-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LlTRHu+02JOMezRIhZNIWtIB7fXFdmAaZFQPZbx88gmWLc2W0YyL5hySlsKLczce MEw8keeMftAfnS20ptaJ5Q== 0001157523-07-010272.txt : 20071026 0001157523-07-010272.hdr.sgml : 20071026 20071025180147 ACCESSION NUMBER: 0001157523-07-010272 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20071025 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20071026 DATE AS OF CHANGE: 20071025 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RADIANT SYSTEMS INC CENTRAL INDEX KEY: 0000845818 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373] IRS NUMBER: 112749765 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-22065 FILM NUMBER: 071191758 BUSINESS ADDRESS: STREET 1: 1000 ALDERMAN DR STREET 2: STE A CITY: ALPHARETTA STATE: GA ZIP: 30202 BUSINESS PHONE: 7707723000 MAIL ADDRESS: STREET 1: 1000 ALDERMAN DRIVE STREET 2: STE A CITY: ALPHARETTA STATE: GA ZIP: 30202 8-K 1 a5528532.txt RADIANT SYSTEMS, INC. 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) October 25, 2007 ------------------------------ RADIANT SYSTEMS, INC. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Georgia 0-22065 11-2749765 - --------------------------------- -------------------------- ------------------- (State or other jurisdiction (Commission File Number) (IRS Employer of incorporation) Identification No.) 3925 Brookside Parkway, Alpharetta, Georgia 30022 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (770) 576-6000 ----------------------------- N/A - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02 Results of Operations and Financial Condition. On October 25, 2007, Radiant Systems, Inc. announced its results of operations for the quarter and nine months ended September 30, 2007. A copy of the related press release is being filed as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference in its entirety. The information in this Form 8-K and the Exhibit attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Act of 1934 and shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. Item 9.01 Financial Statements and Exhibits. (d) Exhibits. 99.1 Press Release, dated October 25, 2007, issued by Radiant Systems, Inc. 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 hereunto duly authorized. RADIANT SYSTEMS, INC. By: /s/Mark E. Haidet ----------------------------------- Mark E. Haidet Chief Financial Officer Dated: October 25, 2007 EX-99.1 2 a5528532ex99_1.txt EXHIBIT 99.1 Exhibit 99.1 Radiant Systems, Inc. Reports Third Quarter Results Continued Growth Leads to Record Third Quarter Revenues and Adjusted Earnings of $0.19 Per Diluted Share ATLANTA--(BUSINESS WIRE)--Oct. 25, 2007--Radiant Systems, Inc. (NASDAQ: RADS), a leading provider of innovative technology for the hospitality and retail industries, today announced financial results for the third quarter and nine months ended September 30, 2007. Summary financial results for the third quarter of 2007 are as follows: -- Total revenues for the period were $62.5 million, an increase of 9 percent over revenues of $57.6 million for the same period in 2006. -- Net income for the period was $2.9 million or $0.09 per diluted share, an increase of $0.5 million, or $0.01 per diluted share, compared to the same period in 2006. -- Adjusted net income (non-GAAP) for the period, which excludes amortization of acquisition-related intangible assets and compensation expense related to the issuance of employee stock options, was $6.3 million, or $0.19 per diluted share, an increase of $1.4 million, or $0.04 per diluted share, compared to the same period in 2006. Summary year to date financial results for the nine month period ended September 30, 2007 are as follows: -- Total revenues for the period were $182.9 million, an increase of 13 percent over revenues of $161.5 million for the same period in 2006. -- Net income for the period was $7.3 million, or approximately $0.22 per diluted share, a decrease of $7.5 million, or $0.23 per diluted share, compared to the same period in 2006. -- Adjusted net income (non-GAAP) for the period, which excludes amortization of acquisition-related intangible assets, non-recurring items, the impact of changes in the valuation allowance against deferred tax assets and compensation expense related to the issuance of employee stock options, was $16.7 million, or $0.51 per diluted share, an increase of $4.1 million, or $0.13 per diluted share, compared to the same period in 2006. John Heyman, the Company's chief executive officer said, "We are exceptionally pleased with the quarter, as we achieved the high end of our earnings guidance, even though revenues came in slightly lower than our guidance. In addition to growing adjusted operating income by over 20% in the quarter, we signed an exclusive partnership with Dunkin Brands, secured a number of contract wins which we have not yet announced, strengthened our channel presence in key markets, made substantial progress with key new products and grew our pipeline significantly. These efforts and the continued success of our people and products provide us with an excellent foundation for growth entering the fourth quarter and 2008." Heyman continued, "Our