EX-99.1 2 exhibit_99-1.htm EXHIBIT 99.1
 
Exhibit 99.1
 
 
Contact:
 Ran Vered, CFO
(+972) 77-774-5011
ranv@radcom.com
 
FOR IMMEDIATE RELEASE

RADCOM REPORTS Q2 & H1 2016 FINANCIAL RESULTS

Q2 Revenues Up 49% YOY to $7.2M
Announces Relationship with AT&T
Strengthened Balance Sheet Supports Execution of Growth Initiatives
 
TEL-AVIV, Israel – August 3, 2016-- RADCOM Ltd. (NASDAQ: RDCM) today reported its financial results for the second quarter and first half ended June 30, 2016.

In $ thousands
Q2 2016
Q2 2015
H1 2016
H1 2015
Revenues
$7,200
$4,837
$13,747
$11,191
Gross margin
70%
75%
72%
79%
Net profit
$1,747
$203
$2,650
$640
Net profit (non-GAAP)
$1,997
$605
$3,337
$1,426
Cash & equivalents
$46,468
$9,916
$46,468
$9,916

Financial Results
Second Quarter: Revenues for the second quarter were $7.2 million, up 49% compared to $4.8 million in the second quarter of 2015, and up 10% compared to $6.5 million in the first quarter of 2016.

Net income for the period, determined in accordance with U.S. GAAP, totaled $1.7 million, or $0.17 per diluted share, compared to $203,000, or $0.02 per diluted share for the second quarter of 2015, and $0.10 per diluted share in the first quarter of 2016.  On a non-GAAP basis, net income totaled $2.0 million, or $0.20 per diluted share, compared to $605,000, or $0.07 per diluted share for the second quarter of 2015, and $0.14 per diluted share in the first quarter of 2016.  Both GAAP and non-GAAP results for the second quarter of 2016 included a $0.8 million or $0.07 per diluted share, benefit related to grants from the Office of the Chief Scientist compared to $0.2 million or $0.02 per diluted share in the second quarter of 2015.

As of June 30, 2016, the Company’s balance of cash and cash equivalents totaled a record $46.5 million compared to $8.7 million at the end of 2015 and $25.5 million at the end of the first quarter.

First Half of 2016: Revenues for the first six months of 2016 increased by 23% to $13.7 million compared to $11.2 million in the first half of 2015.

GAAP net income for the period totaled $2.6 million, or $0.27 per diluted share, compared to $640,000, or $0.07 per diluted share in the first half of 2015. On a non-GAAP basis, net income for the period totaled $3.3 million, or $0.34 per diluted share compared to $1.4 million, or $0.16 per diluted share recorded in the first half of 2015.

Comments of Management
“AT&T’s recent public announcement that it is using RADCOM’s innovative technology to support its shift to network virtualization highlights the strong technological leadership of our game-changing MaveriQ product suite. We are on track in implementing the current contract and have recently signed a product expansion, as well as a multi-year maintenance agreement that further strengthens our long-term relationship,” commented Mr. Yaron Ravkaie, RADCOM’s CEO. “As a vital component of AT&T’s NFV transformation, we are positioned to continue innovating and extending our technologies, in line with our strategic plan, and have already added cutting-edge new capabilities to our MaveriQ solution. We believe this new functionality will be critical for the success of any large-scale network virtualization, further positioning RADCOM as the go-to NFV service assurance vendor. With this recent public announcement and AT&T’s endorsement, we are accelerating our engagements with additional top-tier carriers.”

Mr. Yaron Ravkaie concluded, “We are reiterating our 2016 revenue guidance range of $28-$29.5 million, up 50%-58% compared with 2015. The combination of our best-of-breed MaveriQ suite, growing pipeline of opportunities and significantly strengthened balance sheet positions the Company to scale and grow to a whole new level.”

Earnings Conference Call
 RADCOM's management will hold an interactive conference call today at 9:00 AM Eastern Time (16:00 Israel Time) to discuss the results and to answer participants' questions. To join the call, please call one of the following numbers approximately five minutes before the call is scheduled to begin:
 
From the US (toll-free): + 1-888-668-9141
 
From other locations: +972-3-918-0609
 
For those unable to listen to the call at the time, a replay will be available from August 4th on RADCOM's website.
 
