Click here to close now.

SYS-CON MEDIA Authors: Liz McMillan, Pat Romanski, Elizabeth White, Wade Williamson, Lori MacVittie

News Feed Item

PT Announces Third Quarter 2012 Financial Results

ROCHESTER, N.Y., Nov. 8, 2012 /PRNewswire/ -- PT (NASDAQ: PTIX), a leading global provider of advanced network communications solutions, today announced its unaudited financial results for the third quarter 2012.

Revenue in the third quarter 2012 amounted to $4.7 million, compared to $9.0 million in the third quarter 2011.  Revenue for the nine months ended September 30, 2012 amounted to $18.0 million, compared to $27.1 million during the corresponding period in 2011.

On the basis of generally accepted accounting principles (GAAP), the net loss in the third quarter 2012 amounted to ($1.7 million), or ($.15) per basic share, based on 11.1 million shares outstanding, including amortization of purchased intangible assets of $.03 per share and stock-based compensation expense of $.01 per share.  The GAAP net loss in the third quarter 2011 amounted to ($.1 million), or ($.01) per basic share, including a restructuring charge of $.01 per share, an impairment charge of $.04 per share, amortization of purchased intangible assets of $.03 per share and stock-based compensation expense of $.01 per share, based on 11.1 million shares outstanding.

The GAAP net loss for the nine months ended September 30, 2012 amounted to ($3.1 million), or ($.28) per basic share, including amortization of purchased intangible assets of $.08 per share and stock-based compensation expense of $.02 per share, based on 11.1 million shares outstanding.  The GAAP net loss for the nine months ended September 30, 2011 amounted to ($1.6 million), or ($.15) per basic share, including a restructuring charge of $.02 per share, an impairment charge of $.04 per share, amortization of purchased intangible assets of $.07 per share, litigation expenses of $.04 per share, and stock-based compensation expense of $.02 per share, based on 11.1 million shares outstanding.

The non-GAAP net loss in the third quarter 2012 amounted to ($1.3 million), or ($.12) per basic share, compared to non-GAAP net income of $.7 million, or $.07 per share in the third quarter 2011.  The non-GAAP net loss for the nine months ended September 30, 2012 amounted to ($2.1 million), or ($.19) per basic share, compared to net income of $.5 million, or $.04 per share for the nine months ended September 30, 2011.  Please refer to the reconciliations between GAAP and non-GAAP financial measures contained in this release.

On September 30, 2012, the Company had cash and investments amounting to $14.7 million, working capital of $17.1 million and no long-term debt.

"We are extremely dissatisfied with our third quarter results," said John Slusser, president and chief executive officer.   "After experiencing a dramatic slowdown in telecommunications equipment revenue during the second quarter 2012, we surveyed our customer base to get an updated view of their going forward product requirements and had mixed results.  Our service provider customers generally expect to make additional investments in their network infrastructure while our OEM customers were more reluctant to project requirements because of little or no visibility of demand from their end customers.  Based upon the feedback received and ongoing global economic climate uncertainty, we have concluded that our quarterly revenue run rates will likely not return to the first quarter 2012 level in the near term.  Given this circumstance, we implemented a program to bring our operations more in line with anticipated business opportunities."

On October 31, 2012, PT announced a program to restructure its operations, reduce its workforce, rationalize its product lines, and refocus its resources on initiatives that are more closely aligned with the Company's near-term objectives and market potential.  Specifically, the Company is reducing its personnel by fourteen employees or 10% of its workforce and is recording a non-cash impairment charge against certain of PT's software development costs and purchased intangible assets.  As a result of this action, the Company expects to incur fourth quarter 2012 pre-tax restructuring charges of approximately $.5 million, representing employee-related costs which will result in cash expenditures, and approximately $.8 million, which will be recorded as a non-cash impairment charge.  The Company currently estimates that the full annualized cost savings resulting from this restructuring program will be in the range of $1.3 million to $1.5 million in 2013.

