LOD, Israel, Oct. 25, 2017 /PRNewswire/ --
Third Quarter Highlights:
- Quarterly revenues increased by 5.4% year-over-year to
$39.2 million;
- Quarterly service revenues increased by 12.4% year-over-year to
$12.7 million;
- Quarterly UC-SIP revenues increased more than 15%
year-over-year;
- Quarterly GAAP gross margin was 62.8%; quarterly Non-GAAP gross
margin was 63.2%;
- Quarterly GAAP operating margin was 6.6%; quarterly Non-GAAP
operating margin was 8.8%;
- Quarterly cash flow from operating activities was $6.2 million;
- Quarterly GAAP net income was $1.0
million, or $0.03 per diluted
share, compared to $971,000, or
$0.03 per diluted share, in the prior
year period;
- Quarterly Non-GAAP net income was $3.4
million, or $0.10 per diluted
share, compared to $2.9 million, or
$0.08 per diluted share, in the prior
year period; and
- AudioCodes repurchased 940,000 of its ordinary shares during
the quarter at an aggregate cost of $6.4
million.
Details:
AudioCodes (Nasdaq: AUDC), a leading provider of voice
networking solutions that enable enterprises and service providers
to transition to all-IP voice networks, today announced financial
results for the third quarter ended September 30, 2017.
Revenues for the third quarter of 2017 were $39.2 million, compared to $38.7 million for the second quarter of 2017 and
$37.2 million for the third quarter
of 2016.
Net income was $1.0 million, or
$0.03 per diluted share, for the
third quarter of 2017, compared to $971,000, or $0.03
per diluted share, for the third quarter of 2016.
On a Non-GAAP basis, the Company reported quarterly net income
of $3.4 million, or $0.10 per diluted share, compared to $2.9 million, or $0.08 per diluted share, in the third quarter of
2016.
Non-GAAP net income excludes: (i) stock-based compensation
expenses; (ii) amortization expenses related to intangible assets;
(iii) expenses related to deferred payments in connection with the
acquisition of Active Communications Europe; and (iv) non-cash
deferred tax benefit or expenses. A reconciliation of net income on
a GAAP basis to a non-GAAP basis is provided in the tables that
accompany the condensed consolidated financial statements contained
in this press release.
Net cash provided by operating activities for the third quarter
of 2017 totaled $6.2 million. Cash
and cash equivalents, long- and short-term bank deposits and long-
and short-term marketable securities were $60.1 million as of September 30, 2017, compared to $65.1 million as of September 30, 2016. The decrease in cash and cash
equivalents, long and short-term bank deposits and long and
short-term marketable securities was the result of the use of cash
for the continued repurchasing of the Company's ordinary shares
pursuant to its share repurchase program.
"We are pleased to report strong financial results for the third
quarter of 2017," said Shabtai
Adlersberg, President and Chief Executive Officer of
AudioCodes. "As demonstrated over the past 5 years, we continued to
execute on our UC-SIP strategic plan, and grew sales of UC-SIP
solutions, products and services in the third quarter by more than
15% compared to the year ago quarter. We believe we are now on
track to deliver about 15% annual growth for the UC-SIP business
which is expected to reach $100
million of annual revenues by 2020. Our performance
continues to rely primarily on collaboration with our application
and system integration partners worldwide, as well as through
winning enterprise voice deployments and service provider network
transformation projects on a global basis.
"Along with our higher sales, we continued to improve the
efficiency of our operations. We increased gross margin to a record
63.2%, grew quarterly operating margin to a record 8.8% and had
quarterly net income of $3.4 million,
an 18% increase over the year ago quarter. We are now expecting to
deliver about 25% growth in net income for 2017 compared to 2016.
At the same time, we continued to invest in our new intelligent
voice applications which we believe will start to contribute to
improved revenues and profits in coming years. Finally, as in
recent previous quarters, we continued to buy back shares to return
value to our shareholders," concluded Mr. Adlersberg.
Share Buy Back Program
During the quarter ended September 30,
2017, AudioCodes acquired 940,000 of its ordinary shares
under its share repurchase program for a total consideration of
approximately $6.4 million. As of
September 30, 2017, AudioCodes had
acquired an aggregate of 14.5 million of its ordinary shares since
August 2014 for an aggregate
consideration of approximately $70.7
million.
