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) April 26, 2006

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)	(IRS 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

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 April 26, 2006, Radiant Systems, Inc. announced its results of operations for the quarter ended March 31, 2006. 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 April 26, 2006, 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: July 26, 2006

EX-99.1

Exhibit 99.1

Radiant Systems, Inc. Reports First Quarter Results; Continued Growth Results in Adjusted Earnings of $0.10 Per Diluted Share in the First Quarter

ATLANTA—(BUSINESS WIRE)—April 26, 2006—Radiant Systems, Inc. (NASDAQ: RADS), a leading provider of innovative technology for the hospitality and retail industries, today announced financial results for the first quarter ended March 31, 2006.

Summary financial results for the first quarter of 2006 are as follows:

• Total revenues for the period were $49.0 million, an increase of 31.3 percent over revenues of $37.3 million for the same period in 2005.

• Net income for the period, including the impact of employee stock option expense, was $683,000, or approximately $0.02 per diluted share, a decrease of $489,000, or $0.02 per diluted share, compared to the same period in 2005.

• Adjusted net income (non-GAAP) for the period, which excludes amortization of acquisition related intangible assets, non-recurring charges and compensation expense related to the issuance of employee stock options, was $3.4 million, or $0.10 per diluted share, an increase of $0.9 million, or $0.02 per diluted share, compared to the same period in 2005.

John Heyman, the Company’s chief executive officer said, “We are very pleased with the reception our offerings are seeing in the marketplace, as indicated by another record revenue quarter. New product introductions, increased sales activity and complementary acquisitions have been key drivers of our growth.”

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. Additionally, we have enhanced our capabilities through the addition of the MenuLink and Synchronics organizations. These factors should result in increased revenues and earnings throughout the year.”

“In addition to our continued revenue growth, we are pleased to see improvement in our gross profit margin,” said Mark Haidet, the Company’s chief financial officer. “This improvement was primarily in our service margin through improved utilization of resources and increased revenues.”

Haidet continued, “Based on our results in the quarter as well as our strong pipeline and visibility into the business, we are updating our guidance for 2006.”

The Company’s updated guidance is as follows:

	Revenue Range (millions)	Adjusted Earnings (non-GAAP) / Share Range
Quarter ending June 30, 2006	$ 51 - $ 53	$.10 - $.12
Year ending Dec. 31, 2006 - previous	$205 - $218	$.47 - $.55
Year ending Dec. 31, 2006 - updated	$210 - $218	$.48 - $.55

Commencing in the first quarter of 2006, the Company implemented the Statement of Financial Accounting Standard No. 123R (“FASB 123R”). The statement requires companies to expense the fair value of grants made under stock option programs over the vesting period of the options. The expense is a non-cash transaction. The Company adopted the “Modified Prospective Application” transition method that does not result in the restatement of previously issued financial statements. In its press releases, the Company will report its net income and earnings per share during fiscal year 2006 on both Generally Accepted Accounting Principles (“GAAP”) (which includes the share-based payment charge, which represents the non-cash stock option expense) and non-GAAP (which excludes the share-based payment charge) bases in order to facilitate analysis of the business and meaningful period-to-period comparison.

On October 6, 2005 the Company completed its acquisition of MenuLink Computer Solutions, Inc. (“MenuLink”). All MenuLink operations are included in the Company’s 2005 financial statements as of the date of the acquisition. On January 3, 2006, the Company completed the acquisition of substantially all of the assets of Synchronics, Inc. (“Synchronics”). All Synchronics operations are included in the Company’s 2006 financial statements as of the date of the acquisition.

The Company provides 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, generally accepted accounting principles (“GAAP”) and may be different from adjusted net income measures used by other companies. Net income has been adjusted to exclude amortization of acquisition related intangible assets, non-recurring charges and compensation expense related to the issuance of employee stock options 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 first quarter 2006 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 1-888-587-0679.

