SOURCE: Integral Vision

November 14, 2008 16:00 ET

Integral Vision, Inc. Announces Third Quarter 2008 Results

WIXOM, MI--(Marketwire - November 14, 2008) - Integral Vision, Inc. (OTCBB: INVI), a leading global supplier of automated display inspection technology, today announced financial results for the third quarter ending September 30, 2008.

Third Quarter 2008 Business Highlights

--  The Company's largest customer placed incremental orders for Integral
    Vision's SharpEye™ inspection system.  These systems will be used to
    inspect a new MEMS based display that will be manufactured in a new plant
    located in Taiwan.  Delivery of these systems is expected to be complete by
    the end of the first half of 2009.  The SharpEye product provides analysis
    of defects in the display to assure quality in the manufacturing process.
    
--  The Company also received an order for the SharpEye system from a
    leading Chinese global manufacturer of LCD panels.  This represents the
    initial order stemming from the requirement by a major domestic computer
    manufacturer that the entirety of its LCD supplier base must utilize the
    SharpEye system in the inspection and grading process of incoming displays
    prior to delivery.
    

Third Quarter 2008 Financial Review

--  Shipments for the third quarter were $497,000, of which $486,000
    remained in deferred revenue pending final acceptance.  Integral Vision
    expects that all of the deferred revenue will become revenue in the fourth
    quarter.
    
--  Net revenues for the third quarter were $11,000.  This compares with
    net revenues for the second quarter of $470,000.
    
--  Third quarter results included non-cash charges of $7,200,000 related
    to transactions associated with the Waiver and Amendment Agreement executed
    September 15, 2008 with the PIPE Equity Investors and the Exchange
    Agreements executed September 15, 2008 with the Company's Class 2 and Class
    3 Note holders.
    
--  Third quarter net loss was $8.25 million, or a loss of $0.28.  This
    compares with second quarter net loss of $649,000, or a loss of $0.02.
    

Charles J. Drake, Chairman and CEO of Integral Vision, Inc., commented, "While revenues for the third quarter were down, we shipped several systems during the quarter with acceptance of these systems not obtained before October 1, 2008. We expect that all of the deferred revenue will become revenue in the fourth quarter."

Looking ahead, Drake added, "We expect sales to be strong throughout the next year and continue to be very confident about our current and 2009 opportunities. To date, our bookings in the fourth quarter are substantial and have exceeded anything the Company has recorded in recent years; and we are receiving substantial down payments. We expect that the opportunities from our three main business areas in LCD Inspection, MEMS Display Technologies (Micro Electro-Mechanical Systems), and e-Paper (electronic paper) should make 2009 a profitable year, with steady and larger revenues throughout 2009 and margin improvements going forward."

TO ACCESS THE LIVE CONFERENCE CALL

Integral Vision will host a live conference call at 4:30 p.m. (ET) on Monday, November 17, 2008. To access the conference call, please call 303-262-2138 or 800-240-4186 approximately 5 to 10 minutes prior to the scheduled start time.

TO ACCESS A REPLAY OF THE CONFERENCE CALL

If you are unable to listen to the live conference call, it will be archived for replay. Shortly after the call, a telephonic replay will be available through Wednesday, November 19, 2008, by dialing 303-590-3000 or 800-405-2236. The confirmation code 11122372 is required for the telephonic replay.

COMPANY'S INVESTOR E-MAIL LIST

To be added to Integral Visions investor email list, please contact Laura Guerrant-Oiye of Guerrant Associates at lguerrant@guerrantir.com.

ABOUT INTEGRAL VISION

Integral Vision, Inc. (OTCBB: INVI), an ISO 9001 registered firm, offers display inspection technology that provides analysis of functional and cosmetic defects in the display to assure quality in the manufacturing process as well as verification of the final product. Integral Vision has been inspecting displays since 1992 and is an industry leader committed to providing automated solutions to the quality issues Microdisplay, OLED and LCD manufacturers face in today's competitive marketplace. More information can be found at Website: www.iv-usa.com.

"SAFE-HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. Such statements are based on management's current expectations and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Such factors and uncertainties include, but are not limited to: competitive conditions in the Company's markets and the effect of competitive products and pricing; technological development by the Company, its customers and its competition; the Company's available cash and access to debt and equity financing; and general economic conditions and conditions in the specific industries in which the company has significant customers. As a result, the Company's results may fluctuate. Additional information concerning risk factors that could cause actual results to differ materially from those projected in the forward-looking statements are contained in the Company's filings with the Securities and Exchange Commission. These forward-looking statements represent the Company's best estimates as of the date of this press release. The Company assumes no obligation to update such estimates except as required by the rules and regulations of the Securities and Exchange Commission.

