SoundBite Communications Reports Fourth Quarter and Year End 2012 Financial Results

SoundBite Communications Reports Fourth Quarter and Year End 2012 Financial
Results

Record Fourth Quarter Revenues of $13.9 Million, an Increase of 16% Over
Previous Year Period; Adjusted EBITDA of $1.5 Million, an Increase of 8% Over
Same Period Last Year

BEDFORD, Mass., Feb. 21, 2013 (GLOBE NEWSWIRE) -- SoundBite Communications,
Inc. (Nasdaq:SDBT), a provider of customer experience management solutions,
today announced its financial results for the fourth quarter and full year
2012. Fourth quarter revenues, computed in accordance with U.S. generally
accepted accounting principles (GAAP), were $13.9 million, an increase of 16%
compared to the same quarter in 2011. On a full year basis, GAAP revenues for
2012 were $48.1 million, a 15% increase over 2011. GAAP operating income for
the fourth quarter of 2012 was $433,000. GAAP net income for the fourth
quarter of 2012 was $469,000, or $0.03 per share, versus net income of
$391,000 or $0.02 per share in the fourth quarter of 2011.

On a non-GAAP basis, after excluding non-cash stock-based compensation
expense, amortization of intangible assets, a present value adjustment related
to the SmartReply contingent consideration, and a tax benefit, net income was
$1.1 million or $0.07 per share in the fourth quarter compared to $1.0 million
or $0.06 per share in the same quarter in 2011.

"We are very pleased with our strong fourth quarter financial performance,
exceeding our original forecast as well as our preannouncement in January.
These results were driven by a seasonally strong performance in our mobile
marketing business and increased demand in our hosted contact center
business," stated Jim Milton, president and CEO of SoundBite Communications.
"The fourth quarter was also an important and successful quarter by other
business measures. SoundBite took a clear leadership position for our
industry; championing efforts resulting in a positive declaratory ruling from
the FCC for confirmatory opt-out text messages. As a result, our TCPA related
class action cases have been dismissed. And based on the improving confidence
in our business, we paid a special one-time dividend in December of $0.50 per
share."

Milton continued, "We continued our transformation in 2012 - growing our
mobile channel, delivering improving financial results, and expanding
offerings in the marketing, proactive customer care and collections and
payments lifecycles. For 2013, I am optimistically looking forward to
continuing our momentum across the lifecycle, expanding our global reach,
building our channel partnerships, reaching sustainable profitability, and
enabling our clients to deliver the best customer experience possible."

Recent Highlights

  *Released an enhanced multi-channel compliance suite for contact centers,
    enabling organizations to mitigate risks and meet compliance requirements.
  *Secured a favorable Declaratory Ruling from the Federal Communications
    Commission (FCC) on confirmatory opt-out text message compliance.
  *Announced a complaints solution for financial services organizations
    striving to meet the U.K. Financial Services Authority (FSA) regulatory
    and compliance requirements.
  *Declared a special dividend to stockholders, paid in December 2012, of
    $0.50 per share.
  *Announced a positive end to the class action law suits against GameStop,
    and Bank of America/SoundBite related to confirmatory opt-out text
    messages.

Quarterly Results

GAAP Results

Gross margin for the fourth quarter of 2012 was 63.4% versus 61.2% in the
fourth quarter of 2011. Operating expenses were $8.4 million in the fourth
quarter of 2012 and as a percentage of revenues were 60.3% versus 57.8% in the
year-earlier period.

Operating income for the fourth quarter was $433,000, compared to $397,000 in
the same quarter last year.

Net income was $469,000 for the fourth quarter of 2012 versus net income of
$391,000 in the fourth quarter of 2011. Net income per share for the fourth
quarter of 2012 was $0.03, versus $0.02 in the same quarter of 2011.

