Autoscope Technologies Corporation Announces Financial Results

Rhea-AI Summary

Autoscope Technologies (OTCQX: AATC) has reported its Q4 and full-year 2024 financial results. Fourth quarter highlights include a 22% increase in royalties to $3.0 million, a 186% surge in product sales to $292,000, and a 222% rise in operating income to $1.5 million. However, net income decreased 32% to $761,000 due to increased tax expenses.

Full-year 2024 performance showed royalties up 2% to $13.2 million, product sales growing 148% to $429,000, and operating expenses decreasing 12% to $6.8 million. Operating income increased 33% to $6.2 million, while net income remained stable at $4.5 million. The company's cash balance decreased to $4.4 million from $6.5 million year-over-year.

The company increased its quarterly dividend to $0.15 per share in Q4 2024, up from $0.13, and paid a special one-time dividend of $1.32 per share in February 2024.

Positive

• Significant Q4 growth: royalties +22%, product sales +186%, operating income +222%
• Full-year operating income increased 33% to $6.2M
• Product sales grew 148% year-over-year
• Increased quarterly dividend to $0.15 and paid special dividend of $1.32
• Gross margin improved to 95% from 93% in Q4
• Operating expenses decreased 12% to $6.8M

Negative

• Q4 net income decreased 32% to $761K due to higher tax expenses
• Cash balance declined from $6.5M to $4.4M
• Investment income decreased from $378K to $140K
• Higher tax expense of $1.5M compared to $499K in prior year

MINNEAPOLIS, March 17, 2025 (GLOBE NEWSWIRE) -- Autoscope Technologies Corporation (OTCQX: AATC) today announced results for its quarter and year ended December 31, 2024.

Fourth Quarter 2024 Financial Summary

• Royalties increased 22 percent to $3.0 million in the fourth quarter of 2024 compared to $2.5 million in the same period in the prior year.
• Product sales increased 186 percent to $292,000 in the fourth quarter of 2024 compared to $102,000 in the same period in the prior year.
• Operating expenses from continuing operations in the fourth quarter of 2024 decreased 14 percent to $1.7 million compared to $2.0 million in the same period in the prior year period.
• Income from operations increased 222 percent to $1.5 million compared to $463,000 in the prior year period.
• Net income from continuing operations decreased 32 percent to $761,000 compared to $1.1 million for the same period in the prior year due to increased tax expense primarily due to changes in utilization of deferred tax assets.
  

2024 Full Year Financial Summary

• 2024 royalties increased 2 percent to $13.2 million compared to $13.0 million in the prior year.
• 2024 product sales increased 148 percent to $429,000 compared to $173,000 in the prior year.
• 2024 operating expenses from continuing operations decreased 12 percent to $6.8 million compared to $7.8 million in the prior year.
• Income from operations increased 33 percent to $6.2 million compared to $4.6 million in the prior year.
• Net income from continuing operations totaled $4.5 million for 2024, unchanged from $4.5 million in the prior year due to increased tax expense in 2024 due to changes in utilization of deferred tax assets.
• Cash balance decreased to $4.4 million from $6.5 million at the end of the prior year.

Fourth-Quarter Results

The 2024 fourth-quarter revenue from continuing operations for Autoscope Technologies Corporation (“AATC” or the “Company”), which includes the results of Image Sensing Systems, Inc., a wholly owned subsidiary of AATC (“ISNS”), was $3.3 million compared to $2.6 million in the fourth quarter of 2023. Revenue from royalties was $3.0 million in the fourth quarter of 2024 compared to $2.5 million in the fourth quarter of 2023, a 22 percent increase. The increase in royalties resulted due to the continued strong demand for Autoscope Vision in North America and the timing of sales due to the availability of funds for agency projects. Product sales were $292,000 in the fourth quarter of 2024 compared to $102,000 in the fourth quarter of 2023, a 186 percent increase. The increase in product sales was primarily due to increased sales of Wrong Way detection products, as well as sales of Autoscope Analytics and sales of IntelliSight in the Europe, the Middle East and Africa (“EMEA”) markets. There were no Autoscope Analytics or IntelliSight sales in the prior year.

