RADCOM Reports 57% Year-Over-Year Revenue Increase & Positive Cash Flow For Q3 2013

RADCOM Reports 57% Year-Over-Year Revenue Increase & Positive Cash Flow For Q3

PR Newswire

TEL-AVIV, Israel, Oct. 23, 2013

TEL-AVIV, Israel, Oct. 23, 2013 /PRNewswire/ --RADCOM Ltd. (RADCOM) (NASDAQ:
RDCM), a leading service assurance provider, today reported its results for
the third quarter of 2013, recording a 57% year-over-year increase in
revenues, a 37% year-over-year decrease in net loss and strong bookings for
the third quarter ended September 30, 2013.

In $ thousands     Q3 2013  Q3 2012  Change Q1-Q3 2013 Q1-Q3 2012 Change
Revenues           $4,758   $3,030   57%    $14,775    $10,633    39%
Operating expenses $3,460   $3,530   (2%)   $10,430    $11,644    (10%)
Net loss (GAAP)    $(1,148) $(1,810) (37%)  $(1,537)   $(5,655)   (73%)
Net loss           $(1,017) $(1,684) (40%)  $(1,108)   $(5,258)   (79%)

Results for the 3rd Quarter of 2013
Q3 revenues totaled $4.8 million, up 57% compared with $3.0 million in the
third quarter of 2012, but down 13% compared with the second quarter of 2013.
The sequential decline reflects the timing of recognition of approximately
$800,000 in revenues that was delayed from the third to the fourth quarter.
These revenues add to the Company's visibility, and form a solid basis for a
strong fourth quarter.

Gross margin for the period was 50%, reflecting the impact of a large, old and
low-margin project that was recognized from the backlog. Gross margin is
expected to return to normal levels in future quarters.

With year-over-year revenue growth and steady operating expenses, the Company
was able to slash its net loss by 37% on a year-over-year basis despite the
low gross margin. Net loss for the third quarter of 2013 was $(1,148,000), or
$(0.15) per ordinary share (basic and diluted), compared with $(1,810,000), or
$(0.28) per ordinary share (basic and diluted), for the third quarter of 2012.
On a non-GAAP basis, net loss for the quarter totaled $(1,017,000), or $(0.13)
per ordinary share (basic and diluted), compared with $(1,684,000), or $(0.26)
per ordinary share (basic and diluted), for the parallel quarter of 2012.
Despite the net loss, the Company achieved positive cash flow during the
period, reflecting successful cash management and reduced expenses.

Comments of Management
Commenting on the results, David Ripstein, RADCOM's CEO, said, "The third
quarter was a period of continued strategic progress and momentum that was
masked by certain events that affected our financial results, as detailed
above. Although we are pleased to report another quarter of strong
year-over-year growth, the period's revenue recognition fluctuations prevented
us from achieving the sequential growth we had expected. The shifted revenues,
combined with the bookings we have achieved during the past few weeks, are a
solid basis for a strong fourth quarter in line with the trend that has been
building through 2013.

"In fact, a number of factors make us excited about our future prospects:
especially the growing size and quality of opportunities in the market, the
growth of our sales pipeline and high win rate, the increase in our partner
activities and the strength of our bookings and backlog. Equally important, we
continue to develop exciting new products that bring even more value to our
customers, and whose higher software component will enable us to achieve
better gross margins and profitability over the long term. As such, we remain
optimistic and continue to see strong growth ahead – in both the top and
bottom line - for 2013."

Results for the 1^st Nine Months of 2013
For the first nine months of 2013, revenues increased by 39% to $14.8 million
from $10.6 million in the parallel period of 2012. Net loss for the period was
reduced by nearly 73% to $(1.5) million, or $(o.22) per ordinary share (basic
and diluted), from $(5.7) million, or $(o.88) per ordinary share (basic and
diluted), in the first nine months of 2012. Non-GAAP net loss for the period
was $(1.1) million, or $(0.16) per share (basic and diluted), compared with
$(5.3) million, or $(0.82) per share (basic and diluted) for the first nine
months of 2012.

Earnings Conference Call
RADCOM's management will hold an interactive conference call today at 9:00 AM
Eastern Time (16:00 Israel Time) to discuss the results and to answer
participants' questions. To join the call, please call one of the following
numbers approximately five minutes before the call is scheduled to begin:

From the US (toll-free): + 1-888-407-2553

From other locations: +972-3-918-0644

For those unable to listen to the call at the time, a replay will be available
from October 24^th on RADCOM's website.

RADCOM provides innovative service assurance and customer experience
management solutions for leading telecom operators and communications service
providers. RADCOM specializes in solutions for next-generation mobile and
fixed networks, including LTE, VoLTE, IMS, VoIP, UMTS/GSM and mobile
broadband. RADCOM's comprehensive, carrier- grade solutions are designed for
big data analytics on terabit networks, and are used to prevent service
provider revenue leakage and to enhance customer care management. RADCOM's
products interact with policy management to provide self-optimizing network
solutions. RADCOM's shares are listed on the NASDAQ Capital Market under the
symbol RDCM. For more information, please visit www.radcom.com

Non-GAAP Information
Certain non-GAAP financial measures are included in this press release. These
non-GAAP financial measures are provided to enhance the reader's overall
understanding of our financial performance. By excluding non-cash stock-based
compensation that has been expensed in accordance with ASC Topic 718, our
non-GAAP results provide information to both management and investors that is
useful in assessing our core operating performance and in evaluating and
comparing our results of operations on a consistent basis from period to
period. These non-GAAP financial measures are also used by management to
evaluate financial results and to plan and forecast future periods. The
presentation of this additional information is not meant to be considered a
substitute for the corresponding financial measures prepared in accordance
with GAAP.

