xG Technology Reports Third Quarter 2016 Results and Conference Call

SARASOTA, Fla., Nov. 14, 2016 /PRNewswire/ -- xG Technology, Inc. ("xG" or the "Company") (Nasdaq: XGTI, XGTIW), a leader in providing critical wireless communications for use in challenging operating environments, announced its results for the third quarter ended September 30, 2016. Management will hold a conference call to discuss these results on November 15, 2016 at 5:00 p.m. Eastern Time (details below).

Key Recent Accomplishments

• The Company announced a $16 million binding agreement to acquire Vislink Communication Systems. The purchase is expected to close by year-end 2016. Vislink, which has a present year sales run rate that is expected to be between $45 million and $50 million, specializes in the wireless capture, delivery and management of secure, high-quality, live video from the field to the point of usage.
• The Company received a $3.0 million award in partnership with Southwest Research Institute® ("SwRI") issued by the Defense Information Systems Agency for Prototype Spectrum Sharing Systems for the 2025-2110 MHz frequency band. The award underscores the applicability of xG's unique core technology and leverages IMT's digital broadcasting expertise.
• xG business unit Integrated Microwave Technologies ("IMT") received a $500,000 order from a leading robotic defense contractor for wireless video transmission modules for use in military remote ordnance disposal applications.
• IMT received a $200,000 order from a prominent state police agency located in the Mid-Atlantic region for an Airborne Video Downlink System ("AVDS"). The system consists of video communications equipment and related services that extend the efficacy of tactical operations by leveraging police airborne units.
• The Company announced it is on track to record annual cost savings exceeding $2.0 million resulting from synergies realized by the acquisition of IMT. This is above the amount forecasted in February 2016 when the acquisition was concluded, and includes cost reductions that have already been recorded as well as ones that are to come.

George Schmitt, CEO and Chairman of the Board of xG Technology, said, "We are pleased to report making forward progress in our operations, particularly our efforts to hold our costs in line as we ramped up revenues. We are seeing contributions from both the xMax and IMT sides of our business lines, and we expect that to continue through ongoing opportunities that leverage the strength of our expanded technology solutions."  

Mr. Schmitt continued, "We expect that the proposed acquisition of Vislink will deliver tremendous synergies with xG's xMax and IMT business units in a several areas, including satellite communications-based solutions, highly configurable software-based development platforms, and antenna design and manufacturing. Subject to our closing on the Vislink acquisition, we expect to see our overall revenues range around $75 million next year, allowing for some fluctuation due to currency exchange rates. If we achieve that, we expect to record positive EBITDA in the range of $10 million to $15 million, cash flow in the range of $5 million to $10 million, and positive net income for the year, excluding one-time financing and other non-recurring costs. This will be driven by the cost-cutting that has already occurred, the synergies to be realized from this acquisition, and strong traction we are seeing in the marketplace for our products."

Review of Results

Revenues for the three and nine months ended September 30, 2016, were $1,913,000 and $4,497,000, respectively, representing an increase of $1,724,000 and $3,351,000, respectively, from $189,000 and $1,146,000 in the corresponding periods in 2015. The revenue of $1,913,000 resulted from $1,851,000 from sales of equipment and $62,000 from engineering services for the three months ended September 30, 2016, which can be attributed to the acquisition of IMT. The revenue of $4,497,000 resulted from $4,339,000 from sales of equipment and $158,000 from engineering services during the nine months ended September 30, 2016. Of the $4,497,000 in revenue, $154,000 was previously recorded as deferred revenue.

For the three and nine months ended September 30, 2016, the Company had a net loss of $3.1 million and $11.8 million, respectively, compared to a net loss of $3.1 million and $10.6 million for the three and nine months ended September 30, 2015, respectively, an increase of $1.2 million from the corresponding nine month period a year ago. The increase in net loss is due to an increase in amortization and depreciation, general and administrative, and research and development expenses, largely due to the acquisition of IMT.

xG ended third quarter 2016 with $1.8 million in cash compared to $368,000 at December 31, 2015.

Financial Results Conference Call Details

xG management will hold a conference call to discuss xG's Q3 2016 results on November 15, 2016 at 5:00 p.m. Eastern Time. To participate in the conference call, please call 888-317-6003 (toll free) or 1-412-317-6061 (international call-in). The Elite Entry number, 5496882, will be required to join the conference call. The call will also be simultaneously webcast via a link available at http://www.xgtechnology.com/about-xg-technology/investor-information/. For those who cannot participate in the call, an audio replay will be made available on xG's website.

About xG Technology, Inc.

Founded in 2002, xG Technology has developed technologies that enable always-available, always-connected and always-secure voice, broadband data and video communications. The company's brand portfolio includes xMax and Integrated Microwave Technologies (IMT).

xMax is a patented all-IP, software-defined cognitive radio network that delivers mission-assured wireless connectivity in any RF environment. It provides a solution to the challenges of interoperability, survivability and flexibility in expeditionary and critical communications networks. xMax incorporates advanced optimizing technologies that include spectrum sharing, interference mitigation, multiple-input multiple-output (MIMO) and software defined radio (SDR), making it ideal for wide area, as well as rapid emergency communication deployment in unpredictable environments and during fluid situations. xMax offers solutions for numerous industries worldwide, including military, emergency response and public safety, telemedicine and critical infrastructure.

IMT is a leading provider of mission-critical video solutions, advanced digital microwave systems and engineering, integration, installation and commissioning services serving the Broadcast, Sports & Entertainment and MAG (Military, Aerospace & Government) markets. Since its inception, IMT has focused on building a product portfolio that incorporates a high level of performance, reliability and build quality, extended operating ranges and compact form factors. IMT's product lines include digital broadcast microwave video systems, compact microwave video equipment for licensed and license-free sports and entertainment applications, and wireless video solutions designed for use by state, local and federal police departments. More information on IMT can be found at www.imt-solutions.com.

Based in Sarasota, Florida, xG has over 100 patents and pending patent applications. xG is a publicly traded company listed on the NASDAQ Capital Market (symbol: XGTI) For more information, please visit www.xgtechnology.com

Cautionary Statement Regarding Forward Looking Statements

Statements contained herein that are not based upon current or historical fact are forward-looking in nature and constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements reflect the Company's expectations about its future operating results, performance and opportunities that involve substantial risks and uncertainties.  These statements include but are not limited to statements regarding the intended terms of the offering, closing of the offering and use of any proceeds from the offering. When used herein, the words "anticipate," "believe," "estimate," "upcoming," "plan," "target", "intend" and "expect" and similar expressions, as they relate to xG Technology, Inc., its subsidiaries, or its management, are intended to identify such forward-looking statements. These forward-looking statements are based on information currently available to the Company and are subject to a number of risks, uncertainties, and other factors that could cause the Company's actual results, performance, prospects, and opportunities to differ materially from those expressed in, or implied by, these forward-looking statements.

For More Information:

Daniel Carpini xG Technology [email protected] (941) 953-9035

 

 

 

 

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/xg-technology-reports-third-quarter-2016-results-and-conference-call-300362583.html

SOURCE xG Technology, Inc.