About PT (www.pt.com)

PT (NASDAQ: PTIX) is a global supplier of advanced network communications solutions for telecommunication service providers, government communications, and OEM markets.  PT's product portfolio includes IP-centric network elements and applications designed for high availability, scalability, and long life cycle deployments. PT's SEGway™ SS7 and Diameter Signaling Solutions provide affordable, high density signaling and advanced routing for next-generation LTE and IMS networks. These solutions enable IP migration, gateway capabilities, SIP bridging, and core-to-edge distributed intelligence, as well as features such as Number Portability and SMS Spam Defense. PT's Multi-Protocol and Communication Server (MPS) product portfolio enables LAN/WAN, radar and Smart-Grid networks to acquire, distribute and record critical data over IP Networks. PT's industry-leading Monterey MicroTCA and IPnexus® Platforms anchor a growing portfolio of the Company's own solutions. Many other OEMs and application developers leverage PT's carrier-grade platforms and Linux® development environment (PT's NexusWare®). PT is headquartered in Rochester, NY and maintains sales and engineering offices around the world.

Forward-Looking Statements

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for certain forward-looking statements.  This press release contains forward-looking statements which reflect the Company's current views with respect to future events and financial performance, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and is subject to the safe harbor provisions of those Sections.  The Company's future operating results are subject to various risks and uncertainties and could differ materially from those discussed in the forward-looking statements and may be affected by various trends and factors which are beyond the Company's control.  These risks and uncertainties include, among other factors, business and economic conditions, rapid technological changes accompanied by frequent new product introductions, competitive pressures, dependence on key customers and the potential loss of key customers, inability to gauge order flows from customers, fluctuations in quarterly and annual results, the reliance on a limited number of third party suppliers, limitations of PT's manufacturing capacity and arrangements, the protection of PT's proprietary technology, errors or defects in our products, the effects of pending or threatened litigation, the dependence on key personnel, changes in critical accounting estimates, potential impairments related to investments, foreign regulations, possible loss or significant curtailment of significant government contracts or subcontracts, and potential material weaknesses in internal control over financial reporting.  In addition, during weak or uncertain economic periods, customers' visibility deteriorates causing delays in the placement of their orders.  These factors often result in a substantial portion of PT's revenue being derived from orders placed within a quarter and shipped in the final month of the same quarter.  Forward-looking statements should be read in conjunction with the most recent audited Consolidated Financial Statements, the Notes thereto, Risk Factors, and Management's Discussion and Analysis of Financial Condition and Results of Operations of the Company, as contained in the Company's Annual Report on Form 10-K, and other documents filed with the Securities and Exchange Commission.

Non-GAAP Financial Measures

As a supplement to the GAAP-based consolidated financial statements contained in this press release, the Company is providing a presentation of non-GAAP financial measures which can be useful to investors to gain an overall understanding of the Company's current financial performance.  Specifically, the Company believes the non-GAAP financial measures provide useful information to investors by excluding certain expenses the Company believes are not indicative of its core operating results.  The non-GAAP financial measures exclude certain expenses such as the effects of (a) amortization of purchased intangible assets, (b) stock-based compensation, (c) restructuring costs, (d) litigation expenses and (e) impairment charges – vendor software. 

Management utilizes a number of different financial measures, both GAAP and non-GAAP, in analyzing and assessing the overall performance of our business, in making operating decisions and forecasting and planning for future periods.  We also consider the use of the non-GAAP financial measures to be helpful in assessing various aspects of our business operations.

Non-GAAP financial measures are not meant to be considered a substitute for the corresponding GAAP financial information and should not be considered in isolation from measures of financial performance prepared in accordance with GAAP.  Investors are cautioned that there are material limitations associated with the use of non-GAAP financial measures as an analytical tool and that these measures should only be used to evaluate the Company's results of operations in conjunction with the corresponding GAAP financial information. 

