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Fourth quarter highlights: - Total revenues reached a record $20.3 million, a 22% year over year increase - Record pro-forma net profit of $1.2 million (excluding the cost of options and expenses related to Harmonic and Optibase transactions), net loss on a GAAP basis of $0.2 million. - Positive operating cash flow of $1.5 million - Signing of Definitive Agreement with Harmonic to acquire Scopus
Fourth Quarter Results Summary
Revenues for the fourth quarter totaled $20.3 million, a 2% sequential increase from the $19.9 million revenues in the prior quarter, and a 22% increase over the $16.5 million reported for the fourth quarter of 2007. The breakdown of revenue by region was 39% in EMEA, 16% in Asia and the Pacific Rim, and 45% in the Americas. Gross profit for the fourth quarter of 2008 was $9.7 million compared with $10.1 million in the prior quarter, and $7.7 million in the fourth quarter of 2007. Gross profit as a percentage of revenues was 48%.
Net loss on a GAAP basis for the fourth quarter of 2008 was $0.2 million, or $0.02 loss per share, compared with a net profit of $0.5 million, or $0.04 profit per share, in the prior quarter and a net loss of $0.3 million, or $0.02 loss per share in the fourth quarter of 2007. The results for the quarter ended 31 December, 2008 included a charge of $1.1 million of costs relating to the Harmonic transaction, and the now-cancelled Optibase transaction.
Pro-forma net profit for the fourth quarter of 2008, which excludes expenses related to stock based compensation as defined under FAS123R and the above-mentioned $1.1 million charge, was a record $1.2 million, or $0.09 profit per diluted share. This is compared to a net profit (which only excludes expenses related to stock based compensation as defined under FAS123R) of $0.9 million, or $0.06 per diluted share, in the third quarter of 2008, and a net profit of $0.2 million, or $0.01 profit per share, in the fourth quarter of 2007.
The Company generated a positive operating cash flow of $1.5 million during the quarter, and ended the fourth quarter with cash and cash equivalents plus short term investments and trading securities of $36.1 million. This is compared with $34.6 million on September 30th, 2008.
Full Year 2008 Results
Revenue for the full year of 2008 was $75.7 million, a 32% increase from $57.5 million in 2007. Gross profit for the year was $37.1 million compared with $27.6 million in 2007. Gross profit, as a percentage of revenues, for the full year was 49% compared with 48% last year. Net profit on a GAAP basis for the full year of 2008 was $0.3 million, or $0.02 profit per share, compared with a loss of $2.7 million in 2007. Pro-forma net profit for the year excluding $1.4 million of FAS123R expenses and $1.1 million in costs relating to the Optibase and Harmonic transactions, was $2.9 million or $0.20 profit per diluted share, compared with a pro-forma net loss in 2007 of $0.9 million, or $0.07 loss per share.
"Our results for the fourth quarter culminate a strong year in which we saw a continued sequential growth in our revenues and improved our business fundamentals. It was also a year in which we saw a positive operating cash flow and were profitable on both a GAAP and pro-forma basis," commented Dr. Yaron Simler, CEO of Scopus. "We are pleased with the shareholder approval of the Harmonic transaction and expect closing to take place in early March 2009. We believe that the combined forces of Harmonic and Scopus, will enable us to emerge as a powerful and leading entity in the digital video network space."
Concluded Dr. Simler, "I am also pleased with the achievements of Scopus in the last two years during my tenure as CEO. During this time, the Company became profitable, experiencing double digit year over year revenue growth, and ended 2008 with revenue of $75 million."
The press release contains non-GAAP financial measures. In this regard, GAAP refers to generally accepted accounting principles in the United States. Pursuant to regulations promulgated by the Securities and Exchange Commission, the Company has provided reconciliations within the press release of the non-GAAP financial measures to the most directly comparable GAAP financial measures.
The pro-forma results provided in the press release exclude the cost of options. Due to recent changes in US GAAP regulations, in accordance with FAS123R guidelines, from the first quarter of 2006 and onwards, we have been implementing and recording options expenses as part of our P&L, management believes that the presentation of the pro forma information provides investors with a better understanding of Scopus' financial results going forward and assists investors in comparing Scopus' historical, current and future expected results.
A replay of the call will also be available from the day after the call in the investor relations section of Scopus' website at http://www.scopus.net.
