HOD HASHARON, Israel,
May 8, 2018 /PRNewswire/
-- Allot Communications Ltd. (NASDAQ: ALLT) (TASE: ALLT), a
global provider of leading innovative network intelligence and
security solutions for service providers worldwide, today announced
its first quarter 2018 financial results.
Q1 2018 – Financial Highlights
- Revenues were $21.7 million, up
18% year-over-year;
- GAAP gross margin was 68%; Non-GAAP gross margin was 70%;
- GAAP operating loss of $3.5
million; non-GAAP operating loss of $2.3 million;
- Book-to-bill above one for the fifth consecutive quarter;
Financial Outlook:
- Management maintains its previously issued guidelines for
2018.
- Management continues to expect 2018 revenues to grow to between
$91 - 95 million with the second half
of the year stronger than the first half, reflecting typical
seasonality;
- 2018 Book to Bill is expected at above 1;
Management Comment
Erez Antebi, President &
CEO of Allot, commented:
"The results in the first quarter of 2018 show we are on track
in successfully executing the turnaround process we began last year
and the transition to a security company.
"We see a growing number of communication service providers
worldwide realize that offering secure broadband at a premium price
creates a substantial revenue potential as well as providing an
important service to their customers.
"Allot's position as a leading technology provider for such
security services puts us in a unique position to take advantage of
this market opportunity. We strongly believe that with over
20 million subscribers protected by AllotSecure technology
worldwide, this is just the beginning."
Q1 2018 Financial Results Summary
Total revenues for the first quarter of 2018 were
$21.7 million, up 18% compared to
$18.4 million in the first quarter of
2017.
Gross profit on a GAAP basis for the first quarter of
2018 was $14.8 million (gross margin
of 68.1%), a 22% improvement compared with $12.1 million (gross margin of 65.7%) in the
first quarter of 2017.
Gross profit on a non-GAAP basis for the first quarter of
2018 was $15.1 million (gross margin
of 69.6%), a 21% improvement compared with $12.5 million (gross margin of 67.5%) in the
first quarter of 2017.
Net loss on a GAAP basis for the first quarter of 2018
was $3.7 million, or $0.11 per basic share, compared with a net loss
of $5.1 million, or $0.15 per basic share, in the first quarter of
2017.
Non-GAAP net loss for the first quarter of 2018 was
$2.4 million, or $0.07 per basic share, compared with a non-GAAP
net loss of $3.6 million, or
$0.11 per basic share, in the first
quarter of 2017.
Cash and investments as of March
31, 2018 totaled $104.7
million. The Company recorded negative operating cash flow
of $1.1 million during the first
quarter of 2018.
Conference Call & Webcast:
The Allot management team will host a conference call to discuss
first quarter 2018 earnings results today, May 8, 2018 at 8:30 am
ET, 3:30 pm Israel time. To access the conference call,
please dial one of the following numbers:
US: +1-888-668-9141, UK: +44(0) 800-917-5108, Israel: +972-3-918-0609.
A live webcast and, following the end of the call, an archive of
the conference call, will be accessible on the Allot Communications
website at: http://investors.allot.com/index.cfm
About Allot Communications
Allot Communications Ltd. (NASDAQ, TASE: ALLT) is a provider of
leading innovative network intelligence and security solutions for
service providers worldwide, enhancing value to their customers.
Our solutions are deployed globally for network and application
analytics, traffic control and shaping, network-based security
services, and more. Allot's multi-service platforms are deployed by
over 500 mobile, fixed and cloud service providers and over 1000
enterprises. Our industry leading network-based security as a
service solution has achieved over 50% penetration with some
service providers and is already used by over 20 million
subscribers in Europe. Allot. See.
Control. Secure. For more information, visit www.allot.com
GAAP to Non-GAAP Reconciliation:
The difference between GAAP and non-GAAP revenues is related to
the acquisitions made by the Company and represents revenues
adjusted for the impact of the fair value adjustment to acquired
deferred revenue related to purchase accounting. Non-GAAP net
income is defined as GAAP net income after including deferred
revenues related to the fair value adjustment resulting from
purchase accounting and excluding stock-based compensation
expenses, amortization of acquisition-related intangible assets,
deferred tax asset adjustment, restructuring expenses, changes in
taxes related items and other acquisition-related expenses.
