Radware Ltd Announces 4Q10 Results
TEL AVIV, Israel, Feb. 3, 2011 /PRNewswire/ — Radware (Nasdaq: RDWR), a leading provider of integrated application delivery solutions for business-smart networking, today reported record quarterly revenues of $39.1 million for the fourth quarter of 2010. This represents an increase of 6% compared with revenues of $36.8 million for the third quarter of 2010, and an increase of 22% compared with revenues of $32.1 million in the fourth quarter of 2009.
Total revenues for 2010 were $144.1 million, an increase of 32% compared with revenues of $108.9 million in 2009.
Net income on a GAAP basis for the fourth quarter of 2010 was $3.9 million or $0.17 per diluted share, compared with a net income of $3.7 million or $0.17 per diluted share for the third quarter of 2010 and to $1.7 million or $0.09 million per diluted share in the fourth quarter of 2009.
Net income on a Non-GAAP basis for the fourth quarter of 2010 was $6.6 million or $0.29 per diluted share, compared with a net income of $5.6 million or $0.26 per diluted share for the third quarter of 2010 and to $4.0 million or $0.21 per diluted share in the fourth quarter of 2009.
Net income on a GAAP basis for 2010 was $9.6 million or $0.44 per diluted share compared with a net loss of $5.9 million or $0.31 per diluted share in 2009.
Net income on a Non-GAAP basis for 2010 was $20.1 million or $0.92 per diluted share compared with a net gain of $4.6 million or $0.24 per diluted share in 2009.
At the end of the fourth quarter of 2010, the company’s overall cash position including cash, short-term and long-term bank deposits and marketable securities amounted to $178.8 million, representing an increase in the company’s cash position of approximately $6.5 million in the fourth quarter or $52.7 million in the last 12 months.
“We see our industry lead in virtualization of the application delivery layer as a strong market share and revenue growth catalyst and we were very pleased to already see in Q4 a significant contribution from our newly announced VADI architecture,” stated Roy Zisapel, President and CEO Radware. “In addition, strong customer account success with our attack mitigation products, and continued penetration of the service provider market in Q4, has contributed to our increased profits and market share. It is our belief that these trends will continue to attain even more positive results in 2011.”
During the quarter ended December 31, 2010, Radware released the following significant announcements:
- Radware Accelerates Applications with New Alteon Version
- LifeWay Christian Resources Relies on Radware’s Application Delivery Services to Support its Rapidly Growing e-Commerce and Corporate Networks
- Radware’s DefensePro Earns “Recommend” Rating from NSS Labs for Attack Mitigation
- Radware Offers Multichannel Retailers Best Practices for Cyber Monday
- Radware takes APSolute Attack Prevention to the Next Level to Empower the Fight Against Online Fraud
- Radware Collects 2010 INTERNET TELEPHONY Excellence Award
- Radware Positioned in the Leaders Quadrant of the Magic Quadrant for Application Delivery Controllers
- Radware Launches its Smart Choice Partner Program
- Radware Helps SK Group Support Next-Generation Unified Communications Platform
Company management will host a quarterly investor conference call at 8:45 AM ET on Thursday, February 3rd, 2011. The call will focus on financial results for the quarter ending December 31, 2010, and certain other matters related to the company’s business.
Please use the following dial-in numbers to participate in the fourth quarter 2010 call:
Participants in the US call: Toll Free 1 877 392 9880
International participants call: +1 760 666 3769
The conference call will be webcast on Thursday February 3rd at 8:45am ET in the “listen only” mode via the Internet at: http://www.radware.com/Company/InvestorRelations/default.aspx and will be available for replay during the next 30 days.
About Radware
Radware (NASDAQ: RDWR), a global leader in integrated application delivery solutions, assures the full availability, maximum performance, and complete security of business-critical applications for nearly 10,000 enterprises and carriers worldwide. With APSolute®, Radware’s comprehensive and award-winning suite of application delivery and network security products, companies in every industry can drive business productivity, improve profitability, and reduce IT operating and infrastructure costs by making their networks “business smart”. For more information, please visit www.radware.com.
