Allot Communications Reports Non-GAAP Revenues of $28.5 Million for Fourth Quarter of 2012 and $107.1 Million for the Year
-- GAAP revenues were $26.4 million for the fourth quarter, $104.8 million for the year 2012 --
HOD HASHARON, Israel, February 5, 2013 /PRNewswire/ --
Key highlights:
- Fourth quarter non-GAAP revenues increased 29% increase over the fourth quarter of 2011, GAAP revenues increased 20% over same period
- Fourth quarter non-GAAP net income of $4.6 million, EPS of $0.14; on a GAAP basis, including one time charge of early repayment of grants to the Israeli Office of the Chief Scientist (OCS) of $15.9 million, GAAP loss of $15.1 million, loss per share of $0.46
- Cash, cash equivalents and marketable securities totaled $143.1 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 its fourth quarter and year end 2012 results, with a significant increase in annual revenues.
On a non-GAAP basis, excluding the impact of share-based compensation, settlement of repayment of grants to the OCS, revenue adjustment due to acquisitions, expenses related to M&A activity, deferred tax assets and amortization of certain intangibles, revenues for the fourth quarter of 2012 reached $28.5 million, and non-GAAP net profit for the fourth quarter of 2012 totaled $4.6 million, or $0.14 per basic and diluted share, compared with non-GAAP net profit of $4.2 million, or $0.15 per basic share and $0.14 per diluted share, for the fourth quarter of 2011, and non-GAAP net profit of $5.1 million or $0.16 per basic share and $0.15 per diluted share, for the third quarter of 2012. For the full year 2012, excluding the impact of the factors mentioned above, non-GAAP revenue reached $107.1 million, compared with $77.8 million for the full year 2011, and net profit for the year reached $19.8 million, or $0.62 per basic share and $0.59 per diluted share, compared with non-GAAP net profit of $12.5 million, or $0.50 per basic share and $0.46 per diluted share, for the full year 2011.
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 impact of the fair value adjustment to acquired deferred revenue related to purchase accounting.
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 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.
Total GAAP revenues for the fourth quarter of 2012 reached $26.4 million, a 20% increase from the $22.0 million of revenues reported for the fourth quarter of 2011, and a decline from the $27.8 million of revenues reported for the third quarter of 2012. On a GAAP basis, net loss for the fourth quarter of 2012 was $15.1 million, or $0.46 per basic and diluted share. This compares with net profit of $3.5 million, or $0.13 per basic share and $0.12 per diluted share, in the fourth quarter of 2011, and net profit of $2.4 million, or $0.07 per basic share and diluted share, in the third quarter of 2012. For the full year 2012, GAAP revenues reached $104.8 million, representing a 35% increase over the $77.8 million of revenues in 2011. On a GAAP basis, net loss for the year 2012 was $6.7 million, or $0.21 per basic and diluted share, as compared with net profit of $8.8 million, or $0.35 per basic share and $0.33 per diluted share, in 2011.
During December 2012, the Company recorded a liability for the early payment of $15.9 million due to settlement with the Israeli Office of Chief Scientist (OCS), representing the full balance of the contingent liability related to grants received, which will be paid during the first quarter of 2013. Upon making this payment, the Company will eliminate all future royalty obligations related to its anticipated revenues and save the associated future interest payments related to such obligations, as well as entitle it to apply to a grant program with the OCS with no repayment obligations. These expenses are included in the cost of goods sold reported for the quarter.
"Allot demonstrated significant revenue growth in 2012 despite a challenging macroeconomic environment, particularly in Europe," commented Rami Hadar, Allot Communications' President and Chief Executive Officer. "With the completion of two acquisitions during the year, we now offer a comprehensive video solution to empower our customers to optimize and monetize on Over the Top ("OTT") delivery of video based content and applications. We also delivered on our promise to complete initial commercial deployments with two nationwide mobile operators in the US, in addition to our significant and growing customer base throughout the world. As we enter 2013, we believe that we have a significant funnel of worldwide opportunities and that growth in broadband traffic, applications and devices will drive the need for our products."
Recently, the Company achieved the following significant goals:
- During the quarter, received large orders from 14 service providers, 3 of which represented new customers;
- 9 of the large orders came from mobile service providers, 2 of which were new customers;
- announced the completion of a deployment project at several affiliates of Millicom International Cellular S.A (Tigo), a global telecommunication group with operations in Latin America and Africa; and
- was named by Strategy Analytics as market leader amongst DPI pure-play vendors.
As of December 31, 2012, cash, cash equivalents, short term deposits and marketable securities totaled $143.1 million, with no debt.
Conference Call & Webcast
The Allot management team will host a conference call to discuss its fourth quarter and year end 2012 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: +1 212 444 0412, UK: +44 (0)20 7136 2056, Israel: +972 3763 0147, participant code 1001413.
A replay of the conference call will be available from 12:01 am ET on February 6, 2013 through March 7, 2013 at 17:30 pm ET. To access the replay, please dial: US: +1 347 366 9565, UK: +44 (0)20 3427 0598, access code: 1001413.