About Scopus Video Networks:
Scopus Video Networks (NASDAQ:SCOP) develops, markets, and supports digital video networking solutions that enable network operators to offer advanced video services to their subscribers. Scopus' solutions support digital television, HDTV, live event coverage, and content distribution.
Scopus' comprehensive digital video networking solutions offer intelligent video gateways, encoders, decoders, and network management platforms. Scopus' solutions are designed to allow network operators to increase service revenues, improve customer retention, and minimize capital and operating expenses.
Scopus' customers include satellite, cable, and terrestrial operators, broadcasters and telecom service providers. Scopus' solutions are used by hundreds of network operators worldwide. For more information visit: http://www.scopus.net
This press release contains forward-looking statements concerning our marketing and operations plans. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. All forward-looking statements in this press release are made based on management's current expectations and estimates, which involve risks, uncertainties and other factors that could cause results to differ materially from those expressed in forward-looking statements. These statements involve a number of risks and uncertainties including, but not limited to, risks related to the evolving market for digital video in general and the infancy of the video-over-IP in particular and the ability to successfully demonstrate to service providers integrated solutions, general economic conditions and other risk factors. Scopus does not undertake any obligation to update forward-looking statements made herein.
SCOPUS VIDEO NETWORKS CONDENSED CONSOLIDATED BALANCE SHEET (Dollars in thousands) December 31, 2008 2007 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 33,717 $ 23,090 Short-term deposits - 7,227 Trading securities 2,333 5,230 Trade accounts receivable (net of allowance for doubtful accounts of $93 and $152 respectively) 10,363 12,409 Inventories 13,761 7,774 Other receivables and current assets 2,101 2,151 Total current assets 62,275 57,881 Fixed assets, net 4,317 3,453 Deposits in general severance fund 171 230 Other assets 132 105 TOTAL ASSETS $ 66,895 $ 61,669 LIABILITIES AND SHAREHOLDERS EQUITY CURRENT LIABILITIES: Trade accounts payable $ 7,590 $ 6,221 Other payables and current liabilities 12,527 11,184 Total current liabilities 20,117 17,405 Liabilities for vacation and severance pay 1,921 1,945 SHAREHOLDERS' EQUITY: Ordinary shares 4,614 4,517 Additional paid-in capital 79,514 77,428 Other comprehensive income 81 72 Accumulated deficit (39,352) (39,698) TOTAL SHAREHOLDERS' EQUITY 44,857 42,319 TOTAL LIABILITIES AND SHAREHOLDERS EQUITY $ 66,895 $ 61,669 SCOPUS VIDEO NETWORKS CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Dollars in thousands, except share and per share data) Year ended December 31, Three month ended December 31, 2 0 0 8 2 0 0 7 2 0 0 8 2 0 0 7 (Unaudited) Revenues $ 75,654 $ 57,477 $ 20,252 $ 16,533 Cost of revenues 38,541 29,901 10,531 8,839 Gross profit 37,113 27,576 9,721 7,694 Research and development expenses, net of grants from the OCS 13,735 10,675 3,315 2,867 Sales and marketing expenses 17,579 15,601 4,453 3,983 General and administrative expenses 5,285 5,692 1,472 1,579 Operating loss 514 (4,392) 481 (735) Other expenses* 1,118 - 1,118 - Financing income, net 1,036 1,673 464 468 Income (loss) before income taxes 432 (2,719) (173) (267) Income tax expense (86) (58) (54) 8 Net Income (loss) 346 (2,777) (227) (259) Basic and diluted net loss per ordinary share 0.02 (0.20) (0.02) (0.02) Diluted net earnings (loss) per ordinary share 0.02 (0.20) (0.02) (0.02) Weighted average number of ordinary shares used in basic net earnings (loss) per ordinary share computation 14,040,617 13,595,346 14,055,348 13,848,635 Weighted average number of ordinary shares used in diluted net earnings (loss) per ordinary share computation 14,188,364 13,595,346 14,055,348 13,848,635 * Includes a charge of $1.1 million of costs relating to the Optibase and Harmonic transactions Company Contact: Moshe Eisenberg CFO Tel: +972-3-900-7100 Moshee@scopus.net
SOURCE Scopus Video Networks Ltd
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