Press Releases

iRobot First-Quarter Financial Results Exceed Expectations

BEDFORD, Mass., April 21, 2015 /PRNewswire/ -- iRobot Corp. (NASDAQ: IRBT), a leader in delivering robotic technology-based solutions, today announced its financial results for the first quarter ended March 28, 2015.

iRobot logo

"Our first quarter results exceeded our expectations. Home Robot revenue was up slightly over last year while Defense & Security Robot revenue grew 17%. We are off to a good start in 2015 as we weather global macros and invest to drive Home Robot growth," said Colin Angle, chairman and chief executive officer of iRobot.

"Based on our Q1 results and our outlook for the rest of 2015, we continue to expect revenue of $625 to $635 million, driven by Home Robot growth. We are reducing the high end of our EPS and Adjusted EBITDA ranges and now expect EPS of between $1.25 and $1.35, and adjusted EBITDA of $85 to $90 million, or approximately 14% of revenue. These expectations reflect our confidence that Home Robot revenue will grow 11-13% driven by growth in the United States and China, and our incremental marketing investments to strengthen awareness and support our international partners."

Financial Results

  • Revenue for the first quarter of 2015 was $118.0 million, compared with $114.2 million for the first quarter of 2014.
  • Net income for the first quarter of 2015 was $4.8 million, compared with net income of $5.3 million for the first quarter of 2014.
  • Quarterly earnings per share were $0.16, compared with earnings per share of $0.18 in the first quarter of 2014.
  • Adjusted EBITDA for the first quarter of 2015 was $13.1 million, compared with $14.2 million in the first quarter of 2014.

Business Highlights

  • International Home Robot revenues were up 5% year over year driven by growth in EMEA and China from higher Roomba 800 sales.
  • Defense & Security revenues grew 17% in Q1 2015 from Q1 2014, and more than 70% of revenue was from spares and support.
  • We recently installed multiple Ava 500 robots at Fidelity Investments FCAT center in Boston for various applications including collaboration and FCAT tours for internal and external customers as well as partners.

Financial Expectations

Management provides the following expectations with respect to the second quarter ending June 27, 2015 and fiscal year ending January 2, 2016.










Q2 2015:









Revenue




$143 - $146 million





Earnings Per Share




$0.02 - $0.06         





Adjusted EBITDA




$8 - $10 million














Fiscal Year 2015:




Current                    




Prior

Revenue




$625 - $635 million    




$625 - $635 million

Earnings Per Share




$1.25 - $1.35     




$1.25 - $1.45

Adjusted EBITDA




$85 - $90 million        




$85 - $95 million










First-Quarter Conference Call
iRobot will host a conference call tomorrow at 8:30 a.m. ET to discuss its financial results for the first fiscal quarter 2015, business outlook, and outlook for second-quarter and fiscal year 2015 financial performance. Pertinent details include:






Date:


Wednesday, April 22, 2015  


Time:


8:30 a.m. ET


Call-In Number:


847-619-6396


Passcode:


38036249





A live, audio broadcast of the conference call will also be available at http://investor.irobot.com/phoenix.zhtml?c=193096&p=irol-eventDetails&EventId=5168625.  An archived version of the broadcast will be available on the same website shortly after the conclusion of the live event. A replay of the telephone conference call will be available through April 30, and can be accessed by dialing 630-652-3042, passcode 38036249#.

About iRobot Corp.
iRobot designs and builds robots that empower people to do more. The company's home robots help people find smarter ways to clean, its defense & security robots protect those in harm's way, and its remote presence robots enable virtual presence from anywhere in the world. iRobot's consumer and military robots feature proprietary technologies incorporating advanced concepts in navigation, mobility, manipulation and artificial intelligence. For more information about iRobot, please visit www.irobot.com.

For iRobot Investors
Certain statements made in this press release that are not based on historical information are forward-looking statements which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. This press release contains express or implied forward-looking statements relating to, among other things, iRobot Corp.'s expectations regarding future financial performance, future operating performance and growth, outlook for and future performance of our businesses, the impact of our investments to develop robotic technology, the impact of our marketing investments, and anticipated revenue, earnings per share and Adjusted EBITDA for fiscal year 2015 and the second quarter ending June 27, 2015. These statements are neither promises nor guarantees, but are subject to a variety of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. In particular, the risks and uncertainties include, among other things: our ability to operate in an emerging market, the financial strength of our customers and retailers, general economic conditions, market acceptance of our products, our dependence on the U.S. federal government and government contracts, the timing of government contracts and orders, changes in government policies or spending priorities, and competition. Existing and prospective investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. iRobot Corp. undertakes no obligation to update or revise the information contained in this press release, whether as a result of new information, future events or circumstances or otherwise. For additional disclosure regarding these and other risks faced by iRobot Corp., see the disclosure contained in our public filings with the Securities and Exchange Commission.