In May 2017, AudioCodes received
court approval in Israel to
purchase up to an aggregate of $15
million of additional ordinary shares pursuant to its share
repurchase program. As of September 30,
2017, $5.8 million remained
available to the Company for repurchasing shares under this court
approval. The current court approval for share repurchases expires
on November 15, 2017.
On October 24, 2017, the Company's
Board of Directors approved filing a new application with the court
in Israel requesting approval for
an additional repurchase program for up to $20 million of Ordinary Shares. The Company
expects to file a new application shortly and receive a decision
from the court in the coming weeks.
Conference Call & Web Cast Information
AudioCodes will conduct a conference call at 8:00 A.M., Eastern Time today to discuss the
Company's third quarter operating performance, financial results
and outlook. Interested parties may participate in the conference
call by dialing one the following numbers:
United States Participants: +1 (877) 407-0778
International Participants: +1 (201) 689-8565
The conference call will also be simultaneously webcast.
Investors are invited to listen to the call live via webcast at the
AudioCodes investor website at
http://www.audiocodes.com/investors-lobby.
Follow AudioCodes' social media channels:
AudioCodes invites you to join our online community and follow
us on: AudioCodes Voice Blog, LinkedIn, Twitter, Facebook, and
YouTube.
To download AudioCodes' investor relations app, which offers
access to its SEC filings, press releases, videos, audiocasts and
more, please visit Apple's App Store for the iPhone and iPad or
Google Play for Android mobile devices.
About AudioCodes
AudioCodes Ltd. (NASDAQ, TASE: AUDC) designs, develops and sells
advanced Voice-over-IP (VoIP) and converged VoIP and Data
networking products and applications to Service Providers and
Enterprises. AudioCodes is a VoIP technology market leader, focused
on converged VoIP and data communications, and its products are
deployed globally in Broadband, Mobile, Enterprise networks and
Cable. The Company provides a range of innovative, cost-effective
products including Media Gateways, Multi-Service Business Routers,
Session Border Controllers (SBC), Residential Gateways, IP Phones,
Media Servers, Value Added Applications and Professional Services.
AudioCodes' underlying technology, VoIPerfectHD™, relies on
AudioCodes' leadership in DSP, voice coding and voice processing
technologies. AudioCodes' High Definition (HD) VoIP technologies
and products provide enhanced intelligibility and a better end user
communication experience in Voice communications. For more
information on AudioCodes, visit http://www.audiocodes.com.
Statements concerning AudioCodes' business outlook or future
economic performance; product introductions and plans and
objectives related thereto; and statements concerning assumptions
made or expectations as to any future events, conditions,
performance or other matters, are "forward-looking statements'' as
that term is defined under U.S. Federal securities laws.
Forward-looking statements are subject to various risks,
uncertainties and other factors that could cause actual results to
differ materially from those stated in such statements. These
risks, uncertainties and factors include, but are not limited to:
the effect of global economic conditions in general and conditions
in AudioCodes' industry and target markets in particular; shifts in
supply and demand; market acceptance of new products and the demand
for existing products; the impact of competitive products and
pricing on AudioCodes' and its customers' products and markets;
timely product and technology development, upgrades and the ability
to manage changes in market conditions as needed; possible need for
additional financing; the ability to satisfy covenants in the
Company's loan agreements; possible disruptions from acquisitions;
the ability of AudioCodes to successfully integrate the products
and operations of acquired companies into AudioCodes' business; and
other factors detailed in AudioCodes' filings with the U.S.
Securities and Exchange Commission. AudioCodes assumes no
obligation to update the information in this release.
©2017 AudioCodes Ltd. All rights reserved. AudioCodes, AC, HD
VoIP, HD VoIP Sounds Better, IPmedia, Mediant, MediaPack, What's
Inside Matters, OSN, SmartTAP, User Management Pack, VMAS,
VoIPerfect, VoIPerfectHD, Your Gateway To VoIP, 3GX, VocaNom,
AudioCodes One Voice and CloudBond are trademarks or registered
trademarks of AudioCodes Limited. All other products or trademarks
are property of their respective owners. Product specifications are
subject to change without notice.
AUDIOCODES LTD.
