Allot Communications Reports Non-GAAP 4.4% Revenue Growth for Q1 2015
HOD HASHARON,
Q1 2015 - Financial Highlights:
- Non-GAAP Revenues were
$29.5 million , up 4.4% year over year - Non-GAAP Gross Margin reached 76%
- Non-GAAP Operating Margin was 10%
- Book-to-bill was below one
- The Company generated
$2.1 million of Operating Cash Flow - Net Cash as of
March 31, 2015 totaled$123.8 million
Financial results:
On a GAAP basis, total revenues for the first quarter of 2015 were
On a non-GAAP basis, total revenues for the first quarter of 2015 reached
Q1 2015 - Key Achievements:
- During Q1 2015, 18 large orders were received, 3 of which were from new customers
- 8 of the large orders came from mobile-service providers and 8 were from fixed-line service providers
- In addition, 2 large orders were received for private and public cloud deployments
- Allot completed the acquisition of Optenet during the first quarter. The impact over the first quarter results was immaterial.
- Allot launched SmartEngage which enables mobile operators to increase subscriber service uptake.
- Received four orders from Tier-1 operators to enable delivery of Security-as-a-Service and Comply with Regulation.
"During the first quarter we completed the acquisition of Optenet, a global leader in the field of Security-as-a-Service. We believe that the acquisition will significantly enhance our security offering and support future growth opportunities," said
Conference Call & Webcast:
The Allot management team will host a conference call to discuss first quarter 2015 earnings results today at
A replay of the conference call will be available from
About
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, regulatory matter expenses, acquisition-related expenses and restructuring costs.
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 may contain 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 expressed or implied by 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; 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; and other factors discussed under the heading "Risk Factors" in the Company's annual report on Form 20-F filed with the
Investor Relations Contact:
AVP Corporate Development
International access code +972-52-569-4441
rrozen@allot.com
Public Relations Contact:
International access code +972-54-677-8100
mlustig@allot.com
TABLE - 1 | |||||
| |||||
AND ITS SUBSIDIARIES | |||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||
(U.S. dollars in thousands, except share and per share data) | |||||
Three Months Ended |
|||||
|
|||||
2015 |
2014 |
||||
(Unaudited) |
|||||
Revenues |
$ 29,532 |
$ 28,284 |
|||
Cost of revenues |
7,769 |
8,195 |
|||
Gross profit |
21,763 |
20,089 |
|||
Operating expenses: |
|||||
Research and development costs, net |
6,809 |
7,221 |
|||
Sales and marketing |
11,808 |
10,497 |
|||
General and administrative |
3,250 |
2,887 |
|||
Total operating expenses |
21,867 |
20,605 |
|||
Operating loss |
(104) |
(516) |
|||
Financial and other income, net |
205 |
149 |
|||
Profit (loss) before income tax benefit |
101 |
(367) |
|||
Tax expenses |
135 |
21 |
|||
Net loss |
(34) |
(388) |
|||
Basic net loss per share |
$ (0.00) |
$ (0.01) |
|||
Diluted net loss per share |
$ (0.00) |
$ (0.01) |
|||
Weighted average number of shares |
|||||
used in computing basic net |
|||||
earnings per share |
33,357,909 |
32,939,195 |
|||
Weighted average number of shares |
|||||
used in computing diluted net |
|||||
earnings per share |
33,357,909 |
32,939,195 |
|||
TABLE - 2 | ||||||
| ||||||
AND ITS SUBSIDIARIES | ||||||
RECONCILIATION OF GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||
(U.S. dollars in thousands, except per share data) | ||||||
Three Months Ended |
Three Months Ended | |||||
|
| |||||
(Unaudited) |
(Unaudited) | |||||
$ |
% of Revenues |
$ |
% of Revenues | |||
GAAP Operating loss |
$ (104) |
0% |
$ (516) |
-2% | ||
Share-based compensation (1) |
1,867 |
1,992 |
||||
Amortization of intangible assets (2) |
511 |
465 |
||||
Expenses related to M&A activities (3) |
577 |
8 |
||||
Fair value adjustment for acquired deferred revenues write down |
11 |
12 |
||||
Non-GAAP Operating income |
$ 2,862 |
10% |
$ 1,961 |
7% | ||
GAAP Net loss |
$ (34) |
0% |
$ (388) |
-1% | ||
Share-based compensation (1) |
1,867 |
1,992 |
||||
Amortization of intangible assets (2) |
511 |
465 |
||||
Expenses related to M&A activities (3) |
577 |
8 |
||||
Fair value adjustment for acquired deferred revenues write down |
11 |
12 |
||||
Non-GAAP Net income |
$ 2,932 |
10% |
$ 2,089 |
7% | ||
GAAP loss per share (diluted) |
$ (0.00) |
$ (0.01) |
||||
Share-based compensation |
0.05 |
0.06 |
||||
Amortization of intangible assets |
0.02 |
0.01 |
||||
Expenses related to M&A activities |