FINANCIAL INFORMATION

The summary financial information contained in this press release, including the following information in tabular form, should be read in conjunction with the more detailed information contained in the Company's Form 10-Q filed with the Securities and Exchange Commission on November 14, 2008, and Company's Annual Report on Form 10-KSB filed with the Securities and Exchange Commission on March 31, 2008.

-Tables follow-

                         Balance Sheet
                     Integral Vision, Inc.
                       September 30, 2008


                                                   September    December
                                                      30,          31,
                                                     2008         2007
                                                  (Unaudited)
                                                  -----------  -----------
                                                       (in thousands)

Assets

Current assets:
  Cash                                            $       114  $        11
  Accounts receivable                                     102           75
  Inventories - Note B                                    412          265
  Other                                                   108           97
                                                  -----------  -----------
Total current assets                                      736          448

Property and equipment:
  Building Improvements                                     4            4
  Production and engineering equipment                    234          234
  Furniture and fixtures                                   80           80
  Computer equipment                                      190          190
  Marketing/demonstration equipment                       139          139

                                                  -----------  -----------
                                                          647          647
  Less accumulated depreciation                          (477)        (431)
                                                  -----------  -----------
Net property and equipment                                170          216

Other assets - net of accumulated amortization
 of $1,502,000
 ($1,493,000 for 2007)                                     58           34
                                                  -----------  -----------
                                                  $       964  $       698
                                                  -----------  -----------

Liabilities and Stockholders' Deficit:

Current liabilities:
  Notes payable                                   $       788  $     3,342
  Accounts payable                                         31           75
  Customer deposits                                         -            -
  Accrued compensation and related costs                  286          298
  Accrued interest                                        235          196
  Accrued product warranty                                 79           82
  Other accrued liabilities                                47           40
Total current liabilities                                 486            -
                                                  -----------  -----------
                                                        1,952        4,033

Long-term debt                                          4,460            -

                                                  -----------  -----------
Total liabilities                                       6,412        4,033
                                                  -----------  -----------

Stockholders' deficit:
  Preferred stock, 400,000 shares authorized; none
   issued                                                   -            -
  Common stock, without par value, stated value
   $.20 per share; 70,000,000 shares authorized;
   29,566,409 shares issued and outstanding             5,913        5,913
  Additional paid-in capital                           47,040       39,407
  Accumulated deficit                                 (58,401)     (48,655)
                                                  -----------  -----------
Total stockholders’ deficit                            (5,448)      (3,335)
                                                  -----------  -----------
                                                  $       964  $       698
                                                  ===========  ===========



                       Statements of Operations
                         Integral Vision, Inc.
                (in thousands, except per share data)
                             (unaudited)



                                     Quarter Ended        Nine Months Ended
                               -------------------------  ----------------
                               Sep 30,  June 30,  Sep 30,  Sep 30,  Sep 30,
                                 2008     2008     2007     2008     2007
                               -------  -------  -------  -------  -------
Revenue:
  Net product sales            $    11  $   445  $   118  $   466  $   528
  Net revenue from product
   development agreements            -       25       33       25       33
                               -------  -------  -------  -------  -------
  Total revenues (See Note-B)       11      470      151      491      561
Costs of sales:
  Costs of sales for products       35      215      105      292      442
  Depreciation and amortization      4        4        4       13       13
                               -------  -------  -------  -------  -------
Total costs of sales                39      219      109      305      455
                               -------  -------  -------  -------  -------
Gross margin                       (28)     251       42      186      106

Other costs and expenses:
  Marketing                        160      191      146      499      458
  General and administrative -
   net                             470      340      321    1,143    1,000
  Engineering and development -
   net                             269      228      261      729      841
                               -------  -------  -------  -------  -------
Total other costs and expenses     899      759      728    2,371    2,299
                               -------  -------  -------  -------  -------
Operating loss                    (927)    (508)    (686)  (2,185)  (2,193)
Other income                         3        1       16        3       21
Interest expense                  (466)    (142)     (57)    (703)    (169)
Extinguishment loss from
 modification and exchange of
 debt instruments               (2,644)       -        -   (2,644)       -
Warrants issued to PIPE
 Investors                      (4,217)       -        -   (4,217)       -
                               -------  -------  -------  -------  -------
Net loss                       $(8,251) $  (649) $  (727) $(9,746) $(2,341)
                               =======  =======  =======  =======  =======

Basic and diluted loss per
 share:
  Net loss                     $ (0.28) $ (0.02) $ (0.02) $ (0.33) $ (0.08)
                               =======  =======  =======  =======  =======


Weighted average number of
 shares of common stock and
 common stock equivalents,
 where applicable               29,566   29,566   29,511   29,566   29,523
                               =======  =======  =======  =======  =======

Contact Information

  • Contacts:
    Corporation:
    Integral Vision, Inc.
    Charles J. Drake
    (248) 668-9230
    Email Contact

    Investors and Media:
    Guerrant Associates
    Laura Guerrant-Oiye
    (808) 882-1467
    Email Contact