Delaware | ||
(State or other jurisdiction of incorporation or organization) | ||
001-36414 | 77-0259 335 | |
(Commission File Number) | (I.R.S. Employer Identification No.) | |
8 Crosby Drive, Bedford, MA | 01730 | |
(Address of principal executive offices) | (Zip Code) |
Exhibit No. | Description | |
Amended and Restated Press Release issued by the registrant on February 7, 2019, furnished herewith. |
Date: February 7, 2019 | iRobot Corporation | |
By: /s/ Glen D. Weinstein | ||
Name: Glen D. Weinstein | ||
Title: Chief Legal Officer and Secretary |
Contacts: | ||||
Elise Caffrey | Matthew Lloyd | |||
Investor Relations | Media Relations | |||
iRobot Corp. | iRobot Corp. | |||
(781) 430-3003 | (781) 430-3720 | |||
ecaffrey@irobot.com | mlloyd@irobot.com | |||
• | Revenue for the fourth quarter of 2018 was $384.7 million, compared with $326.9 million for the fourth quarter of 2017. Revenue for the full year 2018 was $1,092.6 million, compared with $883.9 million for the full year 2017. |
• | Operating income in the fourth quarter of 2018 was $29.8 million, compared with $23.1 million in the fourth quarter of 2017. Operating income for the full year 2018 was $105.8 million, compared with $72.7 million for the full year 2017. |
• | Quarterly earnings per share were $0.88 for the fourth quarter of 2018, compared with $0.16 in the fourth quarter of 2017. Fourth-quarter 2017 earnings per share included a negative ($0.41) impact from the tax reform law for the remeasurement of our net deferred tax assets and a provisional repatriation toll charge, as well as a discrete tax benefit of $0.03 relating to stock compensation. Fourth-quarter 2018 earnings per share included a discrete tax benefit of $0.04. Full-year 2018 EPS was $3.07, compared with $1.77 for full-year 2017. Full-year 2017 earnings per share included a negative ($0.41) impact from the new tax reform act for the remeasurement of our net deferred tax assets and a provisional repatriation toll charge, as well as a discrete tax benefit of $0.41 relating to stock compensation. Full-year 2018 earnings per share included a $0.23 discrete tax benefit relating to stock compensation. |
• | We received a final positive ruling from the U.S. International Trade Commission regarding our patent infringement suit, further solidifying the strength of our patent portfolio. |
• | We launched a Braava national television program in Japan, which helped drive Q4 2018 Braava family revenue growth of 25% year-over-year in Japan. |
• | We recently announced the 2019 launch of our robotic lawnmower, Terra, which we think will reinvent the way people cut their lawns. |
Fiscal Year 2019 | |
Revenue | $1,280 - $1,310 |
Operating Income | $108 - $118 |
Tax Rate (before discrete items) | 19 - 21% |
Earnings Per Share (before discrete items) | $3.00 - $3.25 |
Updated Financial Targets - 2020 including tariff impact | |
Revenue Growth | Mid-high teen; 3-year CAGR of approximately 19% |
Gross Margin | Approximately 48% |
Operating Margin | Increasing to 10% |
Date: | Thursday, February 7 |
Time: | 8:30 a.m. ET |
Call-In Number: | 213-358-0894 |
Passcode: | 6399788 |
iRobot Corporation | |||||||||||||||
Consolidated Statements of Income | |||||||||||||||
(in thousands, except per share amounts) | |||||||||||||||
