Company Achieves Breakeven Results on a Non-GAAP Basis HOD
HASHARON, Israel, February 9 /PRNewswire-FirstCall/ -- Key
highlights: - Fourth quarter revenues reached $11.5 million, a 21%
increase over the fourth quarter of 2008 - Fourth quarter non-GAAP
net income of $19,000, as Company achieves break-even results -
Cash, cash equivalents, deposits and investments in marketable
securities increased to $53.3 million - Allot receives $17 million
in orders from a global Tier 1 mobile operator during the year
Allot Communications Ltd. (NASDAQ:ALLT) a leader in IP service
optimization and revenue generation solutions, today announced
achieving break-even results on a non-GAAP basis for the fourth
quarter of 2009 as it reported its financial results for the fourth
quarter and full year ended December 31, 2009. Total revenues for
the fourth quarter of 2009 reached $11.5 million, a 21% increase
from the $9.6 million of revenues reported in the fourth quarter of
2008, and a 6% increase from the $10.8 million revenues reported
for the third quarter of 2009. On a GAAP basis, net loss for the
fourth quarter of 2009 was $1.5 million, or $0.07 per share (basic
and diluted). This compares with net income of $1.0 million, or
$0.05 per share (basic and diluted), in the fourth quarter of 2008,
and a net loss of $2.3 million, or $0.10 per share (basic and
diluted), in the third quarter of 2009. For the full year 2009,
revenues reached $41.8 million, representing a 13% increase over
the $37.1 million of revenues in 2008. On a GAAP basis, net loss in
2009 totaled $7.7 million, or $0.35 per share (basic and diluted),
compared with a net loss of $16.5 million, or $0.75 per share
(basic and diluted), in 2008. On a non-GAAP basis, excluding the
impact of share-based compensation, inventory and fixed assets
write-offs and ARS devaluation and recoveries, non-GAAP net income
for the fourth quarter of 2009 totaled $19,000, or $0.00 per share
(basic and diluted), compared with a non-GAAP net loss of $1.1
million, or $0.05 per share (basic and diluted), for the fourth
quarter of 2008 and a non-GAAP loss of $185,000, or $0.01 per share
(basic and diluted), for the third quarter of 2009. Inventory and
fixed assets write-offs for the fourth quarter of 2009 totaled $0.9
million following the rollout of certain new products. These
non-GAAP measures should be considered in addition to, and not as a
substitute for, comparable GAAP measures. A full reconciliation
between GAAP and non-GAAP results is provided in the accompanying
Table 2. The Company provides these non-GAAP financial measures
because it believes that 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 that they are useful to investors
in enhancing an understanding of the Company's operating
performance. "During 2009 Allot succeeded in continuing to grow
revenues while making significant progress in moving towards our
goal of profitability," commented Rami Hadar, Allot Communications'
President and Chief Executive Officer. "We successfully undertook
the largest deployment in our history with a global Tier 1 mobile
operator, with total orders as at the end of the year reaching $17
million. Coupled with the strong backlog we built up during the
year, we currently believe that Allot is well positioned for
continued growth in 2010." Recently, the Company achieved the
following significant goals: - During the quarter, concluded 9
large deals with service providers, of which 4 represented new
customers and 5 represented expansion deals; - Allot introduced two
new platforms during the quarter, the AC-1400 and AC-3000, which
address the needs of the Tier 2/3 and large enterprise markets; and
- Service Gateway Sigma now supports 75 Gbps and may be clustered
for up to 360 Gbps as verified by the independent Tolly Group. As
of December 31, 2009, cash, cash equivalents, deposits and
investments in marketable securities totaled $53.3 million. Recent
external valuations showed an increase in value of certain ARS in
the Company's portfolio as of the end of the fourth quarter. As a
result, the Company recorded an unrealized net gain of $0.7 million
to other comprehensive income in its shareholders' equity, leaving
the Company with a total of $14.5 million in ARS at the end of the
quarter. To date, all ARS are current on their respective interest
payments. Conference Call & Webcast The Allot management team
will host a conference call will host a conference call to discuss
its fourth quarter and full year 2009 results on Tuesday, February
9, 2010, at 8:30 AM EST, 3:30 PM Israel time. To access the
conference call, please dial one of the following numbers: US:
+1-866-966-5335, International: +44-20-3003-2666, Israel:
+1-809-216-213. A replay of the conference call will be available
from 12:01 am EST on February 10, 2010 through March 10, 2010 at
11:59 pm EST. To access the replay, please dial: +44-20-8196-1998,
access code: 650204#. A live webcast of the conference call can be
accessed on the Allot Communications website at
http://www.allot.com/. The webcast will also be archived on the
website following the conference call. About Allot Communications
Allot Communications Ltd. (NASDAQ:ALLT) is a leading provider of
intelligent IP service optimization solutions for fixed and mobile
broadband operators and large enterprises. Allot's rich portfolio
of solutions leverages dynamic actionable recognition technology
(DART) to transform broadband pipes into smart networks that can
rapidly and efficiently deploy value-added Internet services.
Allot's scalable, carrier-grade solutions provide the visibility,
topology awareness, security, application control and subscriber
management that are vital to managing Internet service delivery,
enhancing user experience, containing operating costs, and
maximizing revenue in broadband networks. For more information,
please visit http://www.allot.com/. Safe Harbor Statement
Information provided in this press release may contain statements
relating to current expectations, estimates, forecasts and
projections about future events that are "forward-looking
statements" as defined in the Private Securities Litigation Reform
Act of 1995. These forward-looking statements generally relate to
the Company's plans, objectives and expectations for future
operations, including the Company's belief that together with its
strong backlog it is well positioned for continued growth in 2010.
