SCOP Scopus Video Networks Ltd Ord (MM)

Strong Sales Lead to Record Revenue in Q4 and 22% Y/Y Growth in 2007 TEL AVIV, Israel, February 11 /PRNewswire-FirstCall/ -- Scopus Video Networks Ltd. (NASDAQ:SCOP), a provider of digital video networking products, today announced its results for the fourth quarter and full year of 2007. Fourth quarter highlights: - Total revenues reached a record $16.5 million, a 37% year over year increase - Pro-forma net profit of $0.2 million (excluding the cost of options) - Positive operating cash flow of $1.9 million - Continued improvement in business fundamentals Fourth Quarter Results Summary Revenues for the fourth quarter totaled $16.5 million, a 9% sequential increase from the $15.2 million revenues in the prior quarter, and a 37% increase over the $12.1 million reported the fourth quarter of 2006. The breakdown of revenue by region was 42% in EMEA, 40% in Asia and the Pacific Rim and 18% in the Americas. Gross profit in the fourth quarter of 2007 was $7.7 million compared with $7.3 million in the prior quarter, and $6 million in the fourth quarter of 2006. Gross profit as a percentage of revenues was 47%. Net loss on a GAAP basis for the fourth quarter of 2007 was $0.3 million, or $0.02 loss per share, compared with a net loss of $0.1 million, or $0.01 per share, in the prior quarter and a net loss of $0.8 million, or $0.06 per share in the fourth quarter of 2006. Pro-forma net profit for the fourth quarter of 2007, which excludes expenses related to stock based compensation as defined under FAS123R was $0.2 million, or $0.01 per diluted share, compared to a net profit of $0.4 million, or $0.02 per diluted share, in the prior quarter, and a net loss of $0.4 million, or $0.03 loss per share, in the fourth quarter of 2006. Full Year 2007 Results Revenue for the full year of 2007 was $57.5 million, a 22% increase from $47.3 million in 2006. Gross profit for the year was $27.6 million compared with $23.0 million last year. Gross profit, as a percentage of revenues, for the full year was 48% compared with 49% last year. Net loss on a GAAP basis for the full year of 2007 was $2.8 million, or $0.20 per share, compared with a loss of $3.8 million in 2006. Pro-forma net loss for the year was $0.9 million or $0.07 per share compared with $1.9 million in 2006. The Company generated positive operating cash flow of $1.9 million during the quarter, and ended the fourth quarter with cash and cash equivalents plus short term investments and trading securities of $35.5 million. This is compared with $33.8 million on September 30th, 2007. "Our results for the fourth quarter culminate a year in which we improved our business fundamentals and reported continued sequential growth in our revenues. It was also a year in which we saw a strong positive cash flow and reached the breakeven level," commented Dr. Yaron Simler, CEO of Scopus. "We expect to continue to benefit from the various actions taken over the past year in accordance with our growth strategy to solidify our position as a one-stop-shop digital video solution provider. Looking forward to 2008, we plan to further grow our revenues, expand the customer base and improve our productivity. Our advanced products and technology, our fully integrated system solutions, as well as our global presence and customer-base diversity, all put us in a strong competitive position, ready for the year ahead." The press release contains non-GAAP financial measures. In this regard, GAAP refers to generally accepted accounting principles in the United States. Pursuant to regulations promulgated by the Securities and Exchange Commission, the Company has provided reconciliations within the press release of the non-GAAP financial measures to the most directly comparable GAAP financial measures. The pro-forma results provided in the press release exclude the cost of options. Due to recent changes in US GAAP regulations, in accordance with FAS123R guidelines, from the first quarter of 2006 and onwards, we have been implementing and recording options expenses as part of our P&L, management believes that the presentation of the pro forma information provides investors with a better understanding of Scopus' financial results going forward and assists investors in comparing Scopus' historical, current and future expected results. Conference Call Details The Company will also be hosting a conference call later today at 9am EST (6am Pacific Time, 2pm UK Time, 4pm Israel Time). On the call, management will review and discuss the results, and will be available to answer investor questions. To participate, please