Allot Communications Reports Continued Increase in Revenues and Net Profit for Third Quarter of 2010
Revenues Rise to $14.7 Million; EPS Increases to $0.05 on a non-GAAP Basis
BOSTON, November 9, 2010 /PRNewswire-FirstCall/ --
Key highlights:
- Third quarter revenues reached $14.7 million, a 36% increase over the
third quarter of 2009
- Third quarter non-GAAP net income of $1.3 million; non-GAAP EPS grows
to $0.05 from $0.03 in the second quarter of 2010
- Cash and cash equivalents totaled $56.2 million
Allot Communications Ltd. (NASDAQ: ALLT), a leading supplier of service optimization and revenue generation solutions for fixed and mobile broadband service providers worldwide, today announced that sales, as well as profitability, continued to rise during the third quarter of 2010.
Total revenues for the third quarter of 2010 reached $14.7 million, a 36% increase from the $10.8 million of revenues reported for the third quarter of 2009, and an 8% increase from the $13.6 million of revenues reported for the second quarter of 2010. On a GAAP basis, net profit for the third quarter of 2010 was $0.8 million, or $0.03 per share (basic and diluted). This compares with a net loss of $2.3 million, or $0.10 per share (basic and diluted), in the third quarter of 2009, and a net loss of $7.4 million, or $0.33 per share (basic and diluted), in the second quarter of 2010, the latter due primarily to the sale of the Company's entire remaining ARS portfolio during the second quarter of 2010.
On a non-GAAP basis, excluding the impact of share-based compensation and amortization of certain intangibles, non-GAAP net income for the third quarter of 2010 totaled $1.3 million or $0.06 per basic share and $0.05 per diluted share, compared with a non-GAAP net loss of $0.2 million, or $0.01 per share (basic and diluted), for the third quarter of 2009, and non-GAAP income of $0.8 million, or $0.03 per share (basic and diluted), for the second quarter of 2010.
These non-GAAP measures should be considered in addition to, and not as a substitute for, comparable GAAP measures. The non-GAAP results and a full reconciliation between GAAP and non-GAAP results are provided in the accompanying Tables 3 and 4. The Company provides these non-GAAP financial measures because it believes that they present a better measure of the Company's core business and management uses the non-GAAP measures internally to evaluate the Company's ongoing performance. Accordingly, the Company believes that they are useful to investors in enhancing an understanding of the Company's operating performance.
"We are pleased to report continued, steady growth in revenues and profitability during the third quarter," commented Rami Hadar, Allot Communications' President and Chief Executive Officer. "The continued dramatic rise in data traffic, particularly in the mobile market, is opening new opportunities for Allot. In addition to classic traffic management functionality, the need for service providers to offer value added services to drive additional revenues has opened up new prospects for Allot's solutions."
Recently, the Company achieved the following significant goals:
- Began deployment with a global Tier 1 mobile operator in Latin America,
which includes 6 different territories to date;
- Received a new large order from a Tier 1 fixed line operator in APAC;
- Received its first major order from a Tier 1, incumbent fixed line
operator in Eastern Europe;
- During the quarter, received orders from 19 large service providers, of
which 8 represented new customers and 11 represented expansion deals;
and
- Of these deals, 12 were with mobile operators, 10 of which are local
operating companies of some of the Company's global Tier 1 mobile
customers.
As of September 30, 2010, cash, cash equivalents, short term deposits and marketable securities totaled $56.2 million.
Conference Call & Webcast
The Allot management team will host a conference call to discuss its third quarter 2010 earnings results today at 8:30 AM ET, 3:30 PM Israel time.
To access the conference call, please dial one of the following numbers: US: 212 444 0412, UK: (0)20 7806 1951, Israel: 03 721 9509, participant code 8572404.
A replay of the conference call will be available from 12:01 am ET on November 10, 2010 through December 8, 2010 at 11:59 pm ET. To access the replay, please dial: US: 347 366 9565, UK: (0)20 7111 1244, access code: 8572404#.
A live webcast of the conference call can be accessed on the Allot Communications website at http://www.allot.com. The webcast will also be archived on the website following the conference call.
About Allot Communications
Allot Communications Ltd. (NASDAQ: ALLT) is a leading provider of intelligent IP service optimization solutions for fixed and mobile broadband operators and large enterprises. Allot's rich portfolio of solutions leverages dynamic actionable recognition technology (DART) to transform broadband pipes into smart networks that can rapidly and efficiently deploy value added Internet services. Allot's scalable, carrier-grade solutions provide the visibility, topology awareness, security, application control and subscriber management that are vital to managing Internet service delivery, enhancing user experience, containing operating costs, and maximizing revenue in broadband networks. For more information, please visit http://www.allot.com.
Safe Harbor Statement
Information provided in this press release may contain statements relating to current expectations, estimates, forecasts and projections about future events that are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally relate to the Company's plans, objectives and expectations for future operations. These forward-looking statements are based upon management's current estimates and projections of future results or trends. Actual results may differ materially from those projected as a result of certain risks and uncertainties. These factors include, but are not limited to: changes in general economic and business conditions; the Company's inability to develop and introduce new technologies, products and applications; loss of market; and other factors discussed under the heading "Risk Factors" in the Company's annual report on Form 20-F filed with the Securities and Exchange Commission. These forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.
