Bitstream Inc. Reports First Quarter Results for 2008
The Company reported first quarter revenue of $6,369,000 and net income of $659,000 or $0.06 per diluted share.
Cambridge, MA — May 14, 2008 —Bitstream Inc. (Nasdaq: BITS) today reported that it increased total revenue by $878,000 or 16% to $6,369,000 for the three months ended March 31, 2008 as compared to total revenue of $5,491,000 for the three months ended March 31, 2007. The Company’s cash and cash equivalents at March 31, 2008 totaled $15,455,000, a decrease of $965,000 from $16,420,000 at December 31, 2007. The decrease was attributable to the use of approximately $1,769,000 in cash to repurchase 308,900 shares of the Company’s common stock during the quarter pursuant to our two previously announced stock buyback plans.
“Our revenue increased both as compared to the same quarter last year and as compared to the fourth quarter of 2007. This is the first time since the first quarter of 2004 that we have achieved sequential revenue growth for the first quarter. We also achieved our highest level of revenue as compared to any previous quarter since going public.” said Anna M. Chagnon, President and Chief Executive Officer. “To help build resources for the future, we increased our rate of investment in sales and marketing, and research and development during the first quarter of 2008 and we anticipate that we will continue to do so throughout the remainder of our fiscal year ending December 31, 2008. In addition, our Board of Directors approved and announced a second $2.5 million stock buyback plan on March 19, 2008, reaffirming our belief in the fundamental value and long-term outlook for the Company. Our financial strength and growth in revenue has allowed us to undertake two stock buyback programs while continuing to increase our investment in sales, marketing and research and development activities to enhance Bitstream’s potential for future revenue growth and profitability.”
GAAP Results
Our income from operations decreased $3,000 or 0.5% to $600,000 for the three months ended March 31, 2008 as compared to $603,000 for the three months ended March 31, 2007, while net income decreased $57,000 or 8.0% to $659,000 or $0.06 per diluted share for the three months ended March 31, 2008 as compared to net income of $716,000 or $0.07 per diluted share for the three months ended March 31, 2007.
Non-GAAP Results
Our income from operations, not including the effect of stock-based compensation expense increased $31,000 or 4.3% to $755,000 for the three months ended March 31, 2008 as compared to $724,000 for the three months ended March 31, 2007. Earnings per diluted share was $0.08 for the three months ended March 31, 2008 and 2007, with net income decreasing $23,000 or 2.7% to $814,000 for the three months ended March 31, 2008 as compared to net income of $837,000 for the three months ended March 31, 2007.
A reconciliation between GAAP and non-GAAP results is provided at the end of this press release.
CONFERENCE CALL REMINDER
Today, May 14, 2008, at 4:30 p.m. EST, Bitstream will host a conference call with the financial community to discuss its results for the quarter ended March 31, 2008:
- Domestic Dial-in number: 1-866-847-7860
- International Dial-in number: 1-703-639-1427
Call into the conference number 5-10 minutes prior to the start time. An operator will request that you provide your name and organization and ask you to wait until the call begins. If you have any difficulty connecting with the conference call number, please contact at Bitstream: (617) 497-6222.
A replay of the conference call will be available through May 24, 2008 (access code): 1236148
- Domestic Replay number: 1-888-266-2081
- International Replay number: 1-703-925-2533
Bitstream Inc.
Consolidated Statements of Operations
(In Thousands, Except Per Share Data)
(unaudited) |
|
|
|
|
|
|
|
|
Three Months
Ended March 31, |
|
|
2008 |
|
|
2007 |
| Revenue: |
|
|
|
|
|
| Software license |
$ |
5,126 |
|
$ |
4,472 |
| Services |
|
1,243 |
|
|
1,019 |
| Total revenue |
|
6,369 |
|
|
5,491 |
|
|
|
|
|
|
| Cost of revenue: |
|
|
|
|
|
| Software license |
|
2,014 |
|
|
1,708 |
| Services |
|
581 |
|
|
492 |
| Total cost of revenue |
|
2,595 |
|
|
2,200 |
|
|
|
|
|
|
| Gross profit |
|
3,774 |
|
|
3,291 |
|
|
|
|
|
|
| Operating expenses: |
|
|
|
|
|
| Marketing and selling |
|
1,135 |
|
|
992 |
| Research and development |
|
1,392 |
|
|
1,099 |
| General and administrative |
|
647 |
|
|
597 |
|
|
|
|
|
|
| Total operating expenses |
|
3,174 |
|
|
2,688 |
|
|
|
|
|
|
| Operating profit |
|
600 |
|
|
603 |
|
|
|
|
|
|
| Other income and expense |
|
|
|
|
|
| Interest income, net |
|
96 |
|
|
124 |
|
|
|
|
|
|
| Total other income and expense |
|
96 |
|
|
124 |
|
|
|
|
|
|
| Income before provision for income taxes |
|
696 |
|
|
727 |
| Provision for income taxes |
|
37 |
|
|
11 |
|
|
|
|
|
|
| Net income |
$ |
659 |
|
$ |
716 |
|
|
|
|
|
|
| Basic net earnings per share |
$ |
0.07 |
|
$ |
0.08 |
| Diluted net earnings per share |
$ |
0.06 |
|
$ |
0.07 |
| Basic weighted average shares outstanding |
|
9,758 |
|
|
9,409 |
| Diluted weighted average shares outstanding |
|
10,527 |
|
|
10,931 |
Bitstream Inc.