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 data traffic optimization and monetization solutions for fixed and mobile broadband operators and large enterprises. Allot's scalable, carrier-grade solutions provide the visibility, topology awareness, security, application control and subscriber management that are vital to managing fixed and mobile data, enhancing user experience, containing operating costs, and enabling service providers to generate revenues from their broadband networks. 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. 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: our ability to increase the breadth and functionality of the Service Gateway platform through additional partnerships, 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.
Investor Relations Contact:
Jay Kalish
Executive Director Investor Relations
International access code +972-54-221-1365
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,
-------------------------- -------------------------
2012 2011 2012 2011
-------- -------- --------- --------
(Unaudited) (Audited)
-------------------------- -------------------------
Revenues $ 26,362 $ 22,028 $ 104,752 $ 77,753
Cost of
revenues 7,918 6,290 31,037 22,175
Expense
related to
settlement of
OCS grants 15,886 - 15,886 -
-------- -------- --------- --------
Gross profit 2,558 15,738 57,829 55,578
-------- -------- --------- --------
Operating
expenses:
Research and
development
costs, net 6,648 3,692 22,060 13,222
Sales and
marketing 9,707 7,268 34,127 26,543
General and
administrative 2,560 1,689 10,664 7,474
-------- -------- --------- --------
Total
operating
expenses 18,915 12,649 66,851 47,239
Operating
profit (loss) (16,357) 3,089 (9,022) 8,339
Financial and
other income,
net 327 238 1,358 415
-------- -------- --------- --------
Profit (loss)
before income
tax benefit (16,030) 3,327 (7,664) 8,754
Tax benefit (969) (170) (926) (55)
-------- -------- --------- --------
Net profit
(loss) (15,061) 3,497 (6,738) 8,809
-------- -------- --------- --------
-------- -------- --------- --------
Basic net
profit (loss)
per share $ (0.46) $ 0.13 $ (0.21) $ 0.35
-------- -------- --------- --------
-------- -------- --------- --------
Diluted net
profit (loss)
per share $ (0.46) $ 0.12 $ (0.21) $ 0.33
-------- -------- --------- --------
-------- -------- --------- --------
Weighted
average number
of shares
used in
computing
basic net
earnings per
share 32,471,655 27,709,271 31,959,921 25,047,771
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Weighted
average number
of shares
used in
computing
diluted net
earnings per
share 32,471,655 29,556,655 31,959,921 27,071,872
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
TABLE - 2
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 Year Ended
December 31, December 31,
--------------------- -------------------
2012 2011 2012 2011
-------- -------- --------- --------
(Unaudited) (Audited)
---------------------- --------------------
GAAP net
profit
(loss) as
reported $ (15,061) $ 3,497 $ (6,738) $ 8,809
----------------------------------------------------------------------
Non-GAAP adjustments:
Fair value
adjustment
for acquired
deferred
revenues
write down (
Revenues) 2,109 - 2,367 -
Expense
related to
settlement
of OCS
grants (Cost
of revenues) 15,886 - 15,886 -
Expenses
recorded for
stock-based
compensation
Cost of
revenues 68 35 222 103
Research and
development
costs, net 429 155 1,185 442
Sales and
marketing 709 317 2,060 1,001
General and
administrative 553 179 1,349 710
Expenses
related to
M&A
activities
and
compliance
with
regulatory
matters (*)
General and
administrative
(G&A) (73) - 1,992 1,336
Research and
development
costs, net 92 - 435 -
Sales and
marketing 62 - 210 -
Adjustment
of
contingent
earnout
(G&A) (261) - (261) -
Intangible
assets
amortization
:
Cost of
revenues 969 30 1,903 121
S&M 26 - 43 -
Tax benefit
(in respect
of net
deferred tax
asset
recorded) (877) - (877) -
-------- -------- -------- --------
Total
adjustments 19,692 716 26,514 3,713
-------- -------- -------- --------
Non-GAAP net profit $ 4,631 $ 4,213 $ 19,776 $ 12,522
-------- -------- -------- --------
-------- -------- -------- --------
Non- GAAP
basic net
profit per
share $ 0.14 $ 0.15 $ 0.62 $ 0.50
-------- -------- -------- --------
-------- -------- -------- --------
Non- GAAP
diluted net
profit per
share $ 0.14 $ 0.14 $ 0.59 $ 0.46
-------- -------- -------- --------
-------- -------- -------- --------
Weighted
average
number of
shares
used in
computing
basic net
earnings per
share 32,471,655 27,709,271 31,959,921 25,047,771
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Weighted
average
number of
shares
used in
computing
diluted net
earnings per
share 33,840,004 29,668,381 33,641,115 27,183,472
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
TABLE - 3
ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
RECONCILATION 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,
------------------ ------------------
2012 2011 2012 2011
