iRobot Acquires Evolution Robotics, Inc.
Expands Position as Global Robotic Floor Care Market-Leader
BEDFORD, Mass. -- September 17, 2012
iRobot Corp. (NASDAQ: IRBT), a leader in delivering robotic technology-based
solutions, today announced it has signed a definitive agreement to acquire
privately-held Evolution Robotics, Inc. (ER), developer of Mint^® and Mint^®
Plus automatic floor cleaning robots, based in Pasadena, California. The
acquisition and the definitive agreement have been approved by the board of
directors of iRobot and the board of directors and stockholders of ER. The
acquisition, which is expected to close in the fourth quarter of 2012, expands
iRobot’s technology leadership through a combination of intellectual property,
engineering talent and new products that will broaden iRobot’s global
portfolio of practical robotics solutions. iRobot will acquire ER for $74
million, subject to customary purchase price adjustments. iRobot will use its
cash reserves to pay for the acquisition.
ER’s technology originated in 2001 in a technology company incubator. In 2010,
ER launched Mint^®, an automatic floor cleaning robot designed exclusively for
hard surface floors, which offers a different approach to cleaning than
iRobot’s current products. Mint automatically dusts and damp mops hard surface
floors using popular cleaning cloths, such as Swiffer^® brand Dry and Wet
Cloths and other similar products. In 2011, ER expanded its product line with
the introduction of Mint^® Plus, an enhanced version. Both products have been
available for purchase on ER’s website and from select U.S. retailers. Mint^®
provides iRobot with a complementary dry/wet floor cleaning solution ideally
suited for maintenance of hard surfaces. Positive customer experience has
driven strong revenue growth since its first product introduction in 2010.
Mint^® provides lower market entry points for customers with hard floors.
“Evolution Robotics’ products will expand our automated floor care offerings
while its technology and intellectual property will bring visual navigation
and simultaneous localization and mapping, among other technologies, which
could be deployed in future iRobot products to deliver greater customer
value,” said Colin Angle, iRobot chairman and CEO. “There are tremendous
opportunities to leverage the strength of the iRobot brand and our sales and
distribution network to expand Mint product sales around the world. Robotic
floor cleaners are one of the fastest growing consumer products in the past
few years and our retailers and distributors welcome opportunities to fuel
“I am also pleased to announce that Paolo Pirjanian, CEO of Evolution
Robotics, will be joining iRobot as Chief Technology Officer, continuing to be
based in the Pasadena office. I have known Paolo for many years and his
extensive experience as an industry-leading roboticist will greatly enhance
our team,” Angle added.
“I am very excited about Evolution Robotics and iRobot joining together as a
formidable force in robotic technology and look forward to my new role as
iRobot’s CTO,” said Paolo Pirjanian, CEO of Evolution Robotics, Inc.
The acquisition is expected to contribute additional revenue of $4-6 million
in 2012 and $22-24 million in 2013. On a GAAP basis, iRobot expects the
acquisition to be dilutive in 2012 and 2013, subject to final purchase price
accounting determinations. The acquisition is expected to be accretive by Q4
2013, excluding non-cash charges, one-time charges and integration costs.
Please refer to the supplemental data sheet attached hereto for detailed
information about the financial impact of the transaction.
iRobot will host a conference call tomorrow at 8:30 a.m. ET to discuss the
acquisition. Pertinent details include:
Date: Tuesday, September 18, 2012
Time: 8:30 a.m. ET
Call-In Number: 847-413-3235
A live, audio broadcast of the conference call will also be available at
An archived version of the broadcast will be available on the same website
shortly after the conclusion of the live event. A replay of the telephone
conference call will be available through September 25, and can be accessed by
dialing 630-652-3042, passcode 33337546#.