Gross margin for the fourth quarter of 2024 was 95 percent, a 2-percentage point increase from a gross margin of 93 percent for the same period in 2023. Royalty gross margin for the fourth quarter of 2024 was 100 percent compared to 97 percent for the same period in 2023. The increase in royalty gross profits and percentage is primarily the result of increased royalty revenues and decreased costs for capitalized software development. Capitalized software development costs relating to Autoscope Vision became fully amortized as of the beginning of the fourth quarter of 2024 and therefore there were no costs in the fourth quarter. Product sales gross margin percent for the fourth quarter of 2024 was 40 percent compared to 16 percent in the prior year period. The increase in the product sales gross margin percent was the result of increased sales in the EMEA markets and increased sales of Wrong Way detection products, which have higher margins due to the lack of fixed costs associated with capitalized software development amortization.

Operating expenses were $1.7 million compared to $2.0 million in the prior year period. The decrease in operating expenses is primarily due to decreased salaries and benefits due to decreased headcount, partially offset by additional research and development costs related to sustaining Autoscope Vision.

Income from operations was $1.5 million compared to $463,000 in the prior year period. The increase in income from operations is due to increased royalty revenues and decreased operating expenses.

Investment income was $51,000 for the fourth quarter of 2024 compared to $178,000 in the prior year period. The decrease in investment income is a result of the decreased investments, primarily in debt securities.

The Company recognized a tax expense of $781,000 compared to a tax benefit of $437,000 in the prior year period. The increase in tax expense resulted primarily from changes in the utilization of deferred tax assets and increased income from continuing operations.

The Company reported net income from continuing operations for the fourth quarter of 2024 of $761,000 or $0.14 per basic and diluted share, compared to a net income of $1.1 million or $0.20 per basic and diluted share in the prior year period. This decrease is primarily due to increased income tax expense and lower investment income, partially offset by increased royalty revenue in 2024 compared to the same period in 2023.

Full Year Results

Revenue from continuing operations increased $0.5 million in 2024 compared to 2023. Royalty income increased to $13.2 million in 2024 compared to $13.0 million in 2023, an increase of 2 percent. The increase in royalties resulted due to the continued strong demand for Autoscope Vision in North America and the timing of sales due to the availability of funds for agency projects. Product sales increased to $429,000 in 2024 from $173,000 in 2023, an increase of 148 percent. The increase in product sales was primarily due to increased sales of Wrong Way detection products, increased sales in the Europe, the Middle East and Africa (“EMEA”) markets and Autoscope Analytics sales, which had not sales in 2023.

Gross margins increased to 95 percent in 2024 compared to 94 percent in 2023. Gross margins on royalty sales increased to 98 percent in 2024 compared to 97 percent in 2023. Gross profit for royalties in 2024 increased $353,000 or 3 percent compared to the prior year. The increase in royalty gross profits and percentage is primarily the result of increased royalty revenues and decreased costs for capitalized software development. Capitalized software development costs relating to Autoscope Vision became fully amortized as of the beginning of the fourth quarter of 2024 and therefore there were no costs in the fourth quarter. Gross margin on product sales increased to 24 percent in 2024 from (74) percent in 2023. Product sales gross profit in 2024 increased $233,000 or 182 percent compared to the prior year. The increase in product sales gross margin percent was the result of increased sales and product mix.

Operating expenses were $6.8 million in 2024 compared to $7.8 million in 2023. Operating expenses decreased primarily due to decreased salaries and benefits due to decreased headcount and lower spending on building maintenance projects.

Income from operations was $6.2 million in 2024 compared to $4.6 million in 2023. The increase in income from operations was primarily due to increased revenues and decreased operating expenses.

Investment income was $140,000 for the year ended December 31, 2024, compared to $377,000 for the year ended December 31, 2023. The decrease in investment income is a result of the decreased investments, primarily in debt securities.

The Company recognized a tax expense of $1.5 million compared to a tax expense of $499,000 in 2023. The increase in tax expense resulted from increased income from operations and changes in the utilization of deferred tax assets.

Consolidated net income from continuing operations was $4.5 million in 2024, unchanged from $4.5 million in 2023. Net income per basic and diluted share was $0.82 in 2024, compared to $0.83 per basic and diluted share in 2023. The net income per basic and diluted share decreased in 2024 due to the increased number of basic and diluted shares.

