Bitstream Inc. Reports Second Quarter Results for 2008
The Company reported second quarter revenue of $6,518,000 and net income of $813,000 or $0.08 per diluted share
Cambridge, MA — August 12 2008 —Bitstream Inc. (NASDAQ: BITS) today reported that it increased total revenue by $481,000 or 8% to $6,518,000 for the three months ended June 30, 2008 as compared to total revenue of $6,037,000 for the three months ended June 30, 2007. The Company’s cash and cash equivalents at June 30, 2008 totaled $13,939,000. Cash generated by operations and cash received from the exercise of stock options was $471,000 and $444,000, respectively, for the three months ended June 30, 2008, while $81,000 was invested in equipment and intangible assets and $2,350,000 was used to repurchase 388,800 shares of the Company’s common stock during the quarter.
“Our revenue grew sequentially from the first quarter, as we achieved our highest level of quarterly revenue as compared to any previous quarter since going public. Our diluted earnings per share increased $0.02 to $0.08 for the second quarter and compared to $0.06 for the three months ended March 31, 2008,” said Anna M. Chagnon, President and Chief Executive Officer. “Given general economic concerns affecting the US economy as a whole, we have decided to delay certain planned expenditures for the remainder of 2008. We do not expect that the deferral of such expenditures will negatively affect our projected growth plans.”
GAAP Results
Our income from operations decreased $288,000 or 27% to $792,000 for the three months ended June 30, 2008 as compared to $1,080,000 for the three months ended June 30, 2007, while net income decreased $412,000 or 34% to $813,000 or $0.08 per diluted share for the three months ended June 30, 2008 as compared to net income of $1,225,000 or $0.11 per diluted share for the three months ended June 30, 2007.
Non-GAAP Results
Our income from operations, not including the effect of stock-based compensation expense decreased $196,000 or 17% to $980,000 for the three months ended June 30, 2008 as compared to $1,176,000 for the three months ended June 30, 2007. Net income decreased $320,000 or 24% to $1,001,000 or $0.10 per diluted share for the three months ended June 30, 2008 as compared to net income of $1,321,000 or $0.12 per diluted share for the three months ended June 30, 2007.
A reconciliation between GAAP and non-GAAP results is provided at the end of this press release.
CONFERENCE CALL REMINDER
Today, August 12, 2008, at 4:30 p.m. EST, Bitstream will host a conference call with the financial community to discuss its results for the quarter ended June 30, 2008:
- Domestic Dial-in number: 1-866-847-7860
- International Dial-in number: 1-703-639-1427
Call into the conference number 5-10 minutes prior to the start time. An operator will request that you provide your name and organization and ask you to wait until the call begins. If you have any difficulty connecting with the conference call number, please contact at Bitstream: (617) 497-6222.
A replay of the conference call will be available through August 22, 2008 (access code): 1270212
- Domestic Replay number: 1-888-266-2081
- International Replay number: 1-703-925-2533
Bitstream Inc.
Consolidated Statements of Operations
(In Thousands, Except Per Share Data)
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended June 30, |
|
|
Six Months
Ended June 30, |
|
|
|
2008 |
|
|
2007 |
|
|
|
2008 |
|
|
2007 |
| Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
| Software license |
|
$ |
5,215 |
|
$ |
5,018 |
|
|
$ |
10,341 |
|
$ |
9,490 |
| Services |
|
|
1,303 |
|
|
1,019 |
|
|
|
2,546 |
|
|
2,038 |
| Total revenue |
|
|
6,518 |
|
|
6,037 |
|
|
|
12,887 |
|
|
11,528 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cost of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
| Software license |
|
|
1,845 |
|
|
1,703 |
|
|
|
3,859 |
|
|
3,411 |
| Services |
|
|
603 |
|
|
484 |
|
|
|
1,184 |
|
|
976 |
| Total cost of revenue |
|
|
2,448 |
|
|
2,187 |
|
|
|
5,043 |
|
|
4,387 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Gross profit |
|
|
4,070 |
|
|
3,850 |
|
|
|
7,844 |
|
|
7,141 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
| Marketing and selling |
|
|
1,244 |
|
|
971 |
|
|
|
2,379 |
|
|
1,963 |
| Research and development |
|
|
1,322 |
|
|
1,192 |
|
|
|
2,714 |
|
|
2,291 |
| General and administrative |
|
|
712 |
|
|
607 |
|
|
|
1,359 |
|
|
1,204 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total operating expenses |
|
|
3,278 |
|
|
2,770 |
|
|
|
6,452 |
|
|
5,458 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating income |
|
|
792 |
|
|
1,080 |
|
|
|
1,392 |
|
|
1,683 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest income, net |
|
|
34 |
|
|
144 |
|
|
|
130 |
|
|
268 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total other income and expense |
|
|
34 |
|
|
144 |
|
|
|
130 |
|
|
268 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income before provision for
income taxes |
|
|
826 |
|
|
1,224 |
|
|
|
1,522 |
|
|
1,951 |
| Provision for (benefit from)
income taxes |
|
|
13 |
|
|
(1 |
) |
|
|
50 |
|
|
10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income |
|
$ |
813 |
|
$ |
1,225 |
|
|
$ |
1,472 |
|
$ |
1,941 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic net earnings per share |
|
$ |
0.08 |
|
$ |
0.12 |
|
|
$ |
0.15 |
|
$ |
0.20 |
| Diluted net earnings per share |
|
$ |
0.08 |
|
$ |
0.11 |
|
|
$ |
0.14 |
|
$ |
0.18 |
| Basic weighted average shares outstanding |
|
|
9,585 |
|
|
9,817 |
|
|
|
9,796 |
|
|
9,614 |
| Diluted weighted average shares outstanding |
|
|
10,304 |
|
|
11,015 |
|
|
|
10,543 |
|
|
10,999 |
Bitstream Inc.