Use of Non-GAAP Financial Information
In addition to reporting financial results in accordance with generally accepted accounting principles (GAAP), Radware uses non-GAAP measures of net operating income, net income and earnings per share, which are adjustments from results based on GAAP to exclude stock-based compensation expenses, in accordance with ASC No. 718, amortization of intangible assets , acquisition-related expenses, unrealized gains up to the amount of losses recorded in previous quarters, in severance pay funds and exchange rate differences, net on balance sheet items included in finance income. Such exchange rate differences may vary from period to period due to changes in exchange rates driven by general market conditions or other circumstances outside of the normal course of Radware’s operations. Management believes that exclusion of these charges allows comparisons of operating results that are consistent across past, present and future periods. Radware’s management believes the non-GAAP financial information provided in this release is useful to investors for the purpose of understanding and assessing Radware’s ongoing operations. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of the non-GAAP financial measures discussed in this press release, to the most directly comparable GAAP financial measures, is included with the financial information contained in this press release. Management uses both GAAP and non-GAAP information in evaluating and operating business internally and, as such, has determined that it is important to provide this information to investors.
This press release may contain forward-looking statements that are subject to risks and uncertainties. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, general business conditions in the Application Switching and Network Security industry, changes in demand for Application Switching and Network Security products, the timing and amount or cancellation of orders and other risks detailed from time to time in Radware’s filings with the Securities and Exchange Commission, including Radware’s Form 20-F.
Chief Financial Officer
Meir Moshe
+972-3766-8610
Corporate Relations
Joyce Anne Shulman
+1 201 785 3209
joyceannes@radware.com
Consolidated Balance Sheets
(U.S. Dollars in thousands)
December 31, December 31,
------------ ------------
2009 2010
--- ---
(Audited) (Unaudited)
Current assets
Cash and cash equivalents 19,843 14,814
Available-for-sale marketable
securities 29,117 24,200
Short term bank deposits 10,130 51,911
Trade receivables, net 16,603 16,543
Other receivables and prepaid
expenses 2,934 3,402
Inventories 9,792 9,722
----- -----
88,419 120,592
------ -------
Long-term investments
Available-for-sale marketable
securities 42,021 82,864
Long-term bank deposits 25,000 5,000
Severance pay funds 2,514 3,342
----- -----
69,535 91,206
------ ------
Property and equipment, net 11,220 11,801
------ ------
Other assets
Intangible assets, net 14,794 12,011
Other long-term assets 467 560
Goodwill 24,465 24,465
------ ------
Total assets 208,900 260,635
======= =======
Current liabilities
Trade payables 5,699 5,913
Deferred revenues 20,734 28,685
Other payables and accrued
expenses 12,413 18,538
38,846 53,136
------ ------
Long-term liabilities
Deferred revenues 16,919 18,610
Accrued severance pay 3,662 3,899
----- -----
20,581 22,509
------ ------
Shareholders' equity
Share capital 465 506
Additional paid-in capital 191,941 218,593
Accumulated other comprehensive
income 935 125
Treasury stock, at cost (18,036) (18,036)
Accumulated deficit (25,832) (16,198)
------- -------
Total shareholders' equity 149,473 184,990
------- -------
Total liabilities and
shareholders' equity 208,900 260,635
======= =======
Condensed Consolidated Statements of Operations
(U.S. Dollars in thousands, except share and per share data)
For the three months ended
December 31,
------------
2009 2010
---- ----
(Unaudited) (Unaudited)
Revenues 32,118 39,054
Cost of revenues 6,564 7,968