(unaudited) | |||||||||||||||
For the three months ended | For the twelve months ended | ||||||||||||||
December 29, 2018 | December 30, 2017 | December 29, 2018 | December 30, 2017 | ||||||||||||
Revenue | $ | 384,665 | $ | 326,897 | $ | 1,092,584 | $ | 883,911 | |||||||
Cost of revenue: | |||||||||||||||
Cost of product revenue | 193,645 | 166,046 | 518,612 | 438,114 | |||||||||||
Amortization of acquired intangible assets | 4,509 | 7,309 | 18,544 | 12,638 | |||||||||||
Total cost of revenue | 198,154 | 173,355 | 537,156 | 450,752 | |||||||||||
Gross profit | 186,511 | 153,542 | 555,428 | 433,159 | |||||||||||
Operating expenses: | |||||||||||||||
Research and development | 37,451 | 32,631 | 140,629 | 113,149 | |||||||||||
Selling and marketing | 94,142 | 70,766 | 210,411 | 162,110 | |||||||||||
General and administrative | 24,871 | 26,806 | 97,501 | 84,771 | |||||||||||
Amortization of acquired intangible assets | 260 | 267 | 1,065 | 439 | |||||||||||
Total operating expenses | 156,724 | 130,470 | 449,606 | 360,469 | |||||||||||
Operating income | 29,787 | 23,072 | 105,822 | 72,690 | |||||||||||
Other income (expense), net | 437 | (614 | ) | 2,800 | 3,676 | ||||||||||
Income before income taxes | 30,224 | 22,458 | 108,622 | 76,366 | |||||||||||
Income tax expense | 5,033 | 17,838 | 20,630 | 25,402 | |||||||||||
Net income | $ | 25,191 | $ | 4,620 | $ | 87,992 | $ | 50,964 | |||||||
Net income per share: | |||||||||||||||
Basic | $ | 0.91 | $ | 0.17 | $ | 3.18 | $ | 1.85 | |||||||
Diluted | $ | 0.88 | $ | 0.16 | $ | 3.07 | $ | 1.77 | |||||||
Number of shares used in per share calculations: | |||||||||||||||
Basic | 27,714 | 27,885 | 27,692 | 27,611 | |||||||||||
Diluted | 28,579 | 28,792 | 28,640 | 28,753 | |||||||||||
Stock-based compensation included in above figures: | |||||||||||||||
Cost of revenue | $ | 372 | $ | 331 | $ | 1,407 | $ | 1,082 | |||||||
Research and development | 2,101 | 1,501 | 7,494 | 5,009 | |||||||||||
Selling and marketing | 810 | 702 | 2,842 | 2,571 | |||||||||||
General and administrative | 3,552 | 3,148 | 14,061 | 11,089 | |||||||||||
Total | $ | 6,835 | $ | 5,682 | $ | 25,804 | $ | 19,751 | |||||||
iRobot Corporation | |||||||
Condensed Consolidated Balance Sheets | |||||||
(unaudited, in thousands) | |||||||
December 29, 2018 | December 30, 2017 | ||||||
Assets | |||||||
Cash and cash equivalents | $ | 130,373 | $ | 128,635 | |||
Short term investments | 31,605 | 37,225 | |||||
Accounts receivable, net | 162,166 | 142,829 | |||||
Inventory | 164,633 | 106,932 | |||||
Other current assets | 25,660 | 19,105 | |||||
Total current assets | 514,437 | 434,726 | |||||
Property and equipment, net | 57,026 | 44,579 | |||||
Deferred tax assets | 36,979 | 31,531 | |||||
Goodwill | 118,896 | 121,440 | |||||
Intangible assets, net | 24,273 | 44,712 | |||||
Other assets | 15,350 | 14,534 | |||||
Total assets | $ | 766,961 | $ | 691,522 | |||
Liabilities and stockholders' equity | |||||||
Accounts payable | $ | 136,742 | $ | 116,316 | |||
Accrued expenses | 71,259 | 73,647 | |||||
Deferred revenue and customer advances | 5,756 | 7,761 | |||||
Total current liabilities | 213,757 | 197,724 | |||||
Deferred tax liabilities | 4,005 | 9,539 | |||||
Other long-term liabilities | 13,877 | 13,932 | |||||
Total long-term liabilities | 17,882 | 23,471 | |||||
