Allot Communications Reports Non-GAAP 40% Revenue Rise and 50% Net Profit Growth for Third Quarter of 2012
HOD HASHARON, Israel, October 30, 2012 /PRNewswire/ --
Key highlights:
- Third quarter non-GAAP revenues increased to $28.0 million, a 40% increase over the third quarter of 2011 and 6% increase over the previous quarter
- Third quarter non-GAAP net profit reaches $5.1 million, a 50% increase over the third quarter of 2011; non-GAAP EPS of $0.15
- Cash, cash equivalents and marketable securities totaled $144.1 million after Oversi acquisition closing; positive cash flow from operations in the third quarter
Allot Communications Ltd. (NASDAQ: ALLT), a leading supplier of service optimization and revenue generation solutions for fixed and mobile data worldwide, today announced continued growth in sales during the third quarter of 2012.
On a non-GAAP basis, total revenues for the third quarter of 2012 reached $28.0 million, a 40% increase from the $20.1 million of revenues reported for the third quarter of 2011, and a 6% increase from the $26.4 million of revenues reported for the second quarter of 2012. On a GAAP basis, net profit for the third quarter of 2012 was $2.4 million, or $0.07 per basic and diluted share. This compares with net profit of $2.1 million, or $0.09 per basic share and $0.08 per diluted share, in the third quarter of 2011, and net profit of $2.7 million, or $0.08 per basic and diluted share, in the second quarter of 2012.
On a non-GAAP basis, net profit for the third quarter of 2012 totaled $5.1 million, or $0.16 per basic share and $0.15 per diluted share, compared with non-GAAP net profit of $3.4 million, or $0.14 per basic share and $0.13 per diluted share, for the third quarter of 2011, and non-GAAP net profit $5.0 million, or $0.16 per basic share and $0.15 per diluted share, for the second quarter of 2012. The results also reflect operating expenses resulting from the Oversi acquisition, which closed on September 4, 2012.
Non-GAAP revenues are defined as GAAP revenues adjusted for impact of the fair value adjustment to acquired deferred revenue related to purchase accounting. Management believes the adjustment is useful to investors as a measure of our operating performance following the acquisition.
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 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 Tables 2 and 3. The Company provides these non-GAAP financial measures because it believes that 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 that they are useful to investors in enhancing an understanding of the Company's operating performance.
"Our continued growth is being driven by strong market fundamentals, namely the continued dramatic growth in data over mobile and fixed line networks," commented Rami Hadar, Allot Communications' President and Chief Executive Officer. "The Allot Service Gateway offers service providers superior performance along with the broadest range of value-added services available on the market today, and services, particularly our video suite, have been a significant differentiator for our customers. During the quarter we recognized revenue from a new Tier 1 mobile operator, as we predicted earlier in the year."
Recently, the Company achieved the following significant goals:
- During the quarter, received large orders from 12 service providers, 2 of which represented new customers;
- 8 of the large orders came from mobile service providers, 2 of which were new customers;
- Recognized revenue from a new Tier 1 mobile operator during the quarter, one of two 10% customers for the quarter;
- Announced closing the acquisition of Oversi on September 4, which provides Allot with a best-of-breed video caching solution; and
- Announced the receipt of a large order for the new Allot MediaSwift-E caching solution, which incorporates the caching technology from Oversi, from an existing multi-million dollar APAC fixed operator customer.
As of September 30, 2012, cash, cash equivalents, short term deposits and marketable securities totaled $144.1 million, post-closing the Oversi acquisition, with no debt. The preliminary allocation of the purchase price for Oversi is based upon estimates and assumptions that are subject to change within the purchase price allocation period, which is generally one year from the acquisition date. The primary areas of the purchase price allocation that are not yet finalized relate to the measurement of certain assets and liabilities.
Conference Call & Webcast
The Allot management team will host a conference call to discuss its third quarter 2012 earnings results today at 8:30 AM ET, 2:30 PM Israel time. To access the conference call, please dial one of the following numbers: US: +1212 444 0412, UK: +44(0)20 7136 2055, Israel: +9723763 0146, participant code 1477641.
A replay of the conference call will be available from 12:01 am ET on October 31, 2012 through November 29, 2012 at 11:59 pm UK time. To access the replay, please dial: US: +347 366 9565 or toll free, 1866 932 5017; UK: +44 (0)20 3427 0598 or toll free, 0800 358 7735, access code: 1477641.
A live webcast of the conference call can be accessed on the Allot Communications website at http://www.allot.com. The webcast will also be archived on the website following the conference call.
About Allot Communications
Allot Communications Ltd. (NASDAQ, TASE: ALLT) is a leading global provider of intelligent solutions to optimize and monetize over-the-top Internet traffic in fixed and mobile broadband networks and large enterprises. Allot Service Gateway offers service providers a broad range of value-added services in a single platform, which include analytics, policy control, video optimization, video caching and charging 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.
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, 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.
