EX-99.1 2 v312231_ex1.htm EXHIBIT 1

 

Exhibit 1

 

PRESS RELEASE

 

Company Contacts       IR Agency Contact

Guy Avidan,
VP Finance & CFO

AudioCodes

Tel: +972-3-976-4000
guy.avidan@audiocodes.com

   Shirley Nakar,
Director, Investor Relations
AudioCodes
Tel: +972-3-976-4000
shirley@audiocodes.com		  

Erik Knettel,

Grayling

Tel: +1-646-284-9415

erik.knettel@grayling.com

 

AudioCodes Reports First Quarter 2012 Results

 

Lod, Israel – May 7, 2012 - AudioCodes (NasdaqGS: AUDC), a leading provider of Voice over IP (VoIP) technologies and Voice Network products, today announced financial results for the first quarter ended March 31, 2012.

 

Revenues for the first quarter of 2012 were $32.3 million compared to $37.2 million for the fourth quarter of 2011 and $41.0 million for the first quarter of 2011.

 

Net loss in accordance with U.S. generally accepted accounting principles (GAAP) was $1.6 million, or ($0.04) per diluted share, for the first quarter of 2012 compared to net income of $670,000, or $0.02 per diluted share, for the fourth quarter of 2011, and net income of $3.0 million, or $0.07 per diluted share, for the first quarter of 2011.

 

Non-GAAP net loss for the first quarter of 2012 was $827,000, or ($0.02) per diluted share, compared to non-GAAP net income of $1.5 million, or $0.04 per diluted share, for the fourth quarter of 2011, and non-GAAP net income of $4.1 million, or $0.10 per diluted share, for the first quarter of 2011.

 

Non-GAAP net income (loss) excludes (i) stock-based compensation expenses and (ii) amortization expenses related to intangible assets. A reconciliation between net income (loss) on a GAAP basis and on a non-GAAP basis is provided in the tables that accompany the condensed consolidated financial statements contained in this press release.

 

AudioCodes Reports First Quarter 2012 ResultsPage 1 of 9


 

In October 2011, AudioCodes’ Board of Directors authorized a program to repurchase up to 4.0 million of the Company’s Ordinary Shares, NIS 0.01 nominal (par) value, which is approximately 10% of the Company’s outstanding shares. During the first quarter of 2012, the Company repurchased a total of approximately 692,000 shares at an aggregate cost of approximately $2.5 million. As of March 31, 2012, approximately 1.9 million shares have been repurchased through the program since its inception at an aggregate cost of approximately $6.5 million.

 

During the first quarter of 2012, net cash of $623,000 was provided by operating activities compared to net cash of $4.1 million provided by operating activities in the fourth quarter of 2011 and net cash of $371,000 used in operating activities in the first quarter of 2011. Cash and cash equivalents, bank deposits and marketable securities were $70.3 million as of March 31, 2012, compared to $75.6 million as of December 31, 2011 and $62.0 million as of March 31, 2011. The year-over-year net increase in cash balances includes new bank loans made to the Company during the second half of 2011 in the aggregate amount of $23.8 million.

 

“AudioCodes’ first quarter revenues were below our original forecast and reflected a faster than anticipated decline in our legacy business, a trend we believe will become less significant in the second half of 2012. These lower revenues reflect weakness in sales in North America including, among others, a decline in legacy OEM business and lower than anticipated government and technology sales. Aside from these headwinds, we saw continued solid demand for our core networking business line which represents about 80% of our overall business. Favorable product mix contributed to strong gross margin performance during the quarter. Strength in AudioCodes’ cash flow from operations for the first quarter was also favorable, strengthening the balance sheet and allowing us to continue to execute on our active share repurchase program,” commented Shabtai Adlersberg, Chairman, President and Chief Executive Officer of AudioCodes.

 

“As we look out on the landscape for our markets, we continue to see good opportunities in unified communications, the contact center market and IP business communications services. In the first quarter of 2012, we continued to introduce innovative products and services into some of the fastest growing segments of the VoIP market, such as the Enterprise Session Border Controller (E-SBC) space where AudioCodes has seen good momentum in growing sales and was recently ranked among the top three global public providers in a leading independent analysis. On the partner front, we continue to collaborate with market leaders such as Microsoft and their unified communications Lync solution to leverage the long-term opportunity we see in the market for communication and collaboration and networked telephony,” concluded Mr. Adlersberg.