Liquidity and Capital Resources

On December 31, 2024, we had $4.4 million in cash and cash equivalents, compared to $6.5 million on December 31, 2023.

Net cash provided by operating activities of continuing operations was $5.2 million in 2024 compared to $5.0 million provided by operating activities of continuing operations in 2023. Net cash provided by operating activities of continuing operations increased in 2024 compared to the prior year primarily as the result of higher accounts receivables and lower accounts payables, offset by lower deferred taxes and lower changes in inventory in 2024 compared to 2023.

Net cash provided by investing activities of continuing operations was $2.9 million in 2024 compared to net cash used by investing activities of continuing operations of $2.0 million in 2023. The increase in the amount of net cash provided for investing activities of continuing operations in 2024 compared to the prior year is primarily the net result of sales and purchases of debt securities previously purchased as investments. Sales of debt securities were $10.5 million during 2024 compared to $8.2 million in 2023, offset by purchases of debt securities of $7.3 million in 2024 and $10.2 million in 2023. Proceeds from the sale of debt securities during 2024 were used to fund the special one-time dividend paid in February 2024. Cash used for purchases of property and equipment increased during 2024 compared to 2023 due to payments made for a new enterprise resource planning (ERP) system launched in October 2024.

Net cash used by financing activities of continuing operations was $10.2 million in 2024 compared to net cash used by financing activities of continuing operations of $2.9 million in 2023. The increase in net cash used by financing activities of continuing operations is due to the special one-time dividend paid in February 2024 of $1.32 per share, totaling $7.2 million. In addition, the Company increased the quarterly cash dividend in the fourth quarter of 2024 to $0.15 per share compared to $0.13 per share for each quarterly cash dividend paid during the first three quarters of 2024 and compared to quarterly cash dividends of $0.13 per share for each quarter in 2023.

“We are pleased to see continued strong demand for Autoscope Vision across North America and see the realization of our strategy to enhance user value through our latest AI-powered platform in Autoscope IntelliSight, Wrong Way, and Autoscope Analytics. By delivering superior AI-driven video detection, we are now leveraging our intellectual property to fulfill our commitment to improving safety and efficiency for all roadway users through data-driven insights,” said Andy Markese, Interim CEO of Autoscope Technologies and President and CEO of Image Sensing Systems. “Our financial foundation is solid, and we remain committed to maintaining a disciplined approach to expense management as we move forward,” concluded Mr. Markese.

About Autoscope Technologies Corporation

Autoscope Technologies Corporation is a global company dedicated to helping improve safety and efficiency for cities and highways by developing and delivering above-ground detection technology, applications and solutions. We give Intelligent Transportation Systems (ITS) professionals more precise and accurate information – including real-time reaction capabilities and in-depth analytics – to make more confident and proactive decisions. We are headquartered in Minneapolis, Minnesota. Visit us on the web at www.autoscope.com.

Forward-Looking Statements

Certain statements and information included in this Annual Report constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange of 1934, as amended. Forward looking statements represent our expectations or beliefs concerning future events and can be identified by the use of forward-looking words such as “believes,” “may,” “will,” “should,” “intends,” “plans,” “estimates,” “expects,” “anticipates” or other comparable terminology. Forward-looking statements are subject to risks and uncertainties that may cause our actual results to differ materially from the results discussed in the forward-looking statements. Some factors that might cause these differences include the factors listed below. Although we have attempted to list these factors comprehensively, we wish to caution investors that other factors may prove to be important in the future and may affect our operating results. New factors may emerge from time to time, and it is not possible to predict all of these factors, nor can we assess the effect each factor or combination of factors may have on our business.