Non-GAAP Results

Fourth quarter 2012 non-GAAP net income was $1.1 million or $0.07 per share,
compared to a non-GAAP net income of $1.0 million or $0.06 per share for the
same period in 2011. Non-GAAP net income computations exclude amortization
expense, stock-based compensation expense, a present value adjustment of the
contingent consideration related to the SmartReply earn-out, and a tax
benefit. A reconciliation of GAAP net income to non-GAAP net income is
included with the financial tables at the end of this release.

Non-GAAP free cash flow, calculated as cash flow from operating activities,
less payments, if any, of contingent purchase price related to the Mobile
Collect and SmartReply acquisitions, and purchases of property and equipment,
for the fourth quarter resulted in a negative free cash flow of $819,000. A
reconciliation of GAAP cash flows (used in) generated from operating
activities to non-GAAP free cash flow is included with the financial tables at
the end of this release.

Adjusted EBITDA

Adjusted EBITDA (earnings before interest, taxes, depreciation and
amortization) for the fourth quarter of 2012 was $1.5 million versus $1.4
million in the fourth quarter of 2011, reflecting an 8% increase over prior
year. Adjusted EBITDA reflects EBITDA excluding the effects of stock-based
compensation expense and present value adjustments of the contingent
consideration related to the SmartReply earn-out in the fourth quarter 2012
and 2011. A reconciliation of net income (loss) to Adjusted EBITDA is included
with the financial tables at the end of this release.

First Quarter Guidance

Based on information available as of February 21, 2013, SoundBite is issuing
guidance for the first quarter 2013 as follows:

SoundBite currently projects revenues in the range of $11.1 million to $11.8
million and gross margin in the range of 59% to 61% for the first quarter of
2013. Operating expenses are expected to be approximately $8.4 million. The
projection for GAAP net loss is in the range of $1.3 million to $1.8 million
and on a per share basis is a net loss of $0.08 to $0.11 for the first quarter
of 2013.

The non-GAAP projections are for a non-GAAP net loss of $400,000 to $900,000,
or $0.03 to $0.06 per share. Non-GAAP estimates exclude the effects of the
amortization of intangible assets of approximately $400,000 associated with
the Company's acquisitions of SmartReply and 2ergo Americas, estimated
stock-based compensation expense of approximately $250,000, severance expenses
of approximately $200,000, and a present value adjustment of the contingent
consideration related to the SmartReply earn-out of approximately $40,000. On
an adjusted basis, SoundBite is projecting earnings before interest, taxes,
depreciation and amortization to be breakeven to a loss of $600,000. These
projections assume a basic weighted share count of approximately 16.5 million
shares for the first quarter of 2013. SoundBite expects capital expenditures
to be approximately $350,000 and depreciation expense to be approximately
$400,000.

Webcast and Teleconference Information

The Company will host a conference call today at 5:00 p.m. ET to discuss its
financial results. A live and archived webcast of the event will be available
at http://ir.soundbite.com/ . A live dial-in is available in the U.S. at + 1
866 362 4666 and outside the U.S. at +1 617 597 5313, and using the passcode:
23977065. A replay of the call will be available approximately two hours after
the call completes and can be accessed by dialing +1 888 286 8010 in the U.S.
and outside the U.S. at +1 617 801 6888 and entering the passcode: 73116708.

Non-GAAP and Adjusted Measures

To supplement its statements of operations information presented in accordance
with GAAP, SoundBite presents information with respect to non-GAAP net income
(loss), non-GAAP free cash flow and Adjusted EBITDA.SoundBite has included in
this release reconciliations of GAAP net income (loss) to non-GAAP net income
(loss), GAAP cash flows (used in) generated from operating activities to
non-GAAP free cash flow, and GAAP net income to Adjusted EBITDA.SoundBite
believes these supplemental measures are often used by investors as measures
of financial performance in evaluating technology companies such as SoundBite
and also believes these financial measures can enhance investors' overall
understanding of SoundBite's historical financial performance.The presentation
of these supplemental financial measures should not be considered in isolation
from, or as a substitute for, SoundBite's financial results reported in
accordance with GAAP.SoundBite may compute these supplemental financial
measures differently from other companies, which would reduce their usefulness
as comparative measures.