-------- -------- --------- --------
(Unaudited) (Audited)
------------------ ------------------
GAAP Revenues $ 26,362 $ 22,028 $ 104,752 $ 77,753
Fair value
adjustment for
acquired
deferred
revenues write
down $ 2,109 - $ 2,367 -
Non-GAAP
Revenues $ 28,471 $ 22,028 $ 107,119 $ 77,753
-------- -------- --------- --------
-------- -------- --------- --------
TABLE - 4
ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands)
December 31, December 31,
------------ ------------
2012 2011
------------ ------------
(Audited) (Audited)
------------ ------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 50,026 $ 116,682
Short term deposits 78,042 24,000
Marketable securities and
restricted cash 14,988 18,718
Trade receivables, net 20,236 11,926
Other receivables and
prepaid expenses 6,815 5,950
Inventories 9,963 10,501
---------- ----------
Total current assets 180,070 187,777
---------- ----------
LONG-TERM ASSETS:
Severance pay fund 213 178
Deferred Taxes 1,525 210
Other assets 239 146
---------- ----------
Total long-term assets 1,977 534
---------- ----------
---------- ----------
PROPERTY AND EQUIPMENT,
NET 6,609 5,352
---------- ----------
GOODWILL AND INTANGIBLE
ASSETS, NET 33,136 3,395
---------- ----------
Total assets $ 221,792 $ 197,058
---------- ----------
---------- ----------
LIABILITIES AND
SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Trade payables $ 4,809 $ 2,684
Deferred revenues 13,829 16,694
Other payables and accrued
expenses 13,947 9,462
Liability related to
settlement of OCS grants 15,886 -
---------- ----------
Total current liabilities 48,471 28,840
---------- ----------
LONG-TERM LIABILITIES:
Deferred revenues 3,945 5,430
Accrued severance pay 254 219
---------- ----------
Total long-term
liabilities 4,199 5,649
---------- ----------
SHAREHOLDERS' EQUITY 169,122 162,569
---------- ----------
Total liabilities and
shareholders' equity $ 221,792 $ 197,058
---------- ----------
---------- ----------
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,
------------------- -------------------
2012 2011 2012 2011
------------------- -------------------
(Unaudited) (Audited)
Cash flows from
operating
activities:
Net income (Loss) $ (15,061) $ 3,497 $ (6,738) $ 8,809
Adjustments to
reconcile net
income to net
cash provided by
operating
activities:
Depreciation 1,007 706 3,120 2,754
Stock-based
compensation
related to
options granted
to employees 1,759 686 4,817 2,256
Amortization of
intangible assets 996 30 1,947 121
Capital loss 6 1 20 10
Decrease
(Increase) in
accrued severance
pay, net (6) 7 - 12
Decrease
(Increase) in
other assets (50) 4 6 98
Decease in
accrued interest
and amortization
of premium on
marketable
securities 68 85 212 151
Increase
(Decrease) in
trade receivables 1,503 873 (8,139) (1,187)
Decrease
(Increase) in
other receivables
and prepaid
expenses (393) (1,876) 1,134 (1,083)
Decrease
(Increase) in
inventories 1,096 (1,453) 3,233 329
Increase in
long-term
deferred taxes,
net (906) (114) (906) (114)
Decrease in trade
payables (2,794) (1,146) (1,287) (2,456)
Increase
(Decrease) in
employees and
payroll accruals 225 (233) 2,392 (748)
Increase
(Decrease) in
deferred revenues (2,794) 7,742 (7,089) 7,423
Increase
(Decrease) in
other payables
and accrued
expenses (1,157) (851) 84 (1,178)
Increase in
Liability related
to settlement of
OCS grants 15,886 - 15,886 -
------------------- ------------------
Net cash provided
by (used in)
operating
activities (615) 7,958 8,692 15,197
------------------- ------------------
Cash flows from
investing
activities:
Increase in
restricted
deposit 1,039 409 913 (78)
Redemption of
short-term
deposits - (6,000) (54,042) (24,000)
Investment in
short-term
deposit 15,958 - - -
Purchase of
property and
equipment (823) (915) (3,820) (2,953)
Proceeds from
sale of property
and equipment - - - 30
Investment in
marketable
securities (500) (504) (8,194) (4,735)
Proceeds from
redemption or
sale of
marketable
securities 8,736 200 10,736 2,603
Acquisitions - - (23,892) -
Loan to purchased
Subsidiary - - (1,000) -
------------------- --------------------
Net cash provided
by (used in)
investing
activities 24,410 (6,810) (79,299) (29,133)
------------------- --------------------
Cash flows from
financing
activities:
Issuance of share
capital related
to secondary
offering - 84,922 - 84,922
Exercise of
employee stock
options 563 818 5,903 2,838
Redemption of
bank loan - - (1,952) -
------------------- --------------------
Net cash provided
by financing
activities 563 85,740 3,951 87,760
------------------- --------------------
Increase in cash
and cash
equivalents 24,358 86,888 (66,656) 73,824
Cash and cash
equivalents at
the beginning of
the year 25,668 29,794 116,682 42,858
------------------- -------------------
Cash and cash
equivalents at
the end of the
year $ 50,026 $ 116,682 $ 50,026 $ 116,682
------------------- -------------------
------------------- -------------------
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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