Allot Communications Reports Non-GAAP Revenues of $27.3 Million for the Fourth Quarter of 2013 and $97.1 Million for the full year

Feb 11, 2014, 02:45 ET from Allot Communications Ltd.

HOD HASHARON, Israel, Feb. 11, 2014 /PRNewswire/ -- 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 its fourth quarter and year end 2013 results, with non-GAAP revenues reaching $27.3 million and $97.1 million, respectively ($27.3 million and $96.5 million on a GAAP basis).

Fourth quarter highlights:

  • Non-GAAP revenues were $27.3 million ($27.3 million on a GAAP basis).
  • Non-GAAP gross margin was 76% (72% on a GAAP basis).
  • Non-GAAP operating margin was 11% (4% on a GAAP basis).
  • Book-to-bill above one.
  • Generated $7 million of operating cash flow. Net cash as of December 31st 2013 totals $121.6 million.

Financial results:

On a non-GAAP basis, total revenues for the fourth quarter of 2013 reached $27.3 million, compared with $24.1 million of revenue reported for the third quarter of 2013 and $28.5 million of revenue reported for the fourth quarter of 2012.  On a non-GAAP basis, net profit for the fourth quarter of 2013 was $3.2 million, or $0.10 per basic share and $0.09 per diluted share. This compares with non-GAAP net profit of $1.1 million, or $0.03 per basic and diluted share, in the third quarter of 2013 and a non-GAAP net profit of $4.6 million, or $0.14 per basic and diluted share, in the fourth quarter of 2012.

On a non-GAAP basis total revenues for the full year 2013 reached $97.1 million, compared with $107.1 million of revenue reported for the full year 2012. Net profit for the full year 2013 reached $4.0 million, or $0.12 per basic and diluted share. This compares with non-GAAP net profit of $19.8 million, or $0.62 per basic share and $0.59 per diluted share, reported for the full year 2012.

Total GAAP revenues for the fourth quarter of 2013 reached $27.3 million compared to $23.9 million of revenue reported for the third quarter of 2013 and $26.4 million of revenue reported for the fourth quarter of 2012 and. On a GAAP basis, the net profit for the fourth quarter of 2013 was $1.2 million, or of $0.04 per basic and diluted share. This compares with net loss of $1.9 million, or a net loss of $0.06 per basic and diluted share, in the third quarter of 2013 and a net loss of $15.1 million, or $0.46 per basic and diluted share, in the fourth quarter of 2012.

For the full year 2013, GAAP revenues reached $96.5 million, compared to $104.8 million in 2012. On a GAAP basis, net loss for the year 2013 was $6.5 million, or $0.20 per basic and diluted share, as compared with net loss of $6.7 million, or $0.21 per basic and diluted share, in 2012.

Key quarterly achievements:

  • During the quarter, large orders were received from 18 service providers, one of which is a new customer.
  • 12 of the large orders came from mobile-service providers and 6 were from fixed-line service providers.
  • Allot's ClearSee analytics selected by Tier-1 mobile operator in EMEA.
  • Allot Communications Video Optimization Solution chosen by EMEA mobile operator.
  • Received $4 million expansion order from a Tier-1 European mobile operator for expanded analytics capabilities and Value-Added Service (VAS) functions.

As of December 31, 2013, cash, cash equivalents, short-term deposits and marketable securities totaled $121.6 million with no debt.

"Our financial performance during the fourth quarter reflects the booking's strength we felt throughout the year, and we were able to register another quarter of book-to-bill above one. We sense initial signs of improvement in the EMEA region," said Rami Hadar, Allot Communications' President and CEO. "The change in momentum of our bookings, stems mostly from the growth of our VAS activities. As we enter 2014, our funnel of opportunities and growth directions are both healthy and diversified."

Conference Call & Webcast

The Allot management team will host a conference call to discuss fourth quarter and year end 2013 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: +1 646 254 3366, UK: +44(0)20 3427 1907, Israel: +9723721 9510, participant code 8126338.

A replay of the conference call will be available from 12:00 AM ET on February 11, 2014 through March 10, 2014 at 6:59 PM ET time. To access the replay, please dial: US:  +1 347 366 9565; UK: +44 (0) 20 3427 0598, access code: 8126338.

A live webcast of the conference call can be accessed on the Allot Communications website at www.allot.com. The webcast also will be archived on the website following the conference call.

About Allot Communications

Allot Communications Ltd. (NASDAQ, TASE: ALLT) is a leading global provider of intelligent broadband solutions that put mobile, fixed and enterprise networks at the center of the digital lifestyle and work style. Allot's DPI-based solutions identify and leverage the business intelligence in data networks, empowering operators to analyze, protect, improve and enrich the digital lifestyle services they deliver. Allot's unique blend of innovative technology, proven know-how, collaborative approach to industry standards and partnerships enables service providers worldwide to elevate their role in the digital lifestyle ecosystem and to open the door to a wealth of new business opportunities. For more information, please visit www.allot.com.