About SoundBite Communications

SoundBite Communications is a customer experience management company with deep
expertise in delivering cloud-based mobile marketing, proactive customer care,
and collections/payments solutions. More than 450 global end-clients,
including nearly 50 Fortune 500 companies, leverage SoundBite's proactive
multi-channel communications and preference management platforms to power 2.5
billion personalized and compliant customer interactions annually across the
full consumer lifecycle. Visit SoundBite.com and follow SoundBite on Twitter
@SoundBiteComm for more information.

The SoundBite Communications, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=4393

Forward-Looking Statement

This is a "safe harbor" statement under the Private Securities Litigation
Reform Act of 1995. Any forward-looking statements contained in this press
release, including statements made under "First Quarter Guidance," are based
upon SoundBite's historical performance and its current plans, estimates and
expectations. The inclusion of this forward-looking information should not be
regarded as a representation by SoundBite, its management or any other person
that the future plans, estimates or expectations contemplated by SoundBite
will be achieved. These forward-looking statements represent SoundBite's
expectations as of the date of this press release. Subsequent events may cause
these expectations to change and SoundBite disclaims any obligation to update
the forward-looking statements in the future. Matters subject to
forward-looking statements involve known and unknown risks and uncertainties,
including: slower than anticipated development of the market for automated
voice messaging services; defects in SoundBite's platform; disruptions in its
service or errors in its execution; discontinued or decreased use of
SoundBite's service by its clients, which are not subject to minimum purchase
requirements for any reason, including market conditions and regulatory
developments; and the occurrence of events adversely affecting the collection
agencies industry or in-house collection departments, which account for a
significant portion of SoundBite's revenues. These and other factors,
including the factors set forth under the caption "Item 1A. Risk Factors" of
Part II in SoundBite's most recent quarterly report on Form 10-Q filed with
the Securities and Exchange Commission, could cause SoundBite's performance or
achievements to be materially different from those expressed or implied by the
forward-looking statements.

SoundBite is a registered service mark of SoundBite Communications, Inc.

(SDBT: F, G)

                                                                
                                                                
SOUNDBITE COMMUNICATIONS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(in thousands, except share and per share amounts)
                                                                
                                                                
                                  Three Months Ended    Twelve Months Ended
                                   December 31           December 31,
                                  2012       2011       2012       2011
Revenues                          $13,853  $11,982  $48,071  $41,653
Cost of revenues (1)               5,067      4,654      18,916     17,018
Gross profit                      8,786      7,328      29,155     24,635
Operating expenses:                                              
Research and development (1)       1,886      1,573      7,223      6,114
Sales and marketing (1)            4,387      3,802      16,649     14,084
General and administrative (1)     2,080      1,556      8,131      6,835
Total operating expenses          8,353      6,931      32,003     27,033
Operating income (loss)            433        397        (2,848)    (2,398)
Interest and other income         15         8          77         0
Income (loss) before income tax    448        405        (2,771)    (2,398)
benefit (provision)
Income tax benefit (provision)   21         (14)       948        891
Net income (loss)                  $469     $391     $(1,823) $(1,507)
                                                                
Net income (loss) per common                                     
share:
Basic                            $0.03    $0.02    $(0.11)  $(0.09)
Diluted                           $0.03    $0.02    $(0.11)  $(0.09)
Weighted average common shares                                   
outstanding:
Basic                            16,429,976 16,466,414 16,410,927 16,435,737
Diluted                           16,918,932 16,487,299 16,410,927 16,435,737
                                                                
(1) Amounts include stock-based compensation expense, as follows:
                                                                
                                  Three Months Ended    Twelve Months Ended
                                   December 31           December 31,
                                  2012       2011       2012       2011
                                                                
