@Road(R), Inc. (Nasdaq: ARDI), a global provider of Mobile Resource
Management (MRM) and intelligent field service automation
solutions, today announced its results for the quarter and nine
months ended September 30, 2005. Total revenues for the third
quarter of 2005 were $25.0 million, a 31% increase compared to
$19.1 million for the third quarter of 2004. Hosted revenues for
the third quarter of 2005 were $19.0 million, and licensed revenues
for the third quarter of 2005 were $6.0 million. Net income
attributable to common stockholders for the third quarter of 2005
was $33.4 million, or $0.54 per diluted share, compared to net
income of $2.9 million, or $0.05 per diluted share, for the third
quarter of 2004. Included in the results for the third quarter 2005
were $34.2 million in a benefit from income taxes, $1.0 million in
intangibles amortization associated with the Vidus(TM) Limited
acquisition and $0.7 million in depreciation. For the nine months
ended September 30, 2005, total revenues were $65.6 million, a 19%
increase compared to the $55.3 million for the same period last
year. Hosted revenues for the first nine months were $58.1 million,
and licensed revenues for the first nine months were $7.4 million.
Net income attributable to common stockholders for the first nine
months of 2005 was $24.9 million, or $0.41 per diluted share,
compared to net income of $7.1 million, or $0.12 per diluted share,
for the first nine months of 2004. Included in the results for the
first nine months of 2005 were the operations of Vidus from the
February 18, 2005 closing date, as well as a $5.6 million charge
for in-process research and development costs, a benefit from
income taxes of $37.4 million, $2.5 million in intangibles
amortization associated with the Vidus acquisition and $1.8 million
in depreciation. "We are pleased to report that some of the
increased RFP activity we've seen in the marketplace earlier this
year has begun to turn into customer wins," said Krish Panu,
president and CEO of @Road. "In addition to the previously
announced customer wins with several of our specific vertical
industry offerings, we've also signed several medium-sized customer
deals. We believe that market momentum continues to build, and we
are looking for customer demand for both our hosted solutions and
licensed software to continue to grow," commented Mr. Panu. The
Company's condensed consolidated balance sheet at September 30,
2005 included $95.6 million of cash, cash equivalents and
short-term investments. "Due to the nature of our business model,
large customer deployments can require upfront cash outlays. In
recent quarters we have purchased significant amounts of inventory
in support of both the SBC deployment and the CDPD migration. Cash
collections from customers should increase in the fourth quarter as
customers pay us for hardware and service from deployments in the
third quarter. We anticipate that the Company's cash, cash
equivalents and short-term investments balances will be
approximately $100 million by the end of the year," stated Mr.
Panu. The Company's business outlook for the fourth quarter calls
for revenue in the range of between $28 million and $29 million.
This is in line with the Company's previous guidance. Fully diluted
earnings per share on a GAAP basis is expected to be approximately
$0.02 per share. This is an increase from the fourth quarter
guidance provided last quarter, which called for fully diluted
earnings per share on a GAAP basis to be approximately $0.01 per
share. The Company further announced that its Board of Directors
has approved the accelerated vesting of all unvested and
"out-of-the-money" stock options previously granted to employees
and officers under the Company's 2000 Stock Option Plan with per
share exercise prices equal to or greater than $6.40, effective
today. Options held by non-employee directors are excluded from the
vesting acceleration. Unvested stock options to purchase a total of
811,110 shares were accelerated, representing approximately 8
percent of the total of all outstanding @Road stock options. The
accelerated stock options have per share exercise prices ranging
from $6.40 to $14.58. Under the recently revised Financial
Accounting Standards Board Statement of Financial Accounting
Standards No. 123 (revised 2004), "Share-based Payments," @Road
will be required to recognize an expense associated with its
outstanding unvested stock options beginning in 2006. As a result
of the acceleration, the Company expects that its stock option
expense would be reduced by approximately $4.5 million over the
original option vesting period. -0- *T Year to Date Highlights --
New Customers -- Announced six recent customer wins in the
transportation and distribution industry. -- Announced new customer
wins as a result of the @Road alliance with the Chemical
Distribution Network (CDN), a distributor-owned organization made
up of 21 leading chemical distribution companies. -- Announced 28
customer wins in the waste services vertical market during the
first five months of 2005. -- Acquisitions -- On February 18, 2005,
@Road completed its acquisition of Vidus Limited, a leading
provider of dynamic field service automation solutions located in
Ipswich, United Kingdom. -- New Services -- Introduced taskforce
MSP(SM), a subscription-based Managed Services Provider (MSP)
delivery model for on-demand automated field service delivery. This
new delivery offering of taskforce includes the same innovative
features and functionality of the licensed version, but with the
additional benefit of being an on-demand MSP solution with a simple
"pay as you go" monthly subscription model. -- Launched @Road
Portico XP(SM) which features the integration of patented @Road
LocationSmart(SM) technology with "Toughbook" ruggedized notebook
computers from Panasonic Computer Solutions Company. When
integrated with @Road Portico XP, Panasonic Toughbook computers can
