Second Quarter Highlights:
- Quarterly revenues increased by 3.2% over the previous quarter and by 10.7% year-over-year to $35.9 million;
- Revenues related to UC-SIP business increased above 25% compared to the second quarter of 2015;
- Quarterly service revenues increased by 11.5% year-over-year to $10.4 million;
- GAAP gross margin was a record of 60.5%, compared to 59.1% in the second quarter of 2015;
- Non-GAAP gross margin was also a record of 61.4%, compared to 59.9% in the second quarter of 2015;
- Quarterly GAAP net income was $721,000, or $0.02 per diluted share, compared to a net loss of $1.9 million, or ($0.05) per diluted share, in the prior year period;
- Quarterly Non-GAAP net income was $2.4 million, or $0.06 per diluted share, compared to a Non-GAAP net loss of $537,000, or ($0.01) per diluted share, in the prior year period;
- Quarterly cash flow from operating activities was $5.5 million;
- AudioCodes repurchased 421,000 shares of its ordinary shares at an aggregate cost of $1.8 million during the quarter;
- On July 20, 2016, AudioCodes completed a cash self-tender offer and accepted for purchase a total of 3,000,000 of its ordinary shares, the maximum amount of shares subject to the offer, at a cash purchase price of $4.35 per share;
Details:
Lod, Israel – July 26, 2016
AudioCodes (Nasdaq: AUDC), a leading provider of voice networking solutions that enable enterprises and service providers to transition to all-IP voice networks, today announced financial results for the second quarter ended June 30, 2016.
Revenues for the second quarter of 2016 were $35.9 million, compared to $34.8 million for the first quarter of 2016 and $32.4 million for the second quarter of 2015.
Net income was $721,000, or $0.02 per diluted share, for the second quarter of 2016, compared to a net loss of $1.9 million, or ($0.05) per diluted share, for the second quarter of 2015.
On a Non-GAAP basis, the Company reported quarterly net income of $2.4 million, or $0.06 per diluted share, compared to a net loss of $537,000, or ($0.01) per diluted share, in the second quarter of 2015.
Non-GAAP net income excludes: (i) stock-based compensation expenses; (ii) amortization expenses related to intangible assets; (iii) expenses related to deferred payments in connection with the acquisition of Active Communications Europe and (iv) non-cash deferred tax benefit or expenses. A reconciliation of net income (loss) 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 for the second quarter of 2016 totaled $5.5 million. Cash and cash equivalents, long- and short-term bank deposits and long- and short-term marketable securities were $78.1 million as of June 30, 2016, compared to $78.6 million as of June 30, 2015. Subsequent to the end of the quarter, the Company used approximately $13.1 million of its short-term bank deposits in connection with the purchase of shares pursuant to its cash self-tender offer.
“We are pleased to report another quarter of strong financial results reflecting the solid progress in our business,” said Shabtai Adlersberg, President and Chief Executive Officer of AudioCodes. “These results were driven by a strong performance in our growing UC-SIP business, which grew above 25% compared to the year ago quarter. We have witnessed strong momentum across our key lines of activity. In the Skype for business market, we enjoyed strong revenue growth, important projects and customer wins, increased success in our solution offering and growing cooperation with our global partners. We experienced similar growth trends in the SBC, IP Phones, and the OVOC network management servers in the markets we serve”.
“We have coupled this quarterly growth in sales with a conservative approach to cost control which has allowed top line growth to filter through to higher gross margin and net income. We maintain a high level of confidence in our business for the second half of the year and coming years due to the top line growth opportunities combined with our strong balance sheet. In the second quarter of 2016 we have continued to buy back shares while increasing investment in our core growth areas,” concluded Mr. Adlersberg.
Share Buy Back Program
During the quarter ended June 30, 2016, AudioCodes acquired 421,000 shares for a total consideration of approximately $1.8 million. Since August 2014, AudioCodes had acquired an aggregate of 7.4 million shares as of June 30, 2016 for an aggregate consideration of approximately $31.5 million.
In May 2016, AudioCodes received court approval in Israel to purchase up to an aggregate of $15 million of additional ordinary shares pursuant to its share repurchase program. The current court approval for share repurchases will expire on Oct 7, 2016.
Under the existing share repurchase program, on June 16, 2016, AudioCodes commenced an offer in the U.S. and Israel to purchase up to 3,000,000 of its ordinary shares, nominal (par) value NIS 0.01 per share, for $4.35 per share. The offer expired on July 20, 2016 and AudioCodes purchased 3,000,000 shares, the maximum amount of shares subject to the offer, at a price of $4.35 per share.
Niran Baruch promoted to Chief Financial Officer
The Company announced that it has promoted Niran Baruch from Chief Accounting Officer to Vice President of Finance and Chief Financial Officer, effective July 26, 2016. Mr. Baruch joined AudioCodes in 2005 initially as Director of Finance and then as Vice President of Finance. In the last year he served as Chief Accounting Officer in which role he was responsible for the management of the finance department. Mr. Baruch has over 16 years of experience in Nasdaq traded public companies, and is a Certified Public Accountant (CPA) with a BA in Business Management and Accounting.
Conference Call & Web Cast Information
AudioCodes will conduct a conference call at 8:00 A.M., Eastern Time today to discuss the Company’s second quarter 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 http://www.audiocodes.com/investors-lobby.
