RADCOM Reports Q2 & H1 Financial Results: On-Track Performance Across All Parameters Driven By Strong Demand For Software-Based

  RADCOM Reports Q2 & H1 Financial Results: On-Track Performance Across All
      Parameters Driven By Strong Demand For Software-Based MaveriQ CEM

PR Newswire

TEL-AVIV, Israel, July 23, 2014

TEL-AVIV, Israel, July 23, 2014 /PRNewswire/ --RADCOM Ltd. (NASDAQ: RDCM), a
leading provider of service assurance and customer experience (CEM) solutions,
today reported its financial results for the second quarter and first half
ended June 30, 2014.



In $ thousands               H1 2014 H1 2013 Q2 2014 Q2 2013
Revenues                     $10,441 $10,016 $4,970  $5,443
Gross margin                 71.0%   66.9%   74.8%   67.3%
Net profit (loss)            $317    $(390)  $207    $204
Net profit (loss) (non-GAAP) $608    $(93)   $360    $419
Cash & equivalents           $3,853  $1,278  $3,853  $1,278
Collections                  $12,940 $8,095  $6,534  $2,958



Financial Results

First Half of 2014: For the first half of 2014, RADCOM's revenues increased to
$10.4 million from $10.0 million in the first half of 2013, while gross margin
for the period increased to 71.0% from 66.9% in the prior-year period. The
rise in gross margin derived from the Company's successful transition to a
software-driven business model and strong initial sales of MaveriQ, RADCOM's
new NFV-ready software-based solution, which will become RADCOM's next growth
driver.

Net income for the first half totaled $317,000, or $0.04 per ordinary share
(basic and diluted), compared with the net loss of $(390,000), or $(0.06) per
ordinary share (basic and diluted), recorded in the first half of 2013. On a
non-GAAP basis, net income for the period totaled $608,000, or $0.08 per basic
ordinary share ($0.07 per diluted ordinary share), compared with a non-GAAP
net loss of $(93,000), or $(0.01) per ordinary share (basic and diluted), for
the first half of 2013.

Collections during the first half totaled a record $12.9 million, a 59%
increase compared with $8.1 million in the second half of 2013. As a result,
the Company's balance of cash and cash equivalents at June 30, 2014 was $3.9
million, triple its level at the end of 2013.

The Company's on-track financial performance and first half collections lead
Management to confirm its projection of significant growth in 2014 compared
with 2013, together anticipated future gross margin of above 75%.

Second Quarter: During the second quarter, RADCOM recorded $5.0 million in
revenues with a record 74.8% gross margin and solid net profit. Net income for
the quarter totaled $207,000, or $0.03 per basic ordinary share ($0.02 per
diluted ordinary share) compared with $204,000, or $0.03 per ordinary share
(basic and diluted), for the second quarter of 2013. On a non-GAAP basis, net
income totaled $360,000, or $0.04 per ordinary share (basic and diluted),
compared with $419,000, or $0.06 per ordinary share (basic and diluted), for
the second quarter of 2013.

Both collections and bookings were strong in the period. The decrease in
revenues compared with the $5.4 million recorded in the second quarter of
2013 reflected revenue recognition issues which are not expected to impact
full-year performance.

Comments of Management
"We are pleased to report another quarter of on-track performance as
demonstrated by our rising profits, margins, cash and collection," commented
Mr. David Ripstein, RADCOM's President and CEO. "These good results reflect
the market's strong reception of our new MaveriQ product, a software-based CEM
solution that is driving our business to a whole new level. MaveriQ's unique
capabilities for the LTE era have made us 'contenders' in more and larger
opportunities than ever before, while giving us a high win rate with both new
and repeat customers in all geographies. MaveriQ's readiness for the
virtualized environment positions us to benefit strongly from the long-term
potential of this new technology cycle. Just as important, MaveriQ's higher
margins – coupled with our success in managing expenses across the board – has
made us more profitable. This isour formula for long-term growth and success,
in line with our plans and projections."

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): + 1-888-668-9141

From other locations: +972-3-918-0609

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

About RADCOM
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.