----- -----
Gross profit 25,554 31,086
------ ------
Operating expenses:
Research and development 6,723 8,280
Selling and marketing 14,873 16,947
General and administrative 2,552 2,534
----- -----
Total operating expenses 24,148 27,761
------ ------
Operating income (loss) 1,406 3,325
Financial income, net 506 855
--- ---
Income (loss) before income
taxes 1,912 4,180
Income taxes (225) (256)
---- ----
Net income (loss) 1,687 3,924
===== =====
Basic net income (loss) per
share $0.09 $0.19
===== =====
Weighted average number of
shares used to compute basic
net income (loss) per share
18,881,697 20,360,557
Diluted net income (loss) per
share $0.09 $0.17
===== =====
Weighted average number of
shares used to compute diluted
net income (loss) per share
19,347,159 22,796,721
For the Year ended
December 31,
------------
2009 2010
---- ----
(Audited) (Unaudited)
Revenues 108,904 144,119
Cost of revenues 23,275 29,204
------ ------
Gross profit 85,629 114,915
------ -------
Operating expenses:
Research and development 25,674 31,660
Selling and marketing 55,130 64,609
General and administrative 11,930 10,190
------ ------
Total operating expenses 92,734 106,459
------ -------
Operating income (loss) (7,105) 8,456
Financial income, net 1,987 2,057
----- -----
Income (loss) before income
taxes (5,118) 10,513
Income taxes (818) (879)
---- ----
Net income (loss) (5,936) 9,634
====== =====
Basic net income (loss) per
share $(0.31) $0.49
====== =====
Weighted average number of
shares used to compute basic
net income (loss) per share
18,879,230 19,557,545
Diluted net income (loss) per
share $(0.31) $0.44
====== =====
Weighted average number of
shares used to compute diluted
net income (loss) per share
18,879,230 21,733,638
Reconciliation of Supplemental Financial Information
(U.S. Dollars in thousands, except share and per share data)
For the Three months ended
December 31,
------------
2009 2010
---- ----
(Unaudited) (Unaudited)
----------- -----------
GAAP net income (loss)
1,687 3,924
----- -----
Stock-based compensation
expenses, included in:
Cost of revenues 16 16
Research and development 217 304
Selling and marketing 407 627
General and administrative 585 409
--- ---
1,225 1,356
----- -----
Amortization of intangible assets
and other acquisition related
adjustments included in:
Cost of revenues 427 540
Selling and marketing 629 531
--- ---
1,056 1,071
----- -----
Acquisition related expenses - -
Unrealized gain in severance
pay funds, included in:
Research and development - -
Selling and marketing - -
General and administrative - -
- -
Exchange rate differences, net on
balance sheet items included in
financial income, net
42 212
--- --
Non-GAAP net income
4,010 6,563
===== =====
Non-GAAP diluted net income per
share
$0.21 $0.29
===== =====
Weighted average number of shares
used to compute Non-GAAP
diluted net income per share
19,347,159 22,796,721
For the Year ended
December 31,
------------
2009 2010
---- ----
(Unaudited) (Unaudited)
----------- -----------
GAAP net income (loss)
(5,936) 9,634
------ -----
Stock-based compensation
expenses, included in:
Cost of revenues 71 63
Research and development 630 1,247
Selling and marketing 1,164 2,393
General and administrative 2,176 1,789
----- -----
4,041 5,492
----- -----
Amortization of intangible assets
and other acquisition related
adjustments included in:
Cost of revenues 2,319 1,757
Selling and marketing 1,928 2,284
----- -----
4,247 4,041
----- -----
Acquisition related expenses 2,485 -
-----
Unrealized gain in severance
pay funds, included in:
Research and development (303) -
Selling and marketing (63) -
General and administrative (55) -
---
(421) -
----
Exchange rate differences, net on
balance sheet items included in
financial income, net
158 921
-- --
Non-GAAP net income
4,574 20,088
===== ======
Non-GAAP diluted net income per
share
$0.24 $0.92
===== =====
Weighted average number of shares
used to compute Non-GAAP
diluted net income per share
18,945,289 21,733,638
SOURCE Radware