AudioCodes Reports First Quarter 2009 Results
Lod, Israel – May 5, 2009 – AudioCodes Ltd. (NasdaqGS: AUDC), a leading provider of Voice over IP (VoIP) technologies and Voice Network products, today announced financial results for the first quarter of 2009 ended March 31, 2009.
Revenues for the first quarter of 2009 were $29.3 million compared to $43.7 million for the quarter ended March 31, 2008. Net loss in accordance with U.S. generally accepted accounting principles (GAAP) was $3.1 million, or ($0.07) per share, for the first quarter of 2009 compared to a GAAP net loss of $416,000, or ($0.01) per share, for the corresponding first quarter of 2008.
Non-GAAP net loss was $1.6 million, or ($0.04) per share, for the first quarter of 2009 compared to non-GAAP net income of $3.1 million, or $0.07 per diluted share, for the first quarter of 2008.
Non-GAAP net income excludes (i) stock-based compensation expenses, (ii) amortization expenses related to the Nuera, Netrake and CTI Squared acquisitions and (iii) an adjustment to expenses related to the Company’s Senior Convertible Notes due to implementation of FASB Staff Position APB 14-1. This new accounting requirement results in the recognition of higher interest expense by the Company, and a related reduction in income tax expense, due to amortization of the discount that results from separating the liability and equity components of the Senior Convertible Notes in accordance with this Staff Position. A reconciliation between net income on a GAAP basis and non-GAAP net income is provided in the tables that accompany the condensed consolidated financial statements contained in this press release.
“Our revenues decreased in the first quarter of 2009 as a result of the downturn in the global economy and the challenging environment. While we are disappointed with our results, we are encouraged with the increased level of customer activity in the quarter and our strong operating expense control while continuing to invest in our next generation products,” stated Shabtai Adlersberg, Chairman of the Board, President and CEO of AudioCodes.
“Based on early second quarter inputs, we anticipate improving market conditions and forecast better financial performance in the coming quarter,” concluded Mr. Adlersberg.
In January 2009, Nortel, AudioCodes’ largest customer in 2008, announced that it would seek creditor protection for the company and some of its subsidiaries. As of March 31, 2009, a total of $1.7 million of sales to the Nortel Group was recorded as unpaid deferred revenues, of which less than $100,000 were recorded in the first quarter of 2009.
Cash and cash equivalents, short-term marketable securities, and short-term and long-term bank deposits were $113.5 million as of March 31, 2009, compared to $115.1 million as of December 31, 2008 and $137.6 million as of March 31, 2008. The year-over-year decline was primarily attributable to the repurchase of our Senior Convertible Notes and the repurchase of our ordinary shares, offset in part by cash provided by our operating activities and additional borrowings.
The Company adopted FASB Staff Position APB 14-1 (“FSP”) effective for financial statements issued for periods starting January 1, 2009. The FSP requires the Company to separately account for the liability and equity components of its Senior Convertible Notes in a manner that reflects the Company’s nonconvertible debt borrowing rate. The FSP requires a retrospective application for all periods presented and comparative figures have been adjusted accordingly. As a result of applying the provisions of the FSP, the Company recorded additional non-cash interest expense, net of taxes, of $550,000 and $873,000 during the first quarter of 2009 and 2008, respectively.
Conference Call & Web cast Information
AudioCodes will conduct a conference call at 9:00 A.M., Eastern Daylight Time on Wednesday, May 6, 2009 to discuss the company’s first quarter operational and financial results. The conference call will be simultaneously Web cast. Investors are invited to listen to the call live via Web cast at the AudioCodes corporate website at www.audiocodes.com