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:
- Commercialization of the
WISeSat PocketQube Satellite with
13 satellites now in orbit launched with Space X. WISeKey
is offering this IoT satellite technology to its IoT clients in a
SaaS model allowing both remote and redundant urban IoT
communications for companies seeking to securely connect their
assets. WISeKey Trust and Security solutions offer unique
integration into an end-to-end platform that communicates in
real-time with the WISeSat Satellite by ensuring the authenticity,
confidentiality, and integrity of the devices and objects.
- Development of a new range of Quantum
Trust Services, that will take advantage of the latest
developments in post-quantum encryption (PQE) to be applied in
real-world applications of digital signatures and encryption using
PKI and digital certificates, such as secure communication channels
(TLS), enhanced Key Exchanges and email security (S/MIME). These
services are currently based on standards that can be improved to
be resilient to quantum attacks and offer backwards compatibility
with existing counterparts. WISeKey’s implementation of PQE is made
around the concept of “hybrid signatures” which combine in a single
X.509 certificate, a conventional signature with a second signature
using a PQE algorithm. This approach ensures backwards
compatibility and opens a new horizon of cybersecurity
services.
- Launching of “Root of Trust” based in
PQE algorithms promoted currently by the NIST as valid
candidates, which will be the foundation of a new
portfolio of Trust Services and secure several IoT projects on
which WISeKey is already working.
- Development
of post-quantum resistant
algorithms through its
strategic R&D partnership with MINES Saint-Etienne
Research Institute. WISeKey’s R&D group has been
working with several NIST’s candidates for the MS600X Common
Criteria products, such as Crystals-Kyber and Crystals-Dilithium,
aiming to develop a complete post-quantum cryptography toolbox to
be combined with new PKI-related Trust Services delivered by
WISeKey. These post-quantum cryptography initiatives will play a
key role in controlling vulnerability and other risks related to
quantum computers technologies which when used by hackers can give
them the ability to crack cryptography algorithms, corrupt
cybersecurity and compromise the global economy, by undermining the
security foundations of the current financial and governmental
services. These initiatives have received tremendous support from
many government entities around the world through the sponsoring of
public/private R&D projects. In particular, WISeKey is active
in key initiatives promoted by the French Agency for Cybersecurity
(ANSSI), and by the National Cybersecurity Center of Excellence of
the US NIST. The WISeKey contributions to the projects will be
Trust Services for credentials and secure semiconductors to keep
the credentials secure. Specifically, WISeKey will offer INeS
Certificate Management Service (CMS) for issuing credentials and
VaultIC secure semiconductors to provide tamperproof key storage
and cryptographic acceleration.
- Use of WISeID as a
Universal Communications Identifier (UCID), a unique
identifier for an IoT device on a network; the blockchain,
a distributed ledger shared with the nodes of a computer network to
guarantee security; and Non-Fungible Tokens (NFTs), cryptographic
assets on a blockchain that cannot be replicated. The combined
practical application of these technologies — implementing UCID on
the device, using NFTs, and putting them on the blockchain —
ensures that the device itself is authenticated on a network that
cannot be corrupted. This is a giant leap forward, and it is
happening now, in the United States government.
- Full
deployment of the WISe.ART
platform. WISe.ART’s unique competitive edge comes from
its platform which is secured by WISeKey’s various security
technologies enabling the authentication of digital identity based
NFTs, physical objects as well as digital assets, in a safe
end-to-end process. The WISe.ART platform offers users full control
of their WISeID NFT, while other NFTs must request access to
identity information, and WISeID NFTs users then can decide by
themselves what level of information they wish to share.The NFT
tokenization uses the WISeKey registered patent
application “System and Method for Providing Persistent
Authenticatable NFT” in the USA. With this method,
NFTs have increased in value and will
hold their value for a long-term. For more
information
visit: https://www.wisekey.com/press/wisekey-files-patent-application-for-persistent-and-authenticatable-nfts/.
Almost 130 artists have already joined the WISe.ART NFT Marketplace
with approximately 500 unique NFT products, adding a commercial NFT
sales potential aggregate of $70 million worth of NFTs that
increasingly see a future for tokens that upend the economics of
content creation and influence on the internet.