Cost of revenues                   $8       $11      $36      $42
Research and development           44         60         184        218
Sales and marketing               72         114        299        459
General and administrative         158        107        509        456
                                  $282     $292     $1,028   $1,175

                                                                
                                                                
SOUNDBITE COMMUNICATIONS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(in thousands, except share amounts)
                                                                
                                                                
                                                    December 31, December 31,
                                                     2012         2011
Assets                                                           
Current assets:                                                  
Cash and cash equivalents                            $10,119    $17,706
Short-term investments                               4,896        10,976
Accounts receivable, net of allowance for doubtful
accounts of $91 and $166 at December 31, 2012        10,223       8,163
and2011, respectively
Prepaid expenses and other current assets            1,621        1,419
Total current assets                                26,859       38,264
Property and equipment, net                         2,026        2,081
Intangible assets, net                              2,764        2,036
Goodwill                                            6,594        4,286
Other assets                                        89           118
Total assets                                        $38,332    $46,785
                                                                
                                                                
Liabilities and Stockholders' Equity                             
Current liabilities:                                             
Accounts payable                                    $1,448     $767
Accrued expenses                                    4,464        3,445
Other current liabilities                           417          561
Total current liabilities                           6,329        4,773
Non-current liabilities:                                         
Long-term contingent consideration payable          535          966
Other liabilities                                   97           277
Total liabilities                                   6,961        6,016
                                                                
Stockholders' equity:                                            
Common stock, $0.001 par value— 75,000,000shares
authorized; 16,972,025 and 16,666,206 shares issued
at December 31, 2012 and 2011, respectively;         17           17
16,498,357 and 16,410,427 shares outstanding at
December 31, 2012 and 2011, respectively
Additional paid-in capital                           71,923       70,681
Treasury stock, at cost—473,668 and 255,779 shares  (833)        (273)
December 31, 2012 and 2011, respectively
Accumulated other comprehensive loss                 (72)         (72)
Accumulated deficit                                  (39,664)    (29,584)
Total stockholders' equity                          31,371       40,769
Total liabilities and stockholders' equity          $38,332    $46,785

                                                                  
                                                                  
SOUNDBITE COMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
                                                                  
                                                                  
                                                        Twelve Months Ended
                                                         December 31,
                                                        2012       2011
Cash flows from operating activities:                              
Net loss                                                 $(1,823) $(1,507)
Adjustments to reconcile net loss to net cash provided             
by (used in) operating activities:
Depreciation of property and equipment                   1,355      1,338
Amortization of intangible assets                        1,772      839
Amortization of premiums paid on short-term investments  4          5
Adjustment to contingent consideration                  (93)       98
Provision for bad debts                                  74         52
Stock-based compensation expense                         1,028      1,175
Deferred taxes                                           (957)      (905)
Gain on disposal of property and equipment               0          (3)
Change in operating assets and liabilities, net of                 
effect of acquisitions:
Accounts receivable                                      (1,669)    (957)
Prepaid expenses and other current assets                (77)       (161)
Other assets                                             29         111
Accounts payable                                         267       (586)
Accrued expenses and other liabilities                   605        (200)
Net cash provided by (used in) operating activities    515       (701)
Cash flows from investing activities:                              
Cash paid related to Mobile Collect acquisition         (498)      (691)
Cash paid related to SmartReply acquisition             0          (3,150)
Cash paid related to 2ergo Americas acquisition         (3,773)    0
Proceeds received from sale of equipment                 0          3
Purchases of short-term investments                      (9,925)    (10,981)
Sales and maturities of short-term investments           16,001     0
Purchases of property and equipment                      (1,093)    (842)
Net cash provided by (used in) investing activities     712        (15,661)
Cash flows from financing activities:                              
Contingent consideration payment related to SmartReply   (211)      0
acquisition
Proceeds from exercise of stock options                  214        52
Payment of dividends                                     (8,257)   0
Treasury stock purchases                                 (560)     (141)
Net cash used in financing activities                   (8,814)    (89)
Net decrease in cash and cash equivalents               (7,587)    (16,451)
Cash and cash equivalents, beginning of year             17,706     34,157
Cash and cash equivalents, end of year                   $10,119  $17,706
                                                                  
