BEDFORD, Mass., Jul 28, 2010 (BUSINESS WIRE) --
iRobot Corp. (NASDAQ: IRBT), a leader in delivering robotic technology-based solutions, today announced its financial results for the second quarter ended July 3, 2010.
"Revenue, earnings per share and Adjusted EBITDA significantly exceeded expectations for the quarter," said Colin Angle, chairman and chief executive officer of iRobot. "Adjusted EBITDA was more than $12 million,or 13 percent of revenue, and we generated $15 million of operating cash flow. Cash and investments increased $48 million year-over-year to more than $98 million at quarter end.
"As a result of outstanding performance by both divisions in the second quarter and good visibility for the rest of 2010, we are increasing our full-year financial expectations."
Revenue for the second quarter of 2010 increased 59 percent to $98 million, compared with $61 million for the same quarter one year ago. Revenue for the first half of 2010 increased 63 percent to $193 million, compared with $118 million a year ago. Gross margin for the second quarter increased to 35 percent of revenue, compared with 27 percent of revenue in the second quarter of 2009. For the first half of 2010, gross margin was 35 percent, up from 28 percent for the first half of 2009. Net income in the second quarter of 2010 was $5 million, compared with a net loss of $3 million in the second quarter of 2009. Net income for the first half of 2010 was $11 million, compared with a loss of $4 million for the first half of 2009.
Business Highlights
- International home robot revenue in Q2 2010 was up more than 80 percent year-over-year to $36 million and comprised 67 percent of total home robot revenue for the quarter. Domestic home robot revenue increased 20 percent to $17 million from $14 million in the second quarter of 2009.
- Government & Industrial robot revenue increased 65 percent in the second quarter over the second quarter of 2009, driven by shipments of 138 PackBot robots and 100 Small Unmanned Ground Vehicles during the quarter.
- Year-to-date operating cash flow was $25 million, compared with $12 million in the first half of 2009.
Financial Expectations
Management provides the following expectations with respect to the year ending January 1, 2011 and the third quarter ending October 2, 2010.
|
Fiscal Year 2010: |
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| Revenue | $385 - $390 million | |||||
| Earnings Per Share | $0.51 - $0.54 | |||||
| Adjusted EBITDA | $36 - $38 million | |||||
|
Q3 2010: |
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| Revenue | $91 - $94 million | |||||
| Earnings Per Share | $0.05 - $0.06 | |||||
| Adjusted EBITDA | $5 - $6 million | |||||
Second-Quarter Conference Call
iRobot will host a conference call tomorrow at 8:30 a.m. ET to discuss its financial results for the second fiscal quarter 2010, business outlook, and outlook for future financial performance. Pertinent details include:
| Date: | Thursday, July 29, 2010 | ||||
| Time: | 8:30 a.m. ET | ||||
| Call-In Number: | 617-847-8705 | ||||
| Passcode: | 90382275 | ||||
A live, audio broadcast of the conference call will also be available at http://investor.irobot.com/phoenix.zhtml?c=193096&p=irol-irhome. An archived version of the broadcast will be available on the same website shortly after the conclusion of the live event. A replay of the telephone conference call will be available through August 5 and can be accessed by dialing 617-801-6888, passcode 69265770.
About iRobot Corp.
iRobot designs and builds robots that make a difference. The company's home robots help people find smarter ways to clean, and its government and industrial robots protect those in harm's way. iRobot's consumer and military robots feature iRobot Aware(R) robot intelligence systems, proprietary technology incorporating advanced concepts in navigation, mobility, manipulation and artificial intelligence. For more information about iRobot, please visit www.irobot.com.
For iRobot Investors
Certain statements made in this press release that are not based on historical information are forward-looking statements which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. This press release contains express or implied forward-looking statements relating to, among other things, iRobot Corp.'s expectations regarding future financial performance and growth, anticipated revenue, Adjusted EBITDA and earnings per share for fiscal year 2010 and the third quarter of 2010, and demand for and market acceptance of its products. These statements are neither promises nor guarantees, but are subject to a variety of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. In particular, the risks and uncertainties include, among other things: our ability to operate in an emerging market, the financial strength of our customers and retailers, general economic conditions, our dependence on the U.S. federal government and government contracts, market acceptance of our products, changes in government policies or spending priorities, and competition. Existing and prospective investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. iRobot Corp. undertakes no obligation to update or revise the information contained in this press release, whether as a result of new information, future events or circumstances or otherwise. For additional disclosure regarding these and other risks faced by iRobot Corp., see the disclosure contained in our public filings with the Securities and Exchange Commission.