About iRobot Corp.
iRobot designs and builds robots that make a difference. The company’s home
robots help people find smarter ways to clean, and its defense & security
robots protect those in harm’s way. iRobot’s consumer and military robots
feature iRobot Aware® robot intelligence systems, proprietary technology
incorporating advanced concepts in navigation, mobility, manipulation and
artificial intelligence. For more information about iRobot, please visit
About Evolution Robotics
Evolution Robotics, Inc., based in Pasadena, California, is the developer of
Mint^® and Mint^®Plus automatic floor cleaning robots. Evolution Robotics was
founded as an operating company of Idealab, a creator and operator of
technology businesses, and has been funded by Vodafone Ventures Ltd, CMEA
Ventures and Shea Ventures.
For iRobot Investors
Certain statements made in this press release that are not based on historical
information are forward-looking statements which are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995.
This press release contains express or implied forward-looking statements
relating to, among other things, iRobot Corp.’s expectations regarding the
timing of the closing of the acquisition of Evolution Robotics, Inc., the
impact of the acquisition on its products and product offerings and the demand
for its products, and the impact of the acquisition on its future financial
performance, anticipated revenue for fiscal year 2012 and fiscal year 2013,
and earnings per share for fiscal year 2012 and fiscal year 2013. These
statements are neither promises nor guarantees, but are subject to a variety
of risks and uncertainties, many of which are beyond our control, which could
cause actual results to differ materially from those contemplated in these
forward-looking statements. In particular, the risks and uncertainties
include, among other things: our ability to operate in an emerging market, the
financial strength of our customers and retailers, general economic
conditions, market acceptance of our products, and competition. Existing and
prospective investors are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof. iRobot
Corp. undertakes no obligation to update or revise the information contained
in this press release, whether as a result of new information, future events
or circumstances or otherwise. For additional disclosure regarding these and
other risks faced by iRobot Corp., see the disclosure contained in our public
filings with the Securities and Exchange Commission.
Deal Financial Highlights*:
-Cash purchase price of $74M (subject to working capital adjustments and other
customary transaction price adjustments)
-Cash purchase price is 3.0x 2013 expected revenue with impact of federal net
operating losses (NOLs), and 3.2x 2013 expected revenue without impact of NOLs
-Preliminary tax-effected net present value of ER's NOLs of approximately $6M
-Acquisition expected to be accretive in Q4 2013, excluding non-cash charges,
one-time charges and integration costs
-Estimated net revenue of $4-6M in Q4 2012 and $22-24M in 2013
-Estimated EPS impact of acqusition of ($0.18)-($0.22) in Q4 2012 and
($0.22)-($0.26) in 2013
-Estimated Adjusted EPS impact of acquisition of ($0.09)-($0.13) in Q4 2012
and ($0.06)-($0.10) in 2013.
See definition of Adjusted EPS impact below.
-ER domestic revenue is expected to be 97% of 2012 sales; limited
International sales to date
-65% of ER's 2012 revenue comes from current iRobot domestic accounts
-ER currently utilizes 2 contract manufacturers in China
-Pasadena, CA office will be maintained
*all financial data subject to purchase price accounting determinations and
final closing details
Use of Non-GAAP Financial Measures
In evaluating this acquisition, iRobot considers and uses Adjusted EPS
(earnings per share) impact as a supplemental measure of the impact. The
Company defines Adjusted EPS impact as earnings per share impact excluding the
impact of deal-related estimated intangible asset amortization, merger and
acquisition expenses, ASC805 inventory accounting adjustments and non-cash
stock compensation expense.
The term Adjusted EPS impact is not defined under U.S. generally accepted
accounting principles, or U.S. GAAP, and is not a measure of operating income,
operating performance or liquidity presented in accordance with U.S. GAAP.
Adjusted EPS impact has limitations as an analytical tool, and when assessing
the Company's operating performance, investors should not consider Adjusted
EPS impact in isolation, or as a substitute for earnings (loss) per share or
other consolidated income statement data prepared in accordance with U.S.
GAAP. Other companies may calculate similar measure differently than iRobot,
limiting their usefulness as comparative tools. iRobot compensates for these
limitations by relying primarily on its GAAP results and using Adjusted EPS
impact only supplementally.
Elise Caffrey, 781-430-3003
Laura Jakosky, 781-430-3234
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