Foresight Announces Fourth Quarter and Full Year 2023 Financial Results

–News Direct–

Foresight Autonomous Holdings Ltd., an innovator in automotive vision systems (Nasdaq and TASE: FRSX) (Foresight or the Company), today reported financial results for the fourth quarter and full year ended December 31, 2023. Foresight ended the full year 2023 with revenues of $497,000 and with $15.7 million in cash, cash equivalent and restricted cash.

The Company reported a U.S. generally accepted accounting principles (GAAP) operating loss of $16.3 million which is approximately a 7% decrease from the GAAP operating loss of $17.5 million reported for the full year 2022. Foresight reported a GAAP net loss of $3.6 million for the fourth quarter 2023, compared to a GAAP net loss of $3.8 million for the fourth quarter 2022, and a non-GAAP net loss of $3.3 million for the fourth quarter 2023, compared to a non-GAAP loss of $3.4 million for the fourth quarter 2022. A reconciliation between GAAP net loss and non-GAAP net loss is provided in the financial statements that are part of this release.

In 2023, the world was captivated by the potential of artificial intelligence (AI) to revolutionize the ways in which we live, work, and travel, said Haim Siboni, CEO of Foresight. This excitement extended to the mobility and transportation industries, as Foresight and its subsidiaries and affiliates gained momentum and drew global interest in their AI-based technologies and other innovative solutions. Foresight recently completed two paid proof of concept (POC) projects with a leading Japanese vehicle manufacturer, demonstrating the widespread commercial viability of our solutions for 3D depth perception. These successful projects follow similar collaborations with leading manufacturers in China, Israel, and South Korea. Foresight continues to execute on its strategy of collaborating with some of the worlds largest Tier One automotive suppliers, indicating expansive and diverse potential for long-term growth."

Foresight recently announced several milestones together with its wholly owned subsidiary, Eye-Net Mobile Ltd. (Eye-Net Mobile or Eye-Net). Eye-Net has successfully completed the technology validation phase of a multi-phase collaboration project with SoftBank Corp. (SoftBank). Moving forward, SoftBank will collaborate with its business partners to initiate sales efforts for Eye-Net's products in Japan. Together, we believe that Foresight and Eye-Net are poised to achieve commercial breakthroughs in 2024, concluded Siboni.

Recent Corporate Highlights:

  • Eye-Net and Softbank Corp. Successfully Complete Technology Validation Phase for Connected Mobility Applications in Japan: In March 2024, Eye-Net announced that SoftBank will collaborate with its business partners to initiate commercial validation efforts of Eye-Net's products in Japan. This follows the successful completion of the technology validation of Eye-Nets products. SoftBank and Eye-Net have entered into a multi-phase agreement initiated in a paid technological POC, of which the first phase was successfully completed in November 2023. Through this collaboration, SoftBank will initiate sales efforts with its key business partners to move forward with the commercial validation of Eye-Nets solutions, paving the way for improved collision prevention in Japan.
  • Eye-Net Secures Follow-up Order from Leading Japanese Vehicle Manufacturer: In March 2024, Eye-Net announced that it has received an additional order for a paid development project from a leading global Japanese vehicle manufacturer, following the successful completion of the first two phases of a paid POC project. The parties engaged in a POC project back in February 2023. The successful completion of that phase is a significant milestone, demonstrating the feasibility and potential benefits of Eye-Net's technology for the automotive industry.
  • Foresight Successfully Completes Project with Leading Japanese Vehicle Manufacturer: In February 2024, Foresight announced the successful completion of two POC projects with a leading Japanese vehicle manufacturer. The vehicle manufacturer evaluated the accuracy of Foresights unique automatic calibration capabilities to enhance 3D depth perception. Following satisfactory results, the parties are exploring co-development initiatives for further evaluation of the solutions capabilities. Potential collaboration may involve integration of Foresights technology into the manufacturers passenger vehicles.
  • Foresight Announces Pricing of $4.5 Million Registered Direct Offering: In December 2023, Foresight announced it entered into definitive agreements with institutional investors and insiders of the Company, including the Companys Chief Executive Officer (through a company under his control), for the purchase and sale of 4,500,000 of the Companys American Depositary Shares (ADSs) at a price of $1.00 per ADS pursuant to a registered direct offering. The gross proceeds of the offering amounted to $4.5 million before deducting placement agent fees and other offering expenses.

