TEL-AVIV, Israel, Oct. 29,
2014 /PRNewswire/ -- RADCOM Ltd. (NASDAQ: RDCM), a
leading provider of customer experience management (CEM) solutions,
today reported its financial results for the third quarter and nine
months ended September 30, 2014.
In $
thousands
|
Q3
2014
|
Q3
2013
|
Q1-Q3
2014
|
Q1-Q3
2013
|
Revenues
|
$6,007
|
$4,758
|
$16,448
|
$14,775
|
Gross
margin
|
66.0%
|
50.4%
|
69.2%
|
61.6%
|
Net profit
(loss) (GAAP)
|
$776
|
$(1,148)
|
$1,093
|
$(1,537)
|
Net profit
(loss) (non-GAAP)
|
$872
|
$(1,017)
|
$1,480
|
$(1,108)
|
Cash &
equivalents (at end of period)
|
$4,509
|
$1,393
|
$4,509
|
$1,393
|
Collections
|
$4,820
|
$3,477
|
$17,761
|
$11,572
|
Financial Results
Third Quarter: RADCOM's revenues for the
third quarter totaled $6.0 million,
up 26% compared with Q3 2013 and 21% compared with Q2 2014.
Gross margin for the quarter increased to 66.0% from 50.4%
in Q3 2013. The significant rise in gross margin reflected the
Company's continued transition to a software-driven business model
together with the sales of MaveriQ, its NFV-ready software-based
solution, countered partially by the lower margins of some older
projects not yet completed.
Net income for the quarter totaled $776,000, or $0.10
per basic ordinary share ($0.09 per
diluted ordinary share) compared with a net loss of $(1,148,000), or $(0.15) per ordinary share (basic and diluted),
for the third quarter of 2013. This is more than triple the
$207,000 net profit reported in Q2
2014, representing a record net margin of 12.9%.
On a non-GAAP basis, net income totaled $872,000, or $0.11
(basic) and $.010 (diluted) per
ordinary share, compared with a net loss of $(1,017,000), or $(0.13) per ordinary share (basic and diluted),
for the third quarter of 2013. This represented a record non-GAAP
net margin of 14.5%.
Collections during the period totaled $4.8 million, raising the Company's cash
balance to $4.5 million at the
end of the quarter, up 17% compared with the second quarter and
280% compared with the end of 2013.
First Nine Months of 2014: For the first nine
months of 2014, RADCOM's revenues increased by 11% to
$16.4 million from $14.8 million in the first nine months of 2013.
Gross margin for the period increased to 69.2% from 61.6% in
the prior-year period, reflecting the Company's ongoing transition
to a software company, as mentioned above.
Net income for the first nine months totaled $1.1 million, or $0.14 (basic) and $0.13 (diluted) per ordinary share, compared with
the net loss of $(1.5) million, or
$(0.22) per ordinary share (basic and
diluted), recorded in the first nine months of 2013. On a non-GAAP
basis, net income for the period totaled $1.5 million, or $0.18 (basic) and $0.17 (diluted) per ordinary share, compared with
the non-GAAP net loss of $(1,100,000), or $(0.16) per ordinary share (basic and diluted)
reported in the first nine months of 2013.
Comments of Management
"We are very pleased to report
another strong quarter that is moving RADCOM to new levels of
revenues, profits and margins," commented Mr. David Ripstein, RADCOM's President and CEO.
"With revenues above $6 million and
growing sales of software-based products, our gross margin
continues to climb towards our long-term target of above 75%. This
has enabled us to deliver our fourth straight profitable quarter
and third straight quarter of positive cash flow, achieving an
all-time record for our operating and net profit with a 14.5% net
margin (non-GAAP). And we believe the best is still ahead."
Mr. Ripstein continued, "These outstanding results derive from
the market's exceedingly strong reception of MaveriQ, our unique
software-based CEM solution, whose superior 'anti-churn'
capabilities are being recognized by Tier I & Tier II
4G/LTE/Data service providers throughout the world. This capability
has given us entry into more and larger tenders than ever before,
and we are enjoying a strong win rate. We feel well positioned to
grow in step with the LTE build-out, a trend we believe has the
power to continue driving our results throughout 2015."
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 October 30th
on RADCOM's website.
