ZKTeco made close to $250 million in revenues from its biometrics and access control technology in 2019, and is planning an IPO on the Shenzhen stock exchange to raise roughly $190 million, IPVM reports.
The funding would be largely used to build three factories, two in China, where ZKTeco is based, and one in the U.S., in Georgia, which is where ZKTeco USA is based. The company also has a subsidiary in India, and 46 others overseas, as well as 14 in China.
IPVM calculates ZKTeco’s likely valuation in the $1 billion to $2 billion range, and notes that the filing document says it achieved net profit margins of 11 percent last year, and has annual growth of around 10 percent.
ZKTeco is headquartered in Dongguan, Guangdong Province, and its workforce includes nearly 3,700 employees, 450 of whom are based overseas, up from roughly 230 in 2017, according to IPVM.
The planned Georgia factory would be built near Atlanta in the next three to four years. IPVM says that thus far there is no Chinese physical security manufacturer with a plant in the U.S. The factory would make high-end products for the American market, as well as improve timely delivery to customers around the world. ZKTeco has a sales presence on every continent except Australia.
“Through the production of mid-to-high-end biometric products, it meets the market needs of high-end customers, increases market share, and enhances the company’s comprehensive competitiveness,” IPVM translates the filing document as saying of the new factory. “This project is mainly engaged in the production and manufacture of access control, ID cards, pedestrian passages and security inspection products.”
ZKTeco USA is 80 percent owned by the investment arm of the parent company, and its net profits surged by 10 times in the first half of 2020, the filing says. The growth seems to have been fueled by the rapid rollout of devices with facial recognition and body-temperature scanning.
The company’s profits grew by 25 percent from 2017 to 2018, and an even more impressive 48 percent from 2018 to 2019, according to the filing. While revenues have declined slightly in the first half of 2020, its profits remained high.
In addition to ‘smart identity,’ which includes fingerprint, palmprint, vein, iris and face biometrics, ZKTeco’s main areas are ‘smart entrance control’ and ‘smart office’ solutions, which also include biometric time and attendance and POS systems. Starting in 2019, the company pivoted from a hardware focus to providing complete solutions.
For context, IPVM explains that if ZKTeco was in the larger video surveillance manufacturing market, it would be China’s fourth largest company in the space behind Hikvision, Dahua and Uniview.
Facial recognition case study
ZKTeco has also published a case study on the use of its facial recognition technology in Japanese vending machines.
Vending machines represent an optimal advertising medium, the company says, but with limitations in terms of advertising area. To overcome those limitations, fast and precise recognition of potential users’ gender and age from facial characteristics enables effective targeting.
Face biometrics-based technology is appropriate to this use case, ZKTeco says, but is traditionally challenged by outdoor lighting conditions, prompting ZKTeco to develop a new system.
The company deployed the ZKTeco FA10M Facial Recognition Module, powered by the ZKLiveFace 5.6 SDK algorithm, to the front of the machines. The module uses both visible and near-infrared cameras, a binocular WDR image sensor and visible fill lights.
Article Topics
access control | biometric identification | biometrics | China | facial recognition | financial results | IPO | IPVM | stocks | time and attendance | ZKTeco
