Press Releases

iRobot Reports First-Quarter 2012 Financial Results

BEDFORD, Mass., April 24, 2012 - iRobot Corp. (NASDAQ: IRBT), a leader in delivering robotic technology-based solutions, today announced its financial results for the first quarter ended March 31, 2012.

  • Revenue for the first quarter of 2012 was $97.8 million, compared with $106.3 million for the same quarter one year ago.
  • Net income in the first quarter of 2012 was $0.7 million, compared with $7.5 million in the first quarter of 2011.
  • Quarterly earnings per share were $0.02, compared with $0.27 in the first quarter last year.
  • Adjusted EBITDA for the first quarter of 2012 was $6.1 million, compared with $15.2 million in the first quarter of 2011.

"We kicked off 2012 with a better than anticipated quarter, and therefore we are reaffirming our full-year fiscal 2012 financial expectations. The results and outlook for our Home Robot business are excellent while the near-term visibility in our Defense & Security business continues to be limited," said Colin Angle, chairman and chief executive officer of iRobot.

"The improvement in domestic sales, expanded distribution of new products and further penetration into long-term international markets will drive growth in the Home Robot business. Orders for FirstLook and SUGV robots from the U.S. military and sales to foreign countries will support our Defense & Security business in the second half of 2012."

Business Highlights

  • Strong growth in both domestic and international markets fueled a 20 percent year-over-year Q1 increase in Home Robot revenue. For the full year, we have increased our expectations for the Home Robot business and now expect revenue in this business unit to comprise 75 percent of total company revenue.
  • Defense & Security Q1 results were below our expectations. We continue to experience funding delays that will impact Q2 revenue as well. We have reflected that impact in our lower full-year expectations for this business unit.
  • In mid-April, we launched one of the largest domestic marketing campaigns in our history. The multifaceted media blitz, based on the concept "iRobot, Do You?", includes an extensive integrated presence on television, online and print publications.

Financial Expectations

Management provides the following expectations with respect to the second quarter ending June 30, 2012 and full year ending December 29, 2012.

Q2 2012:

       
Revenue       $102 - $112 million
Earnings Per Share       $0.05 - $0.13
Adjusted EBITDA       $7 - $10 million
         

Fiscal Year 2012:

       
Revenue       $465 - $485 million
Earnings Per Share       $0.75 - $0.95
Adjusted EBITDA       $56 - $63 million
         

Full-Year 2012 Business Unit Revenue

Home Robots       $345 - $355 million
Defense & Security Robots       $120 - $130 million

First-Quarter Conference Call

iRobot will host a conference call tomorrow at 8:30 a.m. ET to discuss its results for the first fiscal quarter 2012, business outlook, and outlook for 2012 financial performance. Pertinent details include:

        Date:           Wednesday, April 25, 2012
        Time:           8:30 a.m. ET
        Call-In Number:           847-413-3362
        Passcode:           32231617

A live, audio broadcast of the conference call will also be available at http://investor.irobot.com/phoenix.zhtml?c=193096&p=irol-irhome. 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 May 2, and can be accessed by dialing 630-652-3042, passcode 32231617#.

About iRobot Corp.

iRobot designs and builds robots that make a difference. The company's home robots help people find smarter ways to clean, and its defense & security robots protect those in harm's way. iRobot's consumer and military robots feature iRobot Aware® robot intelligence systems, proprietary technology 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 and growth, demand for our robots, and operating performance, anticipated mix of revenue for the year ending December 29, 2012 and the second quarter ending June 30, 2012, and anticipated revenue, earnings per share and Adjusted EBITDA for the year ending December 29, 2012 and the second quarter ending June 30, 2012. 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, our dependence on the U.S. federal government and government contracts, the timing of government contracts and orders, market acceptance of our products, 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 release includes Adjusted EBITDA, a non-GAAP financial measure as defined by SEC Regulation G. We define Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, merger and acquisition expenses, net intellectual property litigation expenses, restructuring expenses, and non-cash stock compensation. A reconciliation between net income and Adjusted EBITDA are 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 31,   April 2,
  2012   2011
Revenue      
Product revenue $ 91,742   $ 96,711
Contract revenue   6,065     9,566
Total   97,807     106,277
       
Cost of Revenue      
Product revenue   58,275     56,190
Contract revenue   5,519     6,633
Total   63,794     62,823
       
Gross Margin   34,013     43,454
       
Operating Expense      
Research & development   8,724     8,729
Selling & marketing   13,570     12,981
General & administrative   11,042     10,600
Total   33,336     32,310
       
Operating income   677     11,144
       
Other income (expense), net   220     238
       
Pre-tax income   897     11,382
Income tax expense   244     3,905
Net income $ 653   $ 7,477
       
Net income per common share:      
Basic $ 0.02   $ 0.29
Diluted $ 0.02   $ 0.27
       
Shares used in per common share calculations:      
Basic   27,352     26,089
Diluted   28,283     27,485
       
       
Stock-based compensation included in above figures:      
Cost of product revenue $ 291   $ 250
Cost of contract revenue   118     95
Research & development   259     81
Selling & marketing   237     181
General & administrative   1,608     1,172
Total $ 2,513   $ 1,779
           
   
iRobot Corporation  
Condensed Consolidated Balance Sheet  
(unaudited, in thousands)  
                   
