By Susan A. Baird
PBN Web Editor
PROVIDENCE – Traffic-enforcement systems and services provider Nestor Inc. (OTCBB: NEST) posted a first-quarter net loss of $2.50 million, a 66-percent increase from the year-ago period’s $1.51 million, despite revenue that climbed 21.7 percent to $2.98 million.
Nestor – parent of Nestor Traffic Systems – cited increased selling and marketing expenses “as the company expands its presence to aggressively pursue new automated traffic-enforcement opportunities,” as well as a $180,000 charge for share-based compensation, up from $140,000 in the year-ago period.
Its growth in recurring revenue “reflects the continued increase in installed systems, with 309 installed CrossingGuard units and eight installed Poliscan units generating revenues at March 31, 2008, as compared to 217 installed CrossingGuard units and 11 installed Poliscan units at March 31, 2007,” the company said in its after-market report. “This increase in revenues is partially offset by the deferral of revenue for one significant customer, pending finalization of an amended contract.”
The quarterly report filed yesterday with the U.S. Securities and Exchange Commission “marks Nestor’s first public filing after its inclusion on the OTC Bulletin Board,” the company noted. Nestor previously had been listed on The Nasdaq Stock Market, but was de-listed at the end of April after its stock price fell below the exchange’s $1-per-share minimum and the company was unable to regain compliance. (READ MORE)
“The results reported for the first quarter of 2008 represent continued improvement realized by the company,” CEO Clarence A. Davis said in a statement.
“We are pleased to note that we added eight new approaches with two new customers in Diboll, Texas and San Juan Capistrano, Calif., during the quarter and will add 18 to 22 approaches in Grand Prairie, Canada, in the second quarter. Finally, the expansion of our sales organization and pursuit of strategic relationships to take advantage of the expanding market for automated enforcement services and other security applications is going well.
“Although we are disappointed that we were unable to maintain the continued listing requirements [of] the Nasdaq Capital Market, we are pleased that our stock continues to be traded on a real-time basis over the Bulletin Board.
“Investors should see no meaningful difference in their ability to trade or track our common stock,” Davis said. “Moreover, this change has no effect on our customers or our ability to serve them.”
Going forward, he said, “we anticipate that our improved performance – coupled with improving financial performance – will allow us to reapply for inclusion on the Nasdaq or other national or regional stock market or exchange, if deemed in our best interest.”
Total assets declined 6.4 percent over the quarter to $23.44 million at March 31, the company said. Nestor listed $1.24 million in cash and cash equivalents as of March 31, a 60.5-percent decline from the $3.13 million it listed as of Dec. 31.
Working capital declined 46.7 percent year-over-year, to $1.6 million at the end of the first quarter from $3.0 million on March 31, 2007, Nestor said.
Nestor Inc. (OTCBB: NEST), the parent of Nestor Traffic Systems, is a provider of video-, photo- and LiDAR-based traffic-enforcement systems and services to state and municipal governments. For more information, visit www.nestor.com.
