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AudioCodes Reports First Quarter 2021 Results

Apr 27, 2021

First Quarter Highlights

  • Quarterly revenues increased by 13.1% year-over-year to $58.8 million;
  • Quarterly service revenues increased by 23.3% year-over-year to $21.8 million;
  • GAAP results:
    • Quarterly GAAP gross margin was 68.4%;
    • Quarterly GAAP operating margin was 17.2%; and
    • Quarterly GAAP net income was $10.0 million, or $0.29 per diluted share;
  • Non-GAAP results:
  • Quarterly Non-GAAP gross margin was 68.7%;
  • Quarterly Non-GAAP operating margin was 22.5%; and
  • Quarterly Non-GAAP net income was $12.7 million, or $0.37 per diluted share;
  • Net cash provided by operating activities was $13.0 million for the quarter.
  • AudioCodes declared a cash dividend of 16 cents per share. The dividend, in the aggregate amount of $5.3 million, was paid on March 4, 2021.
  • AudioCodes repurchased 350,000 of its ordinary shares during the quarter at an aggregate cost of $10.3 million.

Details

Lod, Israel – April 27, 2021 – AudioCodes (NASDAQ: AUDC) Press Release

AudioCodes, a leading vendor of advanced communications software, products and productivity solutions for the digital workplace, today announced the financial results for the first quarter ended March 31, 2021.

Revenues for the first quarter of 2021 were $58.8 million compared to $52.0 million for the first quarter of 2020.

Net income was $10.0 million, or $0.29 per diluted share, for the first quarter of 2021, compared to a net income of $5.3 million, or $0.17 per diluted share, for the first quarter of 2020.

On a Non-GAAP basis, net income was $12.7 million, or $0.37 per diluted share, for the first quarter of 2021 compared to $7.8 million, or $0.25 per diluted share, in the first quarter of 2020.

Non-GAAP net income excludes: (i) share-based compensation expenses; (ii) amortization expenses related to the acquisition of Active Communications Europe assets; (iii) financial income or expenses related to exchange rate differences in connection with revaluation of assets and liabilities in non-dollar denominated currencies and (iv) non-cash deferred tax expenses (benefit). A reconciliation of net income on a GAAP basis to a non-GAAP basis is provided in the tables that accompany the condensed consolidated financial statements contained in this press release.

Net cash provided by operating activities was $13.0 million for the first quarter of 2021. Cash and cash equivalents, long and short-term bank deposits and long and short-term marketable securities were $182.5 million as of March 31, 2021 compared to $186.3 million as of December 31, 2020. The decrease in cash and cash equivalents, long and short-term bank deposits and long and short-term marketable securities was the result of the use of cash for the continued repurchasing of the Company’s ordinary shares pursuant to its share repurchase program and the payment of a cash dividend in the first quarter of 2021, offset, in part, by cash from operating activities.

“We are pleased to report strong financial results for the first quarter of 2021,” said Shabtai Adlersberg, President and Chief Executive Officer of AudioCodes.

“We enjoyed solid business momentum in our enterprise-related activities driven by secular growth opportunities within the UCaaS and Contact Center markets. Our UCaaS business grew over 15% year-over-year and our contact center business grew over 20% year-over-year. These two businesses, which form our Enterprise Business offering, contributed more than 80% of our first quarter revenue. Services revenue grew 23.3% year-over-year and was driven mainly by strength in our professional and managed services offerings.  Most importantly we continued to make progress in pivoting to recurring revenues with strong traction experienced in our AudioCodes Live offering operations.”

“As in previous quarters, communications and collaboration, as well as work from home trend, continue to play center stage in today’s world and the emerging digital workplace. Our investment in enhancing our portfolio of products and solutions for real-time cloud communications, the Microsoft Teams ecosystem and the new emerging intelligent contact center have proven successful in expanding our business in recent years and provide a strong basis for our expected growth in coming years.

Mr. Adlersberg continued, “We have enjoyed solid execution in our Voice.ai operations. Revenue for our Voice.ai operations grew over 100% year-over-year. Recording solutions for UCaaS and contact center, conversational IVR, meeting space solutions and voice-enablement for virtual intelligent agents lead our success in this area. We now expect to reach revenue of $10 million based on our organic growth in this business in the coming 24 months,” concluded Mr. Adlersberg.

Share Buy Back Program and Cash Dividend

In January 2021, the Company received court approval in Israel to purchase up to an aggregate amount of $30 million of additional ordinary shares. The court approval also permits AudioCodes to declare a dividend of any part of this amount. The approval is valid through July 19, 2021.

On February 4, 2021, the Company declared a cash dividend of $0.16 per share. The dividend, in the aggregate amount of approximately $5.3 million, was paid on March 4, 2021 to all of the Company's shareholders of record on February 18, 2021.

During the quarter ended March 31, 2021, the Company acquired 350,000 of its ordinary shares under its share repurchase program for a total consideration of $10.3 million.

Conference Call & Web Cast Information

AudioCodes will conduct a conference call at 8:30 A.M., Eastern Time today to discuss the Company's first quarter of 2021 operating performance, financial results and outlook. Interested parties may participate in the conference call by dialing one the following numbers:

  • United States Participants: +1 (877) 407-0778
  • International Participants: +1 (201) 689-8565

The conference call will also be simultaneously webcast. Investors are invited to listen to the call live via webcast at the AudioCodes investor website at www.audiocodes.com/investors-lobby

 

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