This release includes Adjusted EBITDA, a non-GAAP financial measure as defined by SEC Regulation G. We define Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, merger and acquisition expenses, and non-cash stock compensation. A reconciliation between net income and Adjusted EBITDA is provided in the financial tables at the end of this press release.
| iRobot Corporation | ||||||||||||||
| Consolidated Statement of Operations | ||||||||||||||
| (in thousands, except per share amounts) | ||||||||||||||
| (unaudited) | ||||||||||||||
| For the three months ended | For the six months ended | |||||||||||||
| July 3, | June 27, | July 3, | June 27, | |||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||
| Revenue | ||||||||||||||
| Product revenue | $ | 85,945 | $ | 52,609 | $ | 172,056 | $ | 102,300 | ||||||
| Contract revenue | 11,859 | 8,731 | 20,678 | 15,976 | ||||||||||
| Total | 97,804 | 61,340 | 192,734 | 118,276 | ||||||||||
| Cost of Revenue | ||||||||||||||
| Product revenue | 55,825 | 37,098 | 111,425 | 70,537 | ||||||||||
| Contract revenue | 8,009 | 7,833 | 14,622 | 15,124 | ||||||||||
| Total | 63,834 | 44,931 | 126,047 | 85,661 | ||||||||||
| Gross Margin | 33,970 | 16,409 | 66,687 | 32,615 | ||||||||||
| Operating Expense | ||||||||||||||
| Research & development | 5,691 | 3,896 | 10,190 | 7,474 | ||||||||||
| Selling & marketing | 10,581 | 8,940 | 20,225 | 17,906 | ||||||||||
| General & administrative | 9,313 | 7,365 | 17,789 | 14,495 | ||||||||||
| Total | 25,585 | 20,201 | 48,204 | 39,875 | ||||||||||
| Operating income (loss) | 8,385 | (3,792 | ) | 18,483 | (7,260 | ) | ||||||||
| Other income (expense), net | 40 | 91 | 69 | (208 | ) | |||||||||
| Pre-tax income (loss) | 8,425 | (3,701 | ) | 18,552 | (7,468 | ) | ||||||||
| Income tax expense (benefit) | 3,111 | (1,092 | ) | 7,070 | (3,072 | ) | ||||||||
| Net income (loss) | $ | 5,314 | $ | (2,609 | ) | $ | 11,482 | $ | (4,396 | ) | ||||
| Net income (loss) per common share: | ||||||||||||||
| Basic | $ | 0.21 | $ | (0.10 | ) | $ | 0.46 | $ | (0.18 | ) | ||||
| Diluted | $ | 0.20 | $ | (0.10 | ) | $ | 0.44 | $ | (0.18 | ) | ||||
| Shares used in Per Common Share Calculations: | ||||||||||||||
| Basic | 25,294 | 24,967 | 25,217 | 24,946 | ||||||||||
| Diluted | 26,375 | 24,967 | 26,226 | 24,946 | ||||||||||
| Stock-based compensation included in above figures: | ||||||||||||||
| Cost of product revenue | $ | 355 | $ | 278 | $ | 687 | $ | 491 | ||||||
| Cost of contract revenue | 110 | 162 | 236 | 325 | ||||||||||
| Research & development | 245 | 101 | 277 | 98 | ||||||||||
| Selling & marketing | 289 | 338 | 645 | 655 | ||||||||||
| General & administrative | 1,202 | 1,016 | 2,246 | 1,928 | ||||||||||
| Total | $ | 2,201 | $ | 1,895 | $ | 4,091 | $ | 3,497 | ||||||
| iRobot Corporation | ||||||
| Condensed Consolidated Balance Sheet | ||||||
| (unaudited, in thousands) | ||||||
| July 3, | January 2, | |||||
| 2010 | 2010 | |||||
| Assets | ||||||
| Cash and equivalents | $ | 75,810 | $ | 71,856 | ||
| Short term investments | 22,957 | 4,959 | ||||
| Accounts receivable, net | 27,133 | 35,171 | ||||
| Unbilled revenues | 2,313 | 1,831 | ||||
| Inventory | 30,684 | 32,406 | ||||
| Deferred tax assets | 8,669 | 8,669 | ||||
| Other current assets | 3,290 | 4,119 | ||||
| Total current assets | 170,856 | 159,011 | ||||
| Property, plant and equipment, net | 22,374 | 20,230 | ||||
| Deferred tax assets | 5,623 | 6,089 | ||||
| Other assets | 14,008 | 14,254 | ||||
| Total assets | $ | 212,861 | $ | 199,584 | ||
| Liabilities and stockholders' equity | ||||||
| Accounts payable | $ | 31,768 | $ | 30,559 | ||
| Accrued expenses | 13,363 | 14,384 | ||||
| Accrued compensation | 11,153 | 13,525 | ||||
| Deferred revenue and customer advances | 1,969 | 3,908 | ||||
| Total current liabilities | 58,253 | 62,376 | ||||