0.02 |
0.00 |
||||
Fair value adjustment for acquired deferred revenues write down |
0.00 |
0.00 |
||||
Non-GAAP Net income per share (diluted) |
$ 0.09 |
$ 0.06 |
||||
(1) Share-based compensation: |
||||||
Cost of revenues |
$ 82 |
$ 88 |
||||
Research and development costs, net |
420 |
469 |
||||
Sales and marketing |
752 |
821 |
||||
General and administrative |
613 |
614 |
||||
$ 1,867 |
$ 1,992 |
|||||
(2) Amortization of intangible assets |
||||||
Cost of revenues |
$ 454 |
$ 399 |
||||
Sales and marketing |
57 |
66 |
||||
$ 511 |
$ 465 |
|||||
(3) Expenses related to M&A activities |
||||||
General and administrative |
$ 351 |
$ 8 |
||||
Research and development costs, net |
45 |
- |
||||
Sales and marketing |
181 |
- |
||||
$ 577 |
$ 8 |
|||||
TABLE - 3 | ||||
| ||||
AND ITS SUBSIDIARIES | ||||
RECONCILIATION OF GAAP TO NON-GAAP CONSOLIDATED REVENUES | ||||
(U.S. dollars in thousands, except share and per share data) | ||||
Three Months Ended |
||||
|
||||
2015 |
2014 |
|||
(Unaudited) |
||||
GAAP Revenues |
$ 29,532 |
|
||
Fair value adjustment for acquired deferred revenues write down |
11 |
12 |
||
Non-GAAP Revenues |
$ 29,543 |
|
||
TABLE - 4 | ||||
| ||||
AND ITS SUBSIDIARIES | ||||
CONSOLIDATED BALANCE SHEETS | ||||
(U.S. dollars in thousands) | ||||
|
| |||
2015 |
2014 | |||
(Unaudited) |
(Unaudited) | |||
ASSETS |
||||
CURRENT ASSETS: |
||||
Cash and cash equivalents |
$ 21,930 |
$ 51,036 | ||
Short term deposits |
46,500 |
30,500 | ||
Marketable securities and restricted cash |
55,344 |
40,639 | ||
Trade receivables, net |
23,584 |
21,414 | ||
Other receivables and prepaid expenses |
6,634 |
8,906 | ||
Inventories |
8,321 |
13,474 | ||
Total current assets |
162,313 |
165,969 | ||
LONG-TERM ASSETS: |
||||
Severance pay fund |
260 |
260 | ||
Deferred taxes |
1,620 |
1,602 | ||
Other assets |
3,626 |
2,726 | ||
Total long-term assets |
5,506 |
4,588 | ||
PROPERTY AND EQUIPMENT, NET |
6,011 |
5,990 | ||
GOODWILL AND INTANGIBLE ASSETS, NET |
45,995 |
29,756 | ||
Total assets |
$ 219,825 |
$ 206,303 | ||
LIABILITIES AND SHAREHOLDERS' EQUITY |
||||
CURRENT LIABILITIES: |
||||
Trade payables |
$ 5,876 |
$ 4,887 | ||
Deferred revenues |
12,340 |
13,527 | ||
Other payables and accrued expenses |
15,324 |
12,851 | ||
Total current liabilities |
33,540 |
31,265 | ||
LONG-TERM LIABILITIES: |
||||
Deferred revenues |
4,777 |
2,520 | ||
Accrued severance pay |
292 |
292 | ||
Other long term liabilities |
3,915 |
0 | ||
Total long-term liabilities |
8,984 |
2,812 | ||
SHAREHOLDERS' EQUITY |
177,301 |
172,226 | ||
Total liabilities and shareholders' equity |
$ 219,825 |
$ 206,303 | ||
TABLE - 5 |
|||
|
|||
AND ITS SUBSIDIARIES |
|||
CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||
(U.S. dollars in thousands) |
|||
Three Months Ended |
|||
|
|||
2015 |
2014 |
||
(Unaudited) |
|||
Cash flows from operating activities: |
|||
Net Loss |
$ (34) |
$ (388) |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|||
Depreciation |
762 |
800 |
|
Stock-based compensation related to options granted to employees |
1,849 |
1,992 |
|
Amortization of intangible assets |
449 |
465 |
|
Capital loss |
4 |
- |
|
Decrease in accrued severance pay, net |
12 |
4 |
|
Increase in other assets |
(178) |
(82) |
|
Decrease in accrued interest and amortization of premium on marketable securities |
300 |
208 |
|
Increase (Decrease) in trade receivables |
175 |
(4,506) |
|
Increase in other receivables and prepaid expenses |
(2,691) |
(102) |
|
Decrease in inventories |
1,788 |
324 |
|
Increase in long-term deferred taxes, net |
96 |
- |
|
Increase (Decrease) in trade payables |
(424) |
1,696 |
|
Increase (Decrease) in employees and payroll accruals |
(409) |
1,062 |
|
Increase in deferred revenues |
100 |
1,096 |
|
Increase in other payables and accrued expenses |
292 |
876 |
|
Net cash provided by operating activities |
2,091 |
3,445 |
|
Cash flows from investing activities: |
|||
Redemption of short-term deposits |
12,500 |
7,500 |
|
Purchase of property and equipment |
(666) |
(916) |
|
Investment in marketable securities |
(6,727) |
(900) |
|
Proceeds from redemption or sale of marketable securities |
5,528 |
901 |
|
Acquisitions of certain assets and liabilities |
(10,052) |
- |
|
Loan provided to third party, net |
- |
(2,563) |
|
Net cash provided by investing activities |
583 |
4,022 |
|
Cash flows from financing activities: |
|||
Exercise of employee stock options |
76 |
756 |
|
Net cash provided by financing activities |
76 |
756 |
|
Increase in cash and cash equivalents |
2,750 |
8,223 |
|
Cash and cash equivalents at the beginning of the period |
19,180 |
42,813 |
|
Cash and cash equivalents at the end of the period |
$ 21,930 |
$ 51,036 |
|
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