A reconciliation of non-GAAP measures to GAAP measures is included herein. 

A conference call will be held on Monday, November 12, at 10:00 a.m., New York time, to discuss the results. All institutional investors can participate in the conference by dialing (866) 494-3746 or (416) 915-1196. The call will be available simultaneously for all other investors at (866) 494-3387 or (416) 915-1198. A digital recording of this conference call may be accessed immediately after its completion from November 12 through November 16, 2012. To access the recording, participants should dial (866) 245-6755 or (416) 915-1035 using passcode 510179. A live webcast of the conference call will be available on the PT website at www.pt.com and will be archived to the site within two hours after the completion of the call.

PT is a trademark of Performance Technologies, Inc. The names of actual companies, products, or services may be the trademarks, registered trademarks, or service marks of their respective owners in the United States and/or other countries.

 

PERFORMANCE TECHNOLOGIES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(unaudited)


ASSETS






September 30,

2012


December 31,

2011





Current assets:





Cash and cash equivalents

$ 6,881,000


$ 9,641,000


Investments

5,830,000


2,798,000


Accounts receivable

4,150,000


5,622,000


Inventories

4,693,000


5,421,000


Prepaid expenses and other assets

1,020,000


1,155,000


Prepaid income taxes

119,000


67,000


Total current assets

22,693,000


24,704,000





Investments

1,974,000


3,362,000

Property, equipment and improvements, net

1,791,000


1,891,000

Software development costs, net

4,451,000


3,932,000

Purchased intangible assets, net

3,756,000


4,390,000


Total assets

$34,665,000


$38,279,000







    


LIABILITIES AND STOCKHOLDERS' EQUITY






Current liabilities:




       Accounts payable

$   717,000


$ 1,015,000

       Accrued expenses

1,674,000


1,547,000

       Deferred revenue

3,220,000


2,808,000

       Fair value of foreign currency hedges



46,000

       Other payable



999,000

               Total current liabilities

5,611,000


6,415,000

Deferred income taxes

89,000


83,000

               Total liabilities

5,700,000


6,498,000





Stockholders' equity:




       Preferred stock




       Common stock

133,000


133,000

       Additional paid-in capital

17,533,000


17,347,000

       Retained earnings

21,099,000


24,237,000

       Accumulated other comprehensive income

18,000


(118,000)

       Treasury stock

(9,818,000)


(9,818,000)

              Total stockholders' equity

28,965,000


31,781,000

            Total liabilities and stockholders' equity

$34,665,000


$38,279,000








 

PERFORMANCE TECHNOLOGIES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2012 AND 2011
(unaudited)










Three Months Ended

September 30,


Nine Months Ended
September 30,


2012


2011


2012


2011









Sales

$ 4,671,000


$ 9,000,000


$18,045,000


$27,125,000

Cost of goods sold

2,870,000


4,454,000


9,611,000


14,419,000

Gross profit

1,801,000


4,546,000


8,434,000


12,706,000









Operating expenses:









Selling and marketing

1,232,000


1,585,000


4,127,000


4,966,000


Research and development

1,221,000


1,593,000


4,349,000


5,342,000


General and administrative

983,000


981,000


3,125,000


3,590,000


Impairment charge-vendor software



400,000




400,000


Restructuring charges



71,000




253,000


Total operating expenses

3,436,000


4,630,000


11,601,000


14,551,000

Loss from operations

(1,635,000)


(84,000)


(3,167,000)


(1,845,000)









Other income, net

42,000


(4,000)


41,000


86,000

Loss before income taxes

(1,593,000)


(88,000)


(3,126,000)


(1,759,000)









Income tax provision (benefit)

80,000


(2,000)


12,000


(123,000)


Net loss

$(1,673,000)


$ (86,000)


$(3,138,000)


$(1,636,000)

















Basic loss per share

$         (.15)


$         (.01)


$           (.28)


$           (.15)









