LOS ANGELES, CALIFORNIA, May 28, 2019 (GLOBE NEWSWIRE) -- GTX Corp (OTCQB: GTXO) (“the Company”), a pioneer in the field of wearable GPS, people and asset tracking Location-Based Services (LBS) and Real-Time Location Systems (RTLS), today announced a summary for the First Quarter ended March 31, 2019.
First Quarter 2019 Highlights
- Overall Revenue decreased 59% over 2018 comparable period
- Overall Subscribers increased 26% over 2018 comparable period
- International Subscribers increased 37% over 2018 comparable period
- Domestic Subscribers increased 15% over 2018 comparable period
- IP Revenue increased 170% over comparable 2018 period
- Outside Financings decreased by 75% over 2018 comparable period
- Net cash used in operations decreased 45% over 2018 comparable period
Management commentary: Patrick Bertagna, CEO, GTX Corp.
Due to unforeseen and unexpected production delays surrounding Chinese New Year, we unfortunately missed our numbers because of timing and not being able to get product shipped out before the end of the Quarter. We did, however, ship all of our back orders in April, and as our business grows and we continue to increase our subscriber base, we expect these fluctuations in product sales to not be as impactful on revenues, hence why we continue to focus on building high-margin, recurring revenues from service subscriptions and IP licensing.
We used far less cash this Quarter, did not take on any new convertible financing, grew our subscriber base, transitioned our IP campaign by signing multiple license agreements, were granted two new patents, received a new military contract from an additional base, and partnered with Flint Rehab on an exciting new wearable and machine learning project. Product revenues for the First Quarter 2019 were also impacted because we shipped approximately $160,000 less to the military in the Quarter, than we did in First Quarter 2018. We have since received a new military order and expect to resume shipping the military in June. Even though product sales were lower due to not being able to get product out the door before the end of the Quarter, subscriber revenues and total number of subscribers were up. We did managed to keep a limited amount of SmartSole inventory on hand so our production delays did not impact consumer sales and therefore our subscriber revenues and total number of subscribers increased by 26% compared to the same period last year.
During the period ending March 31, 2019, the Company was granted two new patents, adding more depth, substance and value to its IP portfolio. As the Company continued to focus on building channels of distribution and expanding its product line, we also started recognizing revenues from granting non-exclusive intellectual property licenses to companies that are using our patented technology in the marketplace. We signed three IP license agreements in the First Quarter 2019, and subsequently, another two licenses have been signed. The signing of these agreements marks the transition of our campaign and highlights that we are now starting to monetize the portfolio. Bound by confidentiality, we cannot disclose the names or the dollar amounts of each individual agreement, however, our legal team is currently in ongoing conversations or negotiations with approximately a dozen companies and we expect to sign additional agreements this year. Our IP licensing revenues for the First Quarter 2019, compared to First Quarter 2018, increased 170% and furthering our current IP monetization strategy, GTX is also exploring licensing some of its other patents, intellectual property and assets within some of its school and military business units.
On the military front, we were actively working with Hill Air Force Base in Utah and although we did not receive the contract until April, which is after the end of the Quarter, we did spend a lot of time during the Quarter working with Hill, mapping out a solution to enable them to track their assets. Hill is now our second base that has issued us a contract and we expect to ship the initial order in June. Hill is approximately four times larger than Edwards, which we continue to support and, as part of the Hill contract, we are developing a next generation transmitter, with custom features, which will include an SOS button and extended range and battery life. Since mid-2018, we have also been working with the Sri Lanka Government to get our line of GPS tracking solutions approved for sale and import into the Country as part of a large scale requirement from the Sri Lanka Army, Disaster Management Centre, and Centre for Research and Development under the Ministry of Defense, to tag, track and locate (TTL) their personnel and equipment. During the Quarter, the Sri Lanka Ministry of Defense awarded us a Supplier Registration Certificate, which will now allow us to export our products and technology into the Country. We are also continuing conversations with other foreign and domestic military agencies.
