SOURCE: Lattice Incorporated

Lattice Incorporated

May 17, 2016 08:47 ET

Lattice Announces First Quarter 2016 Financial Results

Conference Call Today, Tuesday, May 17 at 2:00 p.m. ET

PENNSAUKEN, NJ--(Marketwired - May 17, 2016) - Lattice Incorporated (OTCQB: LTTC) ("Lattice" or the "Company"), a cloud-solutions provider of inmate management network systems for correction facilities, announced its financial results for the first quarter ended March 31, 2016.

First Quarter Highlights:

  • Total revenue increased to $2.4 million, up from $1.5 million in the year-ago period
    • Direct service revenue increased 25% compared to the prior year period
    • Wholesaled technology revenue increased to $956,000 from $329,000 in the prior year period
  • Adjusted operating income of $180,000, compared to an adjusted operating loss of $694,000 in the year-ago period. A reconciliation of adjusted operating income (loss), a Non-GAAP metric is included in our 10Q filing.

"We continued to grow our higher-margin direct service revenue in the first quarter," said Paul Burgess, CEO of Lattice. "We remain focused on expanding market share, both geographically and through deeper penetration of the markets and facilities we serve. As part of that effort, our recently launched CellMate™ Mobile platform is an example of our ability to broaden our product offering with innovative solutions, and we anticipate adoption of the technology to accelerate as new services and applications are added."

Direct service revenue provided to correctional facilities based on multi-year contractual relationships with local governments, increased 25% to approximately $1.5 million, up from approximately $1.2 million in the prior year period. Call provisioning revenue, a component of direct service revenue and a key operating metric of the Company's growth strategy, increased 18% to approximately $1.0 million as a result of adding sites and increasing deposit venues at existing sites.

Technology product revenues increased to approximately $1.0 million during the first quarter, up from approximately $0.3 million in the year-ago period. Technology revenues vary period to period with the timing of customer orders and product shipments, and such variations should not be viewed as a trend. We expect 2016 technology revenue to be at or above fiscal 2015 on an annual basis.

Gross margin, as a percentage of revenues, increased to 50% from 35% in the first quarter of 2015. When compared to the prior year quarter the increase in percentage in the current quarter was mainly due to revenue mix as a result of the increase in technology revenue relative to overall revenue compared to the prior year level. In the current quarter, technology revenue accounted for 39% of revenue compared to 22% in the prior year period. On average, the gross margin percentage on technology revenue averages approximately 60% with service revenue gross margin at approximately 30%.

Additional information may be found in the Company's 10-Q filing with the U.S. Securities and Exchange Commission.

Conference Call

Lattice will hold a conference call today, May 17, with CEO Paul Burgess and CFO Joseph Noto, at 2:00 p.m. Eastern time (11:00 a.m. Pacific).

To participate in the call, please dial (888) 364-3108, or (719) 325-2458 for international calls, approximately 10 minutes prior to the scheduled start time. Conference ID: 4873085

A replay of the call will be available for two weeks from 5:00 p.m. ET on May 17, until 11:59 p.m. ET on May 31. The number for the replay is (877) 870-5176, or (858) 384-5517 for international calls; the passcode for the replay is 4873085. In addition, a recording of the call will be available at http://www.redchip.com/company/home/LTTC for one year.

About Lattice Incorporated

Lattice is a provider of inmate management and communications solutions that improve efficiency, reduce administrative burden, and deliver recurring revenue opportunities for corrections facilities globally. Lattice's Corrections Operating Platform™ (COP) is comprised of innovative, highly secure solutions including phone systems, prepaid calling options, voicemail, on-site and remote video visitation and arraignment, point-of-sale kiosks, e-mail, text messaging, and social media. COP's inmate management module efficiently manages prison processes, including communications monitoring, commissary purchases, account funding and billing, biometrics, booking, incident reporting, and more. For more information, visit http://www.latticeinc.com.

Safe Harbor Statement

Safe-Harbor Statement under the Private Securities Litigation Reform Act of 1995: This press release may contain forward-looking information within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, including all statements that are not statements of historical fact regarding the intent, belief or current expectations of the company, its directors or its officers with respect to, among other things: (i) the company's financing plans; (ii) trends affecting the company's financial condition or results of operations; (iii) the company's growth strategy and operating strategy; and (iv) the risk factors disclosed in the Company's periodic reports filed with the SEC. The words "may," "would," "will," "expect," "estimate," "anticipate," "believe," "intend" and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the company's ability to control, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors including the risk factors disclosed in the company's Forms 10-Q previously filed with the SEC.

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