AND ITS SUBSIDIARIES
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
U.S. dollars in
thousands
|
|
|
|
|
|
|
September
30,
|
|
December
31,
|
|
2017
|
|
2016
|
|
(Unaudited)
|
|
(Audited)
|
ASSETS
|
|
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
Cash and cash
equivalents
|
$ 22,040
|
|
$ 24,344
|
Short-term and
restricted bank deposits
|
2,905
|
|
3,401
|
Short-term marketable
securities and accrued interest
|
3,104
|
|
6,778
|
Trade receivables,
net
|
24,597
|
|
25,448
|
Other receivables and
prepaid expenses
|
5,207
|
|
3,377
|
Inventories
|
16,431
|
|
16,333
|
Total current
assets
|
74,284
|
|
79,681
|
|
|
|
|
LONG-TERM
ASSETS:
|
|
|
|
Long-term and
restricted bank deposits
|
$ 4,507
|
|
$ 5,407
|
Long-term marketable
securities
|
27,552
|
|
29,540
|
Deferred tax
assets
|
9,030
|
|
11,607
|
Severance pay
funds
|
19,690
|
|
17,820
|
Total long-term
assets
|
60,779
|
|
64,374
|
|
|
|
|
PROPERTY AND
EQUIPMENT, NET
|
3,676
|
|
3,867
|
|
|
|
|
GOODWILL, INTANGIBLE
ASSETS AND OTHER, NET
|
38,427
|
|
39,054
|
|
|
|
|
Total
assets
|
$ 177,166
|
|
$ 186,976
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
Current maturities of
long-term bank loans
|
$ 2,507
|
|
$ 3,451
|
Trade
payables
|
5,395
|
|
7,710
|
Other payables and
accrued expenses
|
20,466
|
|
18,618
|
Deferred
revenues
|
15,616
|
|
14,951
|
Total current
liabilities
|
43,984
|
|
44,730
|
|
|
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
Accrued severance
pay
|
$ 21,043
|
|
$ 18,941
|
Long-term bank
loans
|
6,840
|
|
8,493
|
Deferred revenues and
other liabilities
|
5,839
|
|
6,153
|
Total long-term
liabilities
|
33,722
|
|
33,587
|
|
|
|
|
Total
equity
|
99,460
|
|
108,659
|
Total liabilities and
equity
|
$ 177,166
|
|
$ 186,976
|
AUDIOCODES LTD.
AND ITS SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
U.S. dollars in
thousands, except share and per share data
|
|
|
|
|
|
Nine months
ended
|
|
Three months
ended
|
|
September
30,
|
|
September
30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(Unaudited)
|
|
(Unaudited)
|
Revenues:
|
|
|
|
|
|
|
|
Products
|
$ 79,450
|
|
$ 75,920
|
|
$ 26,522
|
|
$ 25,904
|
Services
|
35,871
|
|
31,891
|
|
12,686
|
|
11,282
|
Total
revenues
|
115,321
|
|
107,811
|
|
39,208
|
|
37,186
|
Cost of
revenues:
|
|
|
|
|
|
|
|
Products
|
35,241
|
|
34,896
|
|
11,909
|
|
12,042
|
Services
|
8,359
|
|
7,578
|
|
2,692
|
|
2,464
|
Total cost of
revenues
|
43,600
|
|
42,474
|
|
14,601
|
|
14,506
|
Gross
profit
|
71,721
|
|
65,337
|
|
24,607
|
|
22,680
|
Operating
expenses:
|
|
|
|
|
|
|
|
Research and
development, net
|
22,222
|
|
21,457
|
|
7,686
|
|
7,296
|
Selling and
marketing
|
36,549
|
|
33,715
|
|
12,151
|
|
11,518
|
General and
administrative
|
6,537
|
|
5,998
|
|
2,176
|
|
1,898
|
Total operating
expenses
|
65,308
|
|
61,170
|
|
22,013
|
|
20,712
|
Operating
income
|
6,413
|
|
4,167
|
|
2,594
|
|
1,968
|
Financial income
(expenses), net
|
(6)
|
|
(33)
|
|
97
|
|
(7)
|
Income before taxes
on income
|
6,407
|
|
4,134
|
|
2,691
|
|
1,961
|
Taxes on income,
net
|
(3,049)
|
|
(2,664)
|
|
(1,642)
|
|
(990)
|
Net income
|
$ 3,358
|
|
$ 1,470
|
|
$ 1,049
|
|
$ 971
|
Basic net earnings
per share
|
$ 0.11
|
|
$ 0.04
|
|
$ 0.03
|
|
$ 0.03
|
Diluted net earnings
per share
|
$ 0.10
|
|
$ 0.04
|
|
$ 0.03
|
|
$ 0.03
|
Weighted average
number of shares used in
computing basic net
earnings per share (in
thousands)
|
31,500
|
|
35,913
|
|
30,918
|
|
33,975
|
Weighted average
number of shares used in
computing diluted net
earnings per share (in
thousands)
|
32,534
|
|
36,419
|
|
31,959
|
|
34,615
|
AUDIOCODES LTD.
