GlobeNewswire Inc | Aug 13, 2020 04:05PM EDT

August 13, 2020

RICHARDSON, Texas, Aug. 13, 2020 (GLOBE NEWSWIRE) -- INTRUSION Inc. (OTCQB: INTZ), (Intrusion) announced today financial results for the three and six months ended June 30, 2020.

INTRUSIONs net loss was $715 thousand in the second quarter 2020, compared to a net income of $1.8 million in the second quarter 2019 and net loss of $465 thousand in the first quarter 2020.

Revenue for the second quarter 2020 was $1.7 million compared to $4.0 million in the second quarter 2019 and $1.8 million for the first quarter 2020.

Gross profit margin was 61 percent of revenue in the second quarter of 2020 compared to 60 percent in the second quarter 2019 and 58 percent in the first quarter 2020.

INTRUSIONs second quarter 2020 operating expenses were $1.7 million compared to $0.7 million in the second quarter 2019 and $1.5 million in the first quarter 2020.

As of June 30, 2020, INTRUSION reported cash and cash equivalents of $2.9 million, working capital of $2.4 million and debt of $630 thousand.

Order delays have continued into the second quarter of 2020 due to COVID-19. We continue to have positive customer response and look forward to future opportunities. With reduced government staffing, reporting tasks have been greatly reduced. Government renewal business has experienced some delays; however, contract starts have experienced more significant delays due to the pandemics effect on government operations. We anticipate customer orders will pick up in the second half of 2020 provided that government employees continue to return to work, stated Jack B. Blount, President and CEO of Intrusion. Thankfully, the commercial cybersecurity market is expected to grow in 2020. This has escalated an already impressive response to our newest solution offering, INTRUSION Shield.

Shield has experienced positive progress during Alpha testing and we have identified twelve companies for the Beta release anticipated to begin in September. The configuration of hardware is a single Dell network appliance installed inline inside of the customers firewall. The size of the network appliance will vary depending on the number of workstations and the size of the customers internet connection be that 1Gb, 10Gb or 100 Gb, concluded Blount.

Intrusions management will host its regularly scheduled quarterly conference call to discuss the Companys financial and operational progress at 4:00 P.M., CDT Thursday. Interested investors can access the call at 1-833-360-0880. For those unable to participate in the live conference call, a replay will be accessible beginning today at 7:00 P.M., CDT until August 20, 2020 by calling 1-855-859-2056. At the replay prompt, enter conference identification number 9435598. Additionally, a live and archived audio webcast of the conference call will be available at www.intrusion.com.

About INTRUSION Inc.

INTRUSION Inc. is a global provider of entity identification, high speed data mining, cybercrime and advanced persistent threat detection products. INTRUSIONs product families include TraceCop for identity discovery and disclosure, and Savant for network data mining and advanced persistent threat detection. INTRUSIONs products help protect critical information assets by quickly detecting, protecting, analyzing and reporting attacks or misuse of classified, private and regulated information for government and enterprise networks. For more information, please visit www.intrusion.com.

This release may contain certain forward-looking statements, which reflect management's expectations regarding future events and operating performance and speak only as of the date hereof. These forward-looking statements involve a number of risks and uncertainties. Such statements include, without limitations, statements regarding future revenue growth and profitability, the difficulties in forecasting future sales caused by current economic and market conditions, the effects of sales and implementation cycles for our products on our quarterly results and difficulties in accurately estimating market growth, the effect of military actions on government and corporate spending on information security products, spending patterns of, and appropriations to, U.S. government departments,as well as other statements. These statements are made under the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties which could cause actual results to differ materially from those in the forward-looking statements. The factors that could cause actual results to differ materially from expectations are detailed in the Company's most recent reports on Form 10-K and Form 10-Q, particularly under the heading Risk Factors.

INTRUSION INC.UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS(In thousands except par value amounts) June 30, December 31, 2020 2019 ASSETS Current Assets Cash and cash equivalents $ 2,872 $ 3,334 Accounts receivable 1,067 1,566 Prepaid expenses 388 152 Total current assets 4,327 5,052 Noncurrent Assets Property and equipment, net 311 335 Finance leases right-of-use asset, net 41 62 Operating leases right-of-use asset, net 1,223 1,348 Other assets 36 38 Total noncurrent assets 1,611 1,783 TOTAL ASSETS $ 5,938 $ 6,835 LIABILITIES AND EQUITY Current Liabilities Accounts payable and accrued expenses $ 1,152 $ 1,080 Dividends payable 19 20 Finance leases liability, current portion 38 43 Operating leases liability, current portion 291 284 PPP loan payable, current portion 285 ? Deferred revenue 164 516 Total current liabilities 1,949 1,943 Noncurrent Liabilities Finance leases liability, noncurrent portion 5 21 PPP loan payable, noncurrent portion 345 ? Operating lease liability, noncurrent portion 1,170 1,315 Total noncurrent liabilities 1,520 1,336 Stockholders' Equity: Preferred stock, $.01 par value: Authorized shares ? 5,000 Series 1 shares issued and outstanding ? 200 Liquidation preference of $1,012 in 2020 and $1,013 in 707 707 2019Series 2 shares issued and outstanding ? 420 in 2020 and 460 in 2019Liquidation preference of $1,054 in 2020 and $1,155 in 661 724 2019Series 3 shares issued and outstanding ? 266 in 2020 and 289 in 2019Liquidation preference of $583 in 2020 and $634 in 379 412 2019 Common stock, $.01 par value: Authorized shares ? 80,000 Issued shares ? 13,802 in 2020 and 13,552 in 2019 Outstanding shares ? 13,792 in 2020 and 13,542 in 2019 138 136 Common stock held in treasury, at cost ? 10 shares (362 ) (362 )Additional paid-in capital 56,946 56,759 Accumulated deficit (55,957 ) (54,777 )Accumulated other comprehensive loss (43 ) (43 )Total stockholders' equity 2,469 3,556 TOTAL LIABILITIES AND STOCKHOLDERS? EQUITY $ 5,938 $ 6,835

INTRUSION INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands except per share amounts) Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Revenue $ 1,655 $ 4,020 $ 3,450 $ 7,211 Cost of revenue 651 1,590 1,398 2,874 Gross profit 1,004 2,430 2,052 4,337 Operating expenses: Sales and marketing 485 46 995 458 Research and development 907 296 1,660 477 General and administrative 326 321 582 652 Operating income (loss) (714 ) 1,767 (1,185 ) 2,750 Interest income 1 ? 7 ? Interest expense (2 ) (9 ) (2 ) (44 ) Net income (loss) $ (715 ) $ 1,758 $ (1,180 ) $ 2,706 Preferred stock dividends (33 ) (35 ) (66 ) (69 )accruedNet income (loss) attributable $ (748 ) $ 1,723 $ (1,246 ) $ 2,637 to common stockholders Net income (loss) per shareattributable to common stockholders:Basic $ (0.05 ) $ 0.13 $ (0.09 ) $ 0.20 Diluted $ (0.05 ) $ 0.11 $ (0.09 ) $ 0.17 Weighted average common shares outstanding:Basic 13,784 13,523 13,743 13,466 Diluted 13,784 15,371 13,743 15,314

Financial ContactMichael L. Paxton, VP, CFO 972.301.3658, mpaxton@intrusion.com