Allot Communications Ltd.
Allot Communications Ltd. (Form: 6-K, Received: 08/01/2017 06:11:33)


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
 
Form 6-K
 
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of August 2017
Commission File Number: 001-33129

ALLOT COMMUNICATIONS LTD.
 (Translation of registrant’s name into English)

22 Hanagar Street
Neve Ne'eman Industrial Zone B
Hod-Hasharon 45240
Israel
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
 
Form 20-F              Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ___

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ___

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes   ☐            No   ☒

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- ________
 

EXPLANATORY NOTE

On August 1, 2017, Allot Communications Ltd. issued a press release announcing the Second Quarter 2017 Financial Results.

A copy of the press release entitled “Allot Communications Announces Second Quarter 2017 Financial Results” is attached to this Form 6-K as Exhibit 99.1.
 
SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
  Allot Communications Ltd.  
       
By:
/s/ Alberto Sessa   
    Alberto Sessa  
    Chief Financial Officer  
       
Date: August 1, 2017
 


EXHIBIT INDEX

The following exhibit has been filed as part of this Form 6-K:
 
Exhibit Number  
Description
 
99.1







 




Exhibit 99.1
 

 Allot Communications Announces
Second Quarter 2017 Financial Results
 
Revenues in Q2 up from Q1 2017, with smaller loss in Q2 compared to Q1 2017

Hod Hasharon, Israel – August 1, 2017 - Allot Communications Ltd. ( NASDAQ: ALLT, TASE: ALLT), a leading global provider of security and monetization solutions that enable service providers and enterprises to protect and personalize the digital experience, today announced its second quarter 2017 financial results.
 
  Q2 2017 Highlights
 
·
GAAP revenues were $19.5M, up from $18.4M in Q1 2017;
 
·
GAAP operating loss was $3.8M, down from $4.9M in Q1 2017;
 
·
Book-to-bill above one for the second consecutive quarter.
 
Management Comment
 
Erez Antebi, President & CEO of Allot Communications , commented, “The past quarter was the second consecutive quarter with book-to-bill ratio above one. We are also seeing a steady, consistent increase in the number of consumers who are enjoying the benefits of our network security solutions. Internally, we are aligning the organization to fit the new strategy and generate growth. I strongly believe we are on the right path to materialize on the market opportunities we identified as growth engines, and we continue to demonstrate the value of our solutions and commitment to customer success.”
 
Q2 2017 Financial results
 
On a GAAP basis, total revenues for the second quarter of 2017 were $19.5 million, compared to $18.4 million reported for the first quarter of 2017. Net loss for the second quarter of 2017 was $4.0 million, or $0.12 per basic and diluted share. This compares with a net loss of $5.1 million, or $0.15 per basic and diluted share, in the first quarter of 2017.
 
On a non-GAAP basis, total revenues for the second quarter of 2017 were $19.5 million compared to $18.5 million reported for the first quarter of 2017. Net loss for the second quarter of 2017 was $2.3 million, or $0.07 per basic and diluted share. This compares with a net loss of $3.6 million, or $0.11 per basic and diluted share, in the first quarter of 2017.
 
Cash and investments as of June 30, 2017 totaled $111.3 million. The Company recorded a positive operating cash flow of $0.9 million during the quarter.
 
2017 Outlook
 
Management reiterates its previously issued guidance and expects 2017 revenues in the range of $80 - $84 million.  Revenues for the second half of 2017 are expected to be better than for the first half and the book to bill ratio for the year is expected to be above 1.
 

 
Conference Call & Webcast :
 
The Allot management team will host a conference call to discuss second quarter 2017 earnings results today, August 1, 2017 at 8:30 AM ET, 3:30 p.m. Israel time. To access the conference call, please dial one of the following numbers:
 
US: +1-888-668-9141, UK: +44(0) 800-917-5108, Israel: +972-3-918-0609.
 
A recording of the conference call will be available from 12:00PM ET on August 1, 2017 for 30 days. To access the recording, please dial: +1-866-276-1485; UK: +44(0) 800-917-1246; Intl: +972-3-925-5928
 
A live webcast of the conference call can be accessed on the Allot Communications website at: http://www.allot.com.
 
The webcast will also be archived on the website following the conference call.
 
About Allot Communications

Allot Communications (NASDAQ: ALLT, TASE: ALLT) is a leading provider of security and monetization solutions that enables service providers and enterprises to protect and personalize the digital experience. Allot’s flexible and highly scalable service delivery framework leverages the intelligence in data networks, enabling service providers to get closer to their customers, safeguard network assets and users, and accelerate time-to-revenue for value-added services. We employ innovative technology, proven know-how and a collaborative approach to provide the right solution for every network environment. Allot solutions are currently deployed at 5 of the top 10 global mobile operators and in thousands of CSP and enterprise networks worldwide. For more information, please visit www.allot.com.
 

