Document Security Systems (DSS) Tops Q2 EPS by 49c, Revenues Miss

Document Security Systems (NYSE: DSS) reported Q2 EPS of ($0.19), $0.49 better than the analyst estimate of ($0.68). Revenue for the quarter came in at $3.1 million versus the consensus estimate of $4.29 million.

Second Quarter 2020 Financial Highlights

• Revenue for the second quarter of 2020 was $3.1 million, as compared to $3.5 million in the second quarter of 2019. The 10% decrease is a result of declining Printed Products and Technology revenue as both lines were impacted by the COVID-19 pandemic as demand for consumer packaging decreased and several customer events were cancelled or postponed.
• Net Loss from continuing operations during the second quarter of 2020 decreased to $672,000 ($0.19 per share), down from a net loss from continuing operations of approximately $732,000 ($1.00 per share) during the second quarter of 2019.
• Costs and expenses for the second quarter of 2020 totaled $4.4 million, as compared to $4.2 million during the same period of 2019, driven by increases in sales, marketing, general and administrative expenses, along with an increase in professional fees primarily driven by increase in consulting fees incurred by the Direct Marketing business segment and acquisition activities.
• Stockholders’ equity increased 62.3% to $19.9 million as of June 30, 2020, up from $12.3 million at December 31, 2019.

“We ended the quarter with a significantly strengthened balance sheet after successfully completing a capital raise in June that generated $6.2 million in net proceeds, and further bolstered our financial position raising an additional $9.9 million subsequent to the quarter end in July,” stated Frank D. Heuszel, CEO of DSS. “While second quarter revenues were impacted due to the effects of COVID-19, our Premier Packaging subsidiary began the third quarter with a major win, signing a multi-year deal valued at more than $24 million with a long-term customer and one of the world’s largest retailers. We are also extremely excited to have recently met the final condition to move forward with our acquisition of Impact BioMedical. DSS is continuing to pursue its strategy of diversification and this acquisition represents the dedicated efforts of our team to identify assets that we expect will be accretive to our business while approaching such transactions with vision and a focus toward creating lasting shareholder value.”

For earnings history and earnings-related data on Document Security Systems (DSS) click here.

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