 
About RADCOM
RADCOM (NASDAQ: RDCM) is a first-mover and leading provider of NFV-ready service assurance and customer experience management solutions for Communications Service Providers (CSPs). RADCOM's MaveriQ software continuously monitors network performance and quality-of-service, enabling CSPs to optimize the subscriber user experience. RADCOM specializes in solutions for next-generation mobile and fixed networks, including LTE, VoLTE, IMS and others. MaveriQ enables CSPs to smoothly migrate their networks to NFV by assuring physical, NFV-based and hybrid networks. For more information, please visit http://www.radcom.com.
For all investor enquiries, please contact: Ran Vered, CFO, (+972) 77-774-5011, ranv@radcom.com
 
For all media enquiries, please contact: Mark Rolston, Marketing Manager +972-77-774-5036, markr@radcom.com

Non-GAAP Information
Certain non-GAAP financial measures are included in this press release. These non-GAAP financial measures are provided to enhance the reader's overall understanding of our financial performance. By excluding non-cash stock-based compensation that has been expensed in accordance with ASC Topic 718, our non-GAAP results provide information to both management and investors that is useful in assessing our core operating performance and in evaluating and comparing our results of operations on a consistent basis from period to period. These non-GAAP financial measures are also used by management to evaluate financial results and to plan and forecast future periods.  The presentation of this additional information is not meant to be considered a substitute for the corresponding financial measures prepared in accordance with GAAP.

 Risks Regarding Forward-Looking Statements
 
Certain statements made herein that use words such as “estimate,” “project,” “intend,” “expect,” “'believe”, "may", "might", "predict", "potential", "anticipate", "plan" or similar expressions are intended to identify forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. For example, when the Company discusses its 2016 revenue guidance range, expected opportunities, pipeline and growth and deployment, extension of relationships with AT&T and becoming the go-to solution for NFV operators it is using forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties that could cause the actual results, performance or achievements of the Company to be materially different from those that may be expressed or implied by such statements, including, among others, changes in general economic and business conditions and specifically, decline in the demand for the Company’s products, inability to timely develop and introduce new technologies, products and applications, and loss of market share and pressure on prices resulting from competition. For additional information regarding these and other risks and uncertainties associated with the Company’s business, reference is made to the Company’s reports filed from time to time with the United States Securities and Exchange Commission. The Company does not undertake to revise or update any forward-looking statements for any reason.

RADCOM Ltd.
Consolidated Statement of Operations
(1000's of U.S. dollars, except share and per share data)
 
   
Three months ended
 June 30,
    
Six months ended
 June 30,
  
   
2016
    
2015
    
2016
    
2015
  
   
(unaudited)
    
(unaudited)
    
(unaudited)
    
(unaudited)
  
Sales
  
$
7,200
    
$
4,837
    
$
13,747
    
$
11,191
  
Cost of sales
    
2,136
      
1,216
      
3,829
      
2,354
  
Gross profit
    
5,064
      
3,621
      
9,918
      
8,837
  
Research and development, gross
    
1,632
      
1,433
      
3,468
      
3,071
  
Less - royalty-bearing participation
    
756
      
148
      
756
      
148
  
Research and development, net
    
876
      
1,285
      
2,712
      
2,923
  
Sales and marketing, net
    
1,732
      
1,546
      
3,259
      
3,587
  
General and administrative
    
1,156
      
565
      
2,027
      
1,206
  
Total operating expenses
    
3,764
      
3,396
      
7,998
      
7,716
  
Operating income
    
1,300
      
225
      
1,920
      
1,121
  
Financing income (expense), net
    
447
      
78
      
736
      
(374
)
                                 