 
GAAP to Non-GAAP Reconciliation :
 
The difference between GAAP and non-GAAP revenues is related to the acquisitions made by the Company and represents revenues adjusted for the impact of the fair value adjustment to acquired deferred revenue related to purchase accounting. Non-GAAP net income is defined as GAAP net income after including deferred revenues related to the fair value adjustment resulting from purchase accounting and excluding stock-based compensation expenses, amortization of acquisition-related intangible assets, deferred tax asset adjustment, restructuring expenses 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 are 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: 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 third 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.
 
Investor Relations Contact:
GK Investor Relations
Ehud Helft/Gavriel Frohwein
+1 646 688 3559
allot@gkir.com
Public Relations Contact:
Sigalit Orr
Director Corporate Communications
International dialing +972-54-268-1500
sorr@allot.com

 

 
ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except share and per share data)
 
   
Three Months Ended
   
Six Months Ended
 
   
June 30,
   
June 30,
 
   
2017
   
2016
   
2017
   
2016
 
   
(Unaudited)
   
(Unaudited)
 
                         
Revenues
 
$
19,502
   
$
22,958
   
$
37,937
   
$
45,896
 
Cost of revenues
   
6,662
     
6,524
     
12,980
     
13,667
 
                                 
Gross profit
   
12,840
     
16,434
     
24,957
     
32,229
 
                                 
Operating expenses:
                               
Research and development costs, net
   
5,364
     
5,957
     
10,897
     
12,818
 
Sales and marketing
   
8,747
     
8,846
     
17,727
     
19,117
 
General and administrative
   
2,519
     
2,570
     
5,060
     
5,267
 
Total operating expenses
   
16,630
     
17,373
     
33,684
     
37,202
 
Operating loss
   
(3,790
)
   
(939
)
   
(8,727
)
   
(4,973
)
Financial and other income, net
   
112
     
211
     
474
     
327
 
Loss before income tax benefit
   
(3,678
)
   
(728
)
   
(8,253
)
   
(4,646
)
                                 
Tax expenses
   
352
     
499
     
854
     
870
 
Net loss
   
(4,030
)
   
(1,227
)
   
(9,107
)
   
(5,516
)
                                 
 Basic net loss per share
 
$
(0.12
)
 
$
(0.04
)
 
$
(0.27
)
 
$
(0.17
)
                                 
 Diluted net loss per share
 
$
(0.12
)
 
$
(0.04
)
 
$
(0.27
)
 
$
(0.17
)
                                 
Weighted average number of shares
                               
used in computing basic net
                               
earnings per share
   
33,200,982
     
33,234,040
     
33,146,715
     
33,357,014
 
                                 
Weighted average number of shares
                               
used in computing diluted net
                               
earnings per share
   
33,200,982
     
33,234,040
     
33,146,715
     
33,357,014
 

 
ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
RECONCILATION OF GAAP TO NON-GAAP  CONSOLIDATED  STATEMENTS  OF  OPERATIONS
(U.S. dollars in thousands, except per share data)
 
   
Three Months Ended
   
Six Months Ended
 
   
June 30,
   
June 30,
 
   
2017
   
2016
   
2017
   
2016
 
   
(Unaudited)
   
(Unaudited)
 
                         
 GAAP Revenues
 
$
19,502
   
$
22,958
   
$
37,937
   
$
45,896
 
 Fair value adjustment for acquired deferred revenues write down
   
13
     
36
     
37
     
101
 
 Non-GAAP Revenues
 
$
19,515
   
$
22,994
   
$
37,974
   
$
45,997
 
                                 
GAAP cost of revenues
 
$
6,662
   
$
6,524
   
$
12,980
   
$
13,667
 
 Share-based compensation (1)
   
(96
)
   
(104
)
   
(192
)
   
(173
)
 Amortization of intangible assets (2)
   
(242
)
   
(233
)
   
(474
)
   
(481
)
Non-GAAP cost of revenues
 
$
6,324
   
$
6,187
   
$
12,314
   
$
13,013
 
                                 
 GAAP gross profit
 
$
12,840
   
$
16,434
   
$
24,957
   
$
32,229
 
 Gross profit adjustments
   
351
     
373
     
703
     
755
 
 Non-GAAP gross profit
 
$
13,191
   
$
16,807
   
$
25,660
   
$
32,984
 
                                 
 GAAP operating expenses
 
$
16,630
   
$
17,373
   
$
33,684
   
$
37,202
 
 Share-based compensation (1)
   
(870
)
   
(1,220
)
   
(1,618
)
   
(2,806
)
 Amortization of intangible assets (2)
   
(135
)
   
(132
)
   
(269
)
   
(270
)
 Expenses related to M&A activities (3)
   