Consolidated Balance Sheets
(In Thousands)
(unaudited) |
|
|
|
|
|
|
|
| ASSETS |
|
June 30,
2008 |
|
|
December 31,
2007 |
| Current assets: |
|
|
|
|
|
|
| Cash and cash equivalents |
|
$ |
13,939 |
|
$ |
16,420 |
| Accounts receivable, net |
|
|
2,306 |
|
|
2,245 |
| Prepaid expenses and other current assets |
|
|
596 |
|
|
465 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total current assets |
|
|
16,841 |
|
|
19,130 |
|
|
|
|
|
|
|
| Property and equipment, net |
|
|
541 |
|
|
569 |
|
|
|
|
|
|
|
| Other assets: |
|
|
|
|
|
|
| Restricted cash |
|
|
150 |
|
|
150 |
| Goodwill |
|
|
727 |
|
|
727 |
| Intangible assets |
|
|
66 |
|
|
67 |
| Total other assets |
|
|
943 |
|
|
944 |
|
|
|
|
|
|
|
| Total assets |
|
$ |
18,325 |
|
$ |
20,643 |
|
|
|
|
|
|
|
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
| Current liabilities: |
|
|
|
|
|
|
|
| Accounts payable |
|
|
$ |
1,079 |
|
$ |
1,137 |
| Accrued expenses |
|
|
|
1,429 |
|
|
1,759 |
| Deferred revenue |
|
|
|
1,566 |
|
|
1,720 |
|
|
|
|
|
|
|
|
| Total current liabilities |
|
|
|
4,074 |
|
|
4,616 |
|
|
|
|
|
|
|
|
| Long-term liabilities |
|
|
|
10 |
|
|
40 |
|
|
|
|
|
|
|
|
| Total liabilities |
|
|
|
4,084 |
|
|
4,656 |
|
|
|
|
|
|
|
|
| Total stockholders’ equity |
|
|
|
14,241 |
|
|
15,987 |
|
|
|
|
|
|
|
|
| Total liabilities and stockholders’ equity |
|
|
$ |
18,325 |
|
$ |
20,643 |
The following table shows Bitstream’s non-GAAP results reconciled to GAAP results included in this release.
Bitstream Inc.
Non-GAAP Results
(In Thousands, Except Per Share Data)
(unaudited) |
|
|
|
|
|
|
|
|
|
|
Three Months
Ended June 30, |
|
|
|
2008 |
|
|
2007 |
|
|
|
|
|
|
|
| GAAP operating income |
|
$ |
792 |
|
$ |
1,080 |
| SFAS 123R stock-based compensation |
|
|
188 |
|
|
96 |
|
|
|
|
|
|
|
| Non-GAAP operating income |
|
$ |
980 |
|
$ |
1,176 |
|
|
|
|
|
|
|
| GAAP net income |
|
$ |
813 |
|
$ |
1,225 |
| SFAS 123R stock-based compensation |
|
|
188 |
|
|
96 |
|
|
|
|
|
|
|
| Non-GAAP net income |
|
$ |
1,001 |
|
$ |
1,321 |
|
|
|
|
|
|
|
| Diluted net income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
| GAAP net income |
|
$ |
0.08 |
|
$ |
0.11 |
| SFAS 123R stock-based compensation |
|
|
0.02 |
|
|
0.01 |
|
|
|
|
|
|
|
| Non-GAAP net income |
|
$ |
0.10 |
|
$ |
0.12 |
|
|
|
|
|
|
|
| Shares used to compute diluted net income per share |
|
|
10,304 |
|
|
11,015 |
Forward Looking Statements Disclosure
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based on management’s current expectations. Actual performance and results of operations may differ materially from those projected or suggested in the forward-looking statements due to certain risks and uncertainties, including, without limitation, market acceptance of the Company’s products, competition and the timely introduction of new products. Additional information concerning certain risks and uncertainties that would cause actual results to differ materially from those projected or suggested in the forward-looking statements is contained in the Company’s filings with the Securities and Exchange Commission, including Bitstream’s Annual Report on Form 10-K for the year ended December 31, 2007.
About Bitstream
Bitstream Inc. (NASDAQ: BITS) is a software development company that makes communications compelling. Bitstream enables customers worldwide to render high-quality text, browse the Web on wireless devices, select from the largest collection of fonts online, and customize documents over the Internet. Its core competencies include fonts and font technology, browsing technology, and publishing technology. For more information about Bitstream please visit www.bitstream.com.
.
|
