TEL-AVIV, Israel, August 1, 2011 /PRNewswire/ --
- Visibility for Steeper Growth Path Beginning in Early
2012 -
RADCOM Ltd. (RADCOM) (NASDAQ: RDCM) today announced its
financial results for the second quarter and first half of
2011.
In $000s Q2 2011 Q2 2010 Change H1 2011 H1 2010 Change
Revenues $5,927 $4,560 30% $11,534 $8,998 28%
Gross margin 72% 67% 72% 67%
Net income $78 $80 (3%) $201 $131 53%
Discussion of Financial Results
Second Quarter of2011:Revenues for
the quarter ended June 30, 2011
totaled $5.9 million, their highest
level for a fiscal quarter since 2006 and a 30% increase compared
to $4.6 million for the second
quarter of 2010. Gross margin for the period was 72%, up strongly
from 67% during the second quarter of 2010.
Net income for the quarter was $78,000, or $0.01
per ordinary share (basic and diluted), a 3% decrease compared to
$80,000, or $0.02 per ordinary share (basic) and $0.01 per ordinary share (diluted), for the
second quarter of 2010.
Excluding non-cash stock-based compensation expenses and changes
in the fair value of warrants for all periods, the Company's
non-GAAP net income for the quarter reached $315,000, or $0.05
per ordinary share (basic and diluted), a 35% decrease compared to
$487,000, or $0.10 per ordinary share (basic) and $0.09 per ordinary share (diluted) for the second
quarter of 2010.
First Half of 2011: Revenues for the first six
months of 2011 were $11.5 million, a
28% increase compared to $9.0 million
for the first six months of 2010. Gross profit for the period was
72%, up strongly from 67% during the first six months of 2010.
Net income for the period was $201,000, or $0.03
per ordinary share (basic and diluted), a 53% increase compared to
$131,000, or $0.03 per ordinary share (basic) and $0.02 per ordinary share (diluted), for the first
six months of 2010.
Excluding non-cash stock-based compensation expenses and changes
in the fair value of warrants for all periods, the Company's
non-GAAP net income for the first six months of 2011 reached
$626,000, or $0.10 per ordinary share (basic) and $0.09 per ordinary share (diluted), a 19%
decrease compared to $771,000, or
$0.15 per ordinary share (basic) and
$0.14 per ordinary share (diluted)
for the first six months of 2010.
Comments of Management
Commenting on the results, Mr. David
Ripstein, RADCOM's President and CEO, said, "The second
quarter was an exciting period during which we achieved our best
revenues in over four years, strengthened our margins and recorded
our highest-ever bookings for a second quarter - all milestones
which demonstrate our Company's accelerating momentum. In fact, the
total of our orders for the past four quarters is up 61% compared
to the four quarters before that, reflecting a significant increase
in both the absolute numbers of orders and their average size, and
providing us with good visibility for the coming quarters. Given
that it usually takes 9-12 months before we can fully recognize an
order's revenues, this surge should translate into a significantly
higher level of revenues and profits for RADCOM towards early
2012."
Mr. Ripstein continued, "The acceleration in our momentum
reflects 1) the sales-driving power of the rapidly-growing markets
that we operate in - especially the mobile data industry; 2) the
severity of the pain that operators face today as they struggle to
maintain service quality in the face of exponential growth in
network traffic; and 3) the superiority of our solutions and their
proven ability to solve our customers' quality problems. In fact,
service assurance solutions are increasingly viewed as 'must-have'
assets with a crystal-clear return-on-investment. This, coupled
with the industry's massive investments in their networks, is
creating an extremely favorable sales atmosphere for RADCOM."
Mr. Ripstein concluded, "To take full advantage of the
opportunity, we continue to invest in our sales force and R&D
activities, both to support our existing backlog and to explore
additional market opportunities. We are excited to have recently
launched our groundbreaking new GEARX8 technology, a development
which will extend our performance advantage. Taken as a whole, we
are proud that the positioning we have established, including our
differentiated, high-end products, our track record of customer
satisfaction and our expanding sales reach into target regions, has
generated such impressive momentum, and are confident that a
step-change is in the making for our business."
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 August
2nd on RADCOM's website.