About RADCOM
RADCOM provides innovative service
assurance and customer experience management solutions for leading
telecom operators and communications service providers. RADCOM
specializes in solutions for next-generation mobile and fixed
networks, including LTE, VoLTE, IMS, VoIP, UMTS/GSM and mobile
broadband. RADCOM's comprehensive, carrier- grade solutions are
designed for big data analytics on terabit networks, and are used
to prevent service provider revenue leakage and to enhance customer
care management. RADCOM's products interact with policy management
to provide self-optimizing network solutions. RADCOM's shares are
listed on the NASDAQ Capital Market under the symbol RDCM. For more
information, please visit 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, 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
|
|
|
|
|
|
Three months
ended
September 30,
|
|
Nine months
ended
September 30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
Sales
|
$ 6,007
|
|
$ 4,758
|
|
$ 16,448
|
|
$ 14,775
|
Cost of
sales
|
2,044
|
|
2,361
|
|
5,069
|
|
5,678
|
Gross
profit
|
3,963
|
|
2,397
|
|
11,379
|
|
9,097
|
Research and
development, gross
|
1,397
|
|
1,264
|
|
4,483
|
|
4,135
|
Less -
royalty-bearing participation
|
719
|
|
271
|
|
1,306
|
|
940
|
Research and
development, net
|
678
|
|
993
|
|
3,177
|
|
3,195
|
Sales and
marketing
|
1,650
|
|
1,920
|
|
5,371
|
|
5,710
|
General and
administrative
|
550
|
|
547
|
|
1,686
|
|
1,525
|
Total operating
expenses
|
2,878
|
|
3,460
|
|
10,234
|
|
10,430
|
Operating income
(loss)
|
1,085
|
|
(1,063)
|
|
1,145
|
|
(1,333)
|
Financing expenses,
net
|
(309)
|
|
(85)
|
|
(52)
|
|
(204)
|
Income (loss) before
taxes
|
776
|
|
(1,148)
|
|
1,093
|
|
(1,537)
|
Taxes
|
-
|
|
-
|
|
-
|
|
-
|
Net Income
(loss)
|
$ 776
|
|
$ (1,148)
|
|
$ 1,093
|
|
$ (1,537)
|
Basic net income
(loss) per
ordinary share
|
$ 0.10
|
|
$ (0.15)
|
|
$ 0.14
|
|
$ (0.22)
|
Diluted net income
(loss) per
ordinary share
|
$ 0.09
|
|
$ (0.15)
|
|
$ 0.13
|
|
$ (0.22)
|
Weighted average
number of
ordinary shares used in
computing basic net income
(loss) per ordinary share
|
8,073,268
|
|
7,814,034
|
|
8,021,425
|
|
7,138,946
|
Weighted average
number of
ordinary shares used in
computing diluted net income
(loss) per ordinary share
|
8,515,158
|
|
7,814,034
|
|
8,493,472
|
|
7,138,946
|
|
|
|
|
|
|
|
|
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,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
$776
|
|
$(1,148)
|
|
$1,093
|
|
$(1,537)
|
Stock-based
compensation (1)
|
96
|
|
131
|
|
387
|
|
429
|
Non-GAAP net income
(loss)
|
$872
|
|
$(1,017)
|
|
$1,480
|
|
$(1,108)
|
Non-GAAP net income
(loss)
per share (basic)
|
$0.11
|
|
$(0.13)
|
|
$0.18
|
|
$(0.16)
|
Non-GAAP net income
(loss)
per share (diluted)
|
$0.10
|
|
$(0.13)
|
|
$0.17
|
|
$(0.16)
|
|
|
|
|
|
|
|
|
Number of shares used
in
computing Non-GAAP earnings
(loss) per share (basic)
|
8,073,268
|
|
7,814,034
|
|
8,021,425
|
|
7,138,946
|
Number of shares used
in
computing Non-GAAP earnings
(loss) per share (diluted)
|
8,515,158
|
|
7,814,034
|
|
8,493,472
|
|
7,138,946
|
|
|
|
|
|
|
|
|
(1) Stock-based
compensation:
|
|
|
|
|
|
|
|
Cost of
sales
|
2
|
|
1
|
|
11
|
|
7
|
Research
and development
|
34
|
|
20
|
|
135
|
|
107
|
Selling
and marketing
|
29
|
|
14
|
|
133
|
|
75
|
General
and administrative
|
31
|
|
96
|
|
108
|
|
240
|
|
96
|
|
131
|
|
387
|
|
429
|
RADCOM
Ltd.
Consolidated
Balance Sheets
(1000's of U.S.
dollars)
|
|
As
of
|
|
As
of
|
|
September
30,
2014
|
|
December
31,
2013
|
|
(unaudited)
|
|
(audited)
|
Current
assets
|
|
|
|
Cash and cash equivalents
|
4,509
|
|
1,185
|
Restricted cash
|
-
|
|
1,505
|
Trade receivables, net
|
5,430
|
|
5,723
|
Inventories
|
3,340
|
|
4,352
|
Other receivables
|
2,824
|
|
3,092
|
Total current
assets
|
16,103
|
|
15,857
|
Severance pay
fund
|
3,306
|
|
3,535
|
Property and
equipment, net
|
212
|
|
253
|
Total
Assets
|
19,621
|
|
19,645
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
Current
liabilities
|
|
|
|
Short term bank credit
|
-
|
|
629
|
Trade payables
|
1,184
|
|
2,257
|
Deferred revenue and advances from customers
|
1,050
|
|
1,305
|
Employees and payroll accruals
|
1,949
|
|
2,109
|
Other payables and accrued expenses
|
1,773
|
|
1,795
|
Total current
liabilities
|
5,956
|
|
8,095
|
Long-term
liabilities
|
|
|
|
Deferred revenue
|
515
|
|
107
|
Accrued severance pay
|
3,712
|
|
3,944
|
Total long-term
liabilities
|
4,227
|
|
4,051
|
|
|
|
|
Total
liabilities
|
10,183
|
|
12,146
|
|
|
|
|
Shareholders'
equity
|
|
|
|
Share capital
|
345
|
|
335
|
Additional paid-in capital
|
66,728
|
|
65,791
|
Accumulated other comprehensive loss
|
(906)
|
|
(805)
|
Accumulated deficit
|
(56,729)
|
|
(57,822)
|
Total shareholders'
equity
|
9,438
|
|
7,499
|
|
|
|
|
Total liabilities
and shareholders' equity
|
19,621
|
|
19,645
|
|
|
Contact:
Uri
Birenberg
CFO
(972) 77-774-5060
urib@radcom.com
SOURCE RADCOM Ltd.