| Long term liabilities | 3,799 | 4,014 | ||||
| Stockholders' equity | 150,809 | 133,194 | ||||
| Total liabilities and stockholders' equity | $ | 212,861 | $ | 199,584 | ||
| iRobot Corporation | ||||||||||||||||
| Consolidated Statement of Cash Flows | ||||||||||||||||
| (unaudited, in thousands) | ||||||||||||||||
| For the three months ended | For the six months ended | |||||||||||||||
| July 3, | June 27, | July 3, | June 27, | |||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
| Cash flows from operating activities: | ||||||||||||||||
| Net income (loss) | $ | 5,314 | $ | (2,609 | ) | $ | 11,482 | $ | (4,396 | ) | ||||||
| Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||||||||||||
| Depreciation and amortization | 1,917 | 1,950 | 3,755 | 3,864 | ||||||||||||
| Loss on disposal of property and equipment | 2 | 87 | 47 | 102 | ||||||||||||
| Stock-based compensation | 2,201 | 1,895 | 4,091 | 3,497 | ||||||||||||
| Benefit from deferred tax assets | - | (511 | ) | - | (511 | ) | ||||||||||
| Non-cash director deferred compensation | 33 | 33 | 66 | 66 | ||||||||||||
| Changes in operating assets and liabilities -- (use) source | ||||||||||||||||
| Accounts receivable | (1,054 | ) | (8,099 | ) | 8,038 | 4,639 | ||||||||||
| Unbilled revenue | 978 | (326 | ) | (482 | ) | (1,445 | ) | |||||||||
| Inventory | (816 | ) | 2,104 | 1,722 | 5,922 | |||||||||||
| Other assets | 44 | (1,001 | ) | 797 | (2,163 | ) | ||||||||||
| Accounts payable | 2,277 | 1,981 | 1,209 | 1,564 | ||||||||||||
| Accrued expenses | (990 | ) | 225 | (1,031 | ) | (33 | ) | |||||||||
| Accrued compensation | 4,850 | 1,656 | (2,372 | ) | 634 | |||||||||||
| Deferred revenue | (7 | ) | 256 | (1,939 | ) | 342 | ||||||||||
| Change in long term liabilities | (107 | ) | (108 | ) | (215 | ) | (215 | ) | ||||||||
| Net cash provided by (used in) operating activities | 14,642 | (2,467 | ) | 25,168 | 11,867 | |||||||||||
| Cash flows from investing activities: | ||||||||||||||||
| Purchase of property and equipment | (3,629 | ) | (1,672 | ) | (5,668 | ) | (2,448 | ) | ||||||||
| Purchases of investments | (7,831 | ) | - | (25,411 | ) | - | ||||||||||
| Sales of investments | 7,500 | - | 7,500 | - | ||||||||||||
| Net cash used in investing activities | (3,960 | ) | (1,672 | ) | (23,579 | ) | (2,448 | ) | ||||||||
| Cash flows from financing activities: | ||||||||||||||||
| Proceeds from stock option exercises | 1,823 | 132 | 1,927 | 459 | ||||||||||||
| Income tax withholding payment associated with restricted stock vesting | (120 | ) | (9 | ) | (279 | ) | (9 | ) | ||||||||
| Tax benefit of excess stock based compensation deductions | 568 | 268 | 717 | 268 | ||||||||||||
| Net cash provided by financing activities | 2,271 | 391 | 2,365 | 718 | ||||||||||||
| Net increase (decrease) in cash and cash equivalents | 12,953 | (3,748 | ) | 3,954 | 10,137 | |||||||||||
| Cash and cash equivalents, at beginning of period | 62,857 | 54,737 | 71,856 | 40,852 | ||||||||||||
| Cash and cash equivalents, at end of period | $ | 75,810 | $ | 50,989 | $ | 75,810 | $ | 50,989 | ||||||||
| iRobot Corporation | ||||||||||||||||
| Supplemental Information | ||||||||||||||||
| (unaudited) | ||||||||||||||||
| For the three months ended | For the six months ended | |||||||||||||||
| July 3, | June 27, | July 3, | June 27, | |||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
| Revenue: * | ||||||||||||||||
| Home Robots | $ | 52,904 | $ | 34,099 | $ | 105,451 | $ | 66,922 | ||||||||
| Domestic | $ | 17,160 | $ | 14,358 | $ | 33,247 | $ | 29,643 | ||||||||
| International | $ | 35,744 | $ | 19,741 | $ | 72,204 | $ | 37,279 | ||||||||
| Retail | $ | 47,525 | $ | 27,263 | $ | 93,792 | $ | 54,079 | ||||||||
| Direct | $ | 5,379 | $ | 6,836 | $ | 11,659 | $ | 12,843 | ||||||||
| Government & Industrial | $ | 44,900 | $ | 27,241 | $ | 87,283 | $ | 51,354 | ||||||||
