Radware Ltd. Announces Third Quarter 2013 Results

Radware Logo

* Quarterly Revenues of $48.0 Million

* Quarterly Non-GAAP EPS $0.17

TEL AVIV, Israel, Oct. 24, 2013 (GLOBE NEWSWIRE) -- Radware® (Nasdaq:RDWR), a global leader of application delivery and application security solutions for virtual and cloud data centers, today reported quarterly revenues of $48.0 million for the third quarter of 2013.

Net income on a GAAP basis for the third quarter of 2013 was $2.9 million or $0.06 per diluted share, compared with net income of $8.2 million or $0.18 per diluted share for the third quarter of 2012.

Net income on a Non-GAAP basis for the third quarter of 2013 was $7.8 million or $0.17 per diluted share, compared with net income of $10.4 million or $0.22 per diluted share for the third quarter of 2012.

At the end of the third quarter 2013, the company's overall cash position including cash, short-term and long term bank deposits and marketable securities amounted to $270.8 million.

The earnings per share presented for all prior periods were restated to reflect the effects of the stock split that occurred April 12, 2013.

"We are pleased with the continued improvement in our results as we remain focused on our application delivery and attack mitigation solutions," says Roy Zisapel, president and chief executive officer, Radware. "With increased activity levels across our SDN, cloud and cyber security solutions we feel confident in the long term growth opportunities we have both domestically and internationally."

During the third quarter 2013, Radware released the following significant announcements:

  • Radware's Web Application Firewall - AppWall® Receives ICSA Labs Certification
  • Radware Provides Critical Solutions for Network Administrators as Mobile Device Usage Increases
  • New Radware Report Reveals Top Retailers Barely Keeping Up with Online Customer Demands, Web Performance on the Decline
  • Radware Introduces DefenseFlow™ Using Cisco eXtensible Network Controller to Offer SDN DoS and DDoS Protection as a Native Network Service
  • Radware Receives Frost & Sullivan Award for 2013 South Korea Application Delivery Controller Company of the Year
  • Preparing for Notorious Cyber Attack Dates: Radware Provides Five Steps to Secure Your Network
  • Chunghwa System Integration Selects Radware to Meet Virtualization Requirement of its Customers
  • Radware Honored as Silver Stevie® Award Winner in 2013 American Business Awards
  • Radware and Brinkster Extend Cyber Security Coverage with Hybrid Attack Mitigation Solution
  • Radware Joins HP's Partnership Program Furthering its SDN Strategy
  • Radware Announces Lineup of Fall Speaking Engagements
  • Radware Announces Lineup of European and UK Speaking Engagements
  • Radware Announces ElasticScale SDN-Based Network Service Scalability Solution
  • New Radware Research Reveals Top Retailers Sites Too Slow, Struggle to Meet Customer Needs

Company management will host a quarterly investor conference call at 8:45am ET on October 24, 2013. The call will focus on financial results for the quarter ending September 30, 2013 and other matters related to the Company's business.

The conference call will be webcast on October 24, 2013 at 8:45am ET in the "listen only" mode via the Internet at: http://www.radware.com/IR/ and will be available for replay during the next 30 days.

Please use the following dial-in numbers to participate in the third quarter 2013 call:

Participants in the US call: Toll Free +1 800- 230-1096
International participants call: +1 612 234-9960
Conference ID: 304217

About Radware

Radware (Nasdaq:RDWR), is a global leader of application delivery and application security solutions for virtual and cloud data centers. Its award-winning solutions portfolio delivers full resilience for business-critical applications, maximum IT efficiency, and complete business agility.

Radware's solutions empower more than 10,000 enterprise and carrier customers worldwide to adapt to market challenges quickly, maintain business continuity and achieve maximum productivity while keeping costs down. For more information, please visit www.radware.com.

Radware encourages you to join our community and follow us on LinkedIn, Radware Blog, Twitter, YouTube and the Radware Connect app for iPhone®.

Use of Non-GAAP Financial Information

In addition to reporting financial results in accordance with generally accepted accounting principles (GAAP), Radware uses non-GAAP measures of net income and earnings per share, which are adjustments from results based on GAAP to exclude stock-based compensation expenses, in accordance with ASC No. 718, amortization of intangible assets, acquisition related expenses, litigation costs and expenses related to settlement with Israeli tax authorities and exchange rate differences, net on balance sheet items included in finance income. Such exchange rate differences may vary from period to period due to changes in exchange rates driven by general market conditions or other circumstances outside of the normal course of Radware's operations. Management believes that exclusion of these charges allows comparisons of operating results that are consistent across past, present and future periods. Radware's management believes the non-GAAP financial information provided in this release is useful to investors for the purpose of understanding and assessing Radware's ongoing operations. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of the non-GAAP financial measures discussed in this press release, to the most directly comparable GAAP financial measures, is included with the financial information contained in this press release. Management uses both GAAP and non-GAAP information in evaluating and operating business internally and, as such, has determined that it is important to provide this information to investors.

