Bitstream Inc. Reports Second Quarter Results for 2009
The Company reported second quarter revenue of $5,249,000 and net income of $319,000 or $0.03 per diluted share.
CAMBRIDGE, MA –August 11, 2009—Bitstream Inc. (Nasdaq: BITS) today reported that total revenue decreased by $1,269,000 or 19% to $5,249,000 for the three months ended June 30, 2009 as compared to total revenue of $6,518,000 for the three months ended June 30, 2008. Total revenue for the three months ended June 30, 2009 increased by $248,000 or 5.0% as compared to total revenue of $5,001,000 for the three months ended March 31, 2009. The Company’s cash and cash equivalents at June 30, 2009 totaled $17,067,000, an increase of $10,000 from a balance of $17,057,000 at March 31, 2009.
“We are pleased to report that during the second quarter of 2009 we increased our gross profit by $255,000 and decreased our operating expenses by $269,000 as compared to the first quarter of 2009 resulting in income from operations increasing $524,000 for the three months ended June 30, 2009 to $358,000 as compared to a loss from operations of $(166,000) for the three months ended March 31, 2009,” said Anna M. Chagnon, President and Chief Executive Officer. “Although our revenue continues to be affected by global economic concerns and longer corporate sales cycles, we remain optimistic about our ability to drive future revenue growth given the growing demand for many of our products and the opportunities we see to generate additional revenue by licensing our new Bolt Browser.”
GAAP Results
Our income from operations decreased $434,000 or 55% to $358,000 for the three months ended June 30, 2009 as compared to $792,000 for the three months ended June 30, 2008. Net income decreased $494,000 or 61% to $319,000 or $0.03 per diluted share for the three months ended June 30, 2009 as compared to net income of $813,000 or $0.08 per diluted share for the three months ended June 30, 2008.
Non-GAAP Results
Our income from operations, not including the effect of stock-based compensation expense, decreased $416,000 or 42% to $564,000 for the three months ended June 30, 2009 as compared to $980,000 for the three months ended June 30, 2008. Net income, not including the effect of stock-based compensation expense, decreased $476,000 or 48% to $525,000 or $0.05 per diluted share for the three months ended June 30, 2009 as compared to net income of $1,001,000 or $0.10 per diluted share for the three months ended June 30, 2008.
A reconciliation between GAAP and non-GAAP results is provided at the end of this press release.
Bitstream Inc.
Consolidated Statements of Operations
(In Thousands, Except Per Share Data)
(unaudited)
Three Months Ended June 30,
Six Months Ended June 30,
2009
2008
2009
2008
Revenue:
Software license
$
4,084
$
5,215
$
7,849
$
10,341
Services
1,165
1,303
2,401
2,546
Total revenue
5,249
6,518
10,250
12,887
Cost of revenue:
Software license
1,602
1,845
3,167
3,859
Services
539
603
1,122
1,184
Total cost of revenue
2,141
2,448
4,289
5,043
Gross profit
3,108
4,070
5,961
7,844
Operating expenses:
Marketing and selling
874
1,244
1,907
2,379
Research and development
1,193
1,322
2,407
2,714
General and administrative
683
712
1,455
1,359
Total operating expenses
2,750
3,278
5,769
6,452
Operating income
358
792
192
1,392
Interest and other income, net
16
34
35
130
Income before provision for income taxes
374
826
227
1,522
Provision for income taxes
55
13
61
50
Net income
$
319
$
813
$
166
$
1,472
Basic net earnings per share
$
0.03
$
0.08
$
0.02
$
0.15
Diluted net earnings per share
$
0.03
$
0.08
$
0.02
$
0.14
Basic weighted average shares outstanding
9,786
9,585
9,755
9,796
Diluted weighted average shares outstanding
10,152
10,304
10,140
10,543
Bitstream Inc.
Consolidated Balance Sheets
(In Thousands)
(unaudited)
ASSETS
June 30, 2009
December 31, 2008
Current assets:
Cash and cash equivalents
$
17,067
$
16,162
Accounts receivable, net
1,697
1,827
Prepaid expenses and other current assets
377
527
Restricted cash
150
150
Total current assets
19,291
18,666
Property and equipment, net
305
427
Other assets:
Goodwill
727
727
Restricted cash, long-term
136
---
Intangible assets
74
81
Total other assets
937
808
Total assets
$
20,533
$
19,901
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
1,408
$
832
Accrued payroll and other compensation
601
1,057
Other accrued expenses
485
583
Deferred revenue
1,579
1,937
Total current liabilities
4,073
4,409
Total liabilities
4,073
4,409
Total stockholders’ equity
16,460
15,492
Total liabilities and stockholders’ equity
$
20,533
$
19,901
Bitstream Inc.
Non-GAAP Results
(In Thousands, Except Per Share Data)
(unaudited)
The following table shows Bitstream’s non-GAAP results reconciled to GAAP results included in this release.
Three Months Ended June 30,
2009
2008
GAAP operating income
$
358
$
792
SFAS 123R stock-based compensation
206
188
Non-GAAP operating income
$
564
$
980
GAAP net income
$
319
$
813
SFAS 123R stock-based compensation
206
188
Non-GAAP net income
$
525
$
1,001
Diluted net income per share:
GAAP net income
$
0.03
$
0.08
SFAS 123R stock-based compensation
0.02
0.02
Non-GAAP net income
$
0.05
$
0.10
Shares used to compute diluted GAAP net income per share
9,786
9,585
Shares used to compute diluted Non-GAAP net income per share
10,152
10,304
CONFERENCE CALL REMINDER
Today, August 11, 2009 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, 2009:
Domestic Dial-in number: 1-866-793-1306
International Dial-in number: 1-703-639-1308
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 Bitstream at (617) 497-6222.
A replay of the conference call will be available through August 21, 2009 (access code): 1386834
Domestic Replay number: 1-888-266-2081
International Replay number: 1-703-925-2533
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, 2008.
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.