revenues fell slightly short of the guidance due to the growing demand we have seen for our subscription-based offerings which has shifted revenue into future periods, and because of nominal delays we experienced with a new customer program. We have an operating model that allows us to meet the needs of customers who prefer to subscribe to software while continuing to grow our revenues and earnings and expand operating margins. Furthermore, the short-term delay we experienced is now behind us and the subscription contracts will help drive future growth and visibility in our business model." "We are very pleased with the progression of our financial model," said Mark Haidet, the Company's chief financial officer. "We continue to have good visibility into our revenue opportunities and see leverage in our operating model. Our adjusted operating margin has improved 150 basis points for the year and our adjusted operating income has grown by 30%. Our cash from operations for the quarter exceeded $3.3 million with an increase in working capital of $8.1 million. Year to date we have generated free cash flow in excess of $9.4 million." Haidet continued, "Based on our current visibility we are providing revenue guidance in a range of $67.5 million to $69 million and adjusted earnings per share guidance in a range of $.21 to $.22 for the fourth quarter of 2007. As we develop our operating plans for 2008 we are targeting revenue growth of approximately 15% and operating income growth of approximately 25%. We anticipate improving our adjusted operating margin by 100 to 150 basis points again in 2008 to a range of 13.5% to 14%. We are estimating a cash tax rate of approximately 30%." The Company provides adjusted operating margin, adjusted net income and adjusted net income per share in this press release as additional information relating to the Company's operating results. The measures are not in accordance with, or an alternative for GAAP and may be different from adjusted net income and adjusted net income per share measures used by other companies. Adjusted net income and adjusted operating margin has been adjusted to exclude amortization of acquisition-related intangible assets, non-recurring items and compensation expense related to the issuance of employee stock options. The income tax provision is calculated on the Company's cash tax rate for the year (based on of actual cash expected to be paid to domestic and foreign governments). The Company believes that this non-GAAP presentation provides useful information to investors regarding certain additional financial and business trends relating to the Company's financial condition and results of operations, and valuable insight into the Company's ongoing operations and earnings power. Radiant will hold its third quarter 2007 conference call today at approximately 4:30 p.m. Eastern Time. This call is being webcast by CCBN and can be accessed at Radiant's web site at http://phx.corporate-ir.net/phoenix.zhtml?c=115271&p=irol-irhome. The call will also be available via telephone at 1-888-791-1856 - reference ID# 5766832. Radiant Systems, Inc. (www.radiantsystems.com) is a global leader in providing innovative technology to the hospitality and retail industries. Offering unmatched reliability and ease of use, Radiant's point of sale hardware and software solutions are deployed in more than 85,000 restaurants, retail stores, cinemas, convenience stores, fuel centers, and other customer-service venues across more than 100 countries. Radiant serves the needs of its customers through the dedication of more than 1,100 employees, 325 certified sales and service partners, and 1,800 field service representatives around the world. Founded in 1985, the company is headquartered in Atlanta with regional offices throughout the United States as well as in Europe, Asia and Australia. This press release may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to financial results and plans for future business development activities, and are thus prospective. Forward-looking statements include all statements that are not statements of historical fact regarding intent, belief or current expectations of the Company, its directors or its officers. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the Company's ability to control. Actual results may differ materially from those projected in the forward-looking statements. Among the key risks, assumptions and factors that may affect operating results, performance and financial condition are the Company's reliance on a small number of clients for a large portion of its revenues, fluctuations in its quarterly results, its ability to continue and manage its growth, liquidity and other capital resources issues, competition and the other factors discussed in detail in the Company's periodic filings with the Securities and Exchange Commission. The Company undertakes no obligation to update any forward-looking statements. RADIANT SYSTEMS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT SHARE DATA) ASSETS September 30, December 31, 2007 2006 ---------------- --------------- Current assets Cash and cash equivalents $ 19,542 $ 