GAAP to Non-GAAP Reconciliation

The discrepancy between GAAP and non-GAAP revenues is related to the acquisitions made by the Company during the year and represents revenues adjusted for the impact of the fair value adjustment to acquired deferred revenue related to purchase accounting. Non-GAAP net profit is defined as GAAP net profit after including deferred revenues related to the fair value adjustment resulting from purchase accounting and excluding stock based compensation expenses, amortization of acquisition related intangible assets, regulatory 2 matters, acquisition related expenses and compensation expenses related to the acquisitions.

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 Table 2. The Company provides these non-GAAP financial measures because it believes 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 they are useful to investors in enhancing an understanding of the Company's operating performance.

Safe Harbor Statement

This release may contain forward-looking statements, which express the current beliefs and expectations of Company management. Such statements involve a number of known and unknown risks and uncertainties that could cause our future results, performance or achievements to differ significantly from the results, performance or achievements expressed or implied by such forward-looking statements. Important factors that could cause or contribute to such differences include risks relating to: our ability to compete successfully with other companies offering competing technologies; the loss of one or more significant customers; consolidation of, and strategic alliances by, our competitors, government regulation; lower demand for key value-added services; our ability to keep pace with advances in technology and to add new features and value-added services; managing lengthy sales cycles; operational risks associated with large projects; our dependence on third party channel partners for a material portion of our revenues; 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. Forward-looking statements in this release are made pursuant to the safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. 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

Year Ended

December 31,

December 31,

2013

2012

2013

2012

(Unaudited)

(Unaudited)

(Audited)

Revenues

$      27,271

$      26,362

$     96,545

$   104,752

Cost of revenues

7,757

7,918

26,818

31,037

Expense related to Settlement of OCS grant

-

15,886

-

15,886

Gross profit  

19,514

2,558

69,727

57,829

Operating expenses:

Research and development costs, net

6,623

6,648

27,022

22,060

Sales and marketing

10,113

9,707

39,817

34,127

General and administrative

1,707

2,560

9,952

10,664

Total operating expenses

18,443

18,915

76,791

66,851

Operating profit (loss)

1,071

(16,357)

(7,064)

(9,022)

Financial income and others, net

144

327

727

1,358

Profit (loss) before tax expenses (benefit)

1,215

(16,030)

(6,337)

(7,664)

Tax expenses (benefit)

30

(969)

120

(926)

Net profit (loss)

1,185

(15,061)

(6,457)

(6,738)

 Basic net profit (loss) per share

$           0.04

$        (0.46)

$        (0.20)

$        (0.21)

 Diluted net profit (loss) per share

$           0.04

$        (0.46)

$        (0.20)

$        (0.21)

Weighted average number of shares

used in computing basic  net

earnings per share

32,816,792

32,471,655

32,680,766

31,959,921

Weighted average number of shares

used in computing diluted net

earnings per share

33,418,398

32,471,655

32,680,766

31,959,921

 

 

TABLE  - 2

ALLOT COMMUNICATIONS LTD.

AND ITS SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP  CONSOLIDATED  STATEMENTS  OF  OPERATIONS

(U.S. dollars in thousands, except per share data)

Three Months Ended

Year Ended

December 31,

December 31,

2013

2012

2013

2012

(Unaudited)

(Unaudited)

(Audited)

 GAAP net profit (loss) as reported 

$        1,185

$       (15,061)

$    (6,457)

$     (6,738)

Non-GAAP adjustments

Fair value adjustment for acquired deferred revenues write down

70

2,109

530

2,367

Expenses recorded for stock-based compensation

Cost of revenues

79

68

368

222

Research and development costs, net

414

429

1,666

1,185

Sales and marketing

691

709

3,106

2,060

General and administrative

651

553

2,591

1,349

Expenses related to M&A activities and compliance with regulatory matters (*)

General and administrative (G&A)

4

(73)

40

1,992

Adjustment of contingent earnout (G&A)

(1,089)

(261)

(1,089)

(261)

Research and development costs, net

-

92

28

435

Sales and marketing

-

62

12

210

Intangible assets amortization 

Cost of revenues

1,090

969

2,683

1,903

S&M

58

26

231

43

Tax benefit (**)

-

(877)

-

(877)

Expense related to settlement of OCS grants (Cost of revenues)

-

15,886

250

15,886

Total adjustments

1,968

19,692

10,416

26,514

 Non-GAAP net profit  

$        3,153

$           4,631

$      3,959

$    19,776

Non- GAAP basic  net profit  per share

$           0.10

$              0.14

$         0.12

$         0.62

Non- GAAP diluted net profit per share

$           0.09

$              0.14

$         0.12

$         0.59

Weighted average number of shares

used in computing basic net

earnings per share

32,816,792

32,471,655

32,680,766

31,959,921

Weighted average number of shares

used in computing diluted net

earnings per share

33,596,539

33,840,004

33,554,103

33,641,115

(*) Mostly legal, finance and compensation expenses related to the acquisition

(**) Tax benefit in respect of net deferred tax asset recorded for the first time

 

 

TABLE  - 3

ALLOT COMMUNICATIONS LTD.