Consolidated Balance Sheets
(In Thousands)
(unaudited) |
|
|
| ASSETS |
March 31,
2008 |
|
|
December 31,
2007 |
| Current assets: |
|
|
|
|
|
| Cash and cash equivalents |
$ |
15,455 |
|
$ |
16,420 |
| Accounts receivable, net |
|
1,742 |
|
|
2,245 |
| Prepaid expenses and other current assets |
|
773 |
|
|
465 |
|
|
|
|
|
|
|
|
|
|
|
|
| Total current assets |
|
17,970 |
|
|
19,130 |
|
|
|
|
|
|
| Property and equipment, net |
|
536 |
|
|
569 |
|
|
|
|
|
|
| Other assets: |
|
|
|
|
|
| Restricted cash |
|
150 |
|
|
150 |
| Goodwill |
|
727 |
|
|
727 |
| Intangible assets |
|
76 |
|
|
67 |
| Total other assets |
|
953 |
|
|
944 |
|
|
|
|
|
|
| Total assets |
$ |
19,459 |
|
$ |
20,643 |
|
|
|
|
|
|
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
| Current liabilities: |
|
|
|
|
|
| Accounts payable |
$ |
1,338 |
|
$ |
1,137 |
| Accrued expenses |
|
1,131 |
|
|
1,759 |
| Deferred revenue |
|
1,819 |
|
|
1,720 |
|
|
|
|
|
|
| Total current liabilities |
|
4,288 |
|
|
4,616 |
|
|
|
|
|
|
| Long-term liabilities |
|
25 |
|
|
40 |
|
|
|
|
|
|
| Total liabilities |
|
4,313 |
|
|
4,656 |
|
|
|
|
|
|
| Total stockholders’ equity |
|
15,146 |
|
|
15,987 |
|
|
|
|
|
|
| Total liabilities and stockholders’ equity |
$ |
19,459 |
|
$ |
20,643 |
Bitstream Inc.
Non-GAAP Results
(In Thousands, Except Per Share Data)
(unaudited) |
| |
The following table shows Bitstream’s non-GAAP results reconciled to GAAP results included in this release. |
|
|
|
|
|
|
|
Three Months
Ended March 31, |
|
|
2008 |
|
2007 |
|
|
|
|
|
| GAAP operating income |
$ |
600 |
$ |
603 |
| SFAS 123R stock-based compensation |
|
155 |
|
121 |
|
|
|
|
|
| Non-GAAP operating income |
$ |
755 |
$ |
724 |
|
|
|
|
|
| GAAP net income |
$ |
659 |
$ |
716 |
| SFAS 123R stock-based compensation |
|
155 |
|
121 |
|
|
|
|
|
| Non-GAAP net income |
$ |
814 |
$ |
837 |
|
|
|
|
|
| Diluted net income per share: |
|
|
|
|
|
|
|
|
|
| GAAP net income |
$ |
0.06 |
$ |
0.07 |
| SFAS 123R stock-based compensation |
|
0.02 |
|
0.01 |
|
|
|
|
|
| Non-GAAP net income |
$ |
0.08 |
$ |
0.08 |
|
|
|
|
|
| Shares used computing diluted net income per share |
|
10,527 |
|
10,931 |
Forward Looking Statements Disclosure
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based on management’s current expectations. Actual performance and results of operations may differ materially from those projected or suggested in the forward-looking statements due to certain risks and uncertainties, including, without limitation, market acceptance of the Company’s products, competition and the timely introduction of new products. Additional information concerning certain risks and uncertainties that would cause actual results to differ materially from those projected or suggested in the forward-looking statements is contained in the Company’s filings with the Securities and Exchange Commission, including Bitstream’s Annual Report on Form 10-K for the year ended December 31, 2007.
About Bitstream
Bitstream Inc. (NASDAQ: BITS) is a software development company that makes communications compelling. Bitstream enables customers worldwide to render high-quality text, browse the Web on wireless devices, select from the largest collection of fonts online, and customize documents over the Internet. Its core competencies include fonts and font technology, browsing technology, and publishing technology. For more information about Bitstream please visit www.bitstream.com.
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