Press Releases

iRobot Reports Fourth-Quarter and Full-Year Financial Results
Record Results; Strong 2011 Outlook

BEDFORD, Mass., Feb 09, 2011 (BUSINESS WIRE) -- iRobot Corp. (NASDAQ: IRBT), a leader in delivering robotic technology-based solutions, today announced its financial results for the fourth quarter and full year ended January 1, 2011.

Revenue for the fourth quarter of 2010 increased 12 percent to $114.0 million, compared with $101.7 million for the same quarter one year ago. Revenue for the full year 2010 increased 34 percent to $401.0 million from $298.6 million for the full year 2009. Net income in the fourth quarter of 2010 was $7.0 million, compared with $5.1 million in the fourth quarter of 2009. Net income for the full year 2010 was $25.5 million, compared with $3.3 million for the same period in 2009. Quarterly earnings per share were $0.26, compared with $0.20 in the fourth quarter last year. Full-year earnings per share were $0.96, compared with $0.13 last year. The full-year results include an $0.08 one-time tax benefit reported in the third quarter. Excluding the impact of this one-time benefit, earnings per share for the full year would have been $0.88.

"Our record financial results in 2010 were exceptional on all fronts driven by strong performance in both divisions. Revenue increased 34 percent to $401 million for the full year while Adjusted EBITDA more than doubled to $49 million or 12 percent of revenue," said Colin Angle, chairman and chief executive officer of iRobot. "EPS of $0.96 for the year, which includes the impact of an $0.08 one-time tax benefit in Q3, was more than seven times greater than our 2009 EPS. Investments and initiatives implemented in 2010 will enable us to continue our profitable growth. In 2011, we expect stronger revenue and earnings growth in the second half of the year due to the timing of G&I orders and year-over-year comparisons with a record-breaking first half of 2010. We anticipate making further progress towards our three-year financial targets, while investing in our future to support our market-leading position."

Business Highlights

 

  • Strong demand in overseas markets drove a 70 percent year-over-year increase in full-year 2010 international home robot revenue. International home robot revenue of $151 million comprised 66 percent of total home robot revenue.
  • Driven by shipments of Small Unmanned Ground Vehicles and spares, government & industrial robot revenue grew 29 percent in 2010.
  • In 2010, operating cash flow was $49.2 million, compared with $40.6 million in 2009, as a result of improved Adjusted EBITDA driving our year-end cash and investment position to $122 million.

 

Financial Expectations

Management provides the following expectations with respect to the year ending December 31, 2011 and first quarter ending April 2, 2011.

Fiscal Year 2011:

       
Revenue       $450 - $465 million
Earnings Per Share       $0.90 - $1.00
Adjusted EBITDA       $58 - $62 million
       

 

Q1 2011:

       
Revenue       $102 - $106 million
Earnings Per Share       $0.20 - $0.24
Adjusted EBITDA       $12 - $14 million
         

Fourth-Quarter and Full-Year Conference Call

iRobot will host a conference call tomorrow at 8:30 a.m. ET to discuss its financial results for the fourth fiscal quarter and full year 2010, business outlook, and outlook for 2011 financial performance. Pertinent details include:

          Date:         Thursday, February 10, 2011
          Time:         8:30 a.m. ET
          Call-In Number:         617-614-6204
          Passcode:         75920523
                     

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 February 17, and can be accessed by dialing 617-801-6888, passcode 22913930.

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 government and industrial robots protect those in harm's way. iRobot's consumer and military robots feature iRobot Aware(R) robot intelligence systems, proprietary technology incorporating advanced concepts in navigation, mobility, manipulation and artificial intelligence. For more information about iRobot, please visitwww.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, anticipated revenue, Adjusted EBITDA and earnings per share for fiscal year 2011 and the first quarter of 2011. 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, 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 earnings per share excluding the impact of one-time tax benefit and Adjusted EBITDA, each 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, and non-cash stock compensation. Reconciliations between earnings per share and earnings per share excluding the impact of one-time tax benefit, and net income and Adjusted EBITDA are provided in the financial tables at the end of this press release.

 
 
 
 
iRobot Corporation
Consolidated Statement of Operations
(in thousands, except per share amounts)
(unaudited)
                   
                   
    For the three months ended     For the twelve months ended
    January 1,   January 2,     January 1,   January 2,
    2011   2010     2011   2010
Revenue                  
Product revenue   $ 103,287   $ 90,819     $ 360,394   $ 262,199  
Contract revenue     10,708     10,903       40,558     36,418  
Total     113,995     101,722       400,952     298,617  
                   
Cost of Revenue                  
Product revenue     62,506     59,679       228,403     176,631  
Contract revenue     6,001     7,657       27,117     30,790  
Total     68,507     67,336       255,520     207,421  
                   