Those risks and uncertainties may include, but are not limited to, our historical dependence on a single product for most of our revenue; competition; potential changes in government spending on transportation technology; acceptance of our product offerings and designs; budget constraints by governmental entities that purchase our products, including constraints caused by declining tax revenue; the continuing ability of Econolite Control Products, Inc. to sell our products and pay royalties owed to us; the mix of and margins on the products we sell; our dependence on third parties for manufacturing and marketing our products; our dependence on single-source suppliers to meet manufacturing needs; our failure to secure adequate protection for our intellectual property rights; our inability to develop new applications and product enhancements; the potential disruptive effect on the markets we serve of new and emerging technologies and applications, including vehicle-to-vehicle communications and autonomous vehicles; unanticipated delays, costs and expenses inherent in the development and marketing of new products; our inability to respond to low-cost local competitors; our inability to properly manage any growth in revenue and/or production requirements; the influence over our voting stock by affiliates; our inability to hire and retain key scientific and technical personnel; the effects of legal matters in which we may become involved; our inability to achieve and maintain effective internal controls; our inability to successfully integrate any acquisitions; tariffs and other trade barriers; our operating costs tend to be fixed, while our revenue tends to be seasonal, thereby resulting in operating results that fluctuate from quarter to quarter; any significant variations between actual amounts and the amounts estimated for those matters identified as our critical accounting estimates and other significant accounting estimates made in the preparation of our financial statements; political and economic instability, including continuing volatility in the economic and political environment of the European Union and the war in Ukraine, the conflict between Israel and Hamas and other disruptions in the Middle East; our inability to comply with international regulatory restrictions over hazardous substances and electronic waste; the impact of international supply chain disruptions and delays; the impact of changes in U.S. federal and state income tax regulations; the impact of inflation and our ability to pass on rising prices to its customers; and conditions beyond our control such as war, terrorist attacks, health epidemics (including the COVID-19 pandemic caused by the coronavirus) and economic recession..

We further caution you not to unduly rely on any forward-looking statements because they reflect our views only as of the date the statements were made. We undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise. 

Contact:	Andrew Markese, Interim CEO of AATC and President and CEO of ISNS
	612-438-2363

Autoscope Technologies Corporation Condensed Consolidated Statements of Operations (in thousands, except per share information) (unaudited)
	Three-Month Period Ended December 31,								Twelve-Month Period Ended December 31,
		2024				2023				2024				2023
Revenue
Royalties	$	3,048			$	2,501			$	13,200			$	12,960
Product sales		292				102				429				173
		3,340				2,603				13,629				13,133
Cost of revenue		175				187				639				729
Gross profit		3,165				2,416				12,990				12,404
		95	%			93	%			95	%			94	%
Operating expenses
Selling, general and administrative		1,010				1,355				4,414				5,214
Research and development		662				598				2,425				2,577
		1,672				1,953				6,839				7,791
Income from operations		1,493				463				6,151				4,613
Other income		14				53				43				79
Investment income		51				178				140				377
Interest expense, net		(16	)			(17	)			(65	)			(69	)
Income before income taxes		1,542				677				6,269				5,000
Income tax expense		781				(437	)			1,768				499
Net income from continuing operations		761				1,114				4,501				4,501
Discontinued operations
Net income from discontinued operations, net of tax		-				27								125
Gain on disposal of discontinued operations, net of tax		-				(32	)			-				1,999
Earnings from discontinued operations, net of tax		-				(5	)			-				2,124
Consolidated net income	$	761			$	1,109			$	4,501			$	6,625
Net income per share from continuing operations, basic and diluted	$	0.14			$	0.20			$	0.82			$	0.83
Net income per share from discontinued operations, basic and diluted	$	-			$	-			$	-			$	0.39
Net income per share from operations, basic and diluted	$	0.14			$	0.20			$	0.82			$	1.22
Weighted shares - basic		5,467				5,438				5,456				5,423
Weighted shares - diluted		5,478				5,440				5,463				5,425

Autoscope Technologies Corporation Condensed Consolidated Balance Sheets (in thousands) (unaudited)
	December 31, 2024			December 31, 2023
Assets
Current assets
Cash and cash equivalents	$	4,355		$	6,506
Receivables, net		4,064			3,080
Inventories		2,717			2,891
Investment in debt and equity securities		3,091			5,923
Prepaid expenses and other current assets		393			689
		14,620			19,089
Property and equipment, net		2,060			1,973
Intangible assets, net		575			995
Deferred taxes		1,908			3,471
Long term investment securities		-			101
Operating lease asset, net		10			18
	$	19,173		$	25,647
Liabilities and Shareholders’ Equity
Current liabilities
Accounts payable	$	27		$	1,101
Current maturities on long-term debt		63			60
Warranty and other current liabilities		457			360
Current liabilities held for sale		-			24
		547			1,545
Non-Current liabilities
Long-term debt, net of current liabilities		1,493			1,556
Shareholders’ equity		17,133			22,546
	$	19,173		$	25,647