ADDITIONAL FINANCIAL & OPERATIONAL DATA
H1 FY 2022
Key Financials - WISeKey Group
(Million
US$) |
6 months ended June 30, |
US GAAP |
2022 |
2021 |
Operating loss
as reported |
(6.6) |
(8.3) |
Net income
attributable to WISeKey as reported |
2.4 |
(4.3) |
|
|
|
Non-GAAP |
2021 |
2020 |
Total revenue |
12.6 |
9.9 |
Total gross
profit |
5.6 |
3.6 |
EBITDA |
(6.5) |
(7.7) |
Adjusted
EBITDA |
(5.5) |
(7.1) |
|
|
|
|
As at June 30,
2022 |
As at December
31, 2021 |
Total Cash and
restricted cash |
22.9 |
34.3 |
Consolidated Statements of Comprehensive Income/(Loss)
[as reported]
|
6 months ended June 30, |
|
6 months ended June 30, |
USD'000 |
2022 (unaudited) |
|
2021 (unaudited) |
|
|
|
|
Net sales |
10,840 |
|
7,802 |
Cost of
sales |
(6,305) |
|
(4,304) |
Depreciation of
production assets |
240 |
|
(390) |
Gross
profit |
4,775 |
|
3,108 |
|
|
|
|
Other operating
income |
33 |
|
114 |
Research &
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
income |
2,795 |
|
6,781 |
Debt 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 operations |
1,805 |
|
2,142 |
Cost 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 operations |
25 |
|
57 |
Gain on disposal
of a business, net of tax on disposal |
11,801 |
|
- |
Income /
(loss) on discontinued operations |
7,379 |
|
(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
AG |
2,435 |
|
(4,341) |
|
|
|
|
Earnings
per share from continuing operations |
|
|
|
Basic |
(0.07) |
|
(0.04) |
Diluted |
(0.07) |
|
(0.04) |
Earnings
per share from discontinued operations |
|
|
|
Basic |
0.07 |
|
(0.05) |
Diluted |
0.07 |
|
(0.05) |
|
|
|
|
Earning per share attributable to WISeKey
International Holding AG |
|
|
|
Basic |
0.02 |
|
(0.07) |
Diluted |
0.02 |
|
(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 period |
1,156 |
|
- |
Defined benefit
pension plans: |
|
|
|
Net gain (loss)
arising during period |
90 |
|
140 |
Other
comprehensive income / (loss) |
(1,972) |
|
(6,201) |
Comprehensive income / (loss) |
(1,222) |
|
(12,309) |
|
|
|
|
Other
comprehensive income / (loss) attributable to noncontrolling
interests |
(969) |
|
80 |
Other
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 AG |
1,433 |
|
(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'000 |
2022 (unaudited) |
|
2021 |
ASSETS |
|
|
|
Current assets |
|
|
|
Cash and cash
equivalents |
22,818 |
|
34,201 |
Restricted
cash, current |
105 |
|
110 |
Accounts
receivable, net of allowance for doubtful accounts |
30,344 |
|
2,979 |
Notes
receivable from employees and related parties |
66 |
|
68 |
Inventories |
4,189 |
|
2,710 |
Prepaid
expenses |
792 |
|
1,198 |
Current assets
held for sale |
- |
|
689 |
Other current
assets |
927 |
|
555 |
Total
current assets |
59,241 |
|
42,510 |
|
|
|
|
Noncurrent assets |
|
|
|
Notes
receivable, noncurrent |
182 |
|
190 |
Deferred
income tax assets |
1 |
|
1 |
Deferred tax
credits |
1,073 |
|
848 |
Property,
plant and equipment net of accumulated depreciation |
743 |
|
573 |
Intangible
assets, net of accumulated amortization |
103 |
|
105 |
Finance lease
right-of-use assets |
130 |
|
171 |
Operating
lease right-of-use assets |
2,661 |
|
2,941 |
Goodwill |
8,317 |
|
8,317 |
Equity
securities, at cost |
460 |
|
501 |
Equity
securities, at fair value |
1 |
|
1 |
Noncurrent
assets held for sale |
- |
|
32,391 |
Other
noncurrent assets |
241 |
|
256 |
Total
noncurrent assets |
13,912 |
|
46,295 |
TOTAL
ASSETS |