These non-GAAP measures should be considered in addition to, and
not as a substitute for, comparable GAAP measures. The non-GAAP
results and a full reconciliation between GAAP and non-GAAP results
are provided in the accompanying Table 2. The Company provides
these non-GAAP financial measures because it believes they present
a better measure of the Company's core business and management uses
the non-GAAP measures internally to evaluate the Company's ongoing
performance. Accordingly, the Company believes they are useful to
investors in enhancing an understanding of the Company's operating
performance.
Safe Harbor Statement
This release contains forward-looking statements, which express
the current beliefs and expectations of Company management. Such
statements involve a number of known and unknown risks and
uncertainties that could cause our future results, performance or
achievements to differ significantly from the results, performance
or achievements set forth in such forward-looking statements.
Important factors that could cause or contribute to such
differences include risks relating to: our ability to compete
successfully with other companies offering competing technologies;
the loss of one or more significant customers; consolidation of,
and strategic alliances by, our competitors, government regulation;
the timing of completion of key project milestones which impact the
timing of our revenue recognition; lower demand for key value-added
services; our ability to keep pace with advances in technology and
to add new features and value-added services; managing lengthy
sales cycles; operational risks associated with large projects; our
dependence on third party channel partners for a material portion
of our revenues; court approval of the Company's proposed share
buy-back program; and other factors discussed under the heading
"Risk Factors" in the Company's annual report on Form 20-F filed
with the Securities and Exchange Commission. Forward-looking
statements in this release are made pursuant to the safe harbor
provisions contained in the Private Securities Litigation Reform
Act of 1995. These forward-looking statements are made only as of
the date hereof, and the company undertakes no obligation to update
or revise the forward-looking statements, whether as a result of
new information, future events or otherwise.
TABLE -
1
|
ALLOT
COMMUNICATIONS LTD.
|
AND ITS
SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(U.S. dollars in
thousands, except share and per share data)
|
|
|
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2018
|
|
2017
|
|
(Unaudited)
|
|
|
|
|
Revenues
|
$
21,732
|
|
$
18,435
|
Cost of
revenues
|
6,924
|
|
6,318
|
Gross
profit
|
14,808
|
|
12,117
|
|
|
|
|
Operating
expenses:
|
|
|
|
Research and
development costs, net
|
5,793
|
|
5,533
|
Sales and
marketing
|
10,033
|
|
8,980
|
General and
administrative
|
2,466
|
|
2,541
|
Total operating
expenses
|
18,292
|
|
17,054
|
Operating
loss
|
(3,484)
|
|
(4,937)
|
Financial and other
income, net
|
230
|
|
362
|
Loss before income
tax expenses
|
(3,254)
|
|
(4,575)
|
|
|
|
|
Tax
expenses
|
432
|
|
502
|
Net Loss
|
(3,686)
|
|
(5,077)
|
|
|
|
|
Basic net
loss per share
|
$
(0.11)
|
|
$
(0.15)
|
|
|
|
|
|
|
|
|
Diluted net
loss per share
|
$
(0.11)
|
|
$
(0.15)
|
|
|
|
|
Weighted average
number of shares used in
|
|
|
|
computing basic net
loss per share
|
33,555,980
|
|
33,091,845
|
|
|
|
|
Weighted average
number of shares used in
|
|
|
|
computing diluted net
loss per share
|
33,555,980
|
|
33,091,845
|
TABLE -
2
|
ALLOT
COMMUNICATIONS LTD.