About RADCOM
RADCOM provides innovative service assurance solutions for
communications service providers and equipment vendors. RADCOM
specializes in solutions for next-generation networks, both
wireless and wireline. RADCOM's comprehensive, carrier-strength
solutions are used to prevent service provider revenue leakage and
to enable management of customer care. RADCOM's products facilitate
fault management, network service performance analysis,
troubleshooting and pre-mediation with an OSS/BSS. RADCOM's shares
are listed on the NASDAQ Capital Market under the symbol RDCM. For
more information, please visit http://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 and changes in fair value of
warrants that has been expensed in accordance with ASC 815-40, 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 Statements of
Operations
(1000's of U.S. dollars, except share and per share data)
Three months ended Six months ended
June 30, June 30,
2011 2010 2011 2010
(unaudited)(unaudited)(unaudited)(unaudited)
Sales $ 5,927 $ 4,560 $ 11,534 $ 8,998
Cost of sales 1,645 1,510 3,204 3,012
Gross profit 4,282 3,050 8,330 5,986
Research and development, gross 1,525 1,037 2,875 2,085
Less - royalty-bearing
participation 248 342 749 761
Research and development, net 1,277 695 2,126 1,324
Sales and marketing 2,392 1,595 4,900 3,096
General and administrative (1) 589 219 1,201 633
Total operating expenses 4,258 2,509 8,227 5,053
Operating income 24 541 103 933
Financing income (expenses), net 54 (461) 98 (802)
Net income 78 80 201 131
Basic net income per ordinary
share $ 0.01 $ 0.02 $ 0.03 $ 0.03
Diluted net income
per ordinary share $ 0.01 $ 0.01 $ 0.03 $ 0.02
Weighted average number of
ordinary shares used in
computing basic net income
per ordinary share 6,368,553 5,112,291 6,348,529 5,108,447
Weighted average number of
ordinary shares used in
computing diluted net income
per ordinary share 6,799,894 5,585,035 6,843,227 5,435,567
(1) Includes a decrease of $206,000 in allowance for doubtful accounts for
the three and six month periods ended June
30, 2010.
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,
2011 2010 2011 2010
(unaudited) (unaudited) (unaudited) (unaudited)
GAAP net income $78 $80 $201 $131
Stock-based
compensation (1) 237 75 425 108
Change in fair
value of
warrants - 332 - 532
Non-GAAP net
income $315 $487 $626 $771
Non-GAAP
earnings per
share (diluted) $0.05 $0.09 $0.09 $0.14
Number of shares
used in
computing
Non-GAAP
earnings per
share (diluted) 6,799,894 5,585,035 6,843,227 5,435,567
(1) Stock-based
compensation:
Cost of sales 9 2 17 4
Research and
development 57 5 107 9
Selling and
marketing 79 30 145 35
General and
administrative 92 38 156 60
237 75 425 108
RADCOM Ltd.
Consolidated Balance Sheets
(1000's of U.S. dollars)
As of As of
June 30, December 31,
2011 2010
(unaudited)
Current Assets
Cash and cash equivalents 3,981 5,744
Trade receivables, net 7,725 6,851
Inventories 4,812 3,949
Other receivables 3,057 1,708
Total Current Assets 19,575 18,252
Severance pay fund 2,924 2,796
Property and equipment, net 307 338
Total Assets 22,806 21,386
Liabilities and Shareholders' Equity
Current Liabilities
Trade payables 2,677 2,759
Deferred revenue 796 451
Other payables and accrued expenses 3,585 3,898
Total Current Liabilities 7,058 7,108
Long-Term Liabilities
Deferred revenue 174 221
Accrued severance pay 3,314 3,154
Total Long-Term Liabilities 3,488 3,375
Total Liabilities 10,546 10,483
Shareholders' Equity
Share capital 247 234
Additional paid-in capital 60,323 59,180
Accumulated deficit (48,310) (48,511)
Total Shareholders' Equity 12,260 10,903
Total Liabilities and Shareholders'
Equity 22,806 21,386
Contact:
Gilad Yehudai
CFO
+972-77-774-5060
gilady@radcom.com
SOURCE RADCOM Ltd