call one of the following teleconferencing numbers: US Dial-in Number: 1-888-668-9141 UK Dial-in Number: 0-800-917-5108 ISRAEL Dial-in Number: 03-918-0610 INTERNATIONAL Dial-in Number: +972-3-918-0610 A replay of the call will also be available from the day after the call in the investor relations section of Scopus' website at http://www.scopus.net/. About Scopus Video Networks: Scopus Video Networks (NASDAQ:SCOP) develops, markets, and supports digital video networking solutions that enable network operators to offer advanced video services to their subscribers. Scopus' solutions support digital television, HDTV, live event coverage, and content distribution. Scopus' comprehensive digital video networking solutions offer intelligent video gateways, encoders, decoders, and network management platforms. Scopus' solutions are designed to allow network operators to increase service revenues, improve customer retention, and minimize capital and operating expenses. Scopus' customers include satellite, cable, and terrestrial operators, broadcasters and telecom service providers. Scopus' solutions are used by hundreds of network operators worldwide. For more information visit: http://www.scopus.net/ This press release contains forward-looking statements concerning our marketing and operations plans. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. All forward-looking statements in this press release are made based on management's current expectations and estimates, which involve risks, uncertainties and other factors that could cause results to differ materially from those expressed in forward-looking statements. These statements involve a number of risks and uncertainties including, but not limited to, risks related to the evolving market for digital video in general and the infancy of the video-over-IP in particular and the ability to successfully demonstrate to service providers integrated solutions, general economic conditions and other risk factors. Scopus does not undertake any obligation to update forward-looking statements made herein. SCOPUS VIDEO NETWORKS CONDENSED CONSOLIDATED BALANCE SHEET (Dollars in thousands) December 31, 2007 2006 (Unaudited) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 23,090 $ 29,950 Short-term deposits 7,227 - Trading securities 5,230 - Trade accounts receivable (net of allowance for doubtful accounts of $152 and $428 respectively) 12,409 10,268 Inventories 7,774 11,727 Other receivables and current assets 2,151 1,015 Total current assets 57,881 52,960 Fixed assets, net 3,453 2,928 Deposits in general severance fund 230 204 Other assets 105 72 TOTAL ASSETS $ 61,669 $ 56,164 LIABILITIES AND SHAREHOLDERS EQUITY CURRENT LIABILITIES: Trade accounts payable $ 6,221 $ 5,738 Other payables and current liabilities 11,184 7,246 Total current liabilities 17,405 12,984 Liabilities for vacation and severance pay 1,945 1,661 SHAREHOLDERS' EQUITY: Ordinary shares 4,517 4,322 Additional paid-in capital 77,428 74,118 Other comprehensive income 72 - Accumulated deficit (39,698) (36,921) TOTAL SHAREHOLDERS' EQUITY 42,319 41,519 TOTAL LIABILITIES AND SHAREHOLDERS EQUITY $ 61,669 $ 56,164 SCOPUS VIDEO NETWORKS CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Dollars in thousands, except share and per share data) Year ended Three month ended December 31, December 31, 2007 2006 2007 2006 (Unaudited) (Unaudited) Revenues $ 57,477 $ 47,272 $ 16,533 $ 12,106 Cost of revenues 29,901 24,274 8,839 6,102 Gross profit 27,576 22,998 7,694 6,004 Research and development expenses, net of grants from the OCS 10,675 10,240 2,867 2,874 Sales and marketing expenses 15,601 12,602 3,983 3,096 General and administrative expenses 5,692 4,876 1,579 1,080 Operating loss (4,392) (4,720) (735) (1,046) Financing income, net 1,673 963 468 279 Loss before income taxes (2,719) (3,757) (267) (767) Income tax expense (58) (35) 8 (13) Net loss (2,777) (3,792) (259) (780) Basic and diluted net loss per ordinary share (0.20) (0.29) (0.02) (0.06) Weighted average number of ordinary shares outstanding used in basic and diluted loss per ordinary share calculation 13,595,346 13,204,500 13,848,635 13,316,847 Company Contact: Moshe Eisenberg Chief Financial Officer Tel: +972-3-900-7100 Investor Relations Contact Ehud Helft / Kenny Green GK Investor Relations Tel: (US) +1-646-201-9246 DATASOURCE: Scopus Video Networks Ltd CONTACT: Company Contact: Moshe Eisenberg, Chief Financial Officer, Tel: +972-3-900-7100, ; Investor Relations Contact, Ehud Helft / Kenny Green, GK Investor Relations, Tel: (US) +1-646-201-9246,

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