|
AND ITS
SUBSIDIARIES
|
RECONCILIATION OF
GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF
OPERATIONS
|
(U.S. dollars in
thousands, except per share data)
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
March
31,
|
|
|
|
2018
|
|
2017
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
GAAP
Revenues
|
$
21,732
|
|
$
18,435
|
|
Fair value
adjustment for acquired deferred revenues write down
|
-
|
|
24
|
|
Non-GAAP
Revenues
|
$
21,732
|
|
$
18,459
|
|
|
|
|
|
|
|
GAAP cost of
revenues
|
$
6,924
|
|
$
6,318
|
|
Share-based
compensation (1)
|
(80)
|
|
(95)
|
|
Amortization of
intangible assets (2)
|
(232)
|
|
(232)
|
|
Non-GAAP cost of
revenues
|
$
6,612
|
|
$
5,991
|
|
|
|
|
|
|
|
GAAP gross
profit
|
$
14,808
|
|
$
12,117
|
|
Gross profit
adjustments
|
$
312
|
|
351
|
|
Non-GAAP gross
profit
|
$
15,120
|
|
$
12,468
|
|
|
|
|
|
|
|
GAAP operating
expenses
|
$
18,292
|
|
$
17,054
|
|
Share-based
compensation (1)
|
(624)
|
|
(749)
|
|
Amortization of
intangible assets (2)
|
(175)
|
|
(135)
|
|
Expenses
related to M&A activities (3)
|
(38)
|
|
(89)
|
|
Non-GAAP
operating expenses
|
$
17,455
|
|
$
16,081
|
|
|
|
|
|
|
|
GAAP financial
and other income
|
$
230
|
|
$
362
|
|
Expenses
related to M&A activities (3)
|
150
|
|
74
|
|
Non-GAAP
Financial and other income
|
$
380
|
|
$
436
|
|
|
|
|
|
|
|
GAAP taxes on
income
|
$
432
|
|
$
502
|
|
Tax expenses
(in respect of net deferred tax asset recorded)
|
(19)
|
|
(67)
|
|
Non-GAAP taxes
on income
|
$
413
|
|
$
435
|
|
|
|
|
|
|
|
GAAP Net
Loss
|
$
(3,686)
|
|
$
(5,077)
|
|
Share-based
compensation (1)
|
704
|
|
844
|
|
Amortization of
intangible assets (2)
|
407
|
|
367
|
|
Expenses
related to M&A activities (3)
|
188
|
|
163
|
|
Fair value
adjustment for acquired deferred revenues write down
|
-
|
|
24
|
|
Tax expenses in
respect of net deferred tax asset recorded
|
19
|
|
67
|
|
Non-GAAP Net
income (Loss)
|
$
(2,368)
|
|
$
(3,612)
|
|
|
|
|
|
|
|
GAAP Loss per
share (diluted)
|
$
(0.11)
|
|
$
(0.15)
|
|
Share-based
compensation
|
0.02
|
|
0.03
|
|
Amortization of
intangible assets
|
0.01
|
|
0.01
|
|
Expenses
related to M&A activities
|
0.01
|
|
0.00
|
|
Tax expenses
(in respect of net deferred tax asset recorded)
|
0.00
|
|
0.00
|
|
Non-GAAP Net
loss per share (diluted)
|
(0.07)
|
|
$
(0.11)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in
|
|
|
|
|
computing GAAP
diluted net loss per share
|
33,555,980
|
|
33,091,845
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in
|
|
|
|
|
computing non-GAAP
diluted net loss per share
|
33,555,980
|
|
33,091,845
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE - 2
cont.
|
ALLOT
COMMUNICATIONS LTD.
|
AND ITS
SUBSIDIARIES
|
RECONCILIATION OF
GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF
OPERATIONS
|
(U.S. dollars in
thousands, except per share data)
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
March
31,
|
|
|
|
2018
|
|
2017
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
(1) Share-based
compensation (*):
|
|
|
|
|
|
Cost of
revenues
|
$
80
|
|
$
95
|
|
|
Research and
development costs, net
|
155
|
|
229
|
|
|
Sales and
marketing
|
222
|
|
241
|
|
|
General and
administrative
|
247
|
|
279
|
|
|
|
$
704
|
|
$
844
|
|
|
|
|
|
|
|
(2)
Amortization of intangible assets
|
|
|
|
|
|
Cost of
revenues
|
$
232
|
|
$
232
|
|
|
Sales and
marketing
|
175
|
|
135
|
|
|
|
$
407
|
|
$
367
|
|
|
|
|
|
|
|
(3) Expenses
related to M&A activities
|
|
|
|
|
|
General and
administrative
|
$
38
|
|
$
89
|
|
|
Financial
income
|
150
|
|
74
|
|
|
|
$
188
|
|
$
163
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE -
3
|
ALLOT
COMMUNICATIONS LTD.