These forward-looking statements are based upon management's
current estimates and projections of future results or trends.
Actual results may differ materially from those projected as a
result of certain risks and uncertainties. These factors include,
but are not limited to: changes in general economic and business
conditions and, specifically, a decline in demand for the Company's
products; the Company's inability to develop and introduce new
technologies, products and applications; loss of market; 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. 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 December 31, 2009 2008 (Unaudited)
Revenues $ 11,530 $ 9,562 Cost of revenues 3,548 2,448 Gross profit
7,982 7,114 Operating expenses: Research and development costs, net
2,408 2,855 Sales and marketing 5,849 4,510 General and
administrative 1,371 1,363 In - process research and development -
- Total Operating expenses 9,628 8,728 Operating Loss (1,646)
(1,614) Financial and other income (expenses), net 52 2,730 Income
(Loss) before income tax expenses (1,594) 1,116 Income tax expenses
(74) 82 Net earnings (Loss) (1,520) 1,034 Basic and diluted net
earnings (loss) per share $ (0.07) $0.05 Weighted average number of
shares used in computing basic net earnings per share 22,385,132
22,065,556 Weighted average number of shares used in computing
diluted net earnings per share 22,385,132 22,225,288 Year Ended
December 31, 2009 2008 (Unaudited) (Audited) Revenues $ 41,751
$37,101 Cost of revenues 11,835 9,696 Gross profit 29,916 27,405
Operating expenses: Research and development costs, net 9,265
11,964 Sales and marketing 20,408 19,781 General and administrative
5,541 6,174 In - process research and development - 244 Total
Operating expenses 35,214 38,163 Operating Loss (5,298) (10,758)
Financial and other income (expenses), net (2,311) (5,517) Income
(Loss) before income tax expenses (7,609) (16,275) Income tax
expenses 63 220 Net earnings (Loss) (7,672) (16,495) Basic and
diluted net earnings (loss) per share $(0.35) $(0.75) Weighted
average number of shares used in computing basic net earnings per
share 22,185,702 22,054,211 Weighted average number of shares used
in computing diluted net earnings per share 22,185,702 22,054,211
TABLE - 2 ALLOT COMMUNICATIONS LTD. AND ITS SUBSIDIARIES
RECONCILATION OF GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF
OPERATIONS (U.S. dollars in thousands, except per share data) Three
Months Ended December 31, 2009 2008 (Unaudited) GAAP net income
(loss) as reported $(1,520) $ 1,034 Non-GAAP adjustments Expenses
recorded for stock-based compensation Cost of revenues 32 6
Research and development costs, net 92 84 Sales and marketing 215
64 General and administrative 252 218 In-process research and
development - - Expenses related to a law suit - - Core technology
amortization- cost of revenues 27 30 Inventory write off - cost of
revenues 523 - Fixed assets write off - sales and marketing 385 -
Total adjustments to operating loss 1,526 402 Impairment of auction
rate securities - Financial and other income (expenses), net 13
(2,507) Total adjustments 1,539 (2,105) Non-GAAP net earnings
(Loss) $ 19 $ (1,071) Non- GAAP basic and diluted net earnings
(Loss) per share $ 0.00 $ (0.05) Three Months Ended December 31,
2009 2008 (Unaudited) GAAP net income (loss) as reported $ (7,672)
$(16,495) Non-GAAP adjustments Expenses recorded for stock-based
compensation Cost of revenues 104 52 Research and development
costs, net 357 321 Sales and marketing 775 465 General and
administrative 1,062 855 In-process research and development - 244
Expenses related to a law suit - 197 Core technology amortization-
cost of revenues 116 119 Inventory write off - cost of revenues 523
- Fixed assets write off - sales and marketing 385 - Total
adjustments to operating loss 3,322 2,253 Impairment of auction
rate securities - Financial and other income (expenses), net 3,036
7,681 Total adjustments 6,358 9,934 Non-GAAP net earnings (Loss) $
(1,314) $ (6,561) Non- GAAP basic and diluted net earnings (Loss)
per share $ (0.06) $ (0.30) TABLE - 3 ALLOT COMMUNICATIONS LTD. AND
ITS SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (U.S. dollars in
thousands) December 31, December 31, 2009 2008 (Unaudited)
(Audited) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 36,470
$ 40,029 Short term and restricted deposits 2,324 2,121 Trade
receivables 7,842 6,163 Other receivables and prepaid expenses
2,318 1,959 Inventories 5,046 4,259 Total current assets 54,000
54,531 LONG-TERM ASSETS: Marketable securities 14,490 15,319
Severance pay fund 3,410 3,402 Other assets 430 874 Total long-term
assets 18,330 19,595 PROPERTY AND EQUIPMENT, NET 5,674 4,970
GOODWILL AND INTANGIBLE ASSETS, NET 3,639 3,755 Total assets $
81,643 $ 82,851 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT
LIABILITIES: Trade payables $3,142 $2,902 Deferred revenues 5,467
4,475 Other payables and accrued expenses 7,212 6,466 Total current
liabilities 15,821 13,843 LONG-TERM LIABILITIES: Deferred revenues
2,046 2,293 Accrued severance pay 3,364 3,536 Total long-term
liabilities 5,410 5,829 SHAREHOLDERS' EQUITY 60,412 63,179 Total
liabilities and shareholders' equity $81,643 $ 82,851 Investor
Relations Contact: Jay Kalish Executive Director Investor Relations
International access code +972-54-221-1365 DATASOURCE: Allot
Communications Ltd. CONTACT: Investor Relations Contact: Jay
Kalish, Executive Director Investor Relations, International access
code +972-54-221-1365,
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