15,720 Accounts receivable, net 40,025 35,203 Inventories, net 26,978 26,484 Deferred tax assets 8,714 9,327 Other current assets 2,056 1,310 ---------------- --------------- Total current assets 97,315 88,044 Property and equipment, net 14,143 14,726 Software development costs, net 6,888 5,019 Deferred tax assets, non-current 4,245 5,252 Goodwill 62,444 61,948 Intangibles, net 20,178 23,447 Other long-term assets 315 219 ---------------- --------------- $ 205,528 $ 198,655 ================ =============== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Short-term debt facility $ - $ 6,489 Current portion of long-term debt and capital lease payments 7,892 7,439 Accounts payable and accrued liabilities 29,727 30,430 Accrued contractual obligations and payables due to Related Party - 3,665 Client deposits and unearned revenues 14,514 10,365 ---------------- --------------- Total current liabilities 52,133 58,388 Client deposits and deferred revenues, net of current portion 47 188 Long-term debt and capital lease payments, net of current portion 15,712 20,895 Other long-term liabilities 4,649 3,213 ---------------- --------------- Total liabilities 72,541 82,684 ---------------- --------------- Shareholders' equity Common stock, no par value; 100,000,000 shares authorized; 31,745,726 and 30,923,800 shares issued and outstanding, respectively - - Additional paid-in capital 146,543 137,151 Accumulated other comprehensive income 1,731 487 Accumulated deficit (15,287) (21,667) ---------------- --------------- Total shareholders' equity 132,987 115,971 ---------------- --------------- $ 205,528 $ 198,655 ================ =============== RADIANT SYSTEMS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE DATA) For the three months ended September 30, 2007 2007 GAAP Adjustments Non-GAAP --------- ----------- --------- Revenues: System sales $ 35,325 $ 35,325 Client support, maintenance and other services 27,218 27,218 --------- --------- Total revenues 62,543 62,543 Cost of revenues: System sales 19,023 (39) (a) 18,984 Client support, maintenance and other services 15,956 (70) (a) 15,886 --------- ----------- --------- Total cost of revenues 34,979 (109) (e) 34,870 --------- ----------- --------- Gross profit 27,564 109 (e) 27,673 Operating Expenses: Product development 5,687 (140) (a) 5,547 Sales and marketing 7,337 (259) (a) 7,078 Depreciation of fixed assets 1,071 1,071 Amortization of intangible assets 1,029 (1,029) (b) - General and administrative 6,337 (444) (a) 5,893 --------- ----------- --------- Total operating expenses 21,461 (1,872) (e) 19,589 Income from operations 6,103 1,981 (e) 8,084 Interest and other expense, net 711 711 --------- ----------- --------- Income from operations before income taxes 5,392 1,981 (e) 7,373 Income tax provision (2,446) 1,340 (d) (1,106) --------- ----------- --------- Net income 2,946 3,321 (e) 6,267 Net income per share: Basic $ 0.09 $ 0.20 ========= ========= Diluted $ 0.09 $ 0.19 ========= ========= Weighted average shares outstanding: Basic 31,494 31,494 ========= ========= Diluted 33,331 33,331 ========= ========= ----------------------------------- For the three months ended September 30, 2006 2006 GAAP Adjustments Non-GAAP --------- ----------- --------- Revenues: System sales $ 34,497 $ 34,497 Client support, maintenance and other services 23,056 23,056 --------- --------- Total revenues 57,553 57,553 Cost of revenues: System sales 18,548 (142) (a) 18,406 Client support, maintenance and other services 14,361 (61) (a) 14,300 --------- ----------- --------- Total cost of revenues 32,909 (203) (e) 32,706 --------- ----------- --------- Gross profit 24,644 203 (e) 24,847 Operating Expenses: Product development 5,418 (123) (a) 5,295 Sales and marketing 6,335 (206) (a) 6,129 Depreciation of fixed assets 979 979 Amortization of intangible assets 2,047 (2,047) (b) - General and administrative 6,102 (279) (a) 5,823 --------- ----------- --------- Total operating expenses 20,881 (2,655) (e) 18,226 Income from operations 3,763 2,858 (e) 6,621 Interest and other expense, net 813 813 --------- ----------- --------- Income from operations before income taxes 2,950 2,858 (e) 5,808 Income tax provision (517) (395) (d) (912) --------- ----------- --------- Net income 2,433 2,463 (e) 4,896 Net income per share: Basic $ 0.08 $ 0.16 ========= ========= Diluted $ 0.08 $ 0.15 ========= ========= Weighted average shares outstanding: Basic 30,740 30,740 ========= ========= Diluted 32,327 32,327 ========= ========= ----------------------------------- For the nine months ended September 30, 2007 2007 GAAP Adjustments Non-GAAP --------- ----------- --------- Revenues: System sales $104,018 $104,018 Client support, maintenance and other services 78,876 78,876 --------- --------- Total revenues 182,894 182,894 Cost of revenues: System sales 54,498 (121) (a) 54,377 Client support, maintenance and other services 47,356 (209) (a) 47,147 --------- ----------- --------- Total cost of revenues 101,854 (330) (e) 101,524 --------- ----------- --------- Gross profit 81,040 330 (e) 81,370 Operating Expenses: Product development 17,164 (399) (a) 16,765 Sales and marketing 21,567 (728) (a) 