ClearOne Reports 2011 Fourth Quarter and Full Year Financial Results

SALT LAKE CITY, April 2, 2012 /PRNewswire/ -- ClearOne (NASDAQ: CLRO) today reported its financial results for the fourth quarter and full year ended December 31, 2011.

For the 2011 full year, revenue increased 12% to $46.1 million from $41.3 million for 2010.  Gross profit rose 12% to $27.5 million, or 60% of revenue, from $24.6 million, or 60% of revenue, for the prior year.  Operating expenses declined to $17.0 million from $22.8 million for 2010.  Operating income climbed to $10.6 million from $1.8 million for the prior year.  The company recorded a provision for income taxes of $3.7 million versus a benefit from income taxes of $681,000 for 2010.  Net income more than doubled to $6.9 million, or $0.75 per diluted share, from $2.4 million, or $0.27 per diluted share, for 2010.  Operating expenses, operating income and net income for 2011 were impacted by a favorable judgment award of $3.7 million related to litigation against Biamp Systems Corp. for theft of ClearOne trade secrets.  Operating expenses, operating income and net income for 2010 were affected by an unfavorable accrual of $2.2 million of legal expenses in connection with the indemnification of a former ClearOne Officer. Non-GAAP net income increased by 5% to $5.3 million, or $0.57 per diluted share, from $5.1 million, or $0.57 per diluted share, for 2010. Non-GAAP Adjusted EBITDA for 2011 increased by 37% to $9.0 million, or $0.97 per diluted share, from $6.6 million, or $0.74 per diluted share, for 2010. The reconciliation between GAAP and Non-GAAP measures is available in the tables attached to this release.

"Our strong 2011 financial results were primarily driven by increased demand for our portfolio of products in North America and Asia Pacific combined with consistent high gross margins," said Zee Hakimoglu, President, Chief Executive Officer and Chairman of ClearOne.  "Our continued stellar operational performance in 2011 is reflected in the 37% increase in adjusted EBITDA from a year ago.

"Looking ahead, we will leverage our technology acquisitions, benefit from the wealth of experience the retained management teams bring, and continue to develop our sales channels to enter significantly larger and higher growth markets."

For the 2011 fourth quarter, revenue was $12.0 million compared with $12.6 million for the fourth quarter of 2010.  Gross profit was $7.1 million, or 59% of revenue, compared with $7.5 million, or 60% of revenue, for the prior year fourth quarter.  Operating expenses declined to $5.0 million from $7.5 million in the prior year fourth quarter.  Operating income climbed to $2.1 million from $39,000 for the fourth quarter last year.  Net income grew to $1.4 million, or $0.15 per diluted share, from $817,000, or $0.09 per diluted share, for the 2010 fourth quarter. Operating expenses, operating income and net income for the prior year fourth quarter were affected by an unfavorable accrual of $2.2 million legal expenses in connection with the indemnification of a former ClearOne Officer. Non-GAAP net income decreased to $1.5 million, or $0.17 per diluted share, from $2.3 million, or $0.26 per diluted share, for 2010. Non-GAAP Adjusted EBITDA for 2011 decreased to $2.6 million, or $0.28 per diluted share, from $2.8 million, or $0.32 per diluted share, for 2010. The reconciliation between GAAP and Non-GAAP measures is available in the tables attached to this release.

At December 31, 2011, the company had cash and cash equivalents of $16.7 million, and no debt.

Recent Highlights

ClearOne announced several significant developments.

• In February 2012, the company completed the acquisition of Israel-based VCON Video Conferencing, a leader in high-performance, end-to-end, software video conferencing.  The acquisition extends ClearOne's leadership in the enterprise marketplace to video conferencing and collaboration.  Combined, the companies will seamlessly deliver VCON's full HD video conferencing technology and ClearOne's legacy crystal-clear audio for a variety of enterprise applications, including feature-rich room systems and desktop video applications to enhanced infrastructure and network management solutions.
• In December, the company collected its $3.7 million judgment against Biamp.  In August, the United States Court of Appeals for the Tenth Circuit issued an opinion, affirming a November 2008 jury verdict issued by a federal district court in favor of ClearOne against Biamp Systems Corp. for theft of ClearOne's trade secrets, including the federal district court's award of exemplary damages based upon the finding that Biamp's misappropriation was willful and malicious.  

Non-GAAP Financial Measures

ClearOne provides non-GAAP financial information in the form of Non-GAAP net income, EBITDA, Adjusted EBITDA and earnings per share to investors to supplement GAAP financial information. ClearOne believes that excluding certain items from GAAP results allows ClearOne's management to better understand ClearOne's consolidated financial performance from period to period as management does not believe that the excluded items are reflective of underlying operating performance. Non-GAAP net income, EBITDA, Adjusted EBITDA and earnings per share excludes certain costs and expenses, the details of which are provided in the tables below containing the reconciliation between GAAP and Non-GAAP financial measures. The exclusion of these items in the non-GAAP presentation should not be interpreted as implying that these items are non-recurring, infrequent, or unusual. ClearOne believes non-GAAP financial measures will provide investors with useful information to help them evaluate ClearOne's operating results and projections. This non-GAAP financial information is not meant to be considered in isolation or as a substitute for operating income, net income or other financial measures prepared in accordance with GAAP. There are limitations to the use of non-GAAP financial measures. Other companies, including companies in ClearOne's industry, may calculate non-GAAP financial measures differently than ClearOne does, limiting the usefulness of those measures for comparative purposes.  A detailed reconciliation of Non-GAAP net income to GAAP net income is included with this news release.

About ClearOne

ClearOne is a global company that designs, develops and sells conferencing, collaboration, streaming and digital signage solutions for audio, video and data multimedia communication. The performance and simplicity of its advanced comprehensive solutions enhance the quality of life. ClearOne products are designed for business and residential use, offering unprecedented levels of functionality, reliability and scalability. More information about the company can be found at www.clearone.com.

This release contains "forward-looking" statements that are based on present circumstances and on ClearOne's predictions with respect to events that have not occurred, that may not occur, or that may occur with different consequences and timing than those now assumed or anticipated.  Such forward-looking statements, including any statements of the plans and objectives of management for future operations, are not guarantees of future performance or results and involve risks and uncertainties that could cause actual events or results to differ materially from the events or results described in the forward-looking statements.  Such forward-looking statements are made only as of the date of this release and ClearOne assumes no obligation to update forward-looking statements to reflect subsequent events or circumstances.  Readers should not place undue reliance on these forward-looking statements.

http://www.b2i.us/irpass.asp?BzID=509&to=ea&s=0

Contact:
Jeff LeFevre
Investor Relations
801-303-3438
[email protected]

SOURCE ClearOne

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