Gatekeeper Reports Record Revenue of $2.7M for Fiscal Q2 2019
Abbotsford, BC – April 29, 2019 – Gatekeeper Systems Inc. (‘Gatekeeper’ or the ‘Company’) (TSX-V:GSI), a leading provider of video surveillance systems developed to protect people while in transit, today reported its financial results for the three and six months ended February 28, 2019.
Financial Highlights for Second Quarter
- Revenue for the three months ended February 28, 2019 was $2,698,819, an increase of 118% when compared to $1,237,320 in the same period in the previous year, and the highest second-quarter revenue in the Company’s history;
- Revenue for the six-month period was $4,538,297, an increase of 70% when compared to $2,667,219 in the same period in the previous year, and the highest first-half revenue in the Company’s history;
- Gross profit during the three and six months ended February 28, 2019 was $1,142,129 and $2,053,415, respectively, which compares to $635,693 and $1,403,612, respectively in the same prior year comparable periods;
- Net loss for the quarter was $0.01 per share which compares to a net loss of $0.01 per share for the same period in the previous year;
- As at February 28, 2019 the Company had working capital of $5,179,418, no long-term debt, and approximately 87.6 million shares outstanding.
Operational Highlights for Second Quarter
- Expanded Gatekeeper USA operations with new fleet vehicles to support the growing transit business in the Eastern USA and relating to South East Pennsylvania Transportation Authority (“SEPTA”)
- Supplied and installed Crash Worthy Memory Modules integrated with video systems for SEPTA trains;
- Received SEPTA extension contract for service and maintenance of video systems;
- Expanded transit business with new contract for Illinois Jackson County Mass Transit District;
- Received first order for the Company’s new Community Observation Protection System (COPS™);
- Received order to supply school bus video systems to Sunrise Bus Company, a leading Student Transportation Provider in the Northeast and Midwest USA;
- Received order for integrated school bus video and wireless system from Cook Illinois Corporation which operates more than 2,000 buses and ranks as the sixth largest bus contractor in the US;
- Commenced shipments of the Company’s new SP25 10 Mega Pixel stop arm camera system for capturing stop arm violations in multiple lanes;
- Delivered SP25 stop arm cameras to Dekalb County Central United School District in Midwest United States;
- Expanded demo systems of SP25 10 mega pixel stop arm camera system to multiple school districts across Midwest including Indiana;
- Expanded business in North East USA with contract award for SP25 stop arm camera systems to largest school district in Delaware;
- Received new order from BusWest, a leading Thomas Built Buses dealership in California; and
- Introduced new high definition windshield mount dashcam with wireless and driver monitoring capability fully integrated with Gatekeeper’s hosted enterprise software.
Doug Dyment, President and CEO commented, “We are extremely pleased with our fiscal Q2 results, which marks the second consecutive quarter of record-breaking revenues. It’s very encouraging to see this top line revenue growth, which is a direct result of the investments we made in our business over the past year as we positioned for expansion and growth. We added key new customer relationships during the quarter and strengthened our business relationship with SEPTA, who is our cornerstone customer in our transit business. We are also witnessing increasing interest from the school bus market, as customers seek safety solutions for school children.”
During the second quarter, the Company announced a new purchase order from SEPTA which included an extension of its service contract, as well as innovative safety and security solutions which the Company has branded as Community Observation Protection System (“COPS™”). COPS is a mobile, video-based, security system designed to provide real-time video information for special events and problem areas within a city.
During the quarter, the Company prepared high-definition video rail recorders for commercialization, which meet specific rail requirements including EN1055, and is capable of recording up to 24 high definitions cameras. The Company has also developed high density crash hardened memory module for securing video and data in the event of train crashes. The use of video to provide safety and security for passengers, as well as operational assistance, is becoming more common in the design of train communications systems. Protecting this data in the event of train derailments can assist The National Transportation Safety Board (NTSB) during accident investigations. The Company is on schedule to complete installation of its first related contract with SEPTA prior to the 2019 fiscal year end.
SEPTA has become a cornerstone customer for the Company, following the Company’s strategic expansion into the transit market. In April 2018, the Company acquired Delaware-based assets which enabled the SEPTA relationship. The Company subsequently announced additional SEPTA orders that total more than C$7 million and expects most of these orders to be invoiced during the Company’s 2019 fiscal year which ends August 31, 2019.