Income before taxes
    
1,747
      
303
      
2,656
      
747
  
Taxes
    
-
      
100
      
6
      
107
  
                                 
Net profit
  
$
1,747
    
$
203
    
$
2,650
    
$
640
  
                                 
Basic net income per
     ordinary share
  
$
0.18
    
$
0.02
    
$
0.28
    
$
0.08
  
Diluted net income per
      ordinary share
  
$
0.17
    
$
0.02
    
$
0.27
    
$
0.07
  
Weighted average number of
    ordinary shares used in
     computing basic net income
     per ordinary share
    
9,875,268
      
8,537,377
      
9,322,930
      
8,501,254
  
Weighted average number of
    ordinary shares used in
     computing diluted net income
     per ordinary share
    
10,117,835
      
9,093,008
      
9,733,037
      
9,066,624
  
 

RADCOM Ltd.
Consolidated Balance Sheets
(1000's of U.S. dollars)
 
   
As of
    
As of
  
   
June 30,
2016
    
December 31,
2015
  
   
(unaudited)
    
(audited)
  
Current Assets
            
Cash and cash equivalents
  
$
46,468
    
$
8,727
  
Restricted cash deposits
    
32
      
32
  
Trade receivables
    
1,020
      
3,684
  
Inventories
    
1,850
      
1,532
  
Other receivables
    
2,967
      
2,087
  
Total Current Assets
    
52,337
      
16,062
  
Severance pay fund
    
3,240
      
3,181
  
Other long-term receivables
    
627
      
508
  
Property and equipment, net
    
685
      
384
  
Total Assets
  
$
56,889
    
$
20,135
  
                 
Liabilities and Shareholders' Equity
                
Current Liabilities
                
Trade payables
  
$
1,825
    
$
1,465
  
Deferred revenue and advances from customers
    
8,110
      
931
  
Employee and payroll accruals
    
3,628
      
2533
  
Other payables and accrued expenses
    
1,944
      
1,490
  
Total Current Liabilities
    
15,507
      
6,419
  
Long-Term Liabilities
                
Deferred revenue
    
129
      
197
  
Accrued severance pay
    
3,876
      
3,656
  
Total Long-Term Liabilities
    
4,005
      
3,853
  
                 
Total Liabilities
    
19,512
      
10,272
  
                 
Shareholders' Equity
                
Share capital
  
$
510
    
$
372
  
Additional paid-in capital
    
94,791
      
70,270
  
Accumulated other comprehensive loss
    
(2,555
)
    
(2,760
)
Accumulated deficit
    
(55,369
)
    
(58,019
)
Total Shareholders' Equity
    
37,377
      
9,863
  
                 
Total Liabilities and Shareholders' Equity
  
$
56,889
    
$
20,135
  
 
RADCOM Ltd.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
(1000's of U.S. dollars, except share and per share data)
 
   
Three Months Ended
    
Six Months Ended
  
   
June 30,
    
June 30,
  
   
2016
    
2015
    
2016
    
2015
  
   
(unaudited)
    
(unaudited)
    
(unaudited)
    
(unaudited)
  
                         
GAAP net income
  
$
1,747
    
$
203
    
$
2,650
    
$
640
  
Stock-based compensation (1)
    
250
      
402
      
687
      
786
  
                                 
Non-GAAP net income
  
$
1,997
    
$
605
    
$
3,337
    
$
1,426
  
                                 
Non-GAAP net income per share (basic)
  
$
0.20
    
$
0.07
    
$
0.36
    
$
0.17
  
                                 
Non-GAAP net income per share (diluted)
  
$
0.20
    
$
0.07
    
$
0.34
    
$
0.16
  
                                 
Number of shares used in computing Non-GAAP earnings per share (basic)
    
9,875,268
      
8,537,377
      
9,322,930
      
8,501,254
  
                                 
Number of shares used in computing Non-GAAP earnings per share (diluted)
    
10,117,835
      
9,093,008
      
9,733,037
      
9,066,624
  
                                 
(1) Stock-based compensation:
                                
   Cost of sales
    
27
      
13
      
42
      
22
  
   Research and development
    
69
      
159
      
239
      
324
  
   Sales and marketing
    
31
      
133
      
51
      
224
  
   General and administrative
    
123
      
97
      
355
      
216
  
     
250
      
402
      
687
      
786