  • Eye-Net Selected by European Software Rpublique Consortium to Take Part in the Road Safety Revolution: Foresights wholly owned subsidiary, Eye-Net Mobile, signed an agreement to join Software Rpublique in November 2023. Software Rpublique is a European innovation ecosystem for intelligent, secure, and sustainable mobility, founded by Dassault Systmes SE, Eviden, Orange S.A., Renault Group, STMicroelectronics N.V and Thales Group. Eye-Net was selected to join Software Rpubliques incubation program for a project that will deliver an accessible vehicle-to-everything (V2X) road safety solution for all road users.

  • Foresight Receives Notice of U.S. Patent Allowance for 3D Image Analysis System and Calibration Technology: in October 2023 Foresight received a notice of allowance from the U.S. Patent and Trademark Office for its patent application, number 17/982,691, for System and Method for Stereoscopic Image Analysis. The patented technology enables the generation of 3D depth perception from any given pair of cameras, even those that have different optical properties and fields of view. The patent serves as the underlying technology of Foresights Mono2Stereo and Mono2Stereo 360 perception enhancement solutions.

Fourth Quarter 2023 Financial Results

Revenues for the fourth quarter of 2023 increased by 39.4% to $138,000, compared to $99,000 for the fourth quarter of 2022. The revenues were generated primarily from the successful completion of a POC project with a leading Japanese vehicle manufacturer in the amount of $60,000, and from the commercialization agreement with Elbit Systems Land Ltd. ("Elbit") in the amount of $57,000.

Research and development (R&D) expenses, net for the fourth quarter of 2023 were $2,430,000, a 20% decrease compared to $3,035,000 for the fourth quarter of 2022. The decrease is mainly attributed to a decrease in payroll and related expenses and a decrease in subcontracted work and consultants.

Sales and marketing (S&M) expenses for the fourth quarter of 2023 were $290,000, a decrease of 38.4% compared to $471,000 for the fourth quarter of 2022. The decrease is mainly attributed to a decrease in payroll and related expenses and a decrease in consultants.

General and administrative (G&A) expenses for the fourth quarter of 2023 were $675,000, a decrease of 37.9% compared to $1,087,000 in the fourth quarter of 2022. The decrease is primarily attributed to a decrease in payroll and related expenses and in professional services.

Financial expenses, net for the fourth quarter of 2023 were $255,000, compared to financial income, net of $718,000 in the fourth quarter of 2022. Financial expenses, net for the fourth quarter of 2023 consisted of a loss from the revaluation of the Companys investment in Rail Vision Ltd. to its fair value in the amount of $759,000, offset by exchange rate differences and others in the amount of $383,000 and by interest income in the amount of $121,000. Finance income, net for the fourth quarter of 2022 consisted of profit from the revaluation of the Companys investment in Rail Vision Ltd. to its fair value in the amount of $1,267,000 and interest income in the amount of $387,000, offset by exchange rate differences and others in the amount of $936,000.

GAAP net loss for the fourth quarter of 2023 was $3,551,000, or $0.011 per ordinary share, compared to a GAAP net loss of $3,820,000, or $0.012 per ordinary share, in the fourth quarter of 2022.

Non-GAAP net loss for the fourth quarter of 2032 was $3,293,000, or $0.01 per ordinary share, compared to a non-GAAP net loss of $3,377,000 in the fourth quarter of 2022, or $0.01 per ordinary share. A reconciliation between GAAP net loss and non-GAAP net loss is provided following the financial statements that are part of this release. Non-GAAP results exclude the effect of share-based compensation expenses.

