HOD HASHARON, Israel,
May 12, 2020 /PRNewswire/ -- Allot
Ltd. (NASDAQ: ALLT) (TASE: ALLT), a leading global provider of
innovative network intelligence and security solutions for
communication service providers and enterprises worldwide, today
announced its unaudited first quarter 2020 financial results.
Highlights
- First quarter revenues were $29.3
million, up 16% year-over-year;
- Non-GAAP gross margin increased to 74.8% compared to 72.4% in
the first quarter of 2019 and GAAP gross margin increased to 74.0%
compared to 71.2% in the first quarter of 2019;
- Non-GAAP net loss of $0.4 million
and GAAP net loss $1.7 million, both
significantly improved from non-GAAP net loss of $1.9 million and GAAP net loss of $3.3 million in the first quarter of 2019;
- Cash and investments at the end of the first quarter totaled
$110.7 million compared to
$117.6 million at year-end 2019;
- Two additional recurring security revenue deals signed with new
operators during the first quarter
Financial Outlook
- Management reiterates its prior issued guidance, with
expectations for full year 2020 revenues to grow to between
$135-140 million, representing
accelerated double-digit growth. In addition, expectations are that
second quarter revenue will exceed those reported for the first
quarter of 2020;
- Management continues to expect to return to profitability on a
quarterly basis before year-end;
- Management continues to expect to close additional Recurring
Security Revenue deals in 2020 and reiterates that the MAR*
(maximum annual revenue potential of concluded transactions) of new
deals expected to be signed in 2020 should exceed $140 million
Management Comment
Erez Antebi, President &
CEO of Allot, commented: "We are pleased with our first quarter
results. We grew revenues by 16% year-over-year, while improving
margins and continuing our advance toward profitability."
Continued Mr. Antebi, "COVID-19 is presenting Allot with
both challenges and opportunities. Operators worldwide are seeing
growth in demand for bandwidth of up to 40%, as well as an increase
in cyber attacks on consumers and SMBs. While some operators are
delaying tasks they consider less critical, we see overall demand
for Allot products and services at similar levels to what we saw
before COVID-19, and in some areas, we even see somewhat increased
demand."
Concluded Mr. Antebi, "Despite the employees from both
Allot and our customers working from home, as well as the other
adaptations we have all made, we are continuing to work toward
meeting our goals and are on track to achieving our original 2020
plan. I believe that long-term, the growth in bandwidth needs and
increased cyber security needs will further increase demand for
Allot solutions."
First Quarter 2020 Financial Results Summary
Total revenues for the first quarter of 2020 were
$29.3 million, an increase of 16%
compared to $25.3 million in the
first quarter of 2019.
Gross profit on a GAAP basis for the first quarter of
2020 was $21.7 million (gross margin
of 74.0%), a 20% improvement compared with $18.0 million (gross margin of 71.2%) in the
first quarter of 2019.
Gross profit on a non-GAAP basis for the first quarter of
2020 was $21.9 million (gross margin
of 74.8%), a 19% improvement compared with $18.3 million (gross margin of 72.4%) in the
first quarter of 2019.
Net loss on a GAAP basis for the first quarter of 2020
improved to $1.7 million, or
$0.05 per basic share, compared with
a net loss of $3.3 million, or
$0.10 per basic share, in the first
quarter of 2019.
Non-GAAP net loss for the first quarter of 2020 improved
to $0.4 million, or $0.01 per basic share, compared with a non-GAAP
net loss of $1.9 million, or
$0.05 per basic share, in the first
quarter of 2019.
Cash and investments as of March
31, 2020 totaled $110.7
million, compared with $117.6
million, as of December 31,
2019.
Conference Call & Webcast
The Allot management team will host a conference call to discuss
first quarter 2020 earnings results today, May 12, 2020 at 8:30 am
ET, 3:30 pm Israel time. To access the conference call,
please dial one of the following numbers:
US: 1-888-281-1167, UK: 0-800-917-5108, Israel: +972-3-918-0664
A live webcast and, following the end of the call, an archive of
the conference call, will be accessible on the Allot website at:
https://investors.allot.com
Additional Resources
Allot Blog: https://www.allot.com/blog
Follow us on Twitter: @allot_ltd
Follow us on LinkedIn:
https://www.linkedin.com/company/allot-communications
About Allot
Allot Ltd. (NASDAQ: ALLT, TASE: ALLT) is a provider of leading
innovative network intelligence and security solutions for service
providers and enterprises worldwide, enhancing value to their
customers. Our solutions are deployed globally for network and
application analytics, traffic control and shaping, network-based
security services, and more. Allot's multi-service platforms are
deployed by over 500 mobile, fixed and cloud service providers and
over 1000 enterprises. Our industry leading network-based security
as a service solution has achieved over 50% penetration with some
service providers and is already used by over 23 million
subscribers in Europe.