Total liabilities | 231,639 | 221,195 | |||||
Stockholders' equity | 535,322 | 470,327 | |||||
Total liabilities and stockholders' equity | $ | 766,961 | $ | 691,522 | |||
iRobot Corporation | |||||||
Consolidated Statements of Cash Flows | |||||||
(unaudited, in thousands) | |||||||
For the twelve months ended | |||||||
December 29, 2018 | December 30, 2017 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 87,992 | $ | 50,964 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 36,574 | 25,499 | |||||
Gain on business acquisition | — | (2,243 | ) | ||||
Stock-based compensation | 25,804 | 19,751 | |||||
Deferred income taxes, net | (10,848 | ) | (999 | ) | |||
Deferred rent | 1,374 | — | |||||
Other | 463 | 864 | |||||
Changes in operating assets and liabilities — (use) source | |||||||
Accounts receivable | (23,920 | ) | (53,251 | ) | |||
Inventory | (58,546 | ) | (1,470 | ) | |||
Other assets | (8,533 | ) | (10,562 | ) | |||
Accounts payable | 22,470 | 17,457 | |||||
Accrued expenses | (3,618 | ) | 23,447 | ||||
Deferred revenue and customer advances | 2,392 | 2,149 | |||||
Long-term liabilities | 81 | 4,709 | |||||
Net cash provided by operating activities | 71,685 | 76,315 | |||||
Cash flows from investing activities: | |||||||
Additions of property and equipment | (32,422 | ) | (23,371 | ) | |||
Change in other assets | (2,363 | ) | (1,542 | ) | |||
Proceeds from sale of equity investment | 856 | 1,267 | |||||
Cash paid for business acquisitions, net of cash acquired | — | (148,765 | ) | ||||
Purchases of investments | (6,438 | ) | (10,578 | ) | |||
Sales and maturities of investments | 14,000 | 13,066 | |||||
Net cash used in investing activities | (26,367 | ) | (169,923 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from employee stock plans | 10,366 | 10,573 | |||||
Income tax withholding payment associated with restricted stock vesting | (3,532 | ) | (2,983 | ) | |||
Stock repurchases | (50,000 | ) | — | ||||
Net cash (used in) provided by financing activities | (43,166 | ) | 7,590 | ||||
Effect of exchange rate changes on cash and cash equivalents | (414 | ) | 130 | ||||
Net increase (decrease) in cash and cash equivalents | 1,738 | (85,888 | ) | ||||
Cash and cash equivalents, at beginning of period | 128,635 | 214,523 | |||||
Cash and cash equivalents, at end of period | $ | 130,373 | $ | 128,635 | |||
iRobot Corporation | |||||||||||||||
Supplemental Information | |||||||||||||||
(unaudited) | |||||||||||||||
For the three months ended | For the twelve months ended | ||||||||||||||
December 29, 2018 | December 30, 2017 | December 29, 2018 | December 30, 2017 | ||||||||||||
Revenue: * | |||||||||||||||
Consumer | $ | 384,665 | $ | 326,897 | $ | 1,092,584 | $ | 883,655 | |||||||
Domestic | $ | 215,368 | $ | 182,509 | $ | 560,995 | $ | 452,307 | |||||||
International | $ | 169,297 | $ | 144,388 | $ | 531,589 | $ | 431,348 | |||||||
Gross margin | 48.5 | % | 47.0 | % | 50.8 | % | 49.0 | % | |||||||
Consumer units shipped* | 1,682 | 1,340 | 4,537 | 3,698 | |||||||||||
Vacuum | 1,520 | 1,199 | 3,993 | 3,193 | |||||||||||
Mopping | 162 | 141 | 544 | 503 | |||||||||||
Consumer revenue** | $ | 385 | $ | 327 | $ | 1,093 | $ | 884 | |||||||
Vacuum*** | $ | 361 | $ | 305 | $ | 1,008 | $ | 807 | |||||||