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 Nine Months Ended
September 30, September 30,
------------------------- -------------------------
2012 2011 2012 2011
------- ------- ------- -------
(Unaudited) (Unaudited)
------------------------- -------------------------
Revenues $ 27,768 $ 20,088 $ 78,390 $ 55,725
Cost of
revenues 8,464 5,728 23,119 15,885
------- ------- ------- -------
Gross profit 19,304 14,360 55,271 39,840
------- ------- ------- -------
Operating
expenses:
Research and
development
costs, net 6,069 3,467 15,411 9,531
Sales and
marketing 8,539 6,575 24,420 19,276
General and
administrative 2,671 2,379 8,104 5,785
------- ------- ------- -------
Total
operating
expenses 17,279 12,421 47,935 34,592
Operating
profit 2,025 1,939 7,336 5,248
Financial and
other income,
net 382 149 1,030 178
------- ------- ------- -------
Profit before
income tax
expenses 2,407 2,088 8,366 5,426
Tax expenses 19 13 43 114
------- ------- ------- -------
Net profit 2,388 2,075 8,323 5,312
------- ------- ------- -------
------- ------- ------- -------
Basic net
profit per
share $ 0.07 $ 0.09 $ 0.26 $ 0.22
------- ------- ------- -------
------- ------- ------- -------
Diluted net
profit per
share $ 0.07 $ 0.08 $ 0.25 $ 0.20
------- ------- ------- -------
------- ------- ------- -------
Weighted
average number
of shares
used in
computing
basic net
earnings per
share 32,260,061 24,296,038 31,787,646 24,159,643
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Weighted
average number
of shares
used in
computing
diluted net
earnings per
share 33,471,098 26,184,244 33,086,932 26,072,423
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
TABLE - 2
ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
RECONCILATION OF GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except share and per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------- -------------------------
2012 2011 2012 2011
------- ------- ------- -------
(Unaudited) (Unaudited)
------------------------- -------------------------
GAAP net
profit as
reported $ 2,388 $ 2,075 $ 8,323 $ 5,312
--------------------------------------------------------------------------------------
Non-GAAP adjustments
Expenses recorded for stock-based compensation
Cost of
revenues 57 19 154 69
Research and
development
costs, net 329 99 757 287
Sales and
marketing 588 223 1,351 682
General and
administrative 342 165 796 532
Expenses
related to
M&A
activities
and
compliance
with
regulatory
matters (*)
General and
administrative 354 798 2,065 1,336
Research and
development
costs, net 93 - 343 -
Sales and
marketing 55 - 148 -
Intangible
assets
amortization
Cost of
revenues 641 30 934 90
S&M 17 17
Fair value
adjustment
for acquired
deferred
revenues
write down 258 - 258 -
------- ------- ------- -------
Total
adjustments
to operating
profit 2,734 1,334 6,823 2,996
------- ------- ------- -------
Total
adjustments 2,734 1,334 6,823 2,996
------- ------- ------- -------
Non-GAAP net profit $ 5,122 $ 3,409 $ 15,146 $ 8,308
------- ------- ------- -------
------- ------- ------- -------
Non- GAAP
basic net
profit per
share $ 0.16 $ 0.14 $ 0.48 $ 0.34
------- ------- ------- -------
------- ------- ------- -------
Non- GAAP
diluted net
profit per
share $ 0.15 $ 0.13 $ 0.45 $ 0.32
------- ------- ------- -------
------- ------- ------- -------
Weighted
average
number of
shares
used in
computing
basic net
earnings per
share 32,260,061 24,296,038 31,787,646 24,159,643
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Weighted
average
number of
shares
used in
computing
diluted net
earnings per
share 33,848,560 26,287,478 33,347,232 26,172,819
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
(*) Mostly legal, finance and compensation expenses related to the acquisition
TABLE - 3
ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS on a NON-GAAP BASIS
(U.S. dollars in thousands, except share and per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------- -------------------------
2012 2011 2012 2011
------- ------- ------ -------
(Unaudited) (Unaudited)
------------------------- -------------------------
Revenues $ 28,026 $ 20,088 $ 78,648 $ 55,725
Cost of
revenues 7,766 5,679 22,031 15,726
------- ------- ------- -------
Gross profit 20,260 14,409 56,617 39,999
------- ------- ------- -------
Operating
expenses:
Research and
development
costs, net 5,647 3,368 14,311 9,244
Sales and
marketing 7,879 6,352 22,904 18,594
General and
administrative 1,975 1,416 5,243 3,917
------- ------- ------- -------
Total
operating
expenses 15,501 11,136 42,458 31,755
Operating
profit 4,759 3,273 14,159 8,244
Financial and
other income,
net 382 149 1,030 178
------- ------- ------- -------
Profit before
income tax
expenses 5,141 3,422 15,189 8,422
Tax expenses 19 13 43 114
------- ------- ------- -------
Net profit 5,122 3,409 15,146 8,308
------- ------- ------- -------
------- ------- ------- -------
Basic net
profit per
share $ 0.16 $ 0.14 $ 0.48 $ 0.34
------- ------- ------- -------
------- ------- ------- -------
Diluted net
profit per