Allot. See. Control. Secure.
For more information, visit www.allot.com
*MAR (maximum annual revenue potential of concluded
transactions) was estimated by Allot upon transaction signature and
constitutes an approximation of the theoretical annual revenues
Allot would receive if 100% of the customer's subscribers, as
estimated by Allot, signed up for the service.
GAAP to Non-GAAP Reconciliation
Non-GAAP net income is defined as GAAP net income after
excluding stock-based compensation expenses, amortization of
acquisition-related intangible assets, deferred tax asset
adjustment, exchange rate differences related to revaluation of
assets and liabilities denominated in non-dollar currencies and
other acquisition-related expenses.
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
is 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
This release contains forward-looking statements, which express
the current beliefs and expectations of Company management. Such
statements involve a number of known and unknown risks and
uncertainties that could cause our future results, performance or
achievements to differ significantly from the results, performance
or achievements set forth in such forward-looking statements.
Important factors that could cause or contribute to such
differences include risks relating to: those related to the
COVID-19 pandemic, our ability to compete successfully with other
companies offering competing technologies; the loss of one or more
significant customers; consolidation of, and strategic alliances
by, our competitors, government regulation; the timing of
completion of key project milestones which impact the timing of our
revenue recognition; lower demand for key value-added services; our
ability to keep pace with advances in technology and to add new
features and value-added services; managing lengthy sales cycles;
operational risks associated with large projects; our dependence on
fourth party channel partners for a material portion of our
revenues; court approval of the Company's proposed share buy-back
program; 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. Forward-looking statements in
this release are made pursuant to the safe harbor provisions
contained in the Private Securities Litigation Reform Act of 1995.
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
LTD.
|
AND ITS
SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(U.S. dollars in
thousands, except share and per share data)
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2020
|
|
2019
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
Revenues
|
$
29,289
|
|
$
25,342
|
Cost of
revenues
|
7,610
|
|
7,293
|
Gross
profit
|
21,679
|
|
18,049
|
|
|
|
|
Operating
expenses:
|
|
|
|
Research and
development costs, net
|
8,699
|
|
7,174
|
Sales and
marketing
|
11,522
|
|
11,477
|
General and
administrative
|
3,041
|
|
2,705
|
Total operating
expenses
|
23,262
|
|
21,356
|
Operating
loss
|
(1,583)
|
|
(3,307)
|
Financial and other
income, net
|
151
|
|
532
|
Loss before income
tax expenses
|
(1,432)
|
|
(2,775)
|
|
|
|
|
Tax
expenses
|
228
|
|
558
|
Net Loss
|
(1,660)
|
|
(3,333)
|
|
|
|
|
Basic net
loss per share
|
$
(0.05)
|
|
$
(0.10)
|
|
|
|
|
Diluted net
loss per share
|
$
(0.05)
|
|
$
(0.10)
|
|
|
|
|
Weighted average
number of shares used in
|
