EX-99.1 2 d342435dex991.htm PRESS RELEASE Press Release

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Investor Relations Contact:

Brian Norris

Acme Packet

+1.781.328.4790

bnorris@acmepacket.com

  

Media and Analyst Contact:

Mike O’Malley

Acme Packet

+1.781.869.2975

momalley@acmepacket.com

Acme Packet Reports Results for First Quarter of 2012

Bedford, Massachusetts – May 2, 2012 — Acme Packet, Inc. (NASDAQ: APKT), the leader in session delivery network solutions, today announced results for the first quarter of 2012. All earnings per share results are on a fully diluted basis.

Results for the First Quarter of 2012

Total revenue for the first quarter of 2012 was $70.8 million, compared to $74.0 million in the first quarter of 2011 and $83.0 million in the fourth quarter of 2011. Net income for the first quarter of 2012 was $2.4 million, or $0.03 per share, compared to $13.7 million, or $0.19 per share, in the first quarter of 2011 and $8.7 million, or $0.12 per share, in the fourth quarter of 2011. Net income on a non-GAAP1 basis for the first quarter of 2012 was $12.2 million, or $0.17 per share, compared to $18.9 million, or $0.27 per share, in the first quarter of 2011, and $18.3 million, or $0.26 per share, in the fourth quarter of 2011.

Company to Host Live Conference Call and Webcast

The Company’s management team plans to host a live conference call and webcast at 4:30 p.m. eastern time today to discuss the financial results as well as management’s outlook for the business. The conference call may be accessed in the United States by dialing 1.877.777.1972 and using access code “APKT”. The conference call may be accessed outside of the United States by dialing +1.612.332.0932 and using access code “APKT”. The conference call will be simultaneously webcast on the Company’s investor relations website, which can be accessed at www.ir.acmepacket.com. A replay of the conference call will be available approximately two hours after the call by dialing 1.800.475.6701 or +1.320.365.3844 and using access code 243684 or by accessing the webcast replay on the Company’s investor relations website.


1 A reconciliation of GAAP to non-GAAP results, and a statement on the use of non-GAAP financial measures, is included at the end of this press release.

About Acme Packet

Acme Packet (NASDAQ: APKT), the leader in session delivery network solutions, enables the trusted, first-class delivery of next-generation voice, video, data and unified communications services and applications across IP networks. Our Net-Net product family fulfills demanding security, service assurance and regulatory requirements in service provider, enterprise and contact center networks. Based in Bedford, Massachusetts, Acme Packet designs and manufactures its products in the USA, selling them through over 230 reseller partners worldwide. More than 1,675 customers in 108 countries have deployed over 18,000 Acme Packet systems, including 88 of the top 100 service providers and 41 of the Fortune 100. For more information visit www.acmepacket.com.

Acme Packet, Inc. Safe Harbor Statement

Statements contained herein that are not historical fact may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements may relate to, among other things, expected financial and operating results, expected growth rates, future stock-based compensation and amortization expenses, future business prospects and market conditions. Such forward-looking statements do not constitute guarantees of future performance and are subject to a variety of risks and uncertainties that could cause actual results to differ materially from those anticipated. These include, but are not limited to: the amount of stock-based compensation awarded; the applicable Company stock price used to determine stock-based compensation; the exercise pattern of employee stock options; difficulties expanding the Company’s customer base; difficulties leveraging market opportunities; difficulties providing solutions that meet the needs of customers; poor product sales; long sales cycles; difficulties developing new products; difficulties in relationships with vendors and partners; higher risks in international operations; difficulties managing rapid growth; difficulties managing the Company’s financial performance; the ability to hire and retain employees and appropriately staff operations; the Company’s cash needs; the impact of new accounting pronouncements and increased competition. Additional factors that could cause actual results to differ materially from those projected or suggested in any forward-looking statements are contained in the Company’s recent filings with the Securities and Exchange Commission, including those factors discussed under the caption “Risk Factors” in such filings.


Acme Packet, Inc.

Condensed Consolidated Statements of Income

(in thousands, except share and per share data)

(unaudited)

 

     Three Months Ended
March 31,
 
     2012      2011  

Revenue:

     

Product

   $ 53,464       $ 59,742   

Maintenance, support and service

     17,366         14,225   
  

 

 

    

 

 

 

Total revenue

     70,830         73,967   
  

 

 

    

 

 

 

Cost of revenue:

     

Product

     9,978         9,945   

Maintenance, support and service

     3,958         3,006   
  

 

 

    

 

 

 

Total cost of revenue

     13,936         12,951   
  

 

 

    

 

 

 

Gross profit

     56,894         61,016   
  

 

 

    

 

 

 

Operating expenses:

     

Sales and marketing

     31,002         23,703   

Research and development

     15,097         11,294   

General and administrative

     6,438         4,577   

Merger and integration-related costs

     37         180   
  

 