Supplemental disclosure of cash flow information:                  
Cash paid during the period for income taxes             $12      $46
                                                                  
Supplemental disclosures of non-cash investing                     
activities:
Property and equipment, included in accounts payable    $319     $150
Contingent cash payment to Mobile Collect, included in   $--     $271
other current liabilities

                                                                
                                                                
SOUNDBITE COMMUNICATIONS, INC. AND SUBSIDIARIES
Reconciliation of GAAP Net Income (Loss) to Non-GAAP Net Income (Loss) and EPS
(in thousands, except share and per share amounts)
                                                                
                                                                
                                  Three Months Ended    Twelve Months Ended
                                   December 31,          December31,
                                  2012       2011       2012       2011
GAAP net income (loss)             $469     $391     $(1,823) $(1,507)
Stock-based compensation expense   282       292       1,028     1,175
Amortization of intangible assets  387       296       1,606     700
Adjustment to contingent           39        51        (93)      98
consideration
Severance expense                  --       --       --       94
Tax benefit                        (30)      --       (957)     (905)
Non-GAAP net income (loss)         $1,147   $1,030   $(239)   $(345)
                                                                
Non-GAAP net income (loss) per                                   
common share:
Basic                            $0.07    $0.06    $(0.01)  $(0.02)
Diluted                           $0.07    $0.06    $(0.01)  $(0.02)
                                                                
                                                                
Weighted average common shares
used in computing Non-GAAP net                                   
income (loss) per common share:
Basic                            16,429,976 16,466,414 16,410,927 16,435,737
Diluted                           16,918,932 16,487,299 16,410,927 16,435,737

                                                                
                                                                
SOUNDBITE COMMUNICATIONS, INC. AND SUBSIDIARIES
Reconciliation of GAAP Cash Flows from Operating Activities to Non-GAAP Free
Cash Flows
(in thousands)
                                                                
                                                                
                                     Three Months Ended Twelve Months Ended
                                      December 31,       December31,
                                     2012      2011     2012       2011
GAAP cash flows (used in) generated   $(740)  $1,491 $515     $(701)
from operating activities
Contingent purchase price payments to --      (215)   (498)     (691)
Mobile Collect
Contingent purchase price payment to  --      --     (211)     --
SmartReply
Purchases of property and equipment   (79)     (147)   (1,093)   (842)
Non-GAAP free cash flows             $(819)  $1,129 $(1,287) $(2,234)

                                                                
                                                                
SOUNDBITE COMMUNICATIONS, INC. AND SUBSIDIARIES
Reconciliation of Net Income (Loss) to Adjusted EBITDA
(in thousands)
                                                                
                                                                
                                     Three Months Ended Twelve Months Ended
                                      December 31,       December31,
                                     2012      2011     2012       2011
Net income (loss)                     $469    $391   $(1,823) $(1,507)
Interest income                       (12)     (12)    (59)      (25)
Foreign currency exchange (gain) loss (3)      4       (18)      25
Tax benefit (provision)               (21)     14      (948)     (891)
Gain on sale of equipment            --      --     --       (3)
Depreciation of property and          347      335     1,355     1,338
equipment
Amortization of intangible assets     429      338     1,772     839
EBITDA                                $1,209  $1,070 $279     $(224)
Stock-based compensation expense      282      292     1,028     1,175
Adjustment to contingent              39       51      (93)      98
consideration
Severance expense                     --      --     --       94
Adjusted EBITDA                       $1,530  $1,413 $1,214   $1,143

CONTACT: IR & Media Contact:
         Lynn Ricci
         SoundBite Communications
         781-897-2696
         lricci@SoundBite.com

SoundBite Communications
 
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