-
     
-
     
(89
)
   
-
 
 Non-GAAP operating expenses
 
$
15,625
   
$
16,021
   
$
31,708
   
$
34,126
 
                                 
 GAAP financial and other income
 
$
112
   
$
211
   
$
474
   
$
327
 
 Expenses related to M&A activities (3)
   
306
     
(135
)
   
379
     
143
 
 Non-GAAP Financial and other income
 
$
418
   
$
76
   
$
853
   
$
470
 
                                 
 GAAP taxes on income
 
$
352
   
$
499
   
$
854
   
$
870
 
 Tax benefit (in respect of net deferred tax asset recorded)
   
(64
)
   
(69
)
   
(130
)
   
(131
)
 Non-GAAP taxes on income
 
$
288
   
$
430
   
$
724
   
$
739
 
                                 
 GAAP Net Loss
 
$
(4,030
)
 
$
(1,227
)
 
$
(9,107
)
 
$
(5,516
)
 Share-based compensation (1)
   
966
     
1,324
     
1,810
     
2,979
 
 Amortization of intangible assets (2)
   
377
     
365
     
743
     
751
 
 Expenses related to M&A activities (3)
   
306
     
(135
)
   
468
     
143
 
 Fair value adjustment for acquired deferred revenues write down
   
13
     
36
     
37
     
101
 
 Tax benefit (in respect of net deferred tax asset recorded)
   
64
     
69
     
130
     
131
 
 Non-GAAP Net income (Loss)
 
$
(2,304
)
 
$
432
   
$
(5,919
)
 
$
(1,411
)
                                 
 GAAP Loss per share (diluted)
 
$
(0.12
)
 
$
(0.04
)
 
$
(0.27
)
 
$
(0.17
)
 Share-based compensation
   
0.03
     
0.04
     
0.05
     
0.09
 
 Amortization of intangible assets
   
0.01
     
0.01
     
0.02
     
0.02
 
 Expenses related to M&A activities
   
0.01
     
(0.00
)
   
0.01
     
0.01
 
 Fair value adjustment for acquired deferred revenues write down
   
0.00
     
0.00
     
0.00
     
0.00
 
 Tax benefit (in respect of net deferred tax asset recorded)
   
0.00
     
0.00
     
0.01
     
0.01
 
 Non-GAAP Net income (Loss) per share (diluted)
 
$
(0.07
)
 
$
0.01
   
$
(0.18
)
 
$
(0.04
)
                                 
Weighted average number of shares used in
                               
computing GAAP diluted net earnings per share
   
33,200,982
     
33,234,040
     
33,146,715
     
33,357,014
 
                                 
Weighted average number of shares used in
                               
computing non-GAAP diluted net earnings per share
   
33,200,982
     
33,736,414
     
33,146,715
     
33,357,014
 


ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
RECONCILATION OF GAAP TO NON-GAAP  CONSOLIDATED  STATEMENTS  OF  OPERATIONS
(U.S. dollars in thousands, except per share data)
 
   
Three Months Ended
   
Six Months Ended
 
   
June 30,
   
June 30,
 
   
2017
   
2016
   
2017
   
2016
 
   
(Unaudited)
   
(Unaudited)
 
                         
(1) Share-based compensation:
                       
     Cost of revenues
 
$
96
   
$
104
   
$
192
   
$
173
 
     Research and development costs, net
   
217
     
280
     
446
     
706
 
     Sales and marketing
   
246
     
467
     
487
     
1,089
 
     General and administrative
   
407
     
473
     
685
     
1,011
 
   
$
966
   
$
1,324
   
$
1,810
   
$
2,979
 
                                 
 (2) Amortization of intangible assets
                               
     Cost of revenues
 
$
242
   
$
233
   
$
474
   
$
481
 
     Sales and marketing
   
135
     
132
     
269
     
270
 
   
$
377
   
$
365
   
$
743
   
$
751
 
                                 
 (3) Expenses related to M&A activities
                               
     General and administrative
 
$
-
   
$
-
   
$
89
   
$
-
 
     Finanacial expenses
   
306
     
(135
)
   
379
     
143
 
   
$
306
   
$
(135
)
 
$
468
   
$
143
 
 

ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
CONSOLIDATED  BALANCE  SHEETS
(U.S. dollars in thousands)
 
   
June 30,
   
December 31,
 
   
2017
   
2016
 
   
(Unaudited)
   
(Audited)
 
             
ASSETS
           
CURRENT ASSETS:
           
Cash and cash equivalents
 
$
23,460
   
$
23,326
 
Short term deposits
   
24,543
     
29,821
 
Marketable securities
   
63,252
     
60,507
 
Trade receivables, net
   
24,367
     
24,158
 
Other receivables and prepaid expenses
   
3,926
     
3,879
 
Inventories
   
10,084
     
7,235
 
Total current assets
   
149,632
     
148,926
 
                 
LONG-TERM ASSETS:
               