Weighted average common shares

11,116,000


11,116,000


11,116,000


11,116,000























PERFORMANCE TECHNOLOGIES, INCORPORATED AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2012 AND 2011
(unaudited)










Three Months Ended

September 30,


Nine Months Ended
September 30,


2012


2011


2012


2011









Gross Profit Reconciliation








   GAAP gross profit

$ 1,801,000


$4,546,000


$ 8,434,000


$12,706,000

      Amortization of purchased intangible assets(a)

302,000


280,000


891,000


812,000

      Stock-based compensation(b)

4,000


3,000


10,000


9,000

         Non-GAAP gross profit

2,107,000


4,829,000


9,335,000


13,527,000

         Non-GAAP gross profit percentage of sales

45.1%


53.7%


51.7%


49.9%









Operating Expense Reconciliation








   GAAP operating expenses

3,436,000


4,630,000


11,601,000


14,551,000

      Stock-based compensation (b)

(57,000)


(63,000)


(176,000)


(225,000)

      Restructuring costs(c)



(71,000)




(253,000)

      Litigation expenses(d)







(414,000)

      Impairment charge-vendor software(e)



(400,000)




(400,000)

          Non-GAAP operating expenses

3,379,000


4,096,000


11,425,000


13,259,000










Net Loss Reconciliation








   GAAP net loss

(1,673,000)


(86,000)


(3,138,000)


(1,636,000)

      Amortization of purchased intangible assets(a)

302,000


280,000


891,000


812,000

      Stock-based compensation(b)

61,000


66,000


186,000


234,000

      Restructuring costs(c)



71,000




253,000

      Litigation expenses(d)







414,000

      Impairment charge-vendor software(e)



400,000




400,000

          Non-GAAP net (loss) income

$(1,310,000)


$  731,000


$  (2,061,000)


$  477,000









Loss per Common Share








   GAAP basic net loss per common share

$           (.15)


$         (.01)


$          (.28)


$          (.15)

   Non-GAAP basic(f) net (loss) income per common share

$           (.12)


$           .07


$          (.19)


$           .04






















The Non-GAAP financial measures above, and their reconciliation to our GAAP results for the periods presented, reflect adjustments relating to the following items:

(a)    Amortization of purchased intangible assets: a non-cash expense arising from the acquisition of intangible assets that the Company is required to amortize over their expected useful lives. The value of purchased intangible assets increased significantly as a result of the acquisition of the USP and SP2000 signaling technologies from GENBAND in January 2011.

(b)    Stock-based compensation costs: a non-cash expense incurred in accordance with share-based compensation accounting guidance.

(c)   Restructuring costs: costs incurred as a result of restructuring activities taken to bring operating expenses more in line with expected revenues. 

(d)  Litigation expenses: legal expenses not indicative of core operating activities.

(e)  Impairment charge - vendor software - One-time impairment charge recorded in connection with the termination of a marketing reseller agreement with a vendor, not indicative of core operating activities.

(f)  Basic and diluted net income per common share are identical for the three and nine months ended September 30, 2011.