AND ITS SUBSIDIARIES
|
RECONCILIATION OF
GAAP NET INCOME TO NON-GAAP NET INCOME
|
U.S. dollars in
thousands, except per share data
|
|
|
Nine months
ended
|
|
Three months
ended
|
|
September
30,
|
|
September
30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(Unaudited)
|
|
(Unaudited)
|
GAAP net
income
|
$ 3,358
|
|
$ 1,470
|
|
$ 1,049
|
|
$ 971
|
GAAP net earnings per
share
|
$ 0.10
|
|
$ 0.04
|
|
$ 0.03
|
|
$ 0.03
|
Cost of
revenues:
|
|
|
|
|
|
|
|
Stock-based
compensation (1)
|
59
|
|
87
|
|
17
|
|
32
|
Amortization expenses
(2)
|
522
|
|
878
|
|
174
|
|
246
|
|
581
|
|
965
|
|
191
|
|
278
|
Research and
development, net:
|
|
|
|
|
|
|
|
Stock-based
compensation (1)
|
278
|
|
346
|
|
97
|
|
118
|
Deferred payments
expenses (3)
|
136
|
|
564
|
|
63
|
|
188
|
|
414
|
|
910
|
|
160
|
|
306
|
Selling and
marketing:
|
|
|
|
|
|
|
|
Stock-based
compensation (1)
|
779
|
|
837
|
|
239
|
|
278
|
Amortization expenses
(2)
|
90
|
|
90
|
|
30
|
|
30
|
|
869
|
|
927
|
|
269
|
|
308
|
General and
administrative:
|
|
|
|
|
|
|
|
Stock-based
compensation (1)
|
565
|
|
554
|
|
219
|
|
194
|
Income
taxes:
|
|
|
|
|
|
|
|
Deferred tax
(4)
|
2,560
|
|
1,993
|
|
1,496
|
|
817
|
Non-GAAP net
income
|
$ 8,347
|
|
$ 6,819
|
|
$ 3,384
|
|
$2,874
|
Non-GAAP diluted net
earnings per share
|
$ 0.25
|
|
$ 0.19
|
|
$ 0.10
|
|
$ 0.08
|
(1) Stock-based compensation expenses related to options and
restricted stock units granted to employees and others.
(2) Excluding amortization of intangible assets related to the
acquisitions of Netrake, Mailvision and Active Communications
Europe assets.
(3) Excluding expenses related to deferred payments in
connection with the acquisition of Active Communications
Europe.
(4) Non-cash deferred tax expenses.
Note: Non-GAAP measures should be considered in addition to, and
not as a substitute for, the results prepared in accordance with
GAAP. The Company believes that non-GAAP information is useful
because it can enhance the understanding of its ongoing economic
performance and therefore uses internally this non-GAAP information
to evaluate and manage its operations. The Company has chosen to
provide this information to investors to enable them to perform
comparisons of operating results in a manner similar to how the
Company analyzes its operating results and because many comparable
companies report this type of information.
AUDIOCODES LTD.
