8-K

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 27, 2005

RADIANT SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

Georgia	0-22065	11-2749765
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer 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

(Former name or former address, if changed since last report.)

¨ 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 27, 2005, Radiant Systems, Inc. issued a press release announcing third quarter and nine months financial results. The press release is attached as Exhibit 99.1 to this Form 8-K. 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, Pro Forma Financial Information and Exhibits

The following exhibit is being furnished with this report pursuant to Item 2.02 of this Form 8-K:

Exhibit No.	Description
99.1	Press Release Regarding Financial Results for the Quarter and Nine Months Ended September 30, 2005

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 28, 2005

EXHIBIT INDEX

Exhibit Number	Exhibit Name
99.1	Press Release dated October 27, 2005

EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

For More Information,

Please Contact

Melissa Coley (770) 576-6577

Sara Howell (770) 576-6832

Radiant Systems, Inc. Reports Record Third Quarter Revenue

Continued growth results in adjusted earnings of $0.11 per diluted share in the third quarter and positive 2006 outlook

ATLANTA—(BUSINESS WIRE)—Oct. 27, 2005—Radiant Systems, Inc. (NASDAQ: RADS - News), a leading provider of innovative technology for the hospitality, petroleum and convenience retail and entertainment industries, today announced financial results for the third quarter ended Sept. 30, 2005.

Summary financial results for the third quarter of 2005 are as follows:

• Total revenues for the period were $46.8 million, an increase of 28.9 percent over revenues of $36.3 million for the same period in 2004.

• Net income for the period was $0.7 million, or approximately $0.02 per diluted share, a slight decrease of $0.1 million, or $0.01 per diluted share, compared to the same period in 2004.

• Adjusted net income (non-GAAP) from continuing operations for the period, which excludes amortization of acquisition related intangible assets and non-recurring charges, was $3.4 million, or $0.11 per diluted share, an increase of $1.3 million, or $0.04 per diluted share, compared to the same period in 2004.

• During the quarter the Company booked a $1.5 million write-off, approximately $0.05 per diluted share, associated with the consolidation and subleasing of excess office space. The Company expects the sublease to have a positive cash impact of approximately $1.2 to $2.0 million over the next 5 years.

Summary year to date financial results for the nine months ended Sept. 30, 2005 are as follows:

• Total revenues were $123.7 million, an increase of 29.5 percent over revenues of $95.5 million for the same period in 2004.

• Net income from continuing operations was $3.1 million, or approximately $0.10 per diluted share, an improvement of $3.3 million, or $0.11 per diluted share, compared to the same period in 2004.

• Net income was $3.1 million, or approximately $0.10 per diluted share, an increase of $0.6 million, or $0.01 per diluted share, compared to the same period in 2004.

• Adjusted net income (non-GAAP) from continuing operations for the period, which excludes amortization of acquisition related intangible assets and non-recurring charges, was $8.8 million or $0.28 per diluted share, an increase of $5.4 million, or $0.16 per diluted share, compared to the same period in 2004.

John Heyman, the Company’s chief executive officer said, “We are very pleased with our performance in the quarter. Our hospitality division continues to show strong growth and will be bolstered by the addition of the MenuLink organization and products, which greatly enhance the value we can provide to restaurant operators. Additionally we saw a significant increase in spending from major oil companies during the quarter, driven by our traditional point of sale offerings and our new Outdoor Payment Terminal product line.”

Heyman added, “We continue to see strong demand across our segments. Our pipeline is strong, our customer base is diverse and our products are delivering strong returns for our customers.”

“In addition to our strong revenue growth, we are pleased to see improvement in the gross margin of many of our products and services,” said Mark Haidet, the Company’s chief financial officer. “Our service margins continued to improve, as did the margins on our traditional point of sale products. The successful launch of our Outside Payment Terminal product line met with accelerated demand from major oil companies. This generated a temporary but significant change in sales mix during the quarter that resulted in a short term impact on our overall systems margin. Given the improvement in margins for services and traditional systems, combined with the normalization of revenues derived from Outside Payment Terminals, we expect overall margins to improve starting in the fourth quarter.”

Haidet continued, “Based on our strong pipeline and visibility into the business we are again increasing our guidance for the year for both revenue and earnings. In addition, we expect to see this success carry over into 2006 with revenue growth in the range of 15 to 20 percent and adjusted operating income growth at 30 to 60 percent.”

The Company’s updated guidance is as follows:

	Revenue Range (millions)	Adjusted Earnings / Share Range
Quarter ending Dec. 31, 2005	$43-$46	$.10 - $.12
Year ending Dec. 31, 2005 – previous	$158 - $161	$.38 - $.40
Year ending Dec. 31, 2005 – updated	$167 - $170	$.39 - $.41
Year ending Dec. 31, 2006	$195 - $205	$.46 - $.54

On Jan. 31, 2004 the Company completed the disposition of its Enterprise Software Systems segment. The historical financial statements have been reported with the Enterprise Software Systems segment included in discontinued operations. Additionally, on Jan. 12, 2004 the Company completed its acquisition of Aloha Technologies (“Aloha”). All Aloha operations are included in the Company’s 2004 financial statements as of the date of the acquisition.

The Company provides adjusted net income/(loss) and adjusted net income/(loss) 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, generally accepted accounting practices (“GAAP”) and may be different from adjusted net income measures used by other companies. Net income/(loss) has been adjusted to exclude amortization of acquisition related intangible assets and non-recurring charges and includes the ongoing cash benefit of the utilization of net operating losses. 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 2005 conference call today at approximately 5 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 1-888-334-9269 - reference ID# T586456R.