Gross Margin     45,488     34,386       145,432     91,196  
                   
Operating Expense                  
Research & development     8,434     4,114       24,809     14,747  
Selling & marketing     19,576     13,482       50,535     40,902  
General & administrative     9,925     8,195       36,618     30,110  
Total     37,935     25,791       111,962     85,759  
                   
Operating income     7,553     8,595       33,470     5,437  
                   
Other income (expense), net     136     15       504     (81 )
                   
Pre-tax income     7,689     8,610       33,974     5,356  
Income tax expense     689     3,478       8,460     2,026  
Net income   $ 7,000   $ 5,132     $ 25,514   $ 3,330  
                   
Net income per common share:                  
Basic   $ 0.27   $ 0.20     $ 1.00   $ 0.13  
Diluted   $ 0.26   $ 0.20     $ 0.96   $ 0.13  
                   
Shares used in per common share calculations:                  
Basic     25,604     25,059       25,394     24,998  
Diluted     26,798     25,837       26,468     25,640  
                   
                   
Stock-based compensation included in above figures:                  
Cost of product revenue   $ 314   $ 369     $ 1,311   $ 1,127  
Cost of contract revenue     109     111       446     575  
Research & development     237     164       725     351  
Selling & marketing     276     404       1,161     1,410  
General & administrative     1,197     1,155       4,522     4,099  
Total   $ 2,133   $ 2,203     $ 8,165   $ 7,562  
                             
                             
 
 
iRobot Corporation
Condensed Consolidated Balance Sheet
(unaudited, in thousands)
           
    January 1,     January 2,
    2011     2010
           
Assets          
           
Cash and equivalents   $ 108,383     $ 71,856
Short term investments     13,928       4,959
Accounts receivable, net     34,056       35,171
Unbilled revenues     4,012       1,831
Inventory     27,160       32,406
Deferred tax assets     12,917       8,669
Other current assets     6,137       4,119
Total current assets     206,593       159,011
Property, plant and equipment, net     25,620       20,230
Deferred tax assets     8,338       6,089
Other assets     13,780       14,254
Total assets   $ 254,331     $ 199,584
           
Liabilities and stockholders' equity          
           
Accounts payable   $ 38,689     $ 30,559
Accrued expenses     15,790       14,384
Accrued compensation     17,827       13,525
Deferred revenue and customer advances     3,534       3,908
Total current liabilities     75,840       62,376
Long term liabilities     3,584       4,014
Stockholders' equity     174,907       133,194
Total liabilities and stockholders' equity   $ 254,331     $ 199,584
               
               
 
 
 
iRobot Corporation
Consolidated Statement of Cash Flows
(unaudited, in thousands)
                   
                   
    For the three months ended     For the twelve months ended
    January 1,   January 2,     January 1,   January 2,
    2011   2010     2011   2010
Cash flows from operating activities:                  
Net income   $ 7,000     $ 5,132       $ 25,514     $ 3,330  
Adjustments to reconcile net income to net cash provided by operating activities:                  
Depreciation and amortization     1,868       1,921         7,541       8,074  
Loss on disposal of property and equipment     87       26         204       202  
Stock-based compensation     2,133       2,203         8,165       7,562  
Benefit from deferred tax assets     (3,753 )     (2,970 )       (7,620 )     (3,317 )
Non-cash director deferred compensation     33       33         132       132  
Changes in operating assets and liabilities -- (use) source                  
Accounts receivable     (6,262 )     8,763         1,115       759  
Unbilled revenue     (1,478 )     706         (2,181 )     183  
Inventory     6,809       (7,753 )       5,246       2,154  
Other assets     (3,092 )     295         (2,082 )     (816 )
Accounts payable     3,012       2,772         8,130       11,015  
Accrued expenses     1,810       2,712         1,495       3,385  
Accrued compensation     4,710       2,679         4,302       7,132  
Deferred revenue     1,511       (336 )       (374 )     1,276  
Change in long term liabilities     (108 )     (108 )       (430 )     (430 )
Net cash provided by operating activities     14,280       16,075         49,157       40,641  
                   
Cash flows from investing activities:                  
Purchase of property and equipment     (5,060 )     (1,637 )       (12,597 )     (5,038 )
Purchase of Nekton Research LLC, net of cash received     -       (2,500 )       -       (2,500 )
Purchases of investments     -       (5,000 )       (30,461 )     (5,000 )
Sales of investments     2,500       -         21,500       -  
Net cash used in investing activities     (2,560 )     (9,137 )       (21,558 )     (12,538 )
                   
Cash flows from financing activities:                  
Proceeds from stock option exercises     4,293       243         6,590       738  
Income tax withholding payment associated with restricted stock vesting     -       -         (284 )     (76 )
Tax benefit of excess stock based compensation deductions     1,767       1,928         2,622       2,239  
Net cash provided by financing activities     6,060       2,171         8,928       2,901  
                   