share $ 0.15 $ 0.13 $ 0.45 $ 0.32
------- ------- ------- -------
------- ------- ------- -------
Weighted
average number
of shares
used in
computing
basic net
earnings per
share 32,260,061 24,296,038 31,787,646 24,159,643
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Weighted
average number
of shares
used in
computing
diluted net
earnings per
share 33,848,560 26,287,478 33,347,232 26,172,819
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
TABLE - 4
ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands)
September 30, December 31,
2012 2011
------------ -----------
(Unaudited) (Audited)
------------ -----------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 25,668 $ 116,682
Short term deposits 94,000 24,000
Marketable securities and restricted cash 24,427 18,718
Trade receivables, net 21,739 11,926
Other receivables and prepaid expenses 4,946 5,950
Inventories 11,059 10,501
---------- ---------
Total current assets 181,839 187,777
---------- ---------
LONG-TERM ASSETS:
Severance pay fund 182 178
Other assets and deferred taxes 320 356
---------- ---------
Total long-term assets 502 534
---------- ---------
PROPERTY AND EQUIPMENT, NET 6,799 5,352
---------- ---------
GOODWILL AND INTANGIBLE ASSETS, NET 34,541 3,395
---------- ---------
Total assets $ 223,681 $ 197,058
---------- ---------
---------- ---------
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Trade payables $ 7,603 $ 2,684
Deferred revenues 15,936 16,694
Other payables and accrued expenses 15,326 9,462
---------- ---------
Total current liabilities 38,865 28,840
---------- ---------
LONG-TERM LIABILITIES:
Deferred revenues 4,632 5,430
Accrued severance pay 229 219
Total long-term liabilities 4,861 5,649
---------- ---------
SHAREHOLDERS' EQUITY 179,955 162,569
---------- ---------
Total liabilities and shareholders' equity $ 223,681 $ 197,058
---------- ---------
---------- ---------
TABLE - 5
ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands)
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------- --------------------
2012 2011 2012 2011
-------------------- --------------------
(Unaudited) (Unaudited)
-------------------- --------------------
Cash flows from
operating activities:
Net income $ 2,388 $ 2,075 $ 8,323 $ 5,312
Adjustments to
reconcile net income to
net cash provided by
operating activities:
Depreciation 890 712 2,253 2,048
Stock-based
compensation related to
options granted to
employees and
non-employees 1,316 506 3,058 1,570
Amortization of
intangible assets 658 30 951 91
Capital loss 10 - 14 9
Decrease (Increase) in
accrued severance pay,
net (1) (1) 6 5
Decrease in other
assets 55 95 56 94
Decease in accrued
interest and
amortization of premium
on marketable
securities 96 19 144 66
Increase in trade
receivables (4,143) (1,657) (9,642) (2,060)
Decrease (Increase) in
other receivables and
prepaid expenses (65) 2,129 1,561 795
Decrease in inventories 1,816 676 2,137 1,782
Increase (Decrease) in
trade payables (1,125) 1,735 1,367 (1,310)
Increase (Decrease) in
employees and payroll
accruals 1,789 95 2,167 (514)
Decrease in deferred
revenues (2,659) (1,383) (4,295) (319)
Increase (Decrease) in
other payables and
accrued expenses (875) (1,649) 1,242 (329)
-------------------- --------------------
Net cash provided by
operating activities 150 3,382 9,342 7,240
-------------------- --------------------
Cash flows from
investing activities:
Increase in restricted
deposit (147) - (126) (487)
Investment in
short-term deposit (23,000) (18,000) (70,000) (18,000)
Purchase of property
and equipment (1,528) (740) (2,997) (2,039)
Proceeds from sale of
property and equipment - - - 30
Investment in
marketable securities (6,443) (2,317) (7,694) (4,231)
Proceeds from
redemption or sale of
marketable securities 800 803 2,000 2,403
Investment in
Subsidiary (13,493) - (23,892) -
Loan to purchased
Subsidiary - - (1,000) -
--------------------- --------------------
Net cash used in
investing activities (43,811) (20,254) (103,709) (22,324)
--------------------- --------------------
Cash flows from
financing activities:
Exercise of warrants
and employee stock
options 1,198 550 5,305 2,020
Redemption of bank loan (1,952) - (1,952) -
-------------------- --------------------
Net cash provided by
(used in) financing
activities (754) 550 3,353 2,020
-------------------- --------------------
Increase in cash and
cash equivalents (44,415) (16,322) (91,014) (13,064)
Cash and cash
equivalents at the
beginning of the period 70,083 46,116 116,682 42,858
-------------------- --------------------
Cash and cash
equivalents at the end
of the period $ 25,668 $ 29,794 $ 25,668 $ 29,794
---------------------- --------------------
---------------------- --------------------
Investor Relations Contact:
Jay Kalish
Executive Director Investor Relations
International access code +972-54-221-1365
[email protected]
Public Relations Contact:
Maya Lustig
Director of Corporate Communications
Tel: +972-9-7616851
Cell: +972-54-677-8100
[email protected]
SOURCE Allot Communications Ltd.
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