 

AudioCodes Reports First Quarter 2012 ResultsPage 2 of 9


 

Conference Call & Web Cast Information

AudioCodes will conduct a conference call at 9:00 A.M., Eastern Time today to discuss the Company’s first quarter 2012 operating and financial results. The conference call will be simultaneously Web cast. Investors are invited to listen to the call live via Web cast at the AudioCodes corporate website at www.audiocodes.com.

 

About AudioCodes

 

AudioCodes Ltd. (NasdaqGS: 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 Gateways, Session Border Controllers (SBC), Residential Gateways, IP Phones, Media Servers and Value Added Applications. 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 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.

 

©2012 AudioCodes Ltd. All rights reserved. AudioCodes, AC, HD VoIP, HD VoIP Sounds Better, IPmedia, Mediant, MediaPack, OSN, SmartTAP, VMAS, VoIPerfect, VoIPerfectHD, Your Gateway To VoIP and 3GX 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.

 

Summary financial data follows

 

AudioCodes Reports First Quarter 2012 ResultsPage 3 of 9


 

 

AUDIOCODES LTD. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands

 

   March 31,   December 31, 
   2012   2011 
   Unaudited   Audited 
ASSETS          
           
CURRENT ASSETS:          
Cash and cash equivalents  $25,467   $28,257 
Short-term and restricted bank deposits   12,201    14,008 
Trade receivables, net   26,575    30,923 
Other receivables and prepaid expenses   6,553    4,822 
Deferred tax assets   2,600    2,600 
Inventories   19,987    20,415 
Total current assets   93,383    101,025 
           
LONG-TERM INVESTMENTS:          
Long-term and restricted bank deposits   8,520    9,120 
Long-term marketable securities   23,715    23,823 
Investments in an affiliated company   1,261    1,251 
Deferred tax assets   2,600    2,600 
Severance pay funds   16,118    15,410 
Total long-term assets   52,214    52,204 
           
PROPERTY AND EQUIPMENT, NET   3,595    3,368 
           
GOODWILL, INTANGIBLE ASSETS AND OTHER, NET   35,798    36,080 
           
Total assets  $184,990   $192,677 
           
LIABILITIES AND EQUITY          
           
CURRENT LIABILITIES:          
Current maturities of long-term bank loans  $10,364   $10,243 
Trade payables   7,095    12,362 
Other payables and accrued expenses   18,543    18,102 
Deferred revenues   7,268    5,235 
Total current liabilities   43,270    45,942 
           
LONG-TERM LIABILITIES:          
Accrued severance pay   16,709   $16,106 
Long-term bank loans   20,436    22,912 
Senior convertible notes   353    353 
Deferred revenues and other liabilities   1,210    1,345 
Total  long-term liabilities   38,708    40,716 
           
Total equity   103,012    106,019 
           
Total liabilities and equity  $184,990   $192,677 

 

AudioCodes Reports First Quarter 2012 ResultsPage 4 of 9


 

AUDIOCODES LTD. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands, except per share data

 

   Three months ended 
   March 31, 
   2012   2011 
   Unaudited 
         
Revenues  $32,313   $41,044 
Cost of revenues   13,452    17,022 
           
Gross profit   18,861    24,022 
           
Operating expenses:          
Research and development, net   8,118    8,534 
Selling and marketing   10,496    10,221 
General and administrative   1,959    2,132 
           
Total operating expenses   20,573    20,887 
           
Operating income (loss)   (1,712)   3,135 
Financial income, net   228    216 
           
Income (loss) before taxes on income   (1,484)   3,351 
Taxes on income, net   (84)   (65)
Equity in profit (losses) of affiliated companies   10    (257)
           
Net income (loss)  $(1,558)  $3,029 
           
Basic net earnings (loss) per share  $(0.04)  $0.07 
           
Diluted net earnings (loss) per share  $(0.04)  $0.07 
           
Weighted average number of shares used in computing basic net earnings per share   40,270    41,331 
           
Weighted average number of shares used in computing diluted net earnings per share   40,270    42,284 

 

AudioCodes Reports First Quarter 2012 ResultsPage 5 of 9


 

AUDIOCODES LTD. AND ITS SUBSIDIARIES
NON-GAAP PROFORMA STATEMENTS OF OPERATIONS
U.S. dollars in thousands, except per share data

 

   Three months ended 
   March 31, 
   2012   2011 
   Unaudited 
         
Revenues  $32,313   $41,044 
Cost of revenues (1) (2)   13,223    16,686 
           
Gross profit   19,090    24,358 
           
Operating expenses:          
Research and development, net (1)   7,982    8,407 
Selling and marketing (1) (2)   10,298    9,783 
General and administrative (1)   1,791    1,918 
           