SOURCE PT

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
The 17th International Cloud Expo has announced that its Call for Papers is open. 17th International Cloud Expo, to be held November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, APM, APIs, Microservices, Security, Big Data, Internet of Things, DevOps and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding bu...
Today, IT is not just a cost center. IT is an enabler and driver of business. With the emergence of the hybrid cloud paradigm, IT now has increasingly more capabilities to create new strategic opportunities for a business. Hybrid cloud allows an organization to utilize multi-tenant public clouds, dedicated private clouds, bare metal hosting, and the associated support and services for the right use cases through an on-demand, XaaS model. This model of IT creates tremendous opportunities for busi...
Business as usual for IT is evolving into a “Make or Buy” decision on a service-by-service conversation with input from the LOBs. How does your organization move forward with cloud? In his general session at 16th Cloud Expo, Paul Maravei, Regional Sales Manager, Hybrid Cloud and Managed Services at Cisco, discusses how Cisco and its partners offer a market-leading portfolio and ecosystem of cloud infrastructure and application services that allow you to uniquely and securely combine cloud busi...
Businesses are looking to empower employees and departments to do more, go faster, and streamline their processes. For all workers – but mobile workers especially – utilizing the cloud to reconnect documents and improve processes without destructing existing workflows can have a dramatic impact on productivity. In his session at 16th Cloud Expo, Mark Grilli, vice president of Acrobat Solutions marketing at Adobe Systems Incorporated, will outline new ways that the cloud is changing the way peo...
SYS-CON Events announced today that Litmus Automation will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Litmus Automation’s vision is to provide a solution for companies that are in a rush to embrace the disruptive Internet of Things technology and leverage it for real business challenges. Litmus Automation simplifies the complexity of connected devices applications with Loop, a secure and scalable clou...
While not quite mainstream yet, WebRTC is starting to gain ground with Carriers, Enterprises and Independent Software Vendors (ISV’s) alike. WebRTC makes it easy for developers to add audio and video communications into their applications by using Web browsers as their platform. But like any market, every customer engagement has unique requirements, as well as constraints. And of course, one size does not fit all. In her session at WebRTC Summit, Dr. Natasha Tamaskar, Vice President, Head of C...
With the arrival of the Big Data revolution, a data professional is expected to master a broad spectrum of complex domains including data processing, mathematics, programming languages, machine learning techniques, and business knowledge. While this mastery is undoubtedly important, this narrow focus on tool usage has divorced many from the imagination required to solve real-world problems. As the demand for analysis increases, the data science community must transform from tool experts to "data...
As Marc Andreessen says software is eating the world. Everything is rapidly moving toward being software-defined – from our phones and cars through our washing machines to the datacenter. However, there are larger challenges when implementing software defined on a larger scale - when building software defined infrastructure. In his session at 16th Cloud Expo, Boyan Ivanov, CEO of StorPool, will provide some practical insights on what, how and why when implementing "software-defined" in the dat...
SYS-CON Events announced today that WSM International (WSM), the world’s leading cloud and server migration services provider, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. WSM is a solutions integrator with a core focus on cloud and server migration, transformation and DevOps services.
SYS-CON Events announced today that MangoApps will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY., and the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. MangoApps provides private all-in-one social intranets allowing workers to securely collaborate from anywhere in the world and from any device. Social, mobile, and eas...
SYS-CON Events announced today that Emcien will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Emcien’s vision is to let anyone use data to know the future. Emcien has built an automated, predictive analysis product that improves the lives of real people. Emcien allows people to automate their data analysis so they can build a better future.
SYS-CON Events announced today that Solgenia will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY, and the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Solgenia is the global market leader in Cloud Collaboration and Cloud Infrastructure software solutions. Designed to “Bridge the Gap” between Personal and Professional S...
WSM International has launched a DevOps services division that offers assessment, consulting and implementation to large enterprises and organizations with complex infrastructures. The concept of DevOps is to blend information technology (IT) software development with operations to optimize the computing infrastructure according to the specific needs of the organization. According to a recent press release from Gartner, "By 2016, DevOps will evolve from a niche strategy employed by large cloud ...
SYS-CON Events announced today that QTS Realty Trust, one of the nation’s largest and fastest-growing providers of data center facilities and cloud services and a leader in security and compliance, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. QTS Realty Trust, Inc. (NYSE: QTS) is a leading national provider of data center solutions and fully managed services, and a leader in security and compliance...
The speed of software changes in growing and large scale rapid-paced DevOps environments presents a challenge for continuous testing. Many organizations struggle to get this right. Practices that work for small scale continuous testing may not be sufficient as the requirements grow. In his session at DevOps Summit, Marc Hornbeek, Sr. Solutions Architect of DevOps continuous test solutions at Spirent Communications, will explain the best practices of continuous testing at high scale, which is r...