 

    

 

 

 

Total operating expenses

     52,574         39,754   
  

 

 

    

 

 

 

Income from operations

     4,320         21,262   

Other income, net

     94         102   

Income before provision for income taxes

     4,414         21,364   
  

 

 

    

 

 

 

Provision for income taxes

     1,985         7,655   
  

 

 

    

 

 

 

Net income

   $ 2,429       $ 13,709   
  

 

 

    

 

 

 

Net income per share:

     

Basic

   $ 0.04       $ 0.21   

Diluted

   $ 0.03       $ 0.19   

Weighted average number of common shares used in the calculation of net income per share:

     

Basic

     67,953,550         65,076,303   

Diluted

     70,858,871         70,476,973   


Acme Packet, Inc.

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

 

     March 31,
2012
    December 31,
2011
 
Assets     

Current assets:

    

Cash and cash equivalents

   $ 128,151      $ 160,403   

Short-term investments

     247,713        191,672   

Accounts receivable, net

     60,568        59,739   

Inventory

     11,003        10,246   

Deferred product costs

     864        1,515   

Deferred tax asset, net

     4,809        4,809   

Income taxes receivable

     4,634        4,341   

Other current assets

     5,183        4,385   
  

 

 

   

 

 

 

Total current assets

     462,925        437,110   

Long-term investments

     25,451        20,096   

Property and equipment, net

     27,530        26,252   

Intangible assets, net

     8,078        8,569   

Goodwill

     3,778        3,778   

Deferred tax asset, net

     18,371        18,371   

Other assets

     239        230   
  

 

 

   

 

 

 

Total assets

   $ 546,372      $ 514,406   
  

 

 

   

 

 

 
Liabilities and Stockholders’ Equity     

Current liabilities:

    

Accounts payable

   $ 7,125      $ 10,318   

Accrued expenses and other current liabilities

     13,238        12,715   

Deferred revenue

     34,822        22,261   
  

 

 

   

 

 

 

Total current liabilities

     55,185        45,294   
  

 

 

   

 

 

 

Deferred revenue, net of current portion

     2,304        2,049   
  

 

 

   

 

 

 

Deferred rent

     4,495        4,533   
  

 

 

   

 

 

 

Stockholders’ equity:

    

Common stock

     75        74   

Additional paid-in capital

     383,191        363,769   

Treasury stock, at cost

     (37,522     (37,522

Accumulated other comprehensive income

     7        1   

Retained earnings

     138,637        136,208   
  

 

 

   

 

 

 

Total stockholders’ equity

     484,388        462,530   
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 546,372      $ 514,406   
  

 

 

   

 

 

 

Condensed Consolidated Statements of Cash Flow

(in thousands)

(unaudited)

 

     Three Months Ended
March 31,
 
     2012     2011  

Cash provided by operating activities

   $ 26,695      $ 11,541   

Cash used in investing activities

     (65,472     (4,273

Cash provided by financing activities

     6,525        19,987   


Acme Packet, Inc.

Statement on Use of Non-GAAP Financial Measures and

Reconciliation of Non-GAAP Net Income and Non-GAAP Net Income Per Share

(in thousands, except share and per share data)

(unaudited)

Statement on Use of Non-GAAP Financial Measures:

To supplement its condensed consolidated statements of income presented in accordance with accounting principles generally accepted in the United States (“GAAP”), the Company discloses certain non-GAAP financial measures, including “non-GAAP net income”, “net income on a non-GAAP basis”, “non-GAAP EPS”, and “net income per share on a non-GAAP basis”. These non-GAAP financial measures are not presented in accordance with GAAP and are not meant to be a substitute for the most directly comparable GAAP measures of “net income”, “EPS”, or “net income per share”. Rather, these non-GAAP financial measures should be evaluated in conjunction with its most directly comparable GAAP financial measure and the Company’s financial statements as a whole.

Management uses these supplemental non-GAAP financial measures to evaluate performance period over period, to analyze the underlying trends in the Company’s business, to assess its performance relative to its competitors, and to establish operational goals and forecasts that are used in allocating resources. Management uses these non-GAAP financial measures because they exclude stock-based compensation expense which is a non-cash charge and related payroll taxes, amortization of acquired intangible assets, and merger and integration-related costs associated with the Company’s acquisition activities all of which are non-operational costs and expenses. By excluding stock-based compensation expense and related payroll taxes, amortization of acquired intangible assets, and merger and integration-related costs, management can compare the Company’s operations to prior periods and to the operations of other companies in its industry who may have materially different unusual, non-operational charges. Management does not consider any of stock-based compensation expense and related payroll taxes, amortization of acquired intangible assets, and merger and integration-related costs to be part of the Company’s operating activities or meaningful in evaluating the Company’s past financial performance or future prospects. Management believes that excluding these items is useful to investors because it is more representative of ongoing costs and therefore more comparable to historical operations.