enable the field service technician to securely perform real-time
remote tasks such as opening and updating work orders, logging in
job times, viewing customer records, messaging, getting driving
directions, placing orders or reviewing upcoming assignments and
routes. -- Announced the global launch of taskforce(TM) 7, the
latest release of its automated and intelligent field service
delivery mobile enterprise application. taskforce 7 also introduces
a common Microsoft .NET application architecture which can be used
for mobile field service functions, customer service functions and
in the operations and planning functions. -- Completed testing for
the @Road iLM(R) 3100-W, which incorporates an embedded EDGE
wireless communication module, for use on the EDGE high-speed data
network. -- Infrastructure -- Appointed a Vice President, Asia
Pacific, to lead @Road expansion efforts in the Asia Pacific
region. -- Announced the expansion of the Company's operations and
facilities in Chennai, India. -- Intellectual Property -- Announced
the issuance of recently awarded patents by the U.S. Patent and
Trademark Office, bringing the Company's patent portfolio to
seventeen issued patents. @Road has additional patents and patents
pending in jurisdictions throughout the world. -- Alliances --
Announced the formation of a new @Road global alliance and business
development initiative established to form new strategic
relationships for international business and long-term revenue
growth. -- @Road and Cingular Wireless announced that they will
jointly offer MRM solutions that improve asset and fleet management
for companies with both private and for-hire fleets in such
industries as transportation, consumer packaged goods and
telecommunications. -- Capgemini Deutschland and Vidus announced an
alliance for the German speaking market and the integration of
taskforce into SAP for Utilities and SAP Mobile Asset for Utilities
(MAU). The solution combines consulting, software and expertise
from the companies to provide utility organizations with an
integrated, intelligent and real-time solution that can help
increase service levels to meet customer expectations while
reducing operational costs. -- Awards -- Received the prestigious
Frost & Sullivan 2005 Utility Mobile Solution of the Year
Award. Frost & Sullivan recognized @Road with the award in the
Utilities Vertical for the @Road Telco, Cable and Utilities Suite
MRM solution. -- For the fourth consecutive year, @Road earned a
place on the Deloitte Technology Fast 500 list. In addition to
ranking on Deloitte's Technology Fast 500, @Road ranked 27 on the
Silicon Valley Technology Fast 50, which is a ranking of the 50
fastest growing technology companies in Silicon Valley. *T
Conference Call and Webcast Details @Road will host a
teleconference Thursday, October 27, commencing at 2:00 p.m.
Pacific Time, to discuss the third quarter financial results.
Participating in the call will be @Road President and CEO Krish
Panu and CFO Mike Martini. All interested parties may listen by
dialing 800-659-2056 or 617-614-2714, pass code 34725765, or by
tuning into the webcast at www.road.com. About @Road @Road, Inc. is
a leading global provider of solutions designed to automate the
management of mobile resources and to optimize the service delivery
process for customers across a variety of industries. @Road
delivers MRM solutions in three key areas: Field Force Management,
Field Service Management and Field Asset Management. By providing
real-time Mobile Resource Management infrastructure integrating
wireless communications, location-based technologies, transaction
processing and the Internet, @Road solutions are designed to
provide a secure, scalable, upgradeable, enterprise-class platform,
and are offered in on-demand software delivery, on-premise or
hybrid environments that seamlessly connect mobile workers in the
field to real-time corporate data. @Road provides Mobile Resource
Management solutions to approximately 150,000 subscribers on a
hosted basis and to approximately 30,000 end users on a licensed
basis around the world. The Company is headquartered in Fremont,
Calif., and has a global presence with offices in North America,
Europe and Asia. For more information on @Road solutions, visit
www.road.com. Except for the historical information contained
herein, the matters discussed in this news release are
forward-looking statements involving risks and uncertainties that
could cause actual results to differ materially from those in such
forward-looking statements. Numerous factors, risks and
uncertainties affect the company's operating results and could
cause the company's actual results to differ materially from
forecasts and estimates or from any other forward-looking
statements made by, or on behalf of, @Road, and there can be no
assurance that future results will meet expectations, estimates or
projections. These factors, risks and uncertainties include, but
are not limited to, @Road historical and future operating results
and profitability; the ability of @Road to integrate Vidus
operations successfully; the ability of @Road to increase its cash,
cash equivalents and short-term investments balances; the ability
of @Road to gain customer wins; the implementation by @Road of SFAS
123(R); the ability of @Road to accelerate or continue to grow as a
result of its investment initiatives; the ability of @Road and its
alliances to market, sell and support @Road solutions; the timing
of purchasing and implementation decisions by prospects and
customers; competition; the dependence of @Road on mobile data
systems technology, wireless networks, network infrastructure and
positioning systems owned and controlled by others; and general
economic and political conditions. The Company cautions the reader
that the planned appearances of @Road personnel, time and/or manner
of the live teleconference, webcast and replays may change for
administrative or other reasons outside the company's control.