Total operating expenses   20,071    20,108 
           
Operating income (loss)   (981)   4,250 
Financial income, net   228    216 
           
Income (loss) before taxes on income   (753)   4,466 
Taxes on income, net   (84)   (65)
Equity in profit (losses) of affiliated companies   10    (257)
           
Non-GAAP net income (loss)  $(827)  $4,144 
           
Non-GAAP diluted net earnings (loss) per share  $(0.02)  $0.10 
           
Weighted average number of shares used in computing non-GAAP diluted net earnings per share (in thousands)   40,270    42,612 

 

(1)Excluding 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 Nuera, Netrake and CTI Squared.

 

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 Reports First Quarter 2012 ResultsPage 6 of 9


 

AUDIOCODES LTD. AND ITS SUBSIDIARIES
RECONCILIATION BETWEEN GAAP NET INCOME AND NON-GAAP NET INCOME
U.S. dollars in thousands, except per share data

 

   Three months ended 
   March 31, 
   2012   2011 
   Unaudited 
     
GAAP Net income (loss)  $(1,558)  $3,029 
           
GAAP Diluted earnings (loss) per share  $(0.04)  $0.07 
           
Cost of revenues:          
Stock-based compensation (1)   23    27 
Amortization expenses (2)   206    309 
    229    336 
Research and development, net:          
Stock-based compensation (1)   136    127 
           
Selling and marketing:          
Stock-based compensation (1)   122    362 
Amortization expenses (2)   76    76 
    198    438 
General and administrative:          
Stock-based compensation (1)   168    214 
           
Non-GAAP Net income (loss)  $(827)  $4,144 
           
Non-GAAP Diluted earnings (loss) per share  $(0.02)  $0.10 

 

(1)Stock-based compensation expenses related to options and restricted stock units granted to employees and others.
(2)Amortization of intangible assets related to the acquisitions of Nuera, Netrake and CTI Squared.

 

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 Reports First Quarter 2012 ResultsPage 7 of 9


 

AUDIOCODES LTD. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
U.S. dollars in thousands

 

   Three months ended 
   March 31, 
   2012   2011 
   Unaudited 
     
Cash flows from operating activities:          
Net income (loss)  $(1,558)  $3,029 
Adjustments required to reconcile net income to net cash provided by operating activities:          
Depreciation and amortization   706    922 
           
Amortization of marketable securities premiums and accretion of discounts, net   108    87 
Equity in losses (profits) of affiliated companies   (10)   257 
Increase (decrease) in accrued severance pay, net   (105)   99 
Stock-based compensation expenses   449    1,140 
Decrease (increase) in accrued interest on loans, marketable securities, bank deposits and structured notes   3    (178)
Decrease (increase) in trade receivables, net   4,348    (*)(1,860) 
           
Increase in other receivables and prepaid expenses   (1,433)   (3,043)
Decrease in inventories   428    (*)1,037 
Decrease in trade payables   (5,267)   (450)
Increase in deferred revenues   2,273    (*)2,753 
Increase (decrease) in other payables and accrued Expenses and other liabilities   681    (4,164)
           
Net cash provided by (used in) operating activities   623    (371)
           
Cash flows from investing activities:          
Purchase of marketable securities   -    (24,402)
Short-term bank deposits, net   1,807    1,023 
Proceeds from long-term bank deposits   600    - 
Purchase of property and equipment   (651)   (525)
           
Net cash provided by (used in) investing activities   1,756    (23,904)

 

(*) Reclassified

 

AudioCodes Reports First Quarter 2012 ResultsPage 8 of 9


 

AUDIOCODES LTD. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Continued)
U.S. dollars in thousands

 

   Three months ended 
   March 31, 
   2012   2011 
   Unaudited 
     
Cash flows from financing activities:          
Purchase of treasury stock   (2,513)   - 
Repayment of loan from bank   (2,355)   (1,500)
Payment for acquisition of NSC non-controlling interest   (336)   (278)
Proceeds from issuance of shares upon exercise of options and employee stock purchase plan   35    445 
           
Net cash used in financing activities   (5,169)   (1,333)
           
Decrease in cash and cash equivalents   (2,790)   (25,608)
Cash and cash equivalents at the beginning of the period   28,257    50,311 
           
Cash and cash equivalents at the end of the period  $25,467   $24,703 

 

AudioCodes Reports First Quarter 2012 ResultsPage 9 of 9