Autoscope Technologies Corporation. Condensed Consolidated Statements of Cash Flows (in thousands) (unaudited)
	Years Ended December 31,
		2024				2023
Operating activities
Net income	$	4,501			$	6,625
Less: Net income from discontinued operations, net of tax		-				2,124
Net income from continuing operations		4,501				4,501
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization		543				632
Stock-based compensation		214				187
Loss on disposal of assets		1				3
Investment amortization		69				(76	)
Realized gain on available for sale investments		(18	)			-
Unrealized gain on equity investments		(2	)			(4	)
Amortization of debt issuance costs		3				3
Deferred income tax expense		1,542				425
Changes in operating assets and liabilities		(1,674	)			(642	)
Net cash provided by operating activities of continuing operations		5,179				5,029
Net cash (used) provided by operating activities of discontinued operations		(24	)			450
Net cash provided by operating activities		5,155				5,479
Investing activities
Purchases of property and equipment		(211	)			(6	)
Sale of securities		10,453				8,220
Purchase of securities		(7,294	)			(10,170	)
Net cash provided (used) by investing activities of continuing operations		2,948				(1,956	)
Net cash provided by investing activities of discontinued operations		-				4,757
Net cash provided by investing activities		2,948				2,801
Financing activities
Dividends paid		(10,154	)			(2,822	)
Principal payments on long-term debt		(63	)			(60	)
Proceeds from stock options exercised		-				13
Net cash used by financing activities of continuing operations		(10,217	)			(2,869	)
Net cash used by financing activities of discontinued operations		-				-
Net cash used by financing activities		(10,217	)			(2,869	)
Effect of exchange rate changes on cash		(37	)			(82	)
Increase (decrease) in cash and cash equivalents		(2,151	)			5,329
Cash and cash equivalents at beginning of period		6,506				1,177
Cash and cash equivalents at end of period	$	4,355			$	6,506
Non-Cash investing activities:
Cash paid for interest		65				69
Income taxes		285				0

Autoscope Technologies Corporation
Non-GAAP Income from Continuing Operations
(in thousands)
(unaudited)

We define non-GAAP income from operations as income from operations before amortization of intangible assets, depreciation, and restructuring charges for the applicable periods. Management believes non-GAAP income from operations is a useful indicator of our financial performance and our ability to generate cash flows from operations. Our definition of non-GAAP income from operations may not be comparable to similarly titled definitions used by other companies. The table below reconciles non-GAAP income from operations, which is a non-GAAP financial measure, to comparable GAAP financial measures:     

	Three-Month Period Ended December 31,						Twelve-Month Period Ended December 31,
	2024			2023			2024			2023
Income from continuing operations	$	1,493		$	463		$	6,151		$	4,613
Amortization of intangible assets		27			126			420			526
Depreciation		39			25			123			106
Non-GAAP income from continuing operations	$	1,559		$	614		$	6,694		$	5,245

Note – Our calculation of non-GAAP income from operations is considered a non-GAAP financial measure and is not in accordance with, or preferable to, “as reported”, or GAAP financial data. However, we are providing this information, as we believe it facilitates analysis of the Company’s financial performance by investors and financial analysts. 

FAQ

What were AATC's key financial metrics for Q4 2024?

AATC reported Q4 2024 royalties of $3.0M (+22%), product sales of $292K (+186%), and operating income of $1.5M (+222%), with net income at $761K (-32%).

How much did AATC's full-year 2024 royalties and product sales grow?

AATC's 2024 royalties increased 2% to $13.2M, while product sales grew 148% to $429K compared to 2023.

What dividend changes did AATC implement in 2024?

AATC increased Q4 quarterly dividend to $0.15 from $0.13 and paid a special one-time dividend of $1.32 per share in February 2024.

How did AATC's cash position change in 2024?

AATC's cash balance decreased from $6.5M to $4.4M by the end of 2024.