20,839 Depreciation of fixed assets 3,104 - 3,104 Amortization of intangible assets 3,271 (3,271) (b) - Other non-recurring operating expenses 907 (907) (c) - General and administrative 20,121 (1,281) (a) 18,840 --------- ----------- --------- Total operating expenses 66,134 (6,586) (e) 59,548 Income from operations 14,906 6,916 (e) 21,822 Interest and other expense, net 2,157 2,157 --------- ----------- --------- Income from operations before income taxes 12,749 6,916 (e) 19,665 Income tax provision (5,482) 2,532 (d) (2,950) --------- ----------- --------- Net income 7,267 9,448 (e) 16,715 Net income per share: Basic $ 0.23 $ 0.54 ========= ========= Diluted $ 0.22 $ 0.51 ========= ========= Weighted average shares outstanding: Basic 31,205 31,205 ========= ========= Diluted 32,957 32,957 ========= ========= ----------------------------------- For the nine months ended September 30, 2006 2006 GAAP Adjustments Non-GAAP --------- ----------- --------- Revenues: System sales $ 93,024 $ 93,024 Client support, maintenance and other services 68,443 68,443 --------- --------- Total revenues 161,467 161,467 Cost of revenues: System sales 49,202 (370) (a) 48,832 Client support, maintenance and other services 41,161 (164) (a) 40,997 --------- ----------- --------- Total cost of revenues 90,363 (534) (e) 89,829 --------- ----------- --------- Gross profit 71,104 534 (e) 71,638 Operating Expenses: Product development 16,423 (441) (a) 15,982 Sales and marketing 19,166 (557) (a) 18,609 Depreciation of fixed assets 2,521 2,521 Amortization of intangible assets 6,142 (6,142) (b) - Other non-recurring operating expenses 1,663 (1,663) (c) - General and administrative 18,717 (911) (a) 17,806 --------- ----------- --------- Total operating expenses 64,632 (9,714) (e) 54,918 Income from operations 6,472 10,248 (e) 16,720 Interest and other expense, net 2,052 2,052 --------- ----------- --------- Income from operations before income taxes 4,420 10,248 (e) 14,668 Income tax benefit (provision) 10,343 (12,445) (d) (2,102) --------- ----------- --------- Net income 14,763 (2,197) (e) 12,566 Net income per share: Basic $ 0.48 $ 0.41 ========= ========= Diluted $ 0.45 $ 0.38 ========= ========= Weighted average shares outstanding: Basic 30,857 30,857 ========= ========= Diluted 32,703 32,703 ========= ========= ------------------------- --------- (a) The Company adopted SFAS 123(R) on January 1, 2006 using the Modified Prospective Method, which requires us to expense the fair value of grants made under stock option programs over the vesting period of the options. The 2007 and 2006 adjustments to costs of sales and operating expenses represent stock-based compensation expense recorded during the period. Total stock-based compensation expense for the three months ended September 30, 2007 and 2006 was $1.0 million and $0.8 million, respectively, on a pre-tax basis. Total stock-based compensation expense for the nine months ended September 30, 2007 and 2006 was $2.7 million and $2.4 million, respectively, on a pre-tax basis. (b) Adjustments represent purchase amortization from prior acquisitions. Such amortization is commonly excluded from non-GAAP net income by software companies and we therefore exclude these amortization costs to provide more relevant and meaningful comparisons of our operating results to that of our competitors. (c) Adjustment represents the elimination of non-recurring charges that are commonly excluded from non-GAAP net income. We have eliminated these charges to provide a more relevant and meaningful comparisons of our operating results to that of our competitors. For 2006, these charges consisted of lease write-offs related to the restructuring of Company leases. For 2007, these charges consisted of pre-acquisition costs from potential transactions that will not take place ($1.2 million) and a lease restructuring credit of $0.3 million as a result of adjusting our estimate related to the lease restructuring charge that was taken during 2006. (d) The Company reports its non-GAAP income tax provision on a cash tax rate basis which is estimated to be 15% for 2007 and 13% for 2006. Note that the actual cash tax rate for 2006 was approximately 10% and therefore an adjustment was made during the fourth quarter of 2006 which resulted in a decrease in the tax expense recognized in the three and nine months ended September 30, 2006. (e) The Company provides adjusted financial information as additional information relating to the Company's operations. The measures are not in accordance with, or an alternative for GAAP and may be different from other adjusted financial statements of other companies. The adjusted financial information excludes such items as amortization of acquisition-related intangible assets, items that are not considered part of our normal operations and compensation expense related to the issuance of employee stock options. The income tax provision is calculated based on the Company's cash tax rate for the year and excludes the impact of changes in the valuation allowance against deferred tax assets. CONTACT: Radiant Systems, Inc. Erin Daugherty, 770-576-7863 -----END PRIVACY-ENHANCED MESSAGE-----