quarter of 2008. Research and development expenditures for the first quarter of 2009 decreased slightly to $689,000, including $115,000 in stock-based compensation, compared to $711,000, including $115,000 in stock-based compensation, for the corresponding period in 2008. Interest income for the quarter was $347,000, compared to $826,000 for the same period in 2008.

"After holding the line on expenses in the first quarter, we took further cost-cutting actions in April, 2009, by trimming our workforce to save approximately $1 million annually," said Mr. Jagid. "These staff reductions were not in sales and marketing, however. We continue to invest in growth opportunities, for both organic revenue generation and potential strategic acquisitions."

As of March 31, 2009, I.D. Systems had $66.9 million in cash and marketable securities, and $22.3 million of working capital, compared to $56.0 million and $30.1 million, respectively, as of December 31, 2008. The increase in cash is due primarily to the borrowing of $12.9 million from a line of credit facility.

Highlights of the first quarter ended March 31, 2009, included:

 * The launch of I.D. Systems' new PowerFleet(tm) brand wireless Vehicle
   Management System (VMS) for forklifts and other industrial
   equipment, which incorporates the company's most powerful,
   versatile combination of software, hardware, and wireless
   technology to date, including a choice of client-server or
   browser-based software, a wide array of modular system functions
   and extensions, and a flexible combination of wireless
   communication options termed SecureStream(tm).

 * The deployment of the PowerFleet(tm) VMS on a fleet of industrial
   vehicles at the primary manufacturing complex of Mercedes-Benz
   U.S., which was facilitated by I.D. Systems' strategic marketing
   partner NACCO Materials Handling Group, Inc., a leading global
   industrial truck manufacturer, and Barloworld Handling, the
   world's largest dealer of Hyster(r) brand lift trucks.

 * The receipt of a blanket purchase order from Audi AG for the
   PowerFleet(tm) VMS to manage industrial vehicle fleets in the
   European manufacturing operations of both Audi and its corporate
   parent, Volkswagen, with initial deployment in two Audi
   production facilities.

 * The selection of I.D. Systems' AvRamp(tm) VMS by American Eagle
   Airlines to manage a fleet of aircraft ground support equipment
   at Dallas/Fort Worth International Airport, which represents the
   first large-scale implementation of AvRamp(tm) technology by a major
   U.S. airline to improve airport ground handling operations,
   increase the safety of the ramp area, reduce fleet costs, and
   enhance the airline's customer service.

 * The renewal of a corporate service agreement with Ford Motor
   Company to provide maintenance and support services for Ford's
   enterprise-wide deployment of I.D. Systems' VMS technology and
   associated industrial vehicle battery monitoring systems, which
   have been deployed in Ford plants throughout North America since

Investor Conference Call

I.D. Systems will hold a conference call for investors and analysts at 4:45 p.m. Eastern Time on May 7, 2009. Jeffrey Jagid, chairman and CEO, will lead a discussion on the results of the quarter and recent developments. After opening remarks, there will be a question and answer period. The conference call will be broadcast live over the Internet via the Investors section of the company's website at To listen to the live call, go to the website at least 10 minutes early to download and install any necessary audio software.

Non-GAAP Measures

To supplement its financial statements presented in accordance with GAAP, I.D. Systems provides certain non-GAAP measures of financial performance. These non-GAAP measures include non-GAAP net income/loss and non-GAAP net income/loss per basic and diluted share. Reference to these non-GAAP measures should be considered in addition to results prepared under current accounting standards, but are not a substitute for, or superior to, GAAP results. These non-GAAP measures are provided to enhance investors' overall understanding of I.D. Systems' current financial performance and provide further information for comparative information due to the adoption of accounting standard SFAS 123R. Specifically, I.D. Systems believes the non-GAAP measures provide useful information to both management and investors by excluding certain expenses, gains and losses that may not be indicative of its core operating results and business outlook. Reconciliation to the nearest GAAP measure of all non-GAAP measures included in this press release can be found in the financial tables included in this press release.