SEPTA is a regional public transportation authority that operates bus, rapid transit, commuter rail, light rail, and electric trolley bus services for nearly 4 million people in Philadelphia, Pennsylvania. SEPTA is one of the largest transit authorities in the United States, providing over 300 million passenger rides annually on over 3,600 vehicles, which includes approximately 970 trains. SEPTA has rapidly embraced video evidence as protection against injury and damages claims.
SP25 School Bus Vision Technology
During the quarter the Company began shipping SP25 School Bus Vision systems, which have 10-megapixel dual-camera systems for multi-lane viewing license plate capture capability, a high-speed license plate tag reader, and cellular network compatibility ready for remote, and auto downloading of stop-arm violations.
The Company has received increasing interest from school districts regarding the use of video evidence to help protect school children, following the tragic deaths of several school children who have been struck within the past six months by vehicles illegally passing school buses in various states. The National Association of State Directors of Pupil Transportation Services estimates that there are more than 15 million school bus stop-arm violations per year in the United States alone. The Company is actively marketing its new SP25 product line and is supportive of the social movements and state legislation changes that increase awareness and address the safety concerns for schoolchildren.
Ambulance and First Responder Market
The Company has been testing a new video system solution designed for the ambulance market to help medical personal protect themselves against liability as well as provide better care to patients. Several projects are ongoing and the company is optimistic that the current results of proof of concepts will result in near-term revenue.
Summary of Financial Results and Information
|Three months ended||Six months ended|
|Revenue||$ 2,698,819||$ 1,237,320||$ 4,536,297||$ 2,667,219|
|Cost of Sales||$ 1,556,690||$ 601,627||$ 2,484,882||$ 1,263,607|
|Gross Profit||$ 1,142,129||$ 635,693||$ 2,053,882||$ 1,403,612|
|Expenses||$ 1,565,750||$ 1,120,036||$ 3,230,010||$ 2,325,967|
|Operating Loss||$ (423,621)||$ (484,344)||$ (1,176,595)||$ (919,655)|
|Net Loss for the period||$ (455,525)||$ (499,124)||$ (1,142,904)||$ (839,839)|
|Loss per share||$ (0.01)||$ (0.01)||$ (0.01)||$ (0.01)|
|February 28,||August 31,||February 28,|
|Total Assets||$ 6,949,394||$ 7,894,272||$ 7,721,264|
|Total Liabilities||$ 996,829||$ 873,817||$ 375,299|
|Total Shareholders’ Equity||$ 5,952,565||$ 7,020,455||$ 7,345,965|
Full details of the financial reports and operating results for the three and six months ended February 28, 2019 are described in the Company’s condensed interim consolidated financial statements with accompanying notes and related Management’s Discussion and Analysis, available on SEDAR at www.sedar.com.
About Gatekeeper Systems Inc.
Gatekeeper provides wireless high-resolution video security and safety solutions for in-transit applications, including school buses, municipal transit, first response, and the military. The Company offers wireless live-streaming video surveillance, video analytics, driver monitoring, and incident management solutions to help protect school children, public transit users, and employees on the move. The Company has unique photo enforcement and auto-ticketing solutions to deter stop-arm violations and protect school children. Gatekeeper has installed over 100,000 video devices for more than 3,500 customers throughout North America. www.gatekeeper-systems.com
On behalf of the Board,
President & CEO
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Cautionary Note Regarding Forward-Looking Statements: Certain statements made in this press release that are not historical facts are forward-looking statements and are subject to important risks, uncertainties and assumptions, both general and specific, which give rise to the possibility that actual results or events could differ materially from our expectations expressed in or implied by such forward-looking statements. As a result, we cannot guarantee that any forward-looking statement will materialize, and readers are cautioned not to place undue reliance on these forward-looking statements. For more exhaustive information on these risks and uncertainties, the reader should refer to the risk factors described in the management’s discussion and analysis for the period ended February 28, 2019. The forward-looking statements contained in this press release represent our expectations as of the date hereof. We disclaim any intention and assume no obligation to update or revise any forward-looking statements. Forward-looking statements are presented for the purpose of providing information about management’s current expectations and plans and allowing investors and others to obtain a better understanding of our anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes. The Company undertakes no obligations to update or revise such statements to reflect new circumstances or unanticipated events as they occur, unless required by applicable law.