Allot Communications Reports non-GAAP Revenues of $24.2 Million for First Quarter of 2013 PR Newswire HOD HASHARON, Israel, May 7, 2013 HOD HASHARON, Israel, May 7, 2013 /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 first quarter 2013 results, with non-GAAP revenues reaching $24.2 million ($24.1 million on a GAAP basis). First Quarter Highlights: oNon-GAAP revenues were $24.2 million ($24.1 million on a GAAP basis). oNon-GAAP gross margin was 75% (72% on a GAAP basis). oNon-GAAP operating margin was 2% (8% loss on a GAAP basis). oBook-to-bill above 1. oEarly in second quarter, a $9 million follow-on order was received from a tier 1 US mobile operator. Financial Results: On a non-GAAP basis, total revenues for the first quarter of 2013 reached $24.2 million, compared with $24.2 million of revenue reported for the first quarter of 2012 and $28.5 million of revenue reported for the fourth quarter of 2012. On a non-GAAP basis, net profit for the first quarter of 2013 was $0.6 million, or $0.02 per basic and diluted share. This compares with non-GAAP net profit of $5.0 million, or $0.16 per basic share, and $0.15 per diluted share, in the first quarter of 2012 and non-GAAP net profit of $4.6 million, or $0.14 per basic and diluted share, in the fourth quarter of 2012. Total GAAP revenues for the first quarter of 2013 reached $24.1 million compared to $24.2 million of revenue reported for the first quarter of 2012 and $26.4 million of revenue reported for the fourth quarter of 2012. On a GAAP basis, the net loss for the first quarter of 2013 was $1.8 million, or a net loss of $0.06 per basic and diluted share. This compares with net profit of $3.2 million, or $0.10 per basic and diluted share, in the first quarter of 2012, and a net loss of $15.1 million, or a net loss of $0.46 per basic and diluted share, in the fourth quarter of 2012. Key Quarterly Achievements: oDuring the quarter, large orders were received from 16 service providers, 3 of which represented new customers o12 of the large orders came from mobile-service providers, one of which was a new customer oAnnounced a $6 million project to provide virtualized-parental control service to a tier-1 mobile operator oAllot was selected by Tata Communications to provide hosted-policy management services oReceived a $6.5 Million Steering and VAS order from a tier-1 EMEA mobile operator As of March 31, 2013, cash, cash equivalents, short-term deposits and marketable securities totaled $134.8 million with no debt. "The sequential decrease in revenues was mainly attributable to the weakness in EMEA markets as expressed in a book-to-bill below 1 during the second half of 2012, as well as to normal first-quarter seasonality. Despite that, we started the year with a much stronger booking environment reflected by a number of multi-million dollars deals won during the first quarter. Also we started the second quarter with positive booking momentum by securing a follow-on, $9m order from a Tier 1 Mobile operator in the US. We continue to see a strong funnel of large orders ahead," commented Rami Hadar, Allot Communications' President and Chief Executive Officer. "As can be seen by the two large deals announced in the first quarter, Value-Added Services was a major contributor to revenue and booking. We are pleased to see our Service Gateway strategy gain acceptance among tier 1 service providers while we grow our VAS portfolio and redefine the DPI space." Conference Call & Webcast The Allot management team will host a conference call to discuss first quarter 2013 earnings results today at 8:30 a.m. ET, 3:30 p.m. Israel time. To access the conference call, please dial one of the following numbers: US: +1646 254 3360, UK: +44(0)20 3364 5381, Israel: +972-3-763 0145, participant code 2641301. A replay of the conference call will be available from 12:01 a.m. ET on May 7, 2013 through May 14, 2013 at 11:59 p.m. UK time. To access the replay, please dial: US: + 1 347 366 9565, UK: + 44 (0)20 3427 0598, access code: 2641301. 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: 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. 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 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: Rami Rozen AVP Corporate Development International access code +972-52-569-4441 firstname.lastname@example.org Public Relations Contact: Maya Lustig Director of Corporate Communications International access code +972-54-677-8100 email@example.com 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 March 31, 2013 2012 (Unaudited) Revenues $ 24,114 $ 24,217 Cost of revenues 6,740 6,901 Gross profit 17,374 17,316 Operating expenses: Research and development costs, net 6,902 4,010 Sales and marketing 9,827 7,755 General and administrative 2,638 2,774 Total operating expenses 19,367 14,539 Operating profit (loss) (1,993) 2,777 Financial and other income, net 187 462 Profit (loss) before tax expenses (1,806) 3,239 Tax expenses 41 3 Net profit (loss) (1,847) 3,236 Basic net profit (loss) per share $ (0.06) $ 0.10 Diluted net profit (loss) per share $ (0.06) $ 0.10 Weighted average number of shares used in computing basic net earnings per share 32,561,977 31,218,667 Weighted average number of shares used in computing diluted net earnings per share 32,561,977 32,923,903 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 March 31, 2013 2012 (Unaudited) GAAP net profit (loss) as reported $ (1,847) $ 3,236 Non-GAAP adjustments Fair value adjustment for acquired 37 - deferred revenues write down (Revenues) Expenses recorded for stock-based compensation Cost of revenues 86 44 Research and development costs, net 411 188 Sales and marketing 746 318 General and administrative 586 166 Expenses related to M&A activities and compliance with regulatory matters (*) General and administrative (G&A) 12 1,045 Research and development costs, net 6 - Intangible assets amortization Cost of revenues 504 31 S&M 58 - Total adjustments 2,446 1,792 Non-GAAP net profit $ 599 $ 5,028 Non- GAAP basic net profit per share $ 0.02 $ 0.16 Non- GAAP diluted net profit per share $ 0.02 $ 0.15 Weighted average number of shares used in computing basic net earnings per share 32,561,977 31,218,667 Weighted average number of shares used in computing diluted net earnings per share 33,506,441 33,078,735 (*) Mostly legal, finance and compensation expenses related to the acquisitions 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 March 31, 2013 2012 (Unaudited) GAAP Revenues $ 24,114 $ 24,217 Fair value adjustment for acquired deferred 37 - revenues write down Non-GAAP Revenues $ 24,151 $ 24,217 TABLE - 4 ALLOT COMMUNICATIONS LTD. AND ITS SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (U.S. dollars in thousands) March 31, December 31, 2013 2012 (Unaudited) (Audited) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 89,434 $ 50,026 Short term deposits 17,000 78,042 Marketable securities and 28,332 14,987 restricted cash Trade receivables, net 25,587 20,236 Other receivables and prepaid 7,116 6,815 expenses Inventories 9,643 9,963 Total current assets 177,112 180,069 LONG-TERM ASSETS: Severance pay fund 211 213 Deferred Taxes 1,525 1,525 Other assets 268 239 Total long-term assets 2,004 1,977 PROPERTY AND EQUIPMENT, NET 6,585 6,609 GOODWILL AND INTANGIBLE ASSETS, NET 32,574 33,136 Total assets $ 218,275 $ 221,791 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Trade payables $ 3,428 $ 4,809 Deferred revenues 12,500 13,829 Other payables and accrued expenses 14,398 13,947 Liability related to settlement of 15,886 15,886 OCS grants Total current liabilities 46,212 48,471 LONG-TERM LIABILITIES: Deferred revenues 2,286 3,945 Accrued severance pay 276 254 Total long-term liabilities 2,562 4,199 SHAREHOLDERS' EQUITY 169,501 169,121 Total liabilities and shareholders' $ 218,275 $ 221,791 equity TABLE - 5 ALLOT COMMUNICATIONS LTD. AND ITS SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (U.S. dollars in thousands) Three Months Ended March 31, 2013 2012 (Unaudited) Cash flows from operating activities: Net income (Loss) $ $ (1,847) 3,236 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 880 645 Stock-based compensation related to options 1,829 716 granted to employees Amortization of intangible assets 562 31 Capital loss - 4 Decrease (Increase) in accrued severance 24 (6) pay, net Increase in other assets (29) (1) Decease in accrued interest and amortization of premium on marketable 11 37 securities Increase in trade receivables (5,351) (4,387) Decrease (Increase) in other receivables and (44) 224 prepaid expenses Decrease (Increase) in inventories 320 (151) Increase (Decrease) in trade payables (1,381) 3,255 Increase (Decrease) in employees and payroll (722) 265 accruals Increase (Decrease) in deferred revenues (2,988) 1,211 Increase (Decrease) in other payables and 1,173 (677) accrued expenses Net cash provided by (used in) operating (7,563) 4,402 activities Cash flows from investing activities: Decrease (Increase) in restricted deposit 4 (44) Redemption of short-term deposits 61,042 18,000 Purchase of property and equipment (856) (703) Investment in marketable securities (15,662) (251) Proceeds from redemption or sale of 2,279 450 marketable securities Net cash provided by investing activities 46,807 17,452 Cash flows from financing activities: Exercise of employee stock options 164 2,366 Net cash provided by financing activities 164 2,366 Increase in cash and cash equivalents 39,408 24,220 Cash and cash equivalents at the beginning 50,026 116,682 of the period Cash and cash equivalents at the end of the $ $ 140,902 period 89,434 SOURCE Allot Communications Ltd. Website: http://www.allot.com
Allot Communications Reports non-GAAP Revenues of $24.2 Million for First Quarter of 2013
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