| Domestic | $ | 43,406 | $ | 25,404 | $ | 80,473 | $ | 46,695 | ||||||||
| International | $ | 1,494 | $ | 1,837 | $ | 6,810 | $ | 4,659 | ||||||||
| Product | $ | 33,041 | $ | 18,510 | $ | 66,605 | $ | 35,378 | ||||||||
| Contract | $ | 11,859 | $ | 8,731 | $ | 20,678 | $ | 15,976 | ||||||||
| Product Life Cycle | $ | 9,581 | $ | 4,542 | $ | 17,561 | $ | 8,931 | ||||||||
| Gross Margin Percent: | ||||||||||||||||
| Home Robots | 39.2 | % | 29.6 | % | 38.6 | % | 30.3 | % | ||||||||
| Government & Industrial | 29.5 | % | 23.1 | % | 29.8 | % | 24.1 | % | ||||||||
| Total Company | 34.7 | % | 26.8 | % | 34.6 | % | 27.6 | % | ||||||||
| Units shipped: | ||||||||||||||||
| Home Robots * | 294 | 192 | 581 | 375 | ||||||||||||
| Government & Industrial | 250 | 151 | 516 | 301 | ||||||||||||
| Average gross selling prices for robot units: | ||||||||||||||||
| Home Robots | $ | 188 | $ | 189 | $ | 189 | $ | 185 | ||||||||
| Government & Industrial * | $ | 94 | $ | 93 | $ | 95 | $ | 88 | ||||||||
| Government & Industrial Funded Product Backlog * | $ | 12,164 | $ | 17,537 | $ | 12,164 | $ | 17,537 | ||||||||
| Days sales outstanding | 27 | 52 | 27 | 52 | ||||||||||||
| Days in inventory | 50 | 70 | 50 | 70 | ||||||||||||
| Headcount | 613 | 508 | 613 | 508 | ||||||||||||
| * in thousands | ||||||||||||||||
| iRobot Corporation | ||||||||||||||||
| Adjusted EBITDA Reconciliation to GAAP | ||||||||||||||||
| (unaudited, in thousands) | ||||||||||||||||
| For the three months ended | For the six months ended | |||||||||||||||
| July 3, | June 27, | July 3, | June 27, | |||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
| Net income (loss) | $ | 5,314 | $ | (2,609 | ) | $ | 11,482 | $ | (4,396 | ) | ||||||
| Interest income, net | (197 | ) | (15 | ) | (367 | ) | (36 | ) | ||||||||
| Income tax expense (benefit) | 3,111 | (1,092 | ) | 7,070 | (3,072 | ) | ||||||||||
| Depreciation | 1,778 | 1,820 | 3,477 | 3,613 | ||||||||||||
| Amortization | 139 | 128 | 278 | 251 | ||||||||||||
| EBITDA | 10,145 | (1,768 | ) | 21,940 | (3,640 | ) | ||||||||||
| Stock-based compensation expense | 2,201 | 1,895 | 4,091 | 3,497 | ||||||||||||
| Merger and acquisition expense | 61 | - | 71 | - | ||||||||||||
| Adjusted EBITDA | $ | 12,407 | $ | 127 | $ | 26,102 | $ | (143 | ) | |||||||
| Use of Non-GAAP Financial Measures | ||||||||||||||||
| In evaluating its business, iRobot considers and uses Adjusted EBITDA as a supplemental measure of its operating performance. The Company defines Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, merger and acquisition expenses, and non-cash stock compensation. The Company also presents Adjusted EBITDA because it believes it is frequently used by securities analysts, investors and other interested parties as a measure of financial performance. | ||||||||||||||||
| The term Adjusted EBITDA is not defined under U.S. generally accepted accounting principles, or U.S. GAAP, and is not a measure of operating income, operating performance or liquidity presented in accordance with U.S. GAAP. Adjusted EBITDA has limitations as an analytical tool, and when assessing the Company's operating performance, investors should not consider Adjusted EBITDA in isolation, or as a substitute for net income (loss) or other consolidated income statement data prepared in accordance with U.S. GAAP. Among other things, Adjusted EBITDA does not reflect the Company's actual cash expenditures. Other companies may calculate similar measures differently than iRobot, limiting their usefulness as comparative tools. iRobot compensates for these limitations by relying primarily on its GAAP results and using Adjusted EBITDA only supplementally. | ||||||||||||||||
SOURCE: iRobot Corp.
iRobot Corp.
Investor Relations:
Elise Caffrey, 781-430-3003
ecaffrey@irobot.com
or
Media Relations:
Charlie Vaida, 781-430-3182
cvaida@irobot.com