About I.D. Systems

Based in Hackensack, New Jersey, with a European business office in Dusseldorf, Germany, I.D. Systems is a leading provider of wireless solutions for managing and securing high-value enterprise assets, including industrial vehicles, such as forklifts and airport ground support equipment, and rental vehicles. The company's patented technology, which utilizes radio frequency identification, or RFID, technology, addresses the needs of organizations to control, track, monitor and analyze their assets. For more information, visit

"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995

This press release contains forward looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, such as the Company's outlook for 2009 financial results and prospects for additional customers and revenues. Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. These forward-looking statements are subject to risk and uncertainties, including, but not limited to, future economic and business conditions, the loss of any of the Company's key customers or reduction in the purchase of its products by any such customers, the failure of the market for the Company's products to continue to develop, the inability to protect the Company's intellectual property, the inability to manage the Company's growth, the effects of competition from a wide variety of local, regional, national and other providers of wireless solutions and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission, including the Company's annual report on Form 10-K for the year ended December 31, 2008. These risks could cause actual results to differ materially from those expressed in any forward looking statements made by, or on behalf of, the Company. The Company assumes no obligation to update the information contained in this press release.

                             I.D. Systems, Inc.
                      GAAP Condensed Operations Data

                                               Three months ended
                                                    March 31,
                                               2008           2009
                                         -------------   -------------
 Products                                $  3,253,000    $  1,378,000
 Services                                   1,075,000       1,556,000
                                         -------------   -------------
                                            4,328,000       2,934,000
 Cost of Revenue:
 Cost of products                           1,536,000         798,000
 Cost of services                             680,000         547,000
                                         -------------   -------------
                                            2,216,000       1,345,000

 Gross Profit                               2,112,000       1,589,000

 Selling, general and administrative
  expenses                                  4,261,000       4,211,000
 Research and development expenses            711,000         689,000
                                         -------------   -------------

 Loss from operations                      (2,860,000)     (3,311,000)
 Interest income                              826,000         347,000
 Other income                                      --        (108,000)
                                         -------------   -------------

 Net loss                                $ (2,034,000)   $ (3,072,000)
                                         =============   =============

 Net loss per share - basic and diluted  $      (0.19)   $      (0.28)
                                         =============   =============

 Weighted average common shares
  outstanding - basic and diluted          10,881,000      10,895,000
                                         =============   =============

                            I.D. Systems, Inc.
           Reconciliation of GAAP to Non-GAAP Financial Measures

                                                Three Months Ended
                                                     March 31,
                                              2008           2009
                                          -------------  -------------
 Net loss attributable to common
  stockholders                            $ (2,034,000)  $ (3,072,000)

 Stock-based compensation                      785,000        559,000

 Non-GAAP net loss                        $ (1,249,000)  $ (2,513,000)

 Non-GAAP net loss per share - basic
  and diluted                             $      (0.11)  $      (0.23)

                             I.D. Systems, Inc.
                        Condensed Balance Sheet Data

                                       Dec. 31, 2008*   March 31, 2009
                                       --------------   --------------

 Cash and cash equivalents             $  12,558,000    $  18,848,000
 Restricted cash                             230,000           53,000
 Investments - short term                  8,550,000        7,054,000
 Accounts receivable, net                  8,245,000        5,483,000
 Unbilled receivables                        168,000          200,000
 Inventory, net                            3,273,000        4,488,000
 Interest receivable                         217,000          185,000
 Prepaid expenses and other current
  assets                                     261,000          330,000
                                       --------------   --------------
           Total current assets           33,502,000       36,641,000

 Investments - long term                  34,911,000       40,950,000
 Fixed assets, net                         1,050,000        1,110,000
 Goodwill                                    200,000          200,000
 Other Intangible Assets                     178,000          178,000
 Other assets                                107,000          107,000
                                       --------------   --------------

                                       $  69,948,000    $  79,186,000

                                       ==============   ==============

 Accounts payable and accrued expenses $   2,175,000    $     826,000
 Line of Credit                                   --       12,740,000
 Deferred revenue                            424,000          822,000
                                       --------------   --------------
           Total current liabilities       2,599,000       14,388,000

