BEDFORD, Mass., May 8 /PRNewswire-FirstCall/ -- Aware, Inc.
(Nasdaq: AWRE), a leading supplier of broadband technology and biometrics
software, today reported financial results for its first quarter ended March
31, 2008.
Revenues for the first quarter of 2008 were $5.9 million, an increase of
1% compared to $5.8 million in the same quarter last year.
The Company reports its net income and basic and diluted net income per
share in accordance with U.S. generally accepted accounting principles (GAAP),
and additionally, on a non-GAAP basis. Non-GAAP net income, where applicable,
excludes the effect of stock-based compensation expense. The company uses the
non-GAAP information internally to evaluate its operating performance and
believes these non-GAAP measures are useful to investors as they provide
additional insight into the underlying operating results. However, non-GAAP
measures are not stated in accordance with, should not be considered in
isolation from, and are not a substitute for, GAAP measures. A reconciliation
of GAAP to non-GAAP results has been provided in the attached financial
tables.
The GAAP net loss for the first quarter of 2008 was $1.3 million, or $0.05
per diluted share, which included $0.3 million of stock-based compensation
charges in accordance with the provisions of FAS 123(R). This compared to a
GAAP net loss of $0.1 million, or $0.00 per diluted share, for the same period
a year ago.
The Non-GAAP net loss for the first quarter of 2008, excluding the effect
of stock-based compensation, was $1.0 million, or $0.04 per diluted share.
Note: Aware's conference call will be broadcast live over the Internet
today, May 8, 2008 at 5:00 p.m. Eastern Time. To listen to the call, please go
to http://www.aware.com/ir. The conference call may also be heard by calling
617-213-4852 and referencing the confirmation number 86740432. A replay of the
call will be archived on our website after the call.
About Aware
Aware is a leading technology supplier for the telecommunications
industries. For more than ten years, Aware has pioneered innovations at
telecommunications standards-setting organizations and continues to develop
and market DSL silicon intellectual property and test and diagnostics
products. Its StratiPHY(tm) IP product line supports DSL standards, including
ADSL2+ and VDSL2, and has been broadly licensed to leading semiconductor
companies. Telecom equipment vendors and phone companies use Aware's DSL test
and diagnostics modules and Dr. DSL(R) software to help provision DSL circuits
globally. Aware is also a veteran of the biometrics industry, providing
biometric and imaging software components used in government systems worldwide
since 1992. Aware's interoperable, standard-compliant, field-proven imaging
products are used in a number of applications, from border management to
criminal justice to medical imaging. Aware is a publicly held company
(Nasdaq: AWRE) based in Bedford, Massachusetts. http://www.aware.com.
Safe Harbor Warning
Portions of this release contain forward-looking statements regarding
future events and are subject to risks and uncertainties, such as estimates or
projections of future revenue and earnings and the growth of the DSL and
biometrics markets. Aware wishes to caution you that there are factors that
could cause actual results to differ materially from the results indicated by
such statements. The DSL factors include, but are not limited to: we have a
unique business model, our quarterly results are difficult to predict, our DSL
licensing and DSL test and diagnostic businesses depend upon a limited number
of customers, we derive a significant amount of revenue from a small number of
customers, we depend on equipment companies to incorporate our technology into
their products, we face intense competition from other DSL vendors, DSL
technology competes with other technologies for broadband access, our business
could be harmed if our test and diagnostic hardware and software products have
quality problems, we depend on a single source contract manufacturer for the
manufacture of our DSL hardware products, our manufacturing systems may not be
adequate for our DSL test and diagnostics hardware products, we depend on
single source suppliers for components in our DSL hardware products, and our
business is subject to rapid technological change. The biometric factors
include, but are not limited to: market acceptance of our biometric products,
changes in contracting practices of government or law enforcement agencies,
announcements or introductions of new products by our competitors, delays,
failures or problems in our biometric products, delays in the adoption of new
industry biometric standards, and competitive pressures resulting in lower
software product revenues. We refer you to the documents Aware files from time
to time with the Securities and Exchange Commission, specifically the section
titled Risk Factors in our annual report on Form 10-K for the fiscal year
ended December 31, 2007 and other reports and filings made with the Securities
and Exchange Commission.
Aware, StratiPHY, and Dr. DSL are trademarks or registered trademarks of
Aware, Inc.
AWARE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(unaudited)
Three Months Ended
March 31,
2008 2007
Revenue:
Product sales $3,924 $3,465
Contract revenue 1,521 1,834
Royalties 431 501
Total revenue 5,876 5,800
Costs and expenses:
Cost of product sales (1) 824 495
Cost of contract revenue (1) 1,018 1,352
Research and development (1) 3,528 2,557
Selling and marketing (1) 969 873
General and administrative (1) 1,193 1,116
Total costs and expenses 7,532 6,393
Net loss from operations (1,656) (593)
Interest income 383 505
Net loss before provision for income taxes (1,273) (88)
Provision for income taxes (9) (10)
Net loss ($1,282) ($98)
Net loss per share - basic ($0.05) $0.00
Net loss per share - diluted ($0.05) $0.00
Weighted average shares - basic 23,880,358 23,656,931
Weighted average shares - diluted 23,880,358 23,656,931
(1) Effective January 1, 2006 the Company adopted Statement of Financial
Accounting Standard No. 123 (Revised), "Share-Based Payment" (FAS
123(R)). The amounts in the tables above include stock-based
compensation as follows (in thousands):
Three Months Ended
March 31,
2008 2007
Cost of product sales $3 $2
Cost of contract revenue 34 36
Research and development 167 85
Sales and marketing 31 21
General and administrative 90 91
Total stock-based compensation costs $325 $235
AWARE, INC.
Non-GAAP Financial Measures and Reconciliation
(In thousands, except per share data)
(unaudited)
Three Months Ended
March 31,
2008 2007
GAAP net loss ($1,282) ($98)
Stock-based compensation 325 235
Non-GAAP net income (loss) ($957) $137
Three Months Ended
March 31,
2008 2007
GAAP diluted net loss per share ($0.05) ($0.00)
Stock-based compensation per share 0.01 0.01
Non-GAAP diluted net income (loss) per share ($0.04) $0.01
AWARE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(unaudited)
March 31, December 31,
2008 2007
ASSETS
Cash and investments $40,304 $38,549
Accounts receivable, net 5,044 7,661
Inventories, net 1,513 1,424
Property and equipment, net 7,879 7,872
Other assets, net 850 877
Total assets $55,590 $56,383
LIABILITIES AND STOCKHOLDERS' EQUITY
Total current liabilities $2,823 $2,817
Long-term deferred revenue 330 330
Total stockholders' equity 52,437 53,236
Total liabilities and stockholders' equity $55,590 $56,383