Net increase in cash and cash equivalents     17,780       9,109         36,527       31,004  
Cash and cash equivalents, at beginning of period     90,603       62,747         71,856       40,852  
Cash and cash equivalents, at end of period   $ 108,383     $ 71,856       $ 108,383     $ 71,856  
                                   
                                   
 
 
 
iRobot Corporation
Supplemental Information
(unaudited)
                   
                   
    For the three months ended     For the twelve months ended
    January 1,   January 2,     January 1,   January 2,
    2011   2010     2011   2010
                   
Revenue: *                  
                   
Home Robots   $ 69,247     $ 54,607       $ 229,348     $ 165,860  
                   
Domestic   $ 24,841     $ 24,736       $ 77,918     $ 76,705  
International   $ 44,406     $ 29,871       $ 151,430     $ 89,155  
                   
Retail   $ 60,600     $ 45,208       $ 203,026     $ 137,438  
Direct   $ 8,647     $ 9,399       $ 26,322     $ 28,422  
                   
Government & Industrial   $ 44,748     $ 47,115       $ 171,604     $ 132,757  
                   
Domestic   $ 41,779     $ 45,986       $ 158,266     $ 122,535  
International   $ 2,969     $ 1,129       $ 13,338     $ 10,222  
                   
Product   $ 34,039     $ 36,212       $ 131,046     $ 96,339  
Contract   $ 10,709     $ 10,903       $ 40,558     $ 36,418  
                   
Product Life Cycle   $ 11,490     $ 9,356       $ 38,110     $ 23,655  
                   
                   
Gross Margin Percent:                  
Home Robots     42.4 %     36.1 %       40.0 %     32.2 %
Government & Industrial     36.0 %     31.1 %       31.3 %     28.4 %
Total Company     39.9 %     33.8 %       36.3 %     30.5 %
                   
                   
Units shipped:                  
Home Robots *     380       324         1,269       988  
Government & Industrial     169       329         871       789  
                   
                   
Average gross selling prices for robot units:                  
Home Robots   $ 194     $ 188       $ 189     $ 181  
Government & Industrial *   $ 133     $ 82       $ 107     $ 92  
                   
                   
Government & Industrial Funded Product Backlog *   $ 23,869     $ 42,160       $ 23,869     $ 42,160  
                   
                   
Days sales outstanding     30       33         30       33  
                   
Days in inventory     40       50         40       50  
                   
Headcount     657       538         657       538  
                   
                   
* in thousands                  
                   
                   
 
 
 
iRobot Corporation
Adjusted EBITDA Reconciliation to GAAP
(unaudited, in thousands)
                 
                 
    For the three months ended   For the twelve months ended
    January 1,   January 2,   January 1,   January 2,
    2011   2010   2011   2010
                 
Net income   $ 7,000     $ 5,132     $ 25,514     $ 3,330  
                 
Interest income, net     (193 )     (47 )     (765 )     (88 )
Income tax expense     689       3,478       8,460       2,026  
Depreciation     1,741       1,782       7,002       7,545  
Amortization     127       139       539       529  
                 
EBITDA     9,364       10,484       40,750       13,342  
                 
                 
Stock-based compensation expense     2,133       2,203       8,165       7,562  
Merger and acquisition expense     73       -       205       -  
                 
Adjusted EBITDA   $ 11,570     $ 12,687     $ 49,120     $ 20,904  
                 
                 
                 

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, 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.

 
 
 
 
iRobot Corporation
Non-GAAP Net Income and Earnings Per Share Reconciliations to GAAP
(in thousands, except per share amounts)
(unaudited)
                   
                   
    For the three months ended     For the twelve months ended
    January 1,   January 2,     January 1,   January 2,
    2011   2010     2011   2010
                   
GAAP net income   $ 7,000   $ 5,132     $ 25,514     $ 3,330
                   
Less one-time net income tax benefit associated with release of state deferred tax asset valuation allowance     -     -       (2,259 )     -
                   
Non-GAAP net income   $ 7,000   $ 5,132     $ 23,255     $ 3,330
                   
                   
GAAP net income per common share:                  
Basic   $ 0.27   $ 0.20     $ 1.00     $ 0.13
Diluted   $ 0.26   $ 0.20     $ 0.96     $ 0.13
                   
Less one-time net income tax benefit associated with release of state deferred tax asset valuation allowance:                  
Basic   $ -   $ -     $ (0.08 )   $ -
Diluted   $ -   $ -     $ (0.08 )   $ -
                   
Non-GAAP net income per common share:                  
Basic   $ 0.27   $ 0.20     $ 0.92     $ 0.13
Diluted   $ 0.26   $ 0.20     $ 0.88     $ 0.13
                   
                   
Shares used in per common share calculations:                  
Basic     25,604     25,059       25,394       24,998
Diluted     26,798     25,837       26,468       25,640
                             
                             
                             

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 government and industrial 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 visitwww.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 concerning management's plans, objectives and strategies. 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. 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 including, without limitation, our most recent Annual Report on Form 10-K.

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