Mopping*** | $ | 24 | $ | 24 | $ | 85 | $ | 78 | |||||||
Average gross selling prices for robot units - Consumer | $ | 304 | $ | 305 | $ | 294 | $ | 276 | |||||||
Days sales outstanding | 38 | 40 | 38 | 40 | |||||||||||
Days in inventory | 76 | 56 | 76 | 56 | |||||||||||
Headcount | 1,032 | 920 | 1,032 | 920 | |||||||||||
* in thousands | |||||||||||||||
** in millions | |||||||||||||||
*** includes accessory revenue | |||||||||||||||
iRobot Corporation | |||||||||||||||
Supplemental Reconciliation of GAAP Net Income to Adjusted EBITDA | |||||||||||||||
(unaudited, in thousands) | |||||||||||||||
For the three months ended | For the twelve months ended | ||||||||||||||
December 29, 2018 | December 30, 2017 | December 29, 2018 | December 30, 2017 | ||||||||||||
GAAP Net Income | $ | 25,191 | $ | 4,620 | $ | 87,992 | $ | 50,964 | |||||||
Interest income, net | (248 | ) | (226 | ) | (944 | ) | (1,649 | ) | |||||||
Income tax expense | 5,033 | 17,838 | 20,630 | 25,402 | |||||||||||
Depreciation | 4,805 | 3,396 | 16,965 | 12,284 | |||||||||||
Amortization of acquired intangible assets | 4,769 | 7,610 | 19,609 | 13,215 | |||||||||||
EBITDA | 39,550 | 33,238 | 144,252 | 100,216 | |||||||||||
Stock-based compensation | 6,835 | 5,682 | 25,804 | 19,751 | |||||||||||
Net merger, acquisition and divestiture expense | 115 | 657 | 138 | 3,109 | |||||||||||
Gain on business acquisition | — | — | — | (2,243 | ) | ||||||||||
IP litigation expense, net | 39 | 3,158 | 3,556 | 5,068 | |||||||||||
Adjusted EBITDA | $ | 46,539 | $ | 42,735 | $ | 173,750 | $ | 125,901 | |||||||
Adjusted EBITDA as a % of revenue | 12.1 | % | 13.1 | % | 15.9 | % | 14.2 | % |
iRobot Corporation | |||
Supplemental Reconciliation of GAAP Actuals to Non-GAAP Actuals | |||
(in thousands, except per share amounts) | |||
(unaudited) | |||
For the twelve months ended | |||
December 29, 2018 | |||
GAAP Revenue | $ | 1,092,584 | |
GAAP Gross Profit | 555,428 | ||
Amortization of acquired intangible assets | 18,544 | ||
Stock-based compensation | 1,407 | ||
Non-GAAP Gross Profit | $ | 575,379 | |
GAAP Income before Income Taxes | $ | 108,622 | |
Amortization of acquired intangible assets | 19,609 | ||
Stock-based compensation | 25,804 | ||
Net merger, acquisition and divestiture expense | 138 | ||
IP litigation expense, net | 3,556 | ||
(Gain)/loss on strategic investments | (436 | ) | |
Non-GAAP Income before Income Taxes | $ | 157,293 | |
GAAP Income Tax Expense | $ | 20,630 | |
Tax effect of non-GAAP adjustments | 11,854 | ||
Other tax adjustments | 2,109 | ||
Non-GAAP Income Tax Expense | $ | 34,593 | |
GAAP Net Income | $ | 87,992 | |
Amortization of acquired intangible assets | 19,609 | ||
Stock-based compensation | 25,804 | ||
Net merger, acquisition and divestiture expense | 138 | ||
IP litigation expense, net | 3,556 | ||
(Gain)/loss on strategic investments | (436 | ) | |
Income tax effect | (13,963 | ) | |
Non-GAAP Net Income | $ | 122,700 | |
GAAP Net Income Per Diluted Share | $ | 3.07 | |
Amortization of acquired intangible assets | 0.69 | ||
Stock-based compensation | 0.90 | ||
Net merger, acquisition and divestiture expense | — | ||
IP litigation expense, net | 0.13 | ||
(Gain)/loss on strategic investments | (0.02 | ) | |
Income tax effect | (0.49 | ) | |
Non-GAAP Net Income Per Diluted Share | $ | 4.28 |