During the First Quarter 2019, the U.K.’s National Health Services (NHS) expanded their regional pilot programs for our GPS SmartSoles across five municipalities and we expect to see an increase in SmartSole sales and subscribers out of the U.K. this year. Under the NHS program, certain police departments have been issued grants to implement tracking and monitoring technology for seniors. The Scotland PD recently initiated a pilot for the GPS SmartSoles, under the digital rollout program. The initial order has been shipped and we expect to receive the results in June or July which should include a forecast for the remainder of 2019. Most of our international distributors are reporting an increase in activity both in sales and subscribers. In addition to the U.K., Norway, Sweden, Germany and Denmark are experiencing an increase in product demand from government agencies, municipalities, police departments, health services and the private sector.
As part of a long-term R&D project, in February of 2019, we signed a Collaboration Agreement with Flint Rehab, a leading neuro-rehabilitation device company that specializes in next-generation digital health technologies. As part of the Agreement, GTX and Flint Rehab plan to develop a noninvasive GPS wearable tracker for those who wander, which will include location-based GPS technology, biometric activity sensors and machine learning. GTX recently filed a patent for embedding sensors into both right and left insoles with the ability to communicate via Bluetooth. This patent filing is significant to this project as it will be part of the intellectual property of this proposed future product. By having sensors for tracking and biometrics, and utilizing both the left and right soles, we expect to provide a unique and proprietary offering to the marketplace. The National Institute on Aging at the National Institutes of Health (“NIH”) has made funding available for companies to develop these types of technologies as part of their plan to address the growing number of people afflicted with Alzheimer’s disease in America. Flint Rehab has applied for grant funding for this project and we expect to hear from the approval committee sometime in July or August of this year.
“In summary, the First Quarter 2019 was a foundation building period for GTX Corp as we focus on growing our high-margin, recurring revenues from service subscriptions and IP licensing, while also expanding our Military business and laying down the ground work for the future through our collaboration with Flint Rehab” said CEO Patrick Bertagna. “We expect that these fundamental building blocks along with the significant decrease in cash used and outside financing will help position our Company for growth, during the second half of 2019 and into 2020.”
GTX Corp (GTXO) is a pioneer in smart, mobile and wearable GPS tracking and recovery location based products, supported through a proprietary IoT enterprise monitoring platform. GTX offers a global end-to-end solution of hardware, software and connectivity. GTX Corp develops 2 way GPS tracking technologies which seamlessly integrate with consumer products and enterprise applications. GTX Corp utilizes the latest in miniaturized, low power consumption GPS, Cellular, RF and BLE technology enabling subscribers to track in real time the whereabouts of people or high value assets through a complete end to end - customizable transceiver module, wireless connectivity gateway, smart phone Apps, middleware, and IoT portal. Headquartered in Los Angeles, California, GTX is known for its award-winning patented GPS SmartSole® - Think Dr. Scholl’s meets LoJack, the world’s first invisible wearable technology tracking device created for those at risk of wandering due to Alzheimer’s, dementia, autism and traumatic brain injury. GTX Corp’s business model is built around technology innovation and holds over 85 patents with many issued patents in the area of GPS tracking. The company has international distributors servicing customers in over 35 countries and is a U.S. Military Government contractor. Other customers include public health agencies and municipalities, emergency and police authorities, private companies, public and private senior care homes, and consumers.
GTX Corp is an equal opportunity employer with a history of employing a diverse workforce and U.S. veterans; makes many of its products in the USA, is a member of the United Nations Global Compact and Trust 2 Protect partnership. The Company doesn’t just make and sell the best GPS tracking products, they deliver innovative, miniaturized, low power consumption wearable tech that provides safety, security and peace of mind at the touch of a button. GTX puts the "Where" in Wearable Tech.
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Forward Looking Statements
This news release contains forward-looking statements. The terms and phrases “expects,” “would,” “will,” “believes,” and similar terms and phrases are intended to identify these forward-looking statements. Forward-looking statements are based on estimates and assumptions made by GTX in light of its experience and its perception of current conditions and expected future developments, as well as other factors that GTX believes are appropriate in the circumstances. Many factors could cause GTX’s actual results, performance or achievements to differ materially from those expressed or implied by the forward-looking statements. Certain risk factors that may cause actual results to differ are set forth in GTX’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (which may be obtained on the SEC Website). These factors should be considered carefully, and readers should not place undue reliance on GTX’s forward-looking statements. GTX has no intention and undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.