 WALL, N.J., Aug. 14, 2020 GLOBE NEWSWIRE -- BIO-key International, Inc. Nasdaq: BKYI, an innovative provider of biometric and other multi-factor identity and access management IAM solutions for strong, convenient user authentication and large-scale identity applications, today reported results for its second quarter ended June 30, 2020 Q220. BIO-key will host a conference call today at 10:00 a.m. ET details below to review its results and outlook. Recent Highlights: BIO-key expanded its multi-factor identity and access management solution suite with purchase of PortalGuard developer PistolStar. PortalGuard is an enterprise multifactor authentication and single sign-on platform deployed and used by millions of users at hundreds of customers around the world. The 2.5M transaction closed on June 30. BIO-keys Channel Alliance Program, launched in September 2019, has expanded to now include 40 partners. Manny Alia, an Africa-focused business development and management consultant and former JPMorgan Chase executive, was added to BIO-keys Board of Directors. Mr. Alia played an instrumental role in guiding BIO-keys business development and partnership initiatives in Africa. BIO-key completed a 24.8 million underwritten public offering of 38.2M shares of common stock and equivalents and an equal number of five-year warrants exercisable at 0.65 at a combined price of 0.65. The offering closed on July 23rd. BIO-keys biometric solution to secure access to voter registration data was selected for state-wide deployment across 36 counties of a West Coast state, building the solutions U.S. footprint. A multinational agriculture company rolled-out an initial deployment of BIO-keys biometric software solutions and PIV-pro finger print readers to secure system access by their workers at its California facility, with plans to deploy the second location in the next two months. A foreign national bank selected BIO-keys WEB-key, ID Director for Windows software and EcoID and SideSwipe fingerprint readers for its office in Sydney, Australia to protect access to the banks internal data. WEB-keys patented secure, one-to-many cloud authentication capabilities represented a compelling differentiator for the bank, which was seeking to provide secure access for roving users utilizing shared workstations. BIO-keys PortalGuard multifactor authentication solution has been deployed recently by multiple educational institutions and other enterprises across the country.BIO-key CEO Michael DePasquale commented, As anticipated, Q2 was a very challenging period from a revenue standpoint as most software and hardware procurement decision-making was put on hold as government and enterprise customers responded to the COVID-19 pandemic. BIO-key used this period to advance our strategic goals of expanding the breadth of our software solutions, building out our team and infrastructure in Africa, and laying the groundwork for a complete recapitalization of our Company which we completed in July. We believe these initiatives have positioned us well for long term success.The acquisition of PortalGuards parent company PistolStar was completed on June 30, 2020, therefore, its contributions to our operating results will begin in the third quarter. This is a very exciting acquisition for BIO-key as it substantially expands our software offerings and our potential available market, while also bolstering our team in the key areas of sales, marketing and RD as well as increasing our customer base, particularly in key verticals like higher education, financial services, and state and local government. We also believe there are considerable cross selling opportunities between the products and customer bases.Given the business uncertainty caused by the COVID-19 pandemic and its impact on the timing of large scale procurements such as our very large mass-ID programs in Africa, combined with our desire to invest in our business both via acquisition and by building out key teams, we moved to pursue a substantial recapitalization of our company during the second quarter, a process that was successfully concluded in July. The recapitalization allowed us to repay short-term note financings, fully-fund the PistolStar acquisition, and make focused investments in personnel and resources in our most promising areas, including BIO-key Africa. It has also put BIO-key on a very strong financial footing upon which to build our business allowing us to focus our full attention on growth initiatives rather than on working capital, while clearly demonstrating our financial strength to large customer prospects. Finally, during these periods of economic uncertainty, we recognize the importance of being well funded so that we are not only able to endure any challenges but also well positioned to take advantage of potential opportunities that might arise.We have begun to put some of this capital to use, by among other things, building out our team and infrastructure at our BIO-key Africa subsidiary. Initiation of two large scale contracts in Nigeria totaling 75M in anticipated revenue over approximately two years has been delayed due to COVID-19 shutdowns. Things are beginning to reopen and we are now engaged with both customers on planning for these projects, which we now believe will commence before year-end. At the same time, we are also working to extend dialogues on other Africa-based opportunities, however, we currently have limited visibility on the scope and potential timing of such projects.Q2 2020 Results Q220 revenues declined to 307,000 from 728,000 in Q219, primarily due to the business interruption effects of COVID-19 and to lower hardware revenue related to BIO-keys exit of the retail lock business.Gross margin improved to 52 in Q220 versus 7 in Q219, primarily reflecting the elimination of 281,000 in non-cash software license amortization expense recorded in Q219 which did not recur in Q220.Q220 operating expenses increased to 1.5 million from 1.4 million, reflecting the benefit of cost reduction efforts offset by a one-time non-cash warrant expense, as payment for professional services, and personnel restructuring charges for operations in China. BIO-key reported a Q220 operating loss of 1.4M compared to 1.3M in Q219.BIO-keys Q220 results reflect the benefit of 341,000 from a government grant pursuant to the Cares Act PPP funding, offset by 542,000 of net interest expense for amortization of costs associated with the Companys funding efforts, compared to net interest expense of 114,812 in Q219.BIO-key reported net loss available to stockholders of 1.6M, or 0.08 per basic share, in Q220 compared to 1.4M, or 0.10 per basic share, in Q219. Weighted average basic shares outstanding were approximately 20.9M in Q220 compared 14.1M in the year ago second quarter.Financial Strength Subsequent to the close of the second quarter, BIO-key completed an underwritten public offering of common stock and equivalents plus warrants for gross proceeds of 24.8M. After giving effect to the payment of offering expenses, repayment of 4.23M in convertible notes, and the payment of approximately 0.5M in accounts payable, BIO-key had approximately 18M in cash as of August 3, 2020 and no outstanding debt, aside from the 500,000 note payable issued in connection with the acquisition of PistolStar.Conference Call Details Date Time Today, Friday, August 14 at 10 a.m. ET Call Dial In : 1-877-418-5460 U.S. or 1-412-717-9594 International Live Webcast Replay: Investor Webcast Replay Available for 3 months. Audio Replay: 1-877-344-7529 U.S. or 1-412-317-0088 Intl; code 10147125 About BIO-key International, Inc. BIO-key is revolutionizing authentication with biometric centric, multi-factor identity and access management IAM solutions, including its PortalGuard IAM solution, that provide convenient and secure access to devices, information, applications and high-value transactions. BIO-keys proprietary software and hardware solutions, with industry leading biometric capabilities, enable large-scale on-premise and Identity-as-a-Service IDaaS solutions as well as customized enterprise and cloud solutions.BIO-key Safe Harbor Statement All statements contained in this press release other than statements of historical facts are 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 managements 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 not guarantees of future performance or events and are subject to risks and uncertainties that may cause actual results to differ materially from those included within or implied by such forward-looking statements. 