      March 31,   December 31,
      2012   2011
                   
Assets                  
                   
Cash and equivalents     $ 166,798       $ 166,308  
Short term investments         15,277         17,811  
Accounts receivable, net         29,907         43,338  
Unbilled revenues         1,240         2,362  
Inventory         31,681         31,089  
Deferred tax assets         16,222         15,344  
Other current assets     5,078         7,928  
Total current assets         266,203         284,180  
Property, plant and equipment, net         28,209         29,029  
Deferred tax assets         12,640         6,127  
Other assets     18,784         12,877  
Total assets     $ 325,836       $ 332,213  
                   
Liabilities and stockholders' equity                  
                   
Accounts payable     $ 44,302       $ 48,406  
Accrued expenses         19,108         17,188  
Accrued compensation         7,730         17,879  
Deferred revenue and customer advances     2,422         1,527  
Total current liabilities         73,562         85,000  
Long term liabilities         4,189         4,255  
Stockholders' equity         248,085         242,958  
Total liabilities and stockholders' equity     $ 325,836       $ 332,213  
                   
 
iRobot Corporation
Consolidated Statement of Cash Flows
(unaudited, in thousands)
             
             
      For the three months ended
      March 31,     April 2,
      2012     2011
Cash flows from operating activities:            
Net income     $ 653       $ 7,477  
Adjustments to reconcile net income to net cash provided by operating activities:            
Depreciation and amortization       2,602         2,183  
Loss on disposal of property and equipment       69         470  
Stock-based compensation       2,513         1,779  
Deferred income taxes, net       (6,694 )       2,442  
Tax benefit of excess stock based compensation deductions       (705 )       (2,442 )
Non-cash director deferred compensation       22         38  
Changes in operating assets and liabilities — (use) source            
Accounts receivable       13,431         6,447  
Unbilled revenue       1,122         (3,922 )
Inventory       (592 )       (7,911 )
Other assets       2,832         (1,929 )
Accounts payable       (4,104 )       5,555  
Accrued expenses       2,003         (915 )
Accrued compensation       (10,149 )       (9,678 )
Deferred revenue       895         114  
Change in long term liabilities       (66 )       389  
Net cash provided by operating activities       3,832         97  
             
Cash flows from investing activities:            
Purchase of property and equipment       (1,643 )       (4,554 )
Change in other assets       (6,000 )       -  
Purchases of investments       -         (5,000 )
Sales of investments       2,500         2,500  
Net cash used in investing activities       (5,143 )       (7,054 )
             
Cash flows from financing activities:            
Proceeds from stock option exercises       1,323         4,584  
Income tax withholding payment associated with restricted stock vesting       (227 )       (453 )
Tax benefit of excess stock based compensation deductions       705         2,442  
Net cash provided by financing activities       1,801         6,573  
             
Net increase (decrease) in cash and cash equivalents       490         (384 )
Cash and cash equivalents, at beginning of period       166,308         108,383  
Cash and cash equivalents, at end of period     $ 166,798       $ 107,999  
                     
 
iRobot Corporation
Supplemental Information
(unaudited)
             
             
      For the three months ended
      March 31,     April 2,
      2012     2011
             
Revenue: *            
             
Home Robots     $ 81,583     $ 67,882
             
Domestic     $ 21,815     $ 18,058
International     $ 59,768     $ 49,824
             
             
Defense & Security     $ 16,224     $ 38,395
             
Domestic     $ 12,177     $ 30,202
International     $ 4,047     $ 8,193
             
Product     $ 10,159     $ 28,829
Contract     $ 6,065     $ 9,566
             
Product Life Cycle     $ 4,890     $ 12,702
             
             
Gross Margin Percent:            
Home Robots       45.3%       45.5%
Defense & Security       -18.1%       32.7%
Total Company       34.8%       40.9%
             
             
Units shipped:            
Home Robots *       392       349
Defense & Security       138       114
             
             
Average gross selling prices for robot units:            
Home Robots     $ 214     $ 193
Defense & Security *     $ 38     $ 141
             
             
Defense & Security Funded Product Backlog *     $ 6,000     $ 8,302
             
             
Days sales outstanding       29       31
             
Days in inventory       50       55
             
Headcount       620       692
             
* in thousands            
             
iRobot Corporation  
Adjusted EBITDA Reconciliation to GAAP  
(unaudited, in thousands)  
                 
                 
        For the three months ended  
        March 31,     April 2,  
        2012     2011  
                 
Net income       $ 653       $ 7,477    
                 
Interest income, net         (262 )       (210 )  
Income tax expense         244         3,905    
Depreciation         2,394         2,058    
Amortization         208         125    
                 
EBITDA         3,237         13,355    
                 
                 
Stock-based compensation expense         2,513         1,779    
Merger and acquisition expense         12         -    
Net intellectual property litigation expense         37         94    
Restructuring expense         278         -    
                 
Adjusted EBITDA       $ 6,077       $ 15,228    
                 
                 
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 and amortization, merger and acquisition expenses, net intellectual property litigation expenses, restructuring expenses and non-cash stock compensation. 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.

 

 

 

Contact:

Elise Caffrey
Investor Relations
iRobot Corp.
(781) 430-3003
ecaffrey@irobot.com
Charlie Vaida
Media Relations
iRobot Corp.
(781) 430-3182
cvaida@irobot.com