Founded in 1985, Radiant Systems, Inc. provides innovative store technology for the hospitality and retail 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)

	March 31,			December 31,
	2006			2005
ASSETS
Current assets
Cash and cash equivalents	$	13,862		$	17,641
Accounts receivable, net		32,600			27,559
Inventories		20,115			18,093
Other short-term assets		2,571			2,287
Total current assets		69,148			65,580
Property and equipment, net		11,171			9,607
Software development costs, net		2,543			2,249
Goodwill		61,302			44,239
Intangibles, net		29,590			20,537
Other long-term assets		298			293
	$	174,052		$	142,505
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued liabilities	$	24,972		$	23,992
Accrued contractual obligations and payables due to Related Party		2,348			1,947
Customer deposits and unearned revenue		17,354			12,490
Current portion of long-term debt		7,246			4,329
Total current liabilities		51,920			42,758
Client deposits and deferred revenues, net of current portion		329			376
Long-term debt, less current portion		25,909			14,133
Other long-term liabilities		756			805
Total liabilities		78,914			58,072
Shareholders’ equity
Common stock, no par value; 100,000,000 shares authorized; 31,071,470 and 30,094,973 shares issued and outstanding, respectively		—			—
Additional paid-in capital		134,909			124,744
Accumulated other comprehensive loss		(430	)		(287	)
Accumulated deficit		(39,341	)		(40,024	)
Total shareholders’ equity		95,138			84,433
	$	174,052		$	142,505

RADIANT SYSTEMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(IN THOUSANDS, EXCEPT PER SHARE DATA)

	For the three months
	ended March 31,
	2006 GAAP		Adjustments		2006 Non-GAAP
Revenues:
System sales	$	26,439			$	26,439
Client support, maintenance and other services		22,598				22,598
Total revenues		49,037				49,037
Cost of revenues:
System sales		14,052	(94	)(a)		13,958
Client support, maintenance and other services		12,766	(52	)(a)		12,714
Total cost of revenues		26,818	(146	)		26,672
Gross profit		22,219				22,365
Operating Expenses:
Product development		5,627	(166	)(a)		5,461
Sales and marketing		6,230	(155	)(a)		6,075
Depreciation of fixed assets		741				741
Amortization of intangible assets		2,047	(2,047	)(b)		—
General and administrative		5,995	(308	)(a)		5,687
Total operating expenses		20,640	(2,676	)		17,964
Income from operations		1,579	2,822			4,401
Interest and other expense, net		617				617
Income from operations before income taxes		962				3,784
Income tax provision		279	143	(c)		422
Net income		683				3,362
Net income per share
Basic	$	0.02			$	0.11
Diluted	$	0.02			$	0.10
Weighted average shares outstanding:
Basic		30,838				30,838
Diluted		32,973				32,973

	For the three months ended March 31,
	2005 GAAP		Adjustments		2005 Non-GAAP
Revenues:
System sales	$	20,402			$	20,402
Client support, maintenance and other services		16,937				16,937
Total revenues		37,339				37,339
Cost of revenues:
System sales		10,629				10,629
Client support, maintenance and other services		11,260				11,260
Total cost of revenues		21,889	—			21,889
Gross profit		15,450				15,450
Operating Expenses:
Product development		2,973				2,973
Sales and marketing		4,211				4,211
Depreciation of fixed assets		811				811
Amortization of intangible assets		1,283	(1,283	)(b)		—
General and administrative		4,560				4,560
Total operating expenses		13,838	(1,283	)		12,555
Income from operations		1,612	1,283			2,895
Interest and other expense, net		257				257
Income from operations before income taxes		1,355				2,638
Income tax provision		183				183
Net income		1,172				2,455
Net income per share
Basic	$	0.04			$	0.08
Diluted	$	0.04			$	0.08
Weighted average shares outstanding:
Basic		29,247				29,247
Diluted		30,302				30,302

(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. Previously we did not record compensation expense for employee stock options. The 2006 adjustments to costs of sales and operating expenses represent stock- based compensation expense recorded during the period. Total stock-based compensation expense during the quarter was $775,000 on a pre-tax and post-tax basis.

(b) Adjustment represents the exclusion of amortization of intangible assets from non- GAAP results.

(c) Tax effect of the non-GAAP adjustments described.

CONTACT:	Radiant Systems, Inc.
	Sara Ford, 770-576-6832
SOURCE:	Radiant Systems, Inc.