This press release includes Adjusted EBITDA, which is a non-GAAP financial measure as defined by SEC Regulation G. We define Adjusted EBITDA as earnings before interest, taxes, depreciation, amortization, stock-based compensation expense, merger and acquisition expense, net intellectual property litigation expense, and restructuring expense. A reconciliation between net income and Adjusted EBITDA is provided in the financial tables at the end of this press release.

 

iRobot Corporation 

Consolidated Statement of Income

(in thousands, except per share amounts)

(unaudited)








For the three months ended


March 28,

March 29,


2015

2014




Revenue

$       117,961

$       114,204

Cost of revenue

64,253

62,494




Gross margin

53,708

51,710




Operating expenses:



  Research and development

19,032

16,934

  Selling and marketing

14,188

14,532

  General and administrative

12,589

12,264

      Total operating expenses

45,809

43,730




Operating income

7,899

7,980




Other income (expense), net

(794)

(187)




Income before income taxes

7,105

7,793

Income tax expense

2,351

2,513

Net income

$           4,754

$           5,280




Net income per share



   Basic

$            0.16

$            0.18

   Diluted

$            0.16

$            0.18




Number of shares used in calculations per share



   Basic

29,653

29,189

   Diluted

30,230

30,033







Stock-based compensation included in above figures:



        Cost of revenue

$             215

$             169

        Research and development

832

731

        Selling and marketing

309

338

        General and administrative

1,751

1,840

            Total

$           3,107

$           3,078

 

 

 iRobot Corporation 

 Condensed Consolidated Balance Sheet 

 (unaudited, in thousands) 






March 28,


December 27,


2015


2014





 Assets 








 Cash and cash equivalents 

$          183,661


$        185,957

 Short term investments 

37,256


36,166

 Accounts receivable, net 

37,705


71,056

 Unbilled revenue 

633


2,614

 Inventory 

49,698


47,857

 Deferred tax assets 

22,030


21,505

 Other current assets 

9,501


9,704

   Total current assets 

340,484


374,859

 Property and equipment, net 

30,501


31,297

 Deferred tax assets 

8,393


8,409

 Goodwill 

48,751


48,751

 Intangible assets, net 

18,274


19,146

 Other assets 

11,265


10,751

 Total assets 

$          457,668


$        493,213





 Liabilities and stockholders' equity 








 Accounts payable 

$           35,666


$          60,256

 Accrued expenses 

14,322


18,701

 Accrued compensation 

7,805


16,235

 Deferred revenue and customer advances 

1,769


3,849

   Total current liabilities 

59,562


99,041

 Long term liabilities 

3,819


3,736

 Stockholders' equity 

394,287


390,436

 Total liabilities and stockholders' equity 

$          457,668


$        493,213

 

 

 iRobot Corporation 

  Consolidated Statement of Cash Flows 

 (unaudited, in thousands) 








For the three months ended


March 28,

March 29,


2015

2014

Cash flows from operating activities:



Net income

$            4,754

$            5,280

Adjustments to reconcile net income to net cash provided by (used in)
operating activities:



Depreciation and amortization 

3,561

3,142

(Gain)/Loss on disposal of property and equipment

22

(10)

Stock-based compensation 

3,107

3,078

Deferred income taxes, net

(102)

1,912

Tax benefit of excess stock based compensation deductions

(560)

(2,231)

Non-cash director deferred compensation 

38

11




Changes in operating assets and liabilities — (use) source



Accounts receivable 

33,351

2,808

Unbilled revenue 

1,981

(75)

Inventory 

(1,998)

4,080

Other assets 

203

(3,588)

Accounts payable 

(21,835)

(7,924)

Accrued expenses 

(4,374)

(1,399)

Accrued compensation 

(8,430)

(11,862)