 Deferred revenue                            231,000          308,000
 Deferred rent                                33,000           28,000
                                       --------------   --------------
           Total liabilities               2,863,000       14,724,000
                                       --------------   --------------


 Preferred stock; authorized 5,000,000
  shares, $.01 par value; none issued             --               --
 Common stock; authorized 50,000,000
  shares, $.01 par value; 12,082,000
  and 12,122,000 shares issued at
  December 31, 2008 and March 31, 2009,
  respectively, shares outstanding,
  10,893,000 and 10,913,000 at
  December 31, 2008 and March 31, 2009,
  respectively                               120,000          120,000
 Additional paid-in capital              101,437,000      101,996,000
 Accumulated deficit                     (23,667,000)     (26,739,000)
 Accumulated other comprehensive
  income                                      46,000            1,000
                                       --------------   --------------
                                          77,936,000       75,378,000
 Treasury stock; 1,189,000 shares and
  1,209,000 shares at cost at
 December 31, 2008 and March 31, 2009,
  respectively                           (10,851,000)     (10,916,000)
                                       --------------   --------------
           Total stockholders' equity     67,085,000       64,462,000
                                       --------------   --------------
           Total liabilities and
            stockholders' equity       $  69,948,000    $  79,186,000
                                       ==============   ==============

 * Derived from audited balance sheet
    as of December 31, 2008.

                          I.D. Systems, Inc.
                       Condensed Cash Flow Data

                                                Three months ended
                                                    March 31,
                                              2008           2009
                                         -------------   -------------
 Cash flows from operating activities:

 Net loss                                $ (2,034,000)   $ (3,072,000)
 Adjustments to reconcile net loss to
  cash provided by (used in) operating
   Accrued interest income                     24,000          32,000
   Stock-based compensation expense           785,000         559,000
   Depreciation and amortization              140,000         138,000
   Change in fair value of investments             --         108,000
   Deferred rent expense                       (5,000)         (5,000)
   Deferred revenue                           (50,000)        475,000
   Changes in:
    Restricted Cash                                --         177,000
    Accounts receivable                      (523,000)      2,762,000
    Unbilled receivables                   (1,271,000)        (32,000)
    Inventory                                 831,000      (1,215,000)
    Prepaid expenses and other assets          87,000         (69,000)
    Accounts payable and accrued
     expenses                              (1,565,000)     (1,414,000)
                                         -------------   -------------
        Net cash used in operating
         activities                        (3,581,000)     (1,556,000)
                                         -------------   -------------

 Cash flows from investing activities:
   Purchase of fixed assets                   (40,000)       (198,000)
   Purchase of investments                 (2,350,000)    (16,474,000)
   Maturities of investments               19,692,000      11,778,000
                                         -------------   -------------

        Net cash provided by (used in)
         investing activities              17,302,000      (4,894,000)
                                         -------------   -------------

 Cash flows from financing activities:
   Repayment of term loan                     (19,000)             --
   Proceeds from exercise of stock
    options                                     7,000              --
   Purchase of treasury shares             (2,310,000)             --
   Borrowing on Line of Credit                     --      12,900,000
   Principal Payments on Line of Credit            --        (160,000)
                                         -------------   -------------

        Net cash (used in) provided
         by financing activities           (2,322,000)     12,740,000
                                         -------------   -------------
 Net increase in cash and cash
  equivalents                              11,399,000       6,290,000
 Cash and cash equivalents -
  beginning of period                       5,103,000      12,558,000
                                         -------------   -------------
 Cash and cash equivalents -
  end of period                          $ 16,502,000      18,848,000
                                         =============   =============
 Supplemental disclosure of cash
  flow information:
   Cash paid for:
     Interest                            $         --    $         --
                                         =============   =============
   Noncash activities:
    Unrealized loss on investments       $ (1,034,000)   $    (45,000)
                                         =============   =============
   Shares withheld pursuant to stock
    issuance                             $    424,000    $     65,000
                                         =============   =============
CONTACT:  I.D. Systems, Inc.
          Ned Mavrommatis, CFO
          Fax: 201-996-9144