TABLE 1
ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except share and per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2010 2009 2010 2009
(Unaudited) (Unaudited)
Revenues $ 14,668 $ 10,843 $ 40,765 $ 30,221
Cost of revenues 4,125 2,977 11,395 8,287
Gross profit 10,543 7,866 29,370 21,934
Operating expenses:
Research and
development costs, net 2,945 2,350 8,261 6,857
Sales and marketing 5,611 5,302 16,275 14,559
General and administrative 1,382 1,311 4,019 4,170
Total operating expenses 9,938 8,963 28,555 25,586
Operating profit (loss) 605 (1,097) 815 (3,652)
Financial and other income
(expenses), net 247 (1,151) (7,730) (2,363)
Profit (loss) before income
tax expenses 852 (2,248) (6,915) (6,015)
Income tax expenses 100 21 196 137
Net profit (loss) 752 (2,269) (7,111) (6,152)
Basic net profit (loss) per
share $ 0.03 $ (0.10) $ (0.31) $ (0.28)
Diluted net profit (loss)
per share $ 0.03 $ (0.10) $ (0.31) $ (0.28)
Weighted average number
of shares used in
computing basic net
earnings per share 22,813,134 22,214,563 22,656,343 22,118,241
Weighted average number
of shares used in
computing diluted net
earnings per share 23,642,725 22,214,563 22,656,343 22,118,241
TABLE 2
ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands)
September 30, December 31,
2010 2009
(Unudited) (Audited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 49,928 $ 36,470
Marketable securities and restricted cash 6,303 2,324
Trade receivables, net 7,538 7,842
Other receivables and prepaid expenses 2,920 3,618
Inventories 9,679 5,046
Total current assets 76,368 55,300
LONG-TERM ASSETS:
Marketable securities - 14,490
Severance pay fund 295 3,410
Other assets 292 430
Total long-term assets 587 18,330
PROPERTY AND EQUIPMENT, NET 5,448 5,674
GOODWILL AND INTANGIBLE ASSETS, NET 3,546 3,639
Total assets $ 85,949 $ 82,943
LIABILITIES AND
SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Trade payables $ 5,206 $ 3,142
Deferred revenues 7,008 5,467
Other payables and accrued expenses 9,148 8,512
Total current liabilities 21,362 17,121
LONG-TERM LIABILITIES:
Deferred revenues 3,575 2,046
Accrued severance pay 176 3,364
Total long-term liabilities 3,751 5,410
SHAREHOLDERS' EQUITY 60,836 60,412
Total liabilities and shareholders' equity $ 85,949 $ 82,943
TABLE 3
ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
RECONCILATION OF GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF
OPERATIONS
(U.S. dollars in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2010 2009 2010 2009
(Unaudited) (Unaudited)
GAAP net profit (loss) as reported $ 752 $ (2,269) $ (7,111) $ (6,152)
Non-GAAP adjustments
Expenses recorded for stock-based
compensation
Cost of revenues 21 33 72 86
Research and development costs,
net 87 87 273 265
Sales and marketing 213 254 655 560
General and administrative 152 231 528 810
Core technology amortization- cost
of revenues 30 31 90 89
Total adjustments to operating loss 503 636 1,618 1,810
Impairment of auction rate securities
Financial and other expenses, net - 1,448 7,711 3,023
Total adjustments 503 2,084 9,329 4,833
Non-GAAP net profit (loss) 1,255 $ (185) $ 2,218 $ (1,319)
Non- GAAP basic net profit (loss)
per share $ 0.06 $ (0.01) $ 0.10 $ (0.06)
Non- GAAP diluted net profit (loss)
per share $ 0.05 $ (0.01) $ 0.09 $ (0.06)
Weighted average number of shares
used in computing basic net 22,813,134 22,214,563 22,656,343 22,118,241
earnings per share
Weighted average number of shares
used in computing diluted net 24,244,210 22,214,563 23,997,119 22,118,241
earnings per share
TABLE 4
ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except share and per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2010 2009 2010 2009
(Unaudited) (Unaudited)
Revenues $ 14,668 $ 10,843 $ 40,765 $ 30,221
Cost of revenues 4,074 2,913 11,233 8,112
Gross profit 10,594 7,930 29,532 22,109
Operating expenses:
Research and development
costs, net 2,858 2,263 7,988 6,592
Sales and marketing 5,398 5,048 15,620 13,999
General and administrative 1,230 1,080 3,491 3,360
Total operating expenses 9,486 8,391 27,099 23,951
Operating profit (loss) 1,108 (461) 2,433 (1,842)
Financial and other
income (expenses), net 247 297 (19) 660
Profit (loss) before
income tax expenses 1,355 (164) 2,414 (1,182)
Income tax expenses 100 21 196 137
Net profit (loss) 1,255 (185) 2,218 (1,319)
Basic net profit (loss)
per share $ 0.06 $ (0.01) $ 0.10 $ (0.06)
Diluted net profit (loss)
per share $ 0.05 $ (0.01) $ 0.09 $ (0.06)
Weighted average number
of shares
used in computing basic net
earnings per share 22,813,134 22,214,563 22,656,343 22,118,241
Weighted average number
of shares
used in computing diluted net
earnings per share 24,244,210 22,214,563 23,997,119 22,118,241
Investor Relations Contact:
Jay Kalish
Executive Director Investor Relations
International access code
+972-54-221-1365
[email protected]
SOURCE Allot Communications Ltd.
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