|
|
|
computing basic net
loss per share
|
34,625,632
|
|
33,983,863
|
|
|
|
|
Weighted average
number of shares used in
|
|
|
|
computing diluted net
loss per share
|
34,625,632
|
|
33,983,863
|
TABLE -
2
|
ALLOT
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,
|
|
|
|
2020
|
|
2019
|
|
|
|
(Unaudited)
|
|
GAAP cost of
revenues
|
$
7,610
|
|
$
7,293
|
|
Share-based
compensation (1)
|
(67)
|
|
(60)
|
|
Amortization of
intangible assets (2)
|
(152)
|
|
(232)
|
|
Non-GAAP cost of
revenues
|
$
7,391
|
|
$
7,001
|
|
|
|
|
|
|
|
GAAP gross
profit
|
$
21,679
|
|
$
18,049
|
|
Gross profit
adjustments
|
219
|
|
292
|
|
Non-GAAP gross
profit
|
$
21,898
|
|
$
18,341
|
|
|
|
|
|
|
|
GAAP operating
expenses
|
$
23,262
|
|
$
21,356
|
|
Share-based
compensation (1)
|
(857)
|
|
(685)
|
|
Amortization of
intangible assets (2)
|
-
|
|
(188)
|
|
Income
(Expenses) related to M&A activities (3)
|
103
|
|
(295)
|
|
Non-GAAP
operating expenses
|
$
22,508
|
|
$
20,188
|
|
|
|
|
|
|
|
GAAP financial
and other income
|
$
151
|
|
$
532
|
|
Exchange rate
differences*
|
218
|
|
(2)
|
|
Non-GAAP
Financial and other income
|
$
369
|
|
$
530
|
|
|
|
|
|
|
|
GAAP taxes on
income
|
$
228
|
|
$
558
|
|
Tax expenses in
respect of net deferred tax asset recorded
|
(60)
|
|
(16)
|
|
Non-GAAP taxes
on income
|
$
168
|
|
$
542
|
|
|
|
|
|
|
|
GAAP Net
Loss
|
$
(1,660)
|
|
$
(3,333)
|
|
Share-based
compensation (1)
|
924
|
|
745
|
|
Amortization of
intangible assets (2)
|
152
|
|
420
|
|
Income
(Expenses) related to M&A activities (3)
|
(103)
|
|
295
|
|
Exchange rate
differences
|
218
|
|
(2)
|
|
Tax expenses in
respect of net deferred tax asset recorded
|
60
|
|
16
|
|
Non-GAAP Net
Loss
|
$
(409)
|
|
$
(1,859)
|
|
|
|
|
|
|
|
GAAP Loss per
share (diluted)
|
$
(0.05)
|
|
$
(0.10)
|
|
Share-based
compensation
|
0.03
|
|
0.02
|
|
Amortization of
intangible assets
|
0.00
|
|
0.02
|
|
Expenses
(Income) related to M&A activities
|
(0.00)
|
|
0.01
|
|
Exchange rate
differences
|
0.01
|
|
(0.00)
|
|
Non-GAAP Net
loss per share (diluted)
|
$
(0.01)
|
|
$
(0.05)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in
|
|
|
|
|
computing GAAP
diluted net loss per share
|
34,625,632
|
|
33,983,863
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in
|
|
|
|
|
computing non-GAAP
diluted net loss per share
|
34,625,632
|
|
33,983,863
|
|
|
|
|
|
|
|
* Financial income or
expenses related to exchange rate differences in connection with
revaluation of assets
|
|
and
liabilities in non-dollar denominated currencies.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE - 2
cont.
|
ALLOT
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,
|
|
|
|
2020
|
|
2019
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
(1) Share-based
compensation:
|
|
|
|
|
|
Cost of
revenues
|
$
67
|
|
$
60
|
|
|
Research and
development costs, net
|
242
|
|
169
|
|
|
Sales and
marketing
|
378
|
|
283
|
|
|
General and
administrative
|
237
|
|
233
|
|
|
|
$
924
|
|
$
745
|
|
|
|
|
|
|
|
(2)
Amortization of intangible assets
|
|
|
|
|
|
Cost of
revenues
|
$
152
|
|
$
232
|
|
|
Sales and
marketing
|
-
|
|
188
|
|
|
|
$
152
|
|
$
420
|
|
|
|
|
|
|
|
(3) Expenses
(Income) related to M&A activities
|
|
|
|
|
|
Research and
development costs, net
|
$
(103)
|
|
$
295
|
|
|
|
$
(103)
|
|
$
295
|
|
TABLE -
3
|
ALLOT
LTD.