This press release may contain statements concerning Radware's future prospects that are "forward-looking statements" under the Private Securities Litigation Reform Act of 1995. Statements preceded by, followed by, or that otherwise include the words "believes", "expects", "anticipates", "intends", "estimates", "plans", and similar expressions or future or conditional verbs such as "will", "should", "would", "may" and "could" are generally forward-looking in nature and not historical facts. These statements are based on current expectations and projections that involve a number of risks and uncertainties. There can be no assurance that future results will be achieved, and actual results could differ materially from forecasts and estimates. These risks and uncertainties, as well as others, are discussed in greater detail in Radware's Annual Report on Form 20-F and Radware's other filings with the Securities and Exchange Commission. Forward-looking statements speak only as of the date on which they are made and Radware undertakes no commitment to revise or update any forward-looking statement in order to reflect events or circumstances after the date any such statement is made. Radware's public filings are available from the Securities and Exchange Commission's website at www.sec.gov or may be obtained on Radware's website at www.radware.com.

Condensed Consolidated Balance Sheets
(U.S. Dollars in thousands)
December 31,
2012
September 30,
2013
(Unaudited)
Current assets
Cash and cash equivalents 20,048 20,568
Available-for-sale marketable securities 14,004 29,491
Short-term bank deposits 54,155 40,835
Trade receivables, net 18,408 29,970
Other receivables and prepaid expenses 3,975 8,728
Inventories 12,545 13,835
123,135 143,427
Available-for-sale marketable securities 121,114 104,373
Long-term bank deposits 65,625 75,568
186,739 179,941
Property and equipment, net 13,589 16,899
Intangible assets, net 5,128 5,849
Other assets 4,594 4,783
Goodwill 24,465 30,069
Total assets 357,650 380,968
Current liabilities
Trade payables 9,915 6,005
Deferred revenues, other payables and accrued expenses 56,605 61,139
66,520 67,144
Long-term liabilities 19,900 24,396
Shareholders' equity
Share capital 599 609
Additional paid-in capital 249,739 259,125
Accumulated other comprehensive income
2,078
1,349
Treasury stock, at cost (18,082) (20,884)
Retained earnings 36,896 49,229
Total shareholders' equity 271,230 289,428
Total liabilities and shareholders' equity 357,650 380,968
Condensed Consolidated Statements of Income
(U.S. Dollars in thousands, except share and per share data)
For the Three months ended
September 30,
For the nine months ended
September 30,
2012 2013 2012 2013
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenues 47,510 48,022 139,333 139,970
Cost of revenues 8,970 9,165 26,312 26,681
Gross profit 38,540 38,857 113,021 113,289
Operating expenses:
Research and development, net 9,124 10,147 27,219 30,260
Selling and marketing 19,040 20,928 56,744 60,887
General and administrative 2,389 4,386 7,220 10,187
Total operating expenses 30,553 35,461 91,183 101,334
Operating income 7,987 3,396 21,838 11,955
Financial income, net 1,263 1,043 3,754 3,393
Income before taxes on income 9,250 4,439 25,592 15,348
Taxes on income (1,028) (1,537) (2,946) (3,015)
Net Income 8,222 2,902 22,646 12,333
Basic net earnings per share $0.19 $0.06 $0.52 $0.28
Weighted average number of shares used to compute basic net earnings per share
43,955,562

44,832,480

43,557,316

44,763,111
Diluted net earnings per share $0.18 $0.06 $0.49 $0.26
Weighted average number of shares used to compute diluted net earnings per share
46,642,794

46,572,938

46,560,588

46,756,705
*) On April 12, 2013, the Company affected a stock split of the Company's ordinary shares of two (2) for one (1). The earnings per share amounts and the share data presented for all prior periods were restated to reflect the effects of the stock split.


Reconciliation of Supplemental Financial Information
(U.S. Dollars in thousands, except share and per share data)
For the Three months ended
September 30,
For the nine months ended
September 30,
2012 2013 2012 2013
(Unaudited) (Unaudited) (Unaudited) (Unaudited)

GAAP net Income

8,222

2,902

22,646

12,333
Stock-based compensation expenses, included in:
Cost of revenues 17 13 55 39
Research and development 284 455 891 1,128
Selling and marketing 873 636 2,699 1,883
General and administrative 192 199 720 691
1,366 1,303 4,365 3,741
Amortization of intangible assets included in:
Cost of revenues 467 549 1,402 1,615
Selling and marketing 291 229 874 688
758 778 2,276 2,303
Exchange rate differences, net on balance sheet items included in finance expenses 59 171 78 450
Acquisition related expenses -- -- -- 485
Litigation costs -- 1,775 -- 1,775
Tax settlement -- 835 -- 835

Non-GAAP net income

10,405

7,764

29,365

21,922
Non-GAAP diluted net earnings per share $0.22 $0.17 $0.63 $0.47
Weighted average number of shares used to compute Non-GAAP diluted net earnings per share

46,642,794



46,572,938



46,560,588



46,756,705
*) On April 12, 2013, the Company affected a stock split of the Company's ordinary shares of two (2) for one (1). The earnings per share amounts and the share data presented for all prior periods were restated to reflect the effects of the stock split.

CONTACT: Chief Financial Officer Meir Moshe +972-3766-8610 Corporate Media Relations Brian Gallagher +1 201-785-3206 briang@radware.com

Source:Radware Ltd.