TEL-AVIV, Israel, October 24, 2011 /PRNewswire/ --
RADCOM Ltd. (RADCOM) (NASDAQ: RDCM) today announced its
financial results for the third quarter and first nine months of
2011.
Discussion of Financial Results
Third Quarter of 2011: Revenues
for the quarter ended September 30,
2011 totaled $3.4 million, a
28% decrease compared to $4.8 million
for the third quarter of 2010. The decrease resulted primarily from
the delay in the recognition of revenues from two projects that
management had expected to be completed during the quarter. Both of
these projects are expected to be completed and recognized during
the fourth quarter.
As a result of the lower-than-expected revenues, the Company
recorded a net loss for the quarter of $(2.2) million, or $(0.34) per ordinary share (basic and diluted),
compared to net income of $361,000,
or $0.07 per ordinary share (basic)
and $0.06 per ordinary share
(diluted), for the third 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 loss for the quarter was $(2.0)
million, or $(0.31) per
ordinary share (basic and diluted), compared to net income of
$387,000, or $0.07 per ordinary share (basic and diluted) for
the third quarter of 2010.
First 9 Months of 2011: Revenues for the first
nine months of 2011 were $15.0
million, an 8% increase compared to $13.8 million for the first nine months of 2010.
Net loss for the period was $(2.0)
million, or $(0.31) per
ordinary share (basic and diluted), compared to net income of
$0.5 million, or $0.10 per ordinary share (basic) and $0.09 per ordinary share (diluted), for the first
nine months of 2010. The net loss derived primarily from an
increase in the Company's investment in sales, marketing and
R&D.
Excluding non-cash stock-based compensation expenses and changes
in the fair value of warrants for all periods, the Company's
non-GAAP net loss for the first nine months of 2011 was
$(1.3) million, or $(0.21) per ordinary share (basic and diluted),
compared to net income of $1.2
million, or $0.23 per ordinary
share (basic) and $0.21 per
ordinary share (diluted) for the first nine months of 2010.
Comments of Management
Commenting on the results, Mr. David
Ripstein, RADCOM's President and CEO, said, "Our financial
results for the third quarter demonstrate the fluctuations inherent
in a business based increasingly on long-term, seven-figure orders
with long revenue recognition cycles. In general, we are excited
that so many of our orders are now for major projects with Tier-1
customers. In fact, our backlog is now extremely strong, and our
last-twelve-month bookings are up by 68% compared with the previous
12 months. Thus, although shifts in the timing of revenue
recognition can have a significant effect on a single quarter's
results, we are on track for achieving strong growth in Q4 and in
the year ahead.
Mr. Ripstein concluded, "Taken as a whole, the platform of our
business remains very strong, reflecting the continued momentum of
the mobile data industry, the explosion in network traffic, and the
industry's recognition of RADCOM's solutions as an effective
response to painful service quality problems. As such, we believe
that we are on track with a business plan that should enable us to
create significant growth over time."
Earnings conference call
RADCOM's management will hold an interactive conference call today
at 9:00 AM Eastern Time (15:00 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 Oct
25th 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.
Consolidated Statements of Operations
(1000's of U.S. dollars, except share and per share data)
Three months ended Nine months ended
September 30, September 30,
2011 2010 2011 2010
(unaudited) (unaudited) (unaudited) (unaudited)
Sales $ 3,449 $ 4,812 $ 14,983 $ 13,810
Cost of sales 1,366 1,573 4,570 4,585
Gross profit 2,083 3,239 10,413 9,225
Research and
development, gross 1,457 1,114 4,332 3,199
Less -
royalty-bearing
participation 257 380 1,006 1,141
Research and
development, net 1,200 734 3,326 2,058
Sales and marketing 2,346 1,827 7,246 4,923
General and
administrative (1) 520 358 1,721 991
Total operating
expenses 4,066 2,919 12,293 7,972
Operating income
(loss) (1,983) 320 (1,880) 1,253
Financing income
(expenses), net (186) 41 (88) (761)
Net income (loss) (2,169) 361 (1,968) 492
Basic net income
(loss) per ordinary
share $ (0.34) $ 0.07 $ (0.31) $ 0.10
Diluted net income
(loss) per ordinary
share $ (0.34) $ 0.06 $ (0.31) $ 0.09
Weighted average
number of
ordinary shares
used in
computing basic
net income
(loss) per
ordinary share 6,373,675 5,218,847 6,357,003 5,145,651
Weighted average
number of
ordinary shares
used in
computing diluted
net income
(loss) per
ordinary share 6,373,675 5,837,570 6,357,003 5,594,547
(1) Includes a decrease of $120,000 in allowance for doubtful accounts for
the three month period ended September 30,
2010, and a decrease of $326,000 in allowance for doubtful accounts for
the nine month period ended September 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 Nine Months Ended
September 30, September 30,
2011 2010 2011 2010
(unaudited) (unaudited) (unaudited) (unaudited)
GAAP net
income (loss) $(2,169) $361 $(1,968) $492
Stock-based
compensation
(1) 195 34 620 142
Change in fair
value of
warrants - (8) - 524
Non-GAAP net
income (loss) $(1,974) $387 $(1,348) $1,158
Non-GAAP
earnings
(loss) per
share
(diluted) $(0.31) $0.07 $(0.21) $0.21
Number of
shares used in
computing
Non-GAAP
earnings
(loss) per
share
(diluted) 6,373,675 5,837,570 6,357,003 5,594,547
(1)
Stock-based
compensation:
Cost of sales 6 2 23 6
Research and
development 70 6 177 15
Selling and
marketing 52 4 197 39
General and
administrative 67 22 223 82
195 34 620 142
RADCOM Ltd.
Consolidated Balance Sheets
(1000's of U.S. dollars)
As of As of
September 30, December 31,
2011 2010
(unaudited)
Current Assets
Cash and cash equivalents 3,160 5,744
Trade receivables, net 6,059 6,851
Inventories 6,529 3,949
Other receivables 2,895 1,708
Total Current Assets 18,643 18,252
Severance pay fund 2,719 2,796
Property and equipment, net 313 338
Total Assets 21,675 21,386
Liabilities and Shareholders' Equity
Current Liabilities
Trade payables 3,502 2,759
Deferred revenue 652 451
Other payables and accrued expenses 3,942 3,898
Total Current Liabilities 8,096 7,108
Long-Term Liabilities
Deferred revenue 165 221
Accrued severance pay 3,127 3,154
Total Long-Term Liabilities 3,292 3,375
Total Liabilities 11,388 10,483
Shareholders' Equity
Share capital 247 234
Additional paid-in capital 60,519 59,180
Accumulated deficit (50,479) (48,511)
Total Shareholders' Equity 10,287 10,903
Total Liabilities and Shareholders'
Equity 21,675 21,386
Contact:
Gilad Yehudai
CFO
+(972)77-774-5060
gilady@radcom.com
SOURCE RADCOM Ltd