Severance pay fund
   
287
     
252
 
Deferred taxes
   
133
     
267
 
Other assets
   
570
     
1,136
 
Total long-term assets
   
990
     
1,655
 
                 
PROPERTY AND EQUIPMENT, NET
   
5,076
     
4,387
 
GOODWILL AND INTANGIBLE ASSETS, NET
   
35,229
     
35,972
 
                 
Total assets
 
$
190,927
   
$
190,940
 
                 
LIABILITIES AND SHAREHOLDERS' EQUITY
               
CURRENT LIABILITIES:
               
Trade payables
 
$
9,411
   
$
3,275
 
Deferred revenues
   
10,679
     
11,133
 
Other payables and accrued expenses
   
11,482
     
10,538
 
Total current liabilities
   
31,572
     
24,946
 
                 
LONG-TERM LIABILITIES:
               
Deferred revenues
   
3,090
     
3,597
 
Accrued severance pay
   
711
     
592
 
Other long term liabilities
   
4,857
     
4,502
 
Total long-term liabilities
   
8,658
     
8,691
 
                 
SHAREHOLDERS' EQUITY
   
150,697
     
157,303
 
                 
Total liabilities and shareholders' equity
 
$
190,927
   
$
190,940
 
 
 

ALLOT COMMUNICATIONS LTD.
AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands)
 
   
Three Months Ended
   
Six Months Ended
 
   
June 30,
   
June 30,
 
   
2017
   
2016
   
2017
   
2016
 
   
(Unaudited)
   
(Unaudited)
   
(Unaudited)
   
(Unaudited)
 
                         
Cash flows from operating activities:
                       
                         
Net Loss
 
$
(4,030
)
 
$
(1,227
)
 
$
(9,107
)
 
$
(5,516
)
Adjustments to reconcile net income to net cash provided by operating activities:
                               
Depreciation
   
535
     
596
     
1,065
     
1,195
 
Stock-based compensation related to options granted to employees
   
966
     
1,324
     
1,809
     
2,979
 
Amortization of intangible assets
   
376
     
365
     
743
     
751
 
Capital loss
   
3
     
21
     
7
     
20
 
Decrease in accrued severance pay, net
   
56
     
9
     
84
     
27
 
Decrease in other assets
   
258
     
483
     
566
     
374
 
Decease in accrued interest and  amortization of premium on marketable securities
   
376
     
402
     
502
     
740
 
Decrease (Increase) in trade receivables
   
(1,469
)
   
261
     
(209
)
   
542
 
Decrease (Increase) in other receivables and prepaid expenses
   
1,028
     
(92
)
   
406
     
242
 
Increase in inventories
   
(2,087
)
   
(513
)
   
(2,849
)
   
(139
)
Decrease in long-term deferred taxes, net
   
67
     
61
     
134
     
123
 
Increase (Decrease) in trade payables
   
4,287
     
(3,060
)
   
6,136
     
(2,905
)
Increase (Decrease) in employees and payroll accruals
   
340
     
(12
)
   
616
     
(597
)
Increase (Decrease) in deferred revenues
   
(108
)
   
1,163
     
(961
)
   
(64
)
Increase (Decrease) in other payables and accrued expenses
   
269
     
(1,004
)
   
760
     
(404
)
Net cash provided by (used in) operating activities
   
867
     
(1,223
)
   
(298
)
   
(2,632
)
                                 
Cash flows from investing activities:
                               
                                 
Redemption of (Investment in) short-term deposits
   
4,805
     
(267
)
   
5,278
     
9,733
 
Purchase of property and equipment
   
(949
)
   
(409
)
   
(1,760
)
   
(736
)
Investment in marketable securities
   
(8,950
)
   
(8,200
)
   
(15,538
)
   
(16,980
)
Proceeds from redemption or sale of marketable securities
   
7,662
     
7,690
     
12,411
     
18,590
 
Net cash provided by (used in) investing activities
   
2,568
     
(1,186
)
   
391
     
10,607
 
                                 
Cash flows from financing activities:
                               
                                 
Exercise of employee stock options
   
17
     
15
     
41
     
26
 
Purchase of treasury stocks
   
-
     
(2,279
)
   
-
     
(3,326
)
Net cash provided by (used in) financing activities
   
17
     
(2,264
)
   
41
     
(3,300
)
                                 
                                 
Increase (Decrease) in cash and cash equivalents
   
3,452
     
(4,673
)
   
134
     
4,675
 
Cash and cash equivalents at the beginning of the period
   
20,008
     
24,818
     
23,326
     
15,470
 
Cash and cash equivalents at the end of the period
 
$
23,460
   
$
20,145
   
$
23,460
   
$
20,145