Further information regarding these and other risks is included in
the @Road Report on Form 10-K dated March 15, 2005, the @Road
Report on Form 10-Q dated August 9, 2005 and in its other filings
with the Securities and Exchange Commission. @Road and iLM are
registered trademarks of @Road, Inc. The @Road logo, LocationSmart
and @Road Portico are trademarks or service marks of @Road, Inc.
Vidus, taskforce and taskforce MSP are trademarks or service marks
of Vidus Limited, an @Road company. All other product names and
services are the property of their respective owners. -0- *T @Road,
Inc. Condensed Consolidated Balance Sheets (In thousands,
unaudited) September December 30, 2005 31, 2004 (1) ------------
------------ ASSETS Current assets: Cash, cash equivalents and
short-term investments $ 95,580 $ 117,716 Accounts receivable, net
16,178 7,960 Inventories 5,568 3,593 Deferred tax assets 1,309 -
Deferred product costs and other current assets 21,988 12,646
------------ ------------ Total current assets 140,623 141,915
Property and equipment, net 5,901 3,668 Deferred product costs and
other assets 13,609 6,627 Deferred tax assets 39,955 - Intangible
assets, net 30,613 - Goodwill 21,062 - ------------ ------------
Total assets $ 251,763 $ 152,210 ============ ============
LIABILITIES, REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY
Current liabilities: Accounts payable and accrued liabilities $
16,656 $ 11,195 Deferred revenue and customer deposits 17,500
11,347 ------------ ------------ Total current liabilities 34,156
22,542 Deferred revenue 12,776 4,830 Deferred tax liabilities 683 -
Other long term liabilities 487 2 ------------ ------------ Total
liabilities 48,102 27,374 Redeemable preferred stock 8,053 -
Stockholders' equity: Common stock 277,474 232,016 Notes receivable
from stockholders (8) - Accumulated other comprehensive loss (65)
(179) Accumulated deficit (81,793) (107,001) ------------
------------ Total stockholders' equity 195,608 124,836
------------ ------------ Total liabilities, redeemable preferred
stock and stockholders' equity $ 251,763 $ 152,210 ============
============ (1) Derived from the audited December 31, 2004
consolidated financial statements @Road, Inc. Condensed
Consolidated Statements of Operations (In thousands, except per
share amounts) (unaudited) Three months ended Nine months ended
-------------------------- ----------------- Sep 30, June 30, Sep
30, Sep 30, Sep 30, 2005 2005 2004 2005 2004 -------- --------
-------- -------- -------- Revenues: Hosted $18,965 $19,685 $19,102
$58,140 $55,325 Licensed 6,004 941 - 7,447 - -------- --------
-------- -------- -------- Total revenues 24,969 20,626 19,102
65,587 55,325 -------- -------- -------- -------- -------- Costs
and expenses: Cost of hosted revenue (excluding intangible
amortization included below) 10,238 9,227 8,582 28,989 25,619 Cost
of licensed revenue (excluding intangible amortization included
below) 1,481 1,473 - 3,654 - Intangibles amortization 1,010 1,010 7
2,477 28 Sales and marketing 5,496 5,832 2,929 15,975 9,122
Research and development 3,487 3,849 1,695 9,911 4,493 General and
administrative 4,724 3,942 3,240 13,113 7,793 In-process research
and development - - - 5,640 - Terminated acquisition costs - - 139
- 2,156 Stock compensation - - - - 4 -------- -------- --------
-------- -------- Total costs and expenses 26,436 25,333 16,592
79,759 49,215 -------- -------- -------- -------- -------- (Loss)
income from operations (1,467) (4,707) 2,510 (14,172) 6,110 Other
income, net 798 575 420 1,993 996 -------- -------- --------
-------- -------- Net (loss) income before tax (669) (4,132) 2,930
(12,179) 7,106 Benefit from income taxes 34,192 3,195 - 37,387 -
-------- -------- -------- -------- -------- Net income (loss)
33,523 (937) 2,930 25,208 7,106 Preferred stock dividends (124)
(124) - (305) - -------- -------- -------- -------- -------- Net
income (loss) attributable to common stockholders $33,399 $(1,061)
$ 2,930 $24,903 $ 7,106 ======== ======== ======== ========
======== Net income (loss) per share: Basic $ 0.55 $ (0.02) $ 0.05
$ 0.42 $ 0.13 ======== ======== ======== ======== ======== Diluted
$ 0.54 $ (0.02) $ 0.05 $ 0.41 $ 0.12 ======== ======== ========
======== ======== Shares used in calculating net income (loss) per
share: Basic 60,740 60,551 54,498 59,571 54,156 ======== ========
======== ======== ======== Diluted 62,133 60,551 56,199 60,994
57,424 ======== ======== ======== ======== ======== Stock
compensation: Cost of hosted revenue $ - $ - $ - $ - $ - Cost of
licensed revenue - - - - - Sales and marketing - - - - 1 Research
and development - - - - 1 General and administrative - - - - 2
-------- -------- -------- -------- -------- Total stock
compensation $ - $ - $ - $ - $ 4 -------- -------- --------
-------- -------- *T
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