Risks Regarding Forward-Looking Statements
Certain statements made herein that use words such as "estimate," "project,"
"intend," "expect," "'believe", "may", "might", "predict", "potential",
"anticipate", "plan" or similar expressions are intended to identify
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements involve known
and unknown risks and uncertainties that could cause the actual results,
performance or achievements of the Company to be materially different from
those that may be expressed or implied by such statements, including, among
others, changes in general economic and business conditions and specifically,
decline in the demand for the Company's products, inability to timely develop
and introduce new technologies, products and applications, and loss of market
share and pressure on prices resulting from competition. For additional
information regarding these and other risks and uncertainties associated with
the Company's business, reference is made to the Company's reports filed from
time to time with the United States Securities and Exchange Commission. The
Company does not undertake to revise or update any forward-looking statements
for any reason.

Gilad Yehudai
(972) 77-774-5060

Consolidated Statements of Operations
(1000's of U.S. dollars, except share and per share data)
                          Three months ended        Nine months ended
                          September 30,            September 30,
                          2013         2012         2013          2012
                          (unaudited)  (unaudited)  (unaudited)   (unaudited)
Sales                     $   4,758  $   3,030  $  14,775   $  10,633
Cost of sales             2,361        1,303        5,678         4,340
Gross profit              2,397        1,727        9,097         6,293
Research and development, 1,264        1,539        4,135         4,602
Less - royalty-bearing    271          411          940           1,141
Research and development, 993          1,128        3,195         3,461
Sales and marketing       1,920        1,964        5,710         6,734
General and               547          438          1,525         1,449
Total operating expenses  3,460        3,530        10,430        11,644
Operating loss            (1,063)      (1,803)      (1,333)       (5,351)
Financing expenses, net   (85)         (7)          (204)         (184)
Loss before taxes         (1,148)      (1,810)      (1,537)       (5,535)
Taxes                     -            -            -             (120)
Net loss                  $  (1,148)  $ (1,810)   $  (1,537)   $  (5,655)
Basic and Diluted net
loss per                  $  (0.15)  $  (0.28)  $  ( 0.22)  $  ( 0.88)

ordinary share

Weighted average number
 ordinary shares used  7,814,034    6,450,465    7,138,946     6,439,478
 computing basic and
diluted net 
loss per ordinary share

(1000's of U.S. dollars, except share and per share data)
                            Three Months Ended        Nine Months Ended
                            September 30,             September 30,
                            2013         2012         2013         2012
                            (unaudited)  (unaudited)  (unaudited)  (unaudited)
GAAP net loss              $(1,148)     $(1,810)     $(1,537)     $(5,655)
Stock-based compensation    131          126          429          397
Non-GAAP net loss           $(1,017)     $(1,684)     $(1,108)     $(5,258)
Non-GAAP loss per share     $(0.13)      $(0.26)      $(0.16)      $(0.82)
Number of shares used in
computing Non-GAAP loss     7,814,034    6,450,465    7,138,946    6,439,478
per share (diluted)
(1) Stock-based
 Cost of sales            1            3            7            12
 Research and development 20           46           107          144
 Selling and marketing    14           41           75           133
 General and              96           36           240          108
                            131          126          429          397


Consolidated Balance Sheets

(1000's of U.S. dollars)
                                                  As of          As of
                                                  September 30,  December 31,

                                                  2013           2012
                                                  (unaudited)    (audited)
Current Assets
 Cash and cash equivalents                    1,393          1,474
 Restricted Cash                              1,758          1,452
 Trade receivables, net                       5,093          3,292
 Inventories                                  4,583          6,736
 Other receivables                            2,362          3,555
Total Current Assets                              15,189         16,509
Severance pay fund                                3,340          3,090
Property and equipment, net                       262            268
Total Assets                                      18,791         19,867
Liabilities and Shareholders' Equity
Current Liabilities
 Short term bank credit                       -              1,058
 Short term loans                             750            1,527
 Trade payables                               1,402          1,920
 Deferred revenue and advances from customers 1,701          2,970
 Employees and payroll accruals               1,795          1,996
 Other payables and accrued expenses          1,908          1,844
Total Current Liabilities                         7,556          11,315
Long-Term Liabilities
 Deferred revenue                             19             37
 Accrued severance pay                 3,733          3,518
Total Long-Term Liabilities                       3,752          3,555
Total Liabilities                                 11,308         14,870
Shareholders' Equity
 Share capital                                334            251
 Additional paid-in capital                   65,689         61,470
 Accumulated other comprehensive loss         (601)          (322)
 Accumulated deficit                          (57,939)       (56,402)
Total Shareholders' Equity                        7,483          4,997
Total Liabilities and Shareholders' Equity        18,791         19,867


Website: http://www.radcom.com
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