IDEX Biometrics ASA · OSL:IDEX
IDEX Biometrics ASA — Q1 2019 Earnings Presentation
20 slides from IDEX Biometrics ASA's earnings presentation, May 9, 2019
Slide 1: 1st Quarter 2019 Presentation
1ST QUARTER 2019 PRESENTATION CEO, Stan Swearingen and CFO, Henrik Knudtzon 9 May 2019
Slide 2: Disclaimer
DISCLAIMER This presentation includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. Such forward-looking information and statements are based on current expectations, estimates and projec
Slide 3: Strong drivers for biometric payment card adoption
STRONG DRIVERS FOR BIOMETRIC PAYMENT CARD ADOPTION Security • Fingerprint offer mitigation against card present fraud • 19% of the value of card fraud are from transactions at POS terminals1 Convenience • Merchants want to deliver a better in-store experience • 98% of UK consumers prefer contactless
Slide 4: Huge market potential
HUGE MARKET POTENTIAL Total number of cards shipped Units million; Biometric card penetration rate 5,531 4,755 • Underlying growth in multiple card verticals is healthy • Drivers of growth: ‒ Well-used and understood 0.1% 0.9% 2.7% 6.3% 9.7% technology ‒ Convenient for end-user ‒ Infrastructure alre
Slide 5: Multiple card verticals with strong value proposition for biometrics
MULTIPLE CARD VERTICALS WITH STRONG VALUE PROPOSITION FOR BIOMETRICS Expected # of smart cards shipped in 2023 by vertical (millions) • Banks want to differentiate Banking & payment • Fraud reduction 3700 • Favorable consumer experience Govt & healthcare • Financial inclusion 730 • Secure identifica
Slide 6: Biometric technology enabling financial inclusion
BIOMETRIC TECHNOLOGY ENABLING FINANCIAL INCLUSION Government & healthcare “By simplifying a typical purchase transaction, we can • Financial inclusion demonstrate that this technology works for the benefit • Homeland security of the people who need it the most and ensure that their disbursements are
Slide 7: IDEX receives landmark high-volume order in logic access control vertical
IDEX RECEIVES LANDMARK HIGH-VOLUME ORDER IN LOGIC ACCESS CONTROL VERTICAL ID cards & access “People ranked security as the highest priority, over • Secure identification convenience and privacy, for logging in to the majority of applications, particularly when it comes to money- • Fraud prevention r
Slide 8: Publicly showcased dual-interface biometric cards with IDEX sensors
PUBLICLY SHOWCASED DUAL-INTERFACE BIOMETRIC CARDS WITH IDEX SENSORS Feitian card showcased at the Secure Feitian card showcased at RSA Conference XH Smart Tech demoing IDEX dual-interface card at Technology Alliance Payments Summit The Mobile World Congress in Barcelona Exelsecu biometric card Hengb
Slide 9: Growing opportunities in the ecosystem
GROWING OPPORTUNITIES IN THE ECOSYSTEM Smart card manufacturers Secure Element (SE) Payment schemes • IDEX is engaged with the major smart card manufacturers • Leading payment schemes demonstrating dual-interface cards • Actively developing additional partnerships across the ecosystem • Smart card m
Slide 10: Strong pull from banks to introduce biometric cards
STRONG PULL FROM BANKS TO INTRODUCE BIOMETRIC CARDS Banking & Payment • Credit cards • Debit cards • Pre-paid cards Recent UK example of pilot deployment 10 1st QUARTER 2019
Slide 11: Enabling the market with patented enrollment solution
ENABLING THE MARKET WITH PATENTED ENROLLMENT SOLUTION Traditional card enrollment is a complex process… …IDEX has foundational patents on this revolutionary concept “…Simplifying the registration process Visit to physical branch will help speed adoption of biometrics by issuers and consumers alike …
Slide 12: Manufacturing biometric cards is a new challenge for the traditional smart card industry
MANUFACTURING BIOMETRIC CARDS IS A NEW CHALLENGE FOR THE TRADITIONAL SMART CARD INDUSTRY… Mass manufacturing • Current smart cards have no imbedded circuits; card integrators use high temperature/high pressure mass manufacturing techniques • Biometric smart cards require embedded circuitry The chall
Slide 13: …and IDEX is helping to overcome these complexities
…AND IDEX IS HELPING TO OVERCOME THESE COMPLEXITIES Mass manufacturing IDEX is uniquely positioned to accelerate card integrators’ ramp to high volume • Off-the-shelf reference design A typical biometric card stack • Full solution know-how to ensure compatibility between components Overlay • Manufac
Slide 14: A product roadmap to market leadership
A PRODUCT ROADMAP TO MARKET LEADERSHIP Objectives 1. Significantly reduced cost: architecture and leverage display technology 2. Increased value in sensor: consolidate smart card elements into biometric ASIC 2021+ 3. Enhanced security: encryption, match on secure element Enhanced secure element solu
Slide 15: Growing breadth of innovation
GROWING BREADTH OF INNOVATION Patent portfolio by category • Growing patent portfolio reflects increasing Off-chip innovation capability at IDEX • Quality of patents over quantity System • Patents beyond simple biometric sensors Packaging • Working in collaboration with multiple Total Number of cust
Slide 16: Summary and outlook
SUMMARY AND OUTLOOK Q1 score card • Further evolution of the biometric smart card ecosystem; ongoing investments by major players in biometric solutions ( ) • Pilots by several issuers using IDEX’s dual-interface sensors • New customers in multiple verticals • Develop strategic partners in the smart
Slide 17: Key financials
KEY FINANCIALS Henrik Knudtzon, CFO
Slide 18: Stable OPEX
STABLE OPEX OPEX NOK million 63.2 64.6 61.5 58.1 • Revenues from new recently announced 55.8 customer with high gross margin Q1’19 • Q1’19 OPEX excl. share based renumeration of NOKm 57.8; similar to previous quarter • OPEX levels expected to be slightly reduced going forward in 2019 • Stable organi
Slide 19: Robust cash balance
ROBUST CASH BALANCE Cash balance NOK million 244.8 224.9 • Cash position expected to take IDEX to profitability 189.9 • Estimated break even at low-double-digit 130.5 million units shipped 83.7 • Stable quarterly cost level expected for 2019 • No financial debt Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 19 1st Q
Slide 20: Questions
QUESTIONS