Full Year 2023 Financial Results

Revenues for the full year ended December 31, 2023, decreased by 9.6% to $497,000, compared to $550,000 for the full year ended December 31, 2022. The revenues were generated primarily from the commercialization agreement of the Company with Elbit in the amount of $250,000 and from the successful execution of several projects including: POC project with two leading Japanese vehicle manufacturers in the amount of $106,000, POC project of Eye-Net with SoftBank in the amount of $34,000 and from a POC project of Eye-Net with a leading Japanese vehicle manufacturer in the amount of $28,000.

R&D expenses, net for the full year ended December 31, 2023, were $11,587,000, compared to $11,534,000 for the full year ended December 31, 2022.

S&M expenses for the full year ended December 31, 2023, were $1,939,000, a decrease of 13% compared to $2,230,000 for the full year ended December 31, 2022. The decrease is mainly attributed to a decrease in payroll and related expenses and a decrease in consultants offset by an increase in exhibitions and travel.

G&A expenses for the full year ended December 31, 2023 were $3,119,000, a decrease of 21.8% compared to $3,989,000 for the full year ended December 31, 2022. The decrease is mainly attributed to a decrease in payroll and related expenses and in professional services.

Financial expenses, net for the full year ended December 31, 2023 were $2,119,000, a decrease of 49.8% compared to financial expenses, net of $4,221,000 for the full year ended December 31, 2022. Financial expenses, net for the year ended December 31, 2023, consisted of loss from the revaluation of the Companys investment in Rail Vision Ltd. to its fair value in the amount of $2,333,000 and from exchange rate differences and others in the amount of $453,000, offset by interest income in the amount of $667,000. Financial expenses, net for the year ended December 31, 2022, consisted of loss from the revaluation of the Companys investment in Rail Vision Ltd. to its fair value in the amount of $2,208,000, and exchange rate differences and others in the amount of $2,202,000, offset by interest income in the amount of $189,000.

GAAP net loss for the full year ended December 31, 2023, was $18,410,000, or $0.056 per ordinary share, a decrease of 15.1% compared to a GAAP net loss of $21,676,000 for the full year ended December 31, 2022, or $0.067 per ordinary share.

Non-GAAP net loss for the full year ended December 31, 2023, was $16,969,000, or $0.051 per ordinary share, compared to a non-GAAP net loss of $19,850,000 for the full year ended December 31, 2022, or $0.061 per ordinary share.

Balance Sheet Highlights

Cash and restricted cash totaled $15.7 million as of December 31, 2023, compared to $26.5 million in cash, restricted cash, and short-term deposits as of December 31, 2022.

GAAP total equity totaled $16.0 million as of December 31, 2023, a decrease of 44.4% compared to $28.8 million as of December 31, 2022. The decrease is mainly attributed to the net loss for the period in the amount of $18,410,000 and from share-based payments in the amount of $1,441,000, offset by issuance of ordinary shares, net of issuance expenses, in the amount of $4,183,000.

Use of Non-GAAP Financial Results

In addition to disclosing financial results calculated in accordance with United States generally accepted accounting principles (GAAP), the company's earnings release contains non-GAAP financial measures of net loss for the period that exclude the effect of stock-based compensation expenses. The companys management believes the non-GAAP financial information provided in this release is useful to investors understanding and assessment of the company's ongoing operations. Management also uses both GAAP and non-GAAP information in evaluating and operating business internally and as such deemed it important to provide all this information to investors. The non-GAAP financial measures disclosed by the company should not be considered in isolation or as a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements should be carefully evaluated. Reconciliations between GAAP measures and non-GAAP measures are provided later in this press release.