RADCOM Ltd.
Consolidated Statement of Operations
(1000's of U.S. dollars, except share and per share data)
                            Three months ended        Six months ended
                            June 30,                  June 30,
                            2014         2013         2014         2013
                            (unaudited)  (unaudited)  (unaudited)  (unaudited)
Sales                       $ 4,970      $ 5,443      $ 10,441     $ 10,016
Cost of sales               1,253        1,781        3,025        3,316
Gross profit                3,717        3,662        7,416        6,700
Research and development,   1,518        1,420        3,086        2,871
gross
Less - royalty-bearing      289          279          587          669
participation
Research and development,   1,229        1,141        2,499        2,202
net
Sales and marketing         1,774        1,803        3,721        3,790
General and administrative  558          491          1,136        978
Total operating expenses    3,561        3,435        7,356        6,970
Operating income (loss)     156          227          60           (270)
Financing income            51           (23)         257          (120)
(expenses), net
Net income (loss)           $ 207        $ 204        $ 317        $ (390)
Basic net income (loss) per
                            $ 0.03       $ 0.03       $ 0.04       $ (0.06)
 ordinary share
Diluted net income (loss)
per                         $ 0.02       $ 0.03       $ 0.04       $ (0.06)
 ordinary share
Weighted average number of
 ordinary shares used in
 computing basic net       8,017,570    7,133,654    7,995,073    6,795,807
income

 (loss) per ordinary share
Weighted average number of
 ordinary shares used in
 computing diluted net     8,495,235    7,381,794    8,482,199    6,795,807
income

 (loss) per ordinary share



RADCOM Ltd.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
(1000's of U.S. dollars, except share and per share data)
                            Three Months Ended        Six Months Ended
                            June 30,                  June 30,
                            2014         2013         2014         2013
                            (unaudited)  (unaudited)  (unaudited)  (unaudited)
GAAP net income (loss)      $207         $204         $317         $(390)
Stock-based compensation    153          215          291          297
(1)
Non-GAAP net income (loss)  $360         $419         $608         $(93)
Non-GAAP net income (loss)  $0.04        $0.06        $0.08        $(0.01)
per share (basic)
Non-GAAP net income (loss)  $0.04        $0.06        $0.07        $(0.01)
per share (diluted)
Number of shares used in
computing Non-GAAP earnings 8,017,570    7,133,654    7,995,073    6,795,807
(loss) per share (basic)
Number of shares used in
computing Non-GAAP earnings 8,495,235    7,381,794    8,482,199    6,795,807
(loss) per share (diluted)
(1) Stock-based
compensation:
Cost of sales               4            5            8            5
Research and development    56           80           102          86
Sales and marketing         54           55           104          61
General and administrative  39           75           77           145
                            153          215          291          297



RADCOM Ltd.

Consolidated Balance Sheet

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

                                                2014         2013
                                                (unaudited)  (audited)
Current Assets
 Cash and cash equivalents                    3,853        1,185
 Restricted Cash                              -            1,505
 Trade receivables, net                       3,892        5,723
 Inventories                                  4,217        4,352
 Other receivables                            3,199        3,092
Total Current Assets                            15,161       15,857
Severance pay fund                              3,469        3,535
Property and equipment, net                     234          253
Total Assets                                    18,864       19,645
Liabilities and Shareholders' Equity
Current Liabilities
 Short term bank credit                       -            629
 Trade payables                               1,162        2,257
 Deferred revenue and advances from customers 900          1,305
 Employees and payroll accruals               2,113        2,109
 Other payables and accrued expenses          1,681        1,795
Total Current Liabilities                       5,856        8,095
Long-Term Liabilities
 Deferred revenue                             508          107
 Accrued severance pay                        3,925        3,944
Total Long-Term Liabilities                     4,433        4,051
Total Liabilities                               10,289       12,146
Shareholders' Equity
 Share capital                                339          335
 Additional paid-in capital                   66,299       65,791
 Accumulated other comprehensive loss         (558)        (805)
 Accumulated deficit                          (57,505)     (57,822)
Total Shareholders' Equity                      8,575        7,499
Total Liabilities and Shareholders' Equity      18,864       19,645



Contact:
Uri Birenberg
CFO
(972) 77-774-5060
urib@radcom.com

SOURCE RADCOM Ltd.

Website: http://www.radcom.com
 
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