WALL, N.J., July 14 /PRNewswire-FirstCall/ -- BIO-key International, Inc. (OTC Bulletin Board: BKYI), a leader in wireless public safety and finger-based biometric identification solutions, today issued the following open letter to its shareholders discussing recent improvements in its businesses, operating trends and stock performance.
WALL, N.J., July 14 /PRNewswire-FirstCall/ — BIO-key International, Inc. (OTC Bulletin Board: BKYI), a leader in wireless public safety and finger-based biometric identification solutions, today issued the following open letter to its shareholders discussing recent improvements in its businesses, operating trends and stock performance.
— Revenue growth from new biometric customers, recurring licensing revenues and an increase in our installed base of law enforcement customers
— Deepening of the relationship with Research in Motion ("RIM") and wireless carriers to market and sell BIO-key's public safety mobile solutions
— Near-term profitability — Commitment to build shareholder value
Over the last two quarters, BIO-key announced several significant new orders that reflect the momentum being built in the Company's biometrics business as well as a number of contracts that have increased our installed base of accounts. We are very excited about the new opportunities being generated through our biometrics business that reflect rising levels of global adoption for biometric solutions. In June, we announced that the Company received a $2 million contract for software licenses from a global leader in multi-biometric solutions. We expect to deliver this contract during the second and third quarters of this year. This order represents our largest single biometric order ever. More significantly, the award demonstrably validates the accuracy, speed, scalability and robustness of our VST technology. We believe that our technology's superior performance results in real world applications that dramatically improve our ability to compete for opportunities in future commercial and government projects. Additionally, this contract is tied to a partnership that fuses the strengths of our collective technologies to create a high performance biometric matching solution. The contract, which also includes recurring maintenance fees allows for additional licensing of BIO-key's software for projects on a global basis.
In February, we announced that the Indiana Blood Center ("IBC") committed to deploying our WEB-key(R) technology to enhance the convenience and security of identifying blood donors. With this commitment, the IBC became the first in its industry to adopt WEB-key in confirming the identity of donors. The IBC's commitment to us has also led other blood centers to consider deploying identity assurance platforms in order to ensure privacy and security.
In addition to these two wins, we announced earlier in the year our ongoing involvement in the world's largest biometric deployment. We have enrolled over eighty-five million Bangladeshi citizens since project deployment through our WEB-key technology and we are pleased to have received recognition — along with our partners, Tiger IT and the Bangladesh Army — from the UN on the scope and effectiveness of the program. A follow-on contract for the biometric-based solution was awarded in the fourth quarter of 2007. We believe continued growth in our biometric business will lead to improvements in our gross margins. Additionally, since our business is based on sales of high margin software and services, we believe securing additional large contracts — such as our recent $2 million biometric contract — enhances our ability to deliver near-term and consistent profitability.
With respect to our Law Enforcement business, we recently initiated a program to market our mobile access public safety solutions — primarily PocketCop(R) — alongside RIM, Sprint, AT&T, Verizon Wireless and Dobson Communications, among others. Our open-source, network independent PocketCop solution presents an attractive selling point to our partners in this initiative. Our strategy of marketing our solutions jointly with the wireless technology provider and/or handset manufacturer provides a number of compelling benefits, including considerably increasing our distribution reach into the market. We believe this initiative will provide us with access to larger opportunities that were unavailable to us in the past and will also enhance our ability to win those opportunities.
In tandem with our program with the wireless carriers and RIM, we continue to experience positive feedback from our one-day regional user sessions. These events have exposed our solutions to over 250 agencies throughout the country and have enabled us to refine our software based on feedback and responses from participants. We have already experienced positive results in our add-on business from this initiative including a recent $335,000 contract with the Baltimore, MD Police Department for additional MobileCop(R) licenses. We believe that our installed base of 1,000 accounts provides us with a sound platform to leverage and sell our solutions to new accounts and add-ons. Over the last fourteen months, BIO-key added more than fifty new state, county and local agencies to its customer base. Each of these agencies licensed our MobileCop solution and other MobileCop customers hosted more than 50% of these new accounts.
Over the past two years, our operating profile has changed as we focused the Company on the core businesses of developing advanced biometric identification solutions and unique applications for mobile and handheld devices used by public safety professionals. Our focus remains clearly set on achieving consistent profitability while maintaining a balance sheet that provides us with the resources to grow our business. We continue to evaluate all of our non-dilutive options that will enable us to strengthen our balance sheet and achieve our operating goals.
As we discussed on the last several quarterly earnings calls, we are seeing an inflection point being reached in the biometric space and we anticipate making continued progress toward winning several high profile government and commercial projects that have been pending for the past twelve to eighteen months.
Despite positive biometric industry trends and our strong public safety account base, the Company's market value currently stands below our industry peers on a Price /Sales ratio basis. We do not believe that this valuation accurately reflects the Company's opportunity with respect to ongoing biometric growth, add-ons, upgrades and new application sales as well as strategic possibilities and partnerships that are currently being explored.
We believe that we are operating in an increasingly visible and emerging market in biometrics — as evidenced by global trends — and are very excited about the ongoing development of new solutions in the Law enforcement sector. We remain focused on achieving near-term and sustained profitability. We believe that we are better positioned than ever before and intend on managing the Company to create shareholder value in a principled and straightforward fashion. We appreciate our shareholders' continued support and belief in the Company and we look forward to updating you further on the Company's financial performance on our next quarterly earnings call.
BIO-key International, Inc., headquartered in Wall, New Jersey, develops and delivers advanced identification solutions and information services to law enforcement departments, public safety agencies, government and private sector customers. BIO-key's mobile wireless technology provides first responders with critical, reliable, real-time data and images from local, state and national databases. BIO-key's high performance, scalable, cost-effective and easy-to-deploy biometric finger identification technology accurately identifies and authenticates users of wireless and enterprise data to improve security, convenience and privacy and to reduce identity theft. Over 750 police departments in North America use BIO-key solutions, making BIO-key the leading supplier of mobile and wireless solutions for law enforcement. (http://www.bio-key.com)
Certain statements contained in this press release may be construed as "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 (the "Act"). The words "estimate," "project," "intends," "expects," "anticipates," "believes" and similar expressions are intended to identify forward-looking statements. Such forward-looking statements are made based on management's beliefs, as well as assumptions made by, and information currently available to, management pursuant to the "safe-harbor" provisions of the Act. These statements are subject to certain risks and uncertainties that may cause actual results to differ materially from those projected on the basis of these statements. These risks and uncertainties include, without limitation, our history of losses and limited revenue, our ability to develop new products and evolve existing ones and our ability to attract and retain key personnel. For a more complete description of these and other risk factors that may affect the future performance of BIO-key International, Inc., see "Risk Factors" in the Company's Annual Report on Form 10-KSB for the year ended December 31, 2007 and its other filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. The Company also undertakes no obligation to disclose any revision to these forward-looking statements to reflect events or circumstances after the date made or to reflect the occurrence of unanticipated events.
Company Contact: BIO-key International, Inc.
Michael DePasquale 732-359-1110
SOURCE BIO-key International, Inc.