About Foresight

Foresight Autonomous Holdings Ltd. (Nasdaq and TASE: FRSX) is a technology company developing smart multi-spectral vision software solutions and cellular-based applications. Through the Companys wholly owned subsidiaries, Foresight Automotive Ltd., Foresight Changzhou Automotive Ltd. and Eye-Net Mobile Ltd., Foresight develops both in-line-of-sight vision systems and beyond-line-of-sight accident-prevention solutions.

Foresights vision solutions include modules of automatic calibration and dense three-dimensional (3D) point cloud that can be applied to different markets such as automotive, defense, autonomous vehicles and heavy industrial equipment. Eye-Net Mobiles cellular-based solution suite provides real-time pre-collision alerts to enhance road safety and situational awareness for all road users in the urban mobility environment by incorporating cutting-edge AI technology and advanced analytics.

For more information about Foresight and its wholly owned subsidiary, Foresight Automotive, visit www.foresightauto.com, follow @ForesightAuto1 on X, or join Foresight Automotive on LinkedIn.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and other Federal securities laws. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates" and similar expressions or variations of such words are intended to identify forward-looking statements. For example, Foresight is using forward-looking statements in this press release when it discusses that its collaboration agreements indicate expansive and diverse potential for long-term growth, the belief that it and Eye-Net are poised to achieve commercial breakthroughs in 2024, the potential for SoftBank to initiate sales efforts with its key business partners to move forward with the commercial validation of Eye-Nets solutions, paving the way for improved collision prevention in Japan and that it expects to explore co-development initiatives with a leading Japanese vehicle manufacturer, for further evaluation of its solutions capabilities. Because such statements deal with future events and are based on Foresights current expectations, they are subject to various risks and uncertainties, and actual results, performance or achievements of Foresight could differ materially from those described in or implied by the statements in this press release.

The forward-looking statements contained or implied in this press release are subject to other risks and uncertainties, including those discussed under the heading "Risk Factors" in Foresight's annual report on Form 20-F filed with the Securities and Exchange Commission ("SEC") on March 27, 2024, and in any subsequent filings with the SEC. Except as otherwise required by law, Foresight undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. References and links to websites have been provided as a convenience, and the information contained on such websites is not incorporated by reference into this press release. Foresight is not responsible for the contents of third party websites.

FORESIGHT AUTONOMOUS HOLDINGS LTD.

INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS

U.S. dollars in thousands

As of

As of

December 31, 2023

December 31, 2022

ASSETS

Current assets:

Cash and cash equivalents

$

15,635

$

19,173

Restricted cash

99

102

Short term deposits

7,216

Marketable equity securities

474

2

Trade Receivables

308

Other receivables

531

842

Total current assets

17,047

27,335

Non-current assets:

ROU asset

1,802

2,156

Investment in equity securities

2,804

Fixed assets, net

461

598

2,263

5,558

Total assets

$

19,310

$

32,893

LIABILITIES AND SHAREHOLDERS EQUITY

Current liabilities:

Trade payables

$

136

$

315

Operating lease liability

468

527

Other accounts payables

1,548

1,792

Total current liabilities

2,152

2,634

Non-current liabilities:

Operating lease liability

1,163

1,476

Total liabilities

3,315

4,110

Shareholders equity:

Ordinary shares of NIS 0 par value;

Additional paid-in capital

135,282

129,810

Accumulated deficit

-119,890

-101,480

Total Foresight Autonomous Holdings

LTD. shareholders equity

15,392

28,330

Non-Controlling Interest

603

453

Total equity

15,995

28,783

Total liabilities and shareholders equity

$

19,310

$

32,893

FORESIGHT AUTONOMOUS HOLDINGS LTD.

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE

LOSS

U.S. dollars in thousands

Year ended

Three months ended

December 31,

December 31,

2023

2022

2023

2022

Revenues

497

550

138

99

Cost of revenues

143

252

39

44

Gross profit

354

298

99

55

Research and development expenses

-11,587

-11,534

-2,430

-3,035

Sales and marketing expenses

-1,939

-2,230

-290

-471

General and administrative

-3,119

-3,989

-675

-1,087

Operating loss

-16,291

-17,455

-3,296

-4,538

Financing income (expenses), net

-2,119

-4,221

-255

718

Net loss

-18,410

-21,676

-3,551

-3,820

FORESIGHT AUTONOMOUS HOLDINGS LTD.