73,153 |
|
88,805 |
|
|
|
|
LIABILITIES |
|
|
|
Current Liabilities |
|
|
|
Accounts
payable |
13,482 |
|
14,786 |
Notes
payable |
4,193 |
|
4,206 |
Convertible
note payable, current |
800 |
|
- |
Deferred
revenue, current |
199 |
|
92 |
Current
portion of obligations under finance lease liabilities |
4 |
|
55 |
Current
portion of obligations under operating lease liabilities |
567 |
|
595 |
Income tax
payable |
7 |
|
11 |
Current
liabilities held for sale |
- |
|
4,567 |
Other current
liabilities |
331 |
|
439 |
Total
current liabilities |
19,583 |
|
24,751 |
|
|
|
|
Noncurrent liabilities |
|
|
|
Bonds,
mortgages and other long-term debt |
393 |
|
458 |
Convertible
note payable, noncurrent |
31 |
|
9,049 |
Deferred
revenue, noncurrent |
37 |
|
100 |
Operating
lease liabilities, noncurrent |
2,197 |
|
2,468 |
Employee
benefit plan obligation |
4,669 |
|
4,769 |
Other deferred
tax liabilities |
59 |
|
62 |
Noncurrent
liabilities held for sale |
- |
|
5,712 |
Other
noncurrent liabilities |
3 |
|
57 |
Total
noncurrent liabilities |
7,389 |
|
22,675 |
TOTAL
LIABILITIES |
26,972 |
|
47,426 |
|
|
|
|
|
|
|
|
Commitments and contingent liabilities |
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY |
|
|
|
Common stock -
Class A |
400 |
|
400 |
CHF 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 B |
5,334 |
|
4,685 |
CHF 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 capital |
277,376 |
|
268,199 |
Accumulated
other comprehensive income / (loss) |
1,312 |
|
1,407 |
Accumulated
deficit |
(235,724) |
|
(238,160) |
Total
shareholders' equity attributable to WISeKey
shareholders |
48,327 |
|
35,895 |
Noncontrolling
interests in consolidated subsidiaries |
(2,146) |
|
5,484 |
Total
shareholders' equity |
46,181 |
|
41,379 |
TOTAL
LIABILITIES AND EQUITY |
73,153 |
|
88,805 |
The notes are an integral part of our consolidated financial
statements.
Non-GAAP Financial MeasuresIn
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
Reconciliations
Financial Reconciliation of GAAP to non-GAAP Results
(unaudited) |
6 months to June 30, |
6 months to June 30, |
(Million US$) |
2022 |
2021 |
Net sales as reported |
10.8 |
7.8 |
Net sales from
discontinued operations as reported |
1.8 |
2.1 |
Total
revenue |
12.6 |
9.9 |
Gross profit as
reported |
4.8 |
3.1 |
Gross profit
from discontinued operations as reported |
0.8 |
0.5 |
Total
gross profit |
5.6 |
3.6 |
Operating loss
as reported |
(6.6) |
(8.3) |
Non-GAAP
adjustments from continuing operations: |
|
|
Depreciation expense |
0.1 |
0.5 |
Amortization expense on intangibles |
- |
0.1 |
EBITDA |
(6.5) |
(7.7) |
Non-GAAP
adjustments from continuing operations: |
|
|
Expenses settled in equity |
0.1 |
- |
M&A-related legal fees |
0.8 |
0.6 |
M&A-related professional fees |
0.1 |
- |
Adjusted
EBITDA |
(5.5) |
(7.1) |
GAAP to
Non-GAAP Cash and Cash Equivalents |
|
(Million US$) |
As atJune 30,
2022 |
As at December
31, 2021 |
Cash and cash equivalents as reported |
22.8 |
34.2 |
Restricted cash,
current as reported |
0.1 |
0.1 |
Total Cash and
restricted cash |
22.9 |
34.3 |
* 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 LtdCompany
Contact: Carlos MoreiraChairman & CEOTel:
+41 22 594 3000info@wisekey.com |
WISeKey
Investor Relations (US)Contact: Lena
CatiThe Equity Group Inc.Tel: +1 212
836-9611lcati@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.
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