AND ITS SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP  CONSOLIDATED  REVENUES

(U.S. dollars in thousands, except share and per share data)

Three Months Ended

Year Ended

December 31,

December 31,

2013

2012

2013

2012

(Unaudited)

(Unaudited)

(Audited)

GAAP Revenues

$   27,271

$ 26,362

$      96,545

$ 104,752

Fair value adjustment for acquired deferred revenues write down

$          70

$   2,109

$            530

$     2,367

Non-GAAP Revenues

$   27,341

$ 28,471

$      97,075

$ 107,119

 

 

TABLE  - 4

ALLOT COMMUNICATIONS LTD.

AND ITS SUBSIDIARIES

CONSOLIDATED  BALANCE  SHEETS

(U.S. dollars in thousands)

December 31,

December 31,

2013

2012

(Unaudited)

(Audited)

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$            42,813

$           50,026

Short term deposits

38,000

78,042

Marketable securities and restricted cash

40,798

14,987

Trade receivables, net

17,389

20,236

Other receivables and prepaid expenses

8,522

6,815

Inventories

13,798

9,963

Total current assets

161,320

180,069

LONG-TERM ASSETS:

Severance pay fund

254

213

Deferred Taxes

1,363

1,525

Other assets 

224

239

Total long-term assets

1,841

1,977

PROPERTY AND EQUIPMENT, NET

5,874

6,609

GOODWILL AND INTANGIBLE ASSETS, NET

30,221

33,136

Total assets

$          199,256

$        221,791

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:

Trade payables

$               3,191

$             4,809

Deferred revenues

12,504

13,829

Other payables and accrued expenses

10,905

13,947

Liability related to settlement of OCS grants

-

15,886

Total current liabilities

26,600

48,471

LONG-TERM LIABILITIES:

Deferred revenues

2,447

3,945

Accrued severance pay

282

254

Total long-term liabilities

2,729

4,199

SHAREHOLDERS' EQUITY

169,927

169,121

Total liabilities and shareholders' equity

$          199,256

$        221,791

 

 

TABLE  - 5

ALLOT COMMUNICATIONS LTD.

AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS 

(U.S. dollars in thousands)

Three Months Ended

Year Ended

December 31,

December 31,

2013

2012

2013

2012

(Unaudited)

(Unaudited)

(Audited)

Cash flows from operating activities:

Net income (Loss)

$                1,185

$       (15,061)

$            (6,457)

$            (6,738)

Adjustments to reconcile net income  to net cash provided by  operating activities:

Depreciation

839

1,007

3,423

3,120

Stock-based compensation related to options granted to employees

1,835

1,759

7,731

4,817

Amortization of intangible assets

1,148

996

2,915

1,947

Capital loss 

-

6

18

20

Increase in accrued severance pay, net

(9)

(6)

(13)

-

Decrease (Increase) in other assets

1

(50)

15

6

Decease in accrued interest and  amortization of premium on marketable securities 

158

68

366

212

Increase (Decrease) in trade receivables

6,091

1,503

2,847

(8,139)

Decrease (Increase) in other receivables and prepaid expenses

(413)

(393)

(3,053)

1,159

Decrease (Increase) in inventories

(1,729)

1,096

(3,835)

3,233

Decrease (Increase) in long-term deferred taxes, net

162

(906)

162

(931)

Decrease in trade payables

(1,326)

(2,794)

(1,618)

(1,287)

Increase (Decrease) in employees and payroll accruals

(649)

225

(2,053)

2,392

Increase (Decrease) in deferred revenues

1,825

(2,794)

(2,823)

(7,089)

Increase (Decrease) in other payables and accrued expenses

(2,102)

(1,157)

(989)

84

Increase (Decrease) in Liability related to settlement of OCS grants

-

15,886

(15,886)

15,886

Net cash provided by (used in) operating activities

7,016

(615)

(19,250)

8,692

Cash flows from investing activities:

Increase in restricted deposit

-

1,039

146

913

Redemption of short-term deposits 

-

15,958

40,042

-

Investment in short-term deposit

(14,400)

-

-

(54,042)

Purchase of property and equipment

(726)

(823)

(2,706)

(3,820)

Investment in marketable securities

(2,914)

(500)

(32,805)

(8,194)

Proceeds from redemption or sale of marketable securities

1,650

8,736

6,461

10,736

Acquisitions

-

-

-

(23,892)

Loan to purchased Subsidiary

-

-

-

(1,000)

Net cash provided by (used in) investing activities

(16,390)

24,410

11,138

(79,299)

Cash flows from financing activities:

Exercise of employee stock options 

326

563

899

5,903

Redemption of bank loan

-

-

-

(1,952)

Net cash provided by financing activities

326

563

899

3,951

Increase (decrease) in cash and cash equivalents

(9,048)

24,358

(7,213)

(66,656)

Cash and cash equivalents at the beginning of the period

51,861

25,668

50,026

116,682

Cash and cash equivalents at the end of the period

$             42,813

$         50,026

$            42,813

$            50,026

 

 

SOURCE Allot Communications Ltd.



RELATED LINKS

http://www.allot.com