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW

U.S. dollars in thousands

Year ended

Three months ended

December 31,

December 31,

2023

2022

2023

2022

Net cash used in operating activities

Loss for the Period

-18,410

-21,676

-3,551

-3,820

Adjustments to reconcile loss to net cash provided by (used in) operating activities:

3,484

4,619

-45

-134

Net cash used in operating activities

-14,926

-17,057

-3,596

-3,954

Cash Flows from Investing Activities

Changes in short term deposits

7,216

10,297

10,527

Purchase of fixed assets

-124

-313

-10

-31

Investment in SAFE

-286

Investment in equity securities

-715

Net cash provided by (used in) investing activities

7,092

8,983

-10

10,496

Cash flows from Financing Activities:

Issuance of ordinary shares, net of issuance expenses

4,181

4,048

Net cash provided by financing activities

4,181

4,048

Effect of exchange rate changes on cash and cash equivalents

112

-839

1,094

197

Increase (decrease) in cash and cash equivalents and Restricted cash

-3,541

-8,913

1,536

6,739

Cash and cash equivalents and Restricted cash at the beginning of the period

12,536

19,275

28,188

14,198

Cash and cash equivalents and Restricted cash at the end of the period

15,734

19,275

15,734

19,275

FORESIGHT AUTONOMOUS HOLDINGS LTD.

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW

U.S. dollars in thousands

Adjustments to reconcile loss to net cash provided by (used in) operating activities:

Year

Three months

ended

ended

December 31,

December 31,

2023

2022

2023

2022

Share-based payment

1,441

1,826

258

443

Depreciation

263

218

72

57

Revaluation of marketable equity securities

2,330

2,217

754

-1,268

exchange rate changes on cash and cash equivalents

-112

839

-1,094

-197

Changes in assets and liabilities:

Decrease (increase) in other receivables

311

-182

384

158

Increase (decrease) in trade payables

-179

62

-115

87

Increase in trade receivables

-308

-308

Change in operating lease liability, net

-18

-289

101

23

Increase (decrease) in other accounts payable

-244

-72

-97

563

Adjustments to reconcile loss to net cash provided by (used in) operating activities

3,484

4,619

-45

-134

Supplemental cash flow information related to operating leases was as follows:

Year ended

Three months ended

December 31,

December 31,

2023

2022

2023

2022

Cash payments for operating leases

537

550

138

139

New operating lease assets obtained in exchange for operating lease liabilities

155

SUPPLEMENTAL RECONCILIATION OF GAAP TO NON-GAAP RESULTS

(Unaudited) U.S. dollars in thousands

Year ended

Three months ended

December 31,

December 31,

2023

2022

2023

2022

GAAP operating loss

-16,291

-17,455

-3,296

-4,538

Share-based compensation in cost of services

9

25

2

8

Share-based compensation in research and development

849

929

152

233

Share-based compensation in sales and marketing

118

196

17

33

Share-based compensation in general and administrative

465

676

87

169

Non-GAAP operating loss

-14,850

-15,629

-3,038

-4,095

GAAP net loss

-18,410

-21,676

-3,551

-3,820

Share-based compensation expenses

1,441

1,826

258

443

Non-GAAP net loss

-16,969

-19,850

-3,293

-3,377

Contact Details

Investor Relations Contact:

Miri Segal-Scharia, CEO, MS-IR LLC

+1 917-607-8654

[email protected]

Company Website

https://www.foresightauto.com/

View source version on newsdirect.com: https://newsdirect.com/news/foresight-announces-fourth-quarter-and-full-year-2023-financial-results-906241274

Foresight Autonomous Holdings Ltd.

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