|
AND ITS
SUBSIDIARIES
|
CONSOLIDATED
BALANCE SHEETS
|
(U.S. dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
2018
|
|
2017
|
|
|
(Unaudited)
|
|
(Audited)
|
|
|
|
ASSETS
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
22,835
|
|
$
15,342
|
Short term
deposits
|
|
16,943
|
|
31,043
|
Restricted
deposit
|
|
228
|
|
428
|
Marketable
securities
|
|
64,682
|
|
63,194
|
Trade receivables,
net
|
|
21,991
|
|
22,737
|
Other receivables and
prepaid expenses
|
|
4,390
|
|
2,649
|
Inventories
|
|
8,174
|
|
7,897
|
Total current
assets
|
|
139,243
|
|
143,290
|
|
|
|
|
|
LONG-TERM
ASSETS:
|
|
|
|
|
Severance pay
fund
|
|
303
|
|
302
|
Deferred
taxes
|
|
282
|
|
301
|
Other
assets
|
|
347
|
|
1,135
|
Total long-term
assets
|
|
932
|
|
1,738
|
|
|
|
|
|
PROPERTY AND
EQUIPMENT, NET
|
|
5,198
|
|
5,002
|
GOODWILL AND
INTANGIBLE ASSETS, NET
|
|
38,616
|
|
34,495
|
|
|
|
|
|
Total
assets
|
|
$
183,989
|
|
$
184,525
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
Trade
payables
|
|
$
6,470
|
|
$
5,857
|
Deferred
revenues
|
|
11,032
|
|
11,370
|
Other payables and
accrued expenses
|
|
15,579
|
|
14,277
|
Total current
liabilities
|
|
33,081
|
|
31,504
|
|
|
|
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
|
Deferred
revenues
|
|
4,235
|
|
3,878
|
Accrued severance
pay
|
|
781
|
|
747
|
Other long term
liabilities
|
|
5,516
|
|
5,267
|
Total long-term
liabilities
|
|
10,532
|
|
9,892
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
140,376
|
|
143,129
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
|
$
183,989
|
|
$
184,525
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE -
4
|
ALLOT
COMMUNICATIONS LTD.
|
AND ITS
SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(U.S. dollars in
thousands)
|
|
|
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2018
|
|
2017
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
Net Loss
|
$
(3,686)
|
|
$
(5,077)
|
Adjustments to
reconcile net income to net cash used in operating
activities:
|
|
|
|
Depreciation
|
498
|
|
529
|
Stock-based
compensation related to options granted to employees
|
704
|
|
844
|
Amortization of
intangible assets
|
407
|
|
367
|
Capital
loss
|
3
|
|
4
|
Decrease in accrued
severance pay, net
|
33
|
|
28
|
Decrease in other
assets
|
788
|
|
308
|
Decrease in accrued
interest and amortization of premium on marketable
securities
|
246
|
|
126
|
Decrease in trade
receivables
|
746
|
|
1,260
|
Increase in other
receivables and prepaid expenses
|
(1,879)
|
|
(622)
|
Increase in
inventories
|
(277)
|
|
(762)
|
Decrease in long-term
deferred taxes, net
|
19
|
|
67
|
Increase in trade
payables
|
602
|
|
1,849
|
Increase (Decrease)
in employees and payroll accruals
|
(499)
|
|
276
|
Increase (Decrease)
in deferred revenues
|
731
|
|
(853)
|
Increase in other
payables and accrued expenses
|
486
|
|
491
|
|
|
|
|
Net cash used in
operating activities
|
(1,078)
|
|
(1,165)
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
Decrease in
restricted deposit
|
200
|
|
-
|
Redemption of
short-term deposits
|
14,100
|
|
473
|
Purchase of property
and equipment
|
(694)
|
|
(811)
|
Investment in
marketable securities
|
(7,061)
|
|
(6,588)
|
Proceeds from
redemption or sale of marketable securities
|
4,991
|
|
4,749
|
Acquisitions
|
(3,048)
|
|
-
|
Net cash provided by
(used in) investing activities
|
8,488
|
|
(2,177)
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
Exercise of employee
stock options
|
83
|
|
24
|
|
|
|
|
Net cash provided by
financing activities
|
83
|
|
24
|
|
|
|
|
|
|
|
|
Increase (Decrease)
in cash and cash equivalents
|
7,493
|
|
(3,318)
|
Cash and cash
equivalents at the beginning of the period
|
15,342
|
|
23,326
|
|
|
|
|
Cash and cash
equivalents at the end of the period
|
$
22,835
|
|
$
20,008
|
Investor Relations Contact:
GK Investor Relations
Ehud
Helft/Gavriel
Frohwein
+1-646-688-3559
allot@gkir.com
Public Relations Contact:
Vered
Zur
Vice-President Marketing
International dialing +972-54-240-0042
vzur@allot.com
View original
content:http://www.prnewswire.com/news-releases/allot-announces-first-quarter-2018-financial-results-300644338.html
SOURCE Allot Communications Ltd.