Founded in 1985, Radiant Systems, Inc. provides innovative store technology for the hospitality, petroleum and convenience retail and entertainment industries. Radiant’s point-of-sale, self-service kiosk and back-office technology enables operators to drive top-line growth and improve bottom-line performance. Headquartered in Atlanta, Radiant (www.radiantsystems.com) has deployed its solutions in more than 50,000 sites worldwide.

Certain statements contained in this press release are “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. These statements appear in a number of places in this release and include all statements that are not statements of historical fact regarding intent, belief or current expectations of the Company, its directors or its officers with respect to, among other things: (i) the Company’s financing plans; (ii) trends affecting the Company’s financial condition or results of operations, including the Company’s projected revenues and earnings per share guidance; (iii) the Company’s growth strategy and operating strategy; (iv) the Company’s new or future product offerings, and (v) the declaration and payment of dividends. The words “may,” “would,” “could,” “will,” “expect,” “estimate,” “anticipate,” “believe,” “intend,” “plans,” and similar expressions and variations thereof are intended to identify forward-looking statements. 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 as a result of various factors. 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 filings with the Securities and Exchange Commission.

- ### –

RADIANT SYSTEMS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT SHARE DATA)

	September 30, 2005			December 31, 2004
ASSETS
Current assets
Cash and cash equivalents	$	18,914		15,067
Accounts receivable, net		27,921		25,997
Inventories		18,997		18,647
Other short-term assets		2,618		2,122
Total current assets		68,450		61,833
Property and equipment, net		9,517		8,590
Software development costs, net		2,289		2,344
Goodwill		34,827		34,927
Intangibles, net		18,180		22,029
Other long-term assets		325		31
	$	133,588		129,754
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued liabilities	$	23,220		24,123
Accrued contractual obligations and payables due to Related Party		1,875		2,982
Customer deposits and unearned revenue		12,575		9,881
Current portion of long-term debt		3,043		5,661
Total current liabilities		40,713		42,647
Client deposits and deferred revenues, net of current portion		423		564
Long-term debt, less current portion		12,801		12,892
Other long-term liabilities		1,388		344
Total liabilities		55,325		56,447
Shareholders’ equity
Common stock, no par value; 100,000,000 shares authorized; 29,634,342 and 29,321,360 shares issued and outstanding		—		—
Additional paid-in capital		120,727		118,649
Accumulated other comprehensive income (expense)		(10	)	244
Accumulated deficit		(42,454	)	(45,586	)
Total shareholders’ equity		78,263		73,307
	$	133,588		129,754

RADIANT SYSTEMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(IN THOUSANDS, EXCEPT PER SHARE DATA)

(Unaudited)

	For the three months ended						For the nine months ended
	September 30, 2005			September 30, 2004			September 30, 2005			September 30, 2004
Revenues:
System sales	$	27,470		$	20,349		$	69,623		$	48,241
Client support, maintenance and other services		19,366			15,989			54,077			47,262
Total revenues		46,836			36,338			123,700			95,503
Cost of revenues:
System sales		16,443			10,334			38,215			23,491
Client support, maintenance and other services		12,686			10,761			35,671			29,234
Total cost of revenues		29,129			21,095			73,886			52,725
Gross profit		17,707			15,243			49,814			42,778
Operating Expenses:
Product development		3,686			3,135			9,995			9,800
Sales and marketing		4,940			4,889			13,654			13,941
Depreciation of fixed assets		794			967			2,420			2,826
Amortization of intangible assets		1,283			1,281			3,850			3,607
Impairment write-off of HotelTools software		—			—			550			—
Lease restructuring charges		1,450			—			1,450			—
General and administrative		4,405			3,879			13,453			11,961
Total operating expenses		16,558			14,151			45,372			42,135
Income from operations		1,149			1,092			4,442			643
Interest and other (expense) income, net		(268	)		(256	)		(735	)		(690	)
Income (loss) from continuing operations before income taxes		881			836			3,707			(47	)
Income tax provision		150			32			575			129
Income (loss) from continuing operations		731			804			3,132			(176	)
Discontinued operations
Loss from operations of Enterprise business, net		—			—			—			(913	)
Gain on disposal of Enterprise business, net		—			—			—			3,626
Income from discontinued operations		—			—			—			2,713
Net income	$	731		$	804		$	3,132		$	2,537
Income (loss) per share from continuing operations
Basic	$	0.02		$	0.03		$	0.11		$	(0.01	)
Diluted	$	0.02		$	0.03		$	0.10		$	(0.01	)
Net income per share
Basic	$	0.02		$	0.03		$	0.11		$	0.09
Diluted	$	0.02		$	0.03		$	0.10		$	0.09
Weighted average shares outstanding:
Basic		29,596			28,705			29,360			28,796
Diluted		31,999			29,404			31,333			28,796
Reconciliation of Adjusted Net Income:
Net income (loss)	$	731		$	804		$	3,132		$	2,537
Operations of discontinued business		—			—			—			913
Gain on disposal of discontinued business		—			—			—			(3,626	)
Impairment write-off of HotelTools software, net of tax effect		—			—			523			—
Lease restructuring charge, net of tax effect		1,416			—			1,416			—
Amortization of purchased intangibles, net of tax effect		1,252			1,281			3,754			3,607
Adjusted net income	$	3,399		$	2,085		$	8,825		$	3,431
Adjusted net income per diluted share		0.11		$	0.07		$	0.28		$	0.12