AND ITS SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENT OF CASH FLOWS
|
U.S. dollars in
thousands
|
|
|
|
Nine months
ended
|
|
Three months
ended
|
|
|
September
30,
|
|
September
30,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
(Unaudited)
|
|
(Unaudited)
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
Net income
|
|
$ 3,358
|
|
$ 1,470
|
|
$ 1,049
|
|
$ 971
|
Adjustments required
to reconcile net income to
net cash
provided by or used in operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
1,859
|
|
2,262
|
|
599
|
|
712
|
Amortization of
marketable securities premiums
and
accretion of discounts, net
|
|
475
|
|
677
|
|
146
|
|
187
|
Increase in accrued
severance pay, net
|
|
232
|
|
583
|
|
284
|
|
103
|
Stock-based
compensation expenses
|
|
1,681
|
|
1,824
|
|
572
|
|
622
|
Decrease (increase)
in accrued interest and
exchange
rate effect of loans, marketable
securities and bank deposits
|
|
251
|
|
187
|
|
36
|
|
(43)
|
Decrease in long-term
deferred tax assets, net
|
|
2,497
|
|
2,055
|
|
1,475
|
|
837
|
Decrease (increase)
in trade receivables, net
|
|
851
|
|
(211)
|
|
960
|
|
(1,262)
|
Decrease (increase)
in other receivables and
prepaid
expenses
|
|
(1,789)
|
|
(658)
|
|
2,398
|
|
(599)
|
Decrease (increase)
in inventories
|
|
(98)
|
|
1,111
|
|
(488)
|
|
(642)
|
Increase (decrease)
in trade payables
|
|
(2,315)
|
|
313
|
|
386
|
|
2,494
|
Increase (decrease)
in other payables and accrued
expenses
|
|
1,594
|
|
1,638
|
|
(63)
|
|
1,373
|
Increase (decrease)
in deferred revenues
|
|
809
|
|
400
|
|
(1,160)
|
|
(1,319)
|
Net cash provided by
operating activities
|
|
9,405
|
|
11,651
|
|
6,194
|
|
3,434
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Proceeds from sale of
marketable securities
|
|
-
|
|
12,429
|
|
-
|
|
-
|
Decrease in
short-term deposits, net
|
|
496
|
|
1,729
|
|
161
|
|
13,508
|
Decrease in long-term
bank deposits
|
|
900
|
|
477
|
|
300
|
|
150
|
Proceeds from
redemption of marketable securities
|
|
5,350
|
|
900
|
|
4,500
|
|
-
|
Purchase of property
and equipment
|
|
(1,041)
|
|
(1,189)
|
|
(395)
|
|
(367)
|
Net cash provided by
investing activities
|
|
5,705
|
|
14,346
|
|
4,566
|
|
13,291
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AUDIOCODES LTD.
AND ITS SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENT OF CASH FLOWS
|
U.S. dollars in
thousands
|
|
|
|
|
|
|
|
Nine months
ended
|
|
Three months
ended
|
|
|
September
30,
|
|
September
30,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
(Unaudited)
|
|
(Unaudited)
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Purchase of treasury
stock
|
|
(16,548)
|
|
(21,726)
|
|
(6,366)
|
|
(15,000)
|
Repayment of
long-term bank loans
|
|
(2,878)
|
|
(4,275)
|
|
(953)
|
|
(1,296)
|
Consideration related
to payment for acquisition
of
Mailvision
|
|
-
|
|
(233)
|
|
-
|
|
-
|
Proceeds from
issuance of shares upon exercise
of
options and warrants
|
|
2,012
|
|
561
|
|
479
|
|
342
|
Net cash used in
financing activities
|
|
(17,414)
|
|
(25,673)
|
|
(6,840)
|
|
(15,954)
|
|
|
|
|
|
|
|
|
|
Increase (decrease)
in cash and cash equivalents
|
|
(2,304)
|
|
324
|
|
3,920
|
|
771
|
Cash and cash
equivalents at the beginning of the
period
|
|
24,344
|
|
18,908
|
|
18,120
|
|
18,461
|
Cash and cash
equivalents at the end of the
period
|
|
$ 22,040
|
|
$ 19,232
|
|
$ 22,040
|
|
$ 19,232
|
Company
Contacts
|
|
IR Agency
Contact
|
Niran
Baruch,
VP Finance &
Chief Financial Officer
AudioCodes
Tel:
+972-3-976-4000
niran.baruch@audiocodes.com
|
Shirley
Nakar,
Director, Investor
Relations
AudioCodes
Tel:
+972-3-976-4000
shirley@audiocodes.com
|
Philip
Carlson/Elizabeth Barker
KCSA Strategic
Communications
Tel:
+1-212-896-1233
audc@kcsa.com
|
View original
content:http://www.prnewswire.com/news-releases/audiocodes-reports-third-quarter-2017-results-300542853.html
SOURCE AudioCodes Ltd.