|
AND ITS
SUBSIDIARIES
|
CONSOLIDATED
BALANCE SHEETS
|
(U.S. dollars in
thousands)
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
2020
|
|
2019
|
|
|
(Unaudited)
|
|
(Audited)
|
|
|
|
ASSETS
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
29,494
|
|
$
16,930
|
Short-term bank
deposits
|
|
800
|
|
5,557
|
Restricted
deposit
|
|
32,156
|
|
23,183
|
Available-for-sale
marketable securities
|
|
47,841
|
|
61,012
|
Trade receivables,
net
|
|
23,140
|
|
29,008
|
Other receivables and
prepaid expenses
|
|
7,589
|
|
6,528
|
Inventories
|
|
15,153
|
|
10,668
|
Total current
assets
|
|
156,173
|
|
152,886
|
|
|
|
|
|
LONG-TERM
ASSETS:
|
|
|
|
|
Restricted
deposit
|
|
440
|
|
10,913
|
Severance pay
fund
|
|
341
|
|
387
|
Operating lease
right-of-use assets
|
|
5,797
|
|
6,368
|
Deferred
taxes
|
|
432
|
|
517
|
Other
assets
|
|
766
|
|
926
|
Total long-term
assets
|
|
7,776
|
|
19,111
|
|
|
|
|
|
PROPERTY AND
EQUIPMENT, NET
|
|
8,700
|
|
8,135
|
GOODWILL AND
INTANGIBLE ASSETS, NET
|
|
34,884
|
|
35,037
|
|
|
|
|
|
Total
assets
|
|
$
207,533
|
|
$
215,169
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS'
EQUITY
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
Trade
payables
|
|
$
13,944
|
|
$
11,676
|
Deferred
revenues
|
|
29,921
|
|
36,360
|
Short-term operating
lease liabilities
|
|
2,951
|
|
3,151
|
Other payables and
accrued expenses
|
|
19,885
|
|
22,255
|
Total current
liabilities
|
|
66,701
|
|
73,442
|
|
|
|
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
|
Deferred
revenues
|
|
6,075
|
|
5,262
|
Long-term operating
lease liabilities
|
|
2,738
|
|
3,820
|
Accrued severance
pay
|
|
749
|
|
794
|
Total long-term
liabilities
|
|
9,562
|
|
9,876
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
131,270
|
|
131,851
|
Total liabilities and
shareholders' equity
|
|
$
207,533
|
|
$
215,169
|
TABLE -
4
|
ALLOT
LTD.
|
AND ITS
SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(U.S. dollars in
thousands)
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
March
31,
|
|
|
2020
|
|
2019
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
Cash flows from
operating activities:
|
|
|
|
|
Net Loss
|
$
(1,660)
|
|
$
(3,333)
|
|
Adjustments to
reconcile net income to net cash used in operating
activities:
|
|
|
|
|
Depreciation
|
788
|
|
616
|
|
Stock-based
compensation related to options granted to employees
|
924
|
|
745
|
|
Amortization of
intangible assets
|
152
|
|
420
|
|
Increase (Decrease)
in accrued severance pay, net
|
1
|
|
(65)
|
|
Decrease in other
assets
|
160
|
|
67
|
|
Decrease in accrued
interest and amortization of premium on marketable
securities
|
171
|
|
77
|
|
Changes in operating
leases, net
|
(711)
|
|
(206)
|
|
Decrease (Increase)
in trade receivables
|
5,868
|
|
(2,593)
|
|
Increase in other
receivables and prepaid expenses
|
(401)
|
|
(1,147)
|
|
Increase in
inventories
|
(4,485)
|
|
(1,910)
|
|
Decrease (Increase)
in long-term deferred taxes, net
|
84
|
|
(33)
|
|
Increase in trade
payables
|
2,268
|
|
2,557
|
|
Increase (Decrease)
in employees and payroll accruals
|
(1,325)
|
|
1,023
|
|
Decrease in deferred
revenues
|
(5,626)
|
|
(592)
|
|
Increase (Decrease)
in other payables, accrued expenses and other long term
liabilities
|
(1,718)
|
|
1,893
|
|
Net cash used in
operating activities
|
(5,510)
|
|
(2,481)
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
Decrease (Increase)
in restricted deposit
|
1,500
|
|
(83)
|
|
Redemption of
short-term deposits
|
4,757
|
|
3,986
|
|
Purchase of property
and equipment
|
(1,351)
|
|
(729)
|
|
Investment in
available-for sale marketable securities
|
(375)
|
|
(11,584)
|
|
Proceeds from
redemption or sale of available-for sale marketable
securities
|
12,923
|
|
11,379
|
|
Net cash provided by
investing activities
|
17,454
|
|
2,969
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
Exercise of employee
stock options
|
620
|
|
606
|
|
Net cash provided by
financing activities
|
620
|
|
606
|
|
|
|
|
|
|
Increase in cash and
cash equivalents
|
12,564
|
|
1,094
|
|
Cash and cash
equivalents at the beginning of the period
|
16,930
|
|
16,336
|
|
Cash and cash
equivalents at the end of the period
|
$
29,494
|
|
$
17,430
|
|
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Investor Relations
Contact
GK Investor
Relations
Ehud Helft
+1 646 201
9246
allot@gkir.com
|
Public Relations
Contact
Seth Greenberg, Allot
Ltd.
+972 54 922
2294
sgreenberg@allot.com
|
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content:http://www.prnewswire.com/news-releases/allot-announces-first-quarter-2020-financial-results-301057372.html
SOURCE Allot Ltd.