Because management uses them, management believes that the disclosure of these non-GAAP financial measures to investors provides greater transparency and useful information to help the investor better understand the Company’s operating performance and to evaluate the methodology used by management to evaluate and measure such performance. Notwithstanding their utility to investors in understanding operational trends, these non-GAAP measures should not be considered measures of the Company’s liquidity. In addition, the Company cautions that its definition of “non-GAAP net income”, “net income on a non-GAAP basis”, “non-GAAP EPS” and “net income per share on a non-GAAP basis” may differ from similar measures used by other companies and may differ from period to period. Also, in future periods, management may make other adjustments for expenses and gains that it does not consider reflective of core operating performance in a particular period thereby modifying its definition of “non-GAAP net income”, “non-GAAP EPS” and “non-GAAP net income per share” by excluding these other or additional expenses and gains.


Reconciliation of GAAP to Non-GAAP Financial Measures for the Three Months Ended March 31, 2012, March 31, 2011 and December 31, 2011:

Acme Packet, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

Three Months Ended March 31, 2012

(in thousands, except per share data)

(unaudited)

 

     GAAP      Stock-based
compensation
expense and
related
payroll taxes
    Amortization
of acquired
intangible
assets
    Merger and
integration-
related
costs
    Non-GAAP1  

Cost of revenue:

           

Product

   $ 9,978       $ (428   $ (434   $ —        $ 9,116   

Maintenance, support and service

     3,958         (702     —          —          3,256   

Operating expenses:

           

Sales and marketing

     31,002         (6,414     (57     —          24,531   

Research and development

     15,097         (4,295     —          —          10,802   

General and administrative

     6,438         (2,077     —          —          4,361   

Merger and integration-related costs

     37         —          —          (37     —     

Provision for income taxes

     1,985         4,473        188        —          6,646   

Net income

   $ 2,429       $ 9,443      $ 303      $ 37      $ 12,212   

Net income per share:

           

Basic

   $ 0.04       $ 0.14      $ 0.00      $ 0.00      $ 0.18   

Diluted

   $ 0.03       $ 0.13      $ 0.00      $ 0.00      $ 0.17   

Acme Packet, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

Three Months Ended March 31, 2011

(in thousands, except per share data)

(unaudited)

 

     GAAP      Stock-based
compensation
expense and
related
payroll taxes
    Amortization
of acquired
intangible
assets
    Merger and
integration-
related
costs
    Non-GAAP1  

Cost of revenue:

           

Product

   $ 9,945       $ (262   $ (371   $ —        $ 9,312   

Maintenance, support and service

     3,006         (451     —          —          2,555   

Operating expenses:

           

Sales and marketing

     23,703         (3,579     (46     —          20,078   

Research and development

     11,294         (2,242     (12     —          9,040   

General and administrative

     4,577         (980     —          —          3,597   

Merger and integration-related costs

     180         —          —          (180     —     

Provision for income taxes

     7,655         2,737        156        —          10,548   

Net income

   $ 13,709       $ 4,777      $ 273      $ 180      $ 18,939   

Net income per share:

           

Basic

   $ 0.21       $ 0.07      $ 0.00      $ 0.00      $ 0.29   

Diluted

   $ 0.19       $ 0.07      $ 0.00      $ 0.00      $ 0.27   


Acme Packet, Inc.

Reconciliation of GAAP to Non-GAAP Financial Measures

Three Months Ended December 31, 2011

(in thousands, except per share data)

(unaudited)

 

     GAAP      Stock-based
compensation
expense and
related
payroll taxes
    Amortization
of acquired
intangible
assets
    Non-GAAP1  

Cost of revenue:

         

Product

   $ 12,155       $ (314   $ (385   $ 11,456   

Maintenance, support and service

     3,118         (577     —          2,541   

Operating expenses:

         

Sales and marketing

     29,940         (4,857     (100     24,983   

Research and development

     14,221         (3,063     (11     11,147   

General and administrative

     6,073         (1,574     —          4,499   

Provision for income taxes

     8,681         1,148        174        10,003   

Net income

   $ 8,717       $ 9,237      $ 322      $ 18,276   

Net income per share:

         

Basic

   $ 0.13       $ 0.14      $ 0.00      $ 0.27   

Diluted

   $ 0.12       $ 0.13      $ 0.00      $ 0.26   

Acme Packet, Inc.

Other Operational Data

(unaudited)

 

     Three Months Ended  
     March 31,
2012
     December 31,
2011
     March 31,
2011
 

Other operational data:

        

Depreciation and amortization (in thousands)

   $ 2,958       $ 2,944       $ 2,358   

Capital expenditures (in thousands)

   $ 3,745       $ 4,186       $ 4,644   

Days sales outstanding

     77         65         53   

Total headcount

     764         752         641   

Quarterly inventory turnover – annualized

     3.76         4.41         5.79