Deferred revenue and customer advances

(2,080)

(665)

Long term liabilities

83

(319)

Net cash provided by (used in) operating activities 

7,721

(7,762)




Cash flows from investing activities:



Additions of property and equipment 

(4,445)

(2,177)

Change in other assets

(515)

-

Purchases of investments 

(3,541)

(11,211)

Sales of investments 

2,500

2,500

Net cash used in investing activities 

(6,001)

(10,888)




Cash flows from financing activities:



Proceeds from stock option exercises 

1,466

6,957

Income tax withholding payment associated with restricted stock vesting

(1,118)

(1,118)

Stock repurchases

(4,924)

-

Tax benefit of excess stock based compensation deductions

560

2,231

Net cash provided by (used in) financing activities 

(4,016)

8,070




Net decrease in cash and cash equivalents 

(2,296)

(10,580)

Cash and cash equivalents, at beginning of period 

185,957

165,404

Cash and cash equivalents, at end of period 

$        183,661

$        154,824

 

 

 iRobot Corporation 

Supplemental Information

(unaudited)








For the three months ended


March 28,

March 29,


2015

2014




Revenue: *






Home Robots

$        111,085

$        108,035




    Domestic

$          40,627

$          41,030

    International

$          70,458

$          67,005







Defense & Security

$            6,526

$            5,602




    Domestic

$            3,853

$            3,135

    International

$            2,673

$            2,467




    Product

$            6,372

$            5,592

    Contract

$               154

$                 10




    Product Life Cycle

$            4,728

$            3,533







Gross Margin Percent:



    Home Robots

51.1%

50.4%

    Defense & Security

33.2%

37.2%

    Total Company

45.5%

45.3%







Units shipped:



    Home Robots *

491

465

    Defense & Security

28

38







Average gross selling prices for robot units:



    Home Robots

$               238

$               243

    Defense & Security *

$                 59

$                 54







Defense & Security Funded Product Backlog *

$          13,655

$          12,444







Days sales outstanding

30

30




Days in inventory

71

61




Headcount

589

539







* in thousands



 

 

 iRobot Corporation  




 Adjusted EBITDA Reconciliation to GAAP 




 (unaudited, in thousands) 























For the three months ended








March 28,

March 29,








2015

2014
















 Net income 

$            4,754

$            5,280
















 Interest income, net 

(154)

(145)







 Income tax expense 

2,351

2,513







 Depreciation 

2,621

2,167







 Amortization 

940

975
















 EBITDA 

10,512

10,790

























 Stock-based compensation expense 

3,107

3,078







 Merger and acquisition expense 

-

-







 Net intellectual property litigation expense 

(510)

369







 Restructuring expense 

-

-
















 Adjusted EBITDA 

$          13,109

$          14,237


































Use of Non-GAAP Financial Measures



























In evaluating its business, iRobot considers and uses Adjusted EBITDA as a supplemental measure of its operating performance. The Company defines Adjusted EBITDA as earnings before interest, taxes, depreciation, amortization, stock-based compensation expense, merger and acquisition expense, net intellectual property litigation expense, and restructuring expense. The Company also presents Adjusted EBITDA because it believes it is frequently used by securities analysts, investors and other interested parties as a measure of financial performance.










The term Adjusted EBITDA is not defined under U.S. generally accepted accounting principles, or U.S. GAAP, and is not a measure of operating income, operating performance or liquidity presented in accordance with U.S. GAAP. Adjusted EBITDA has limitations as an analytical tool, and when assessing the Company's operating performance, investors should not consider Adjusted EBITDA in isolation, or as a substitute for net income (loss) or other consolidated income statement data prepared in accordance with U.S. GAAP. Among other things, Adjusted EBITDA does not reflect the Company's actual cash expenditures. Other companies may calculate similar measures differently than iRobot, limiting their usefulness as comparative tools. iRobot compensates for these limitations by relying primarily on its GAAP results and using Adjusted EBITDA only supplementally.

 

Logo - http://photos.prnewswire.com/prnh/20131104/NE10106LOGO

SOURCE iRobot Corp.

For further information: Elise Caffrey, Investor Relations, iRobot Corp., (781) 430-3003, ecaffrey@irobot.com; Matthew Lloyd, Media Relations, iRobot Corp., (781) 430-3720, mlloyd@irobot.com