Fourth quarter revenues rise 25% year over year to a record $18.2
million, Full-year revenues increase 24% to a record $65.4 million
BOSTON, Feb. 8 /PRNewswire-FirstCall/ -- Color Kinetics
Incorporated (NASDAQ:CLRK), a leading innovator of intelligent LED
lighting systems and technologies, today announced its results of
operations for the fourth quarter of 2006. Revenues were $18.2
million, an increase of 25% from the $14.5 million reported in the
fourth quarter of 2005. GAAP net income was $1.6 million or $0.07
per fully diluted share. Non-GAAP net income was $2.2 million or
$0.10 per fully diluted share prior to non-cash charges of $639,000
associated with the FAS 123R accounting standard. Revenues for the
full year ended December 31, 2006 were $65.4 million, an increase
of 24% from the $52.9 million reported in 2005. GAAP net income was
$3.2 million or $0.16 per fully diluted share. Non-GAAP net income
prior to the stock-based compensation charges was $5.6 million or
$0.28 per fully diluted share. "We believe there's little doubt
among industry leaders that LEDs will play an integral role in the
future of lighting," said Bill Sims, President and CEO, Color
Kinetics. "Our strong financial results reflect the exciting growth
and adoption we're witnessing across multiple sectors -- including
newly expanded markets for our lighting systems, and the
accelerating traction of our licensing program. We have held firm
to an investment strategy that continues to deliver returns,
whether through product line expansion, new engineering resources
or on-going patent prosecution -- all intended to help drive
continued top- and bottom-line success in the longer term." "Today
there is heightened awareness of the potential for energy-efficient
lighting to help conserve resources and spare the environment. We
believe such increased attention to the matter, along with
continued research, development and government funding, will help
set the stage for an eventual transition to LED technology as the
right long-term solution," said Sims. "As the market opportunities
for LED lighting continue to grow, Color Kinetics is preparing in
parallel to lead the transformation forward through important new
technologies, systems and strategic partnerships." Additional 2006
achievements included: - The completion of a successful follow-on
public stock offering - The unveiling of new landmark installations
such as LAX Gateway at Los Angeles International Airport, the
London Eye, and feature film Deck the Halls - Product line
expansions in both color and white light - Accelerating strength in
licensing, including agreements with Osram Sylvania for Gotham
Architectural Downlighting, Neo-Neon, Martin Professional, Robe
Show Lighting and Dialight - The issuance of 14 new patents - A
court victory and conclusion of all litigation with Super Vision -
The award of a $1.7 million grant by the Department of Energy -
Inclusion among Forbes' top 25 technology growth companies For the
first quarter of 2007, the company currently targets revenues
within the range of $18.4 million to $19.4 million, with non-GAAP
net income of $0.09 to $0.11 per fully diluted share prior to
stock-based compensation expense. Net income on a GAAP basis,
reflecting FAS 123R stock compensation, is expected to be between
$0.06 and $0.08 per fully diluted share. Color Kinetics will host a
conference call to review its fourth quarter and full-year results
after the close of market today. The conference call may be
accessed by dial-in number or via the Internet as follows: Time:
4:30 pm ET Domestic dial-in number: 866-700-5192 International
dial-in number: 617-213-8833 Passcode: 70499419 Webcast:
http://phx.corporate-ir.net/phoenix.zhtml?c=178448&p=irol-irhome
A dial-in replay of the conference call will be available from 6:30
pm ET on February 8 through February 15 at 888-286-8010 (domestic),
617-801-6888 (international), passcode: 15264449. The webcast will
be archived and available for one year via the Investor Relations
section of Color Kinetics' website. About Color Kinetics Color
Kinetics Incorporated (NASDAQ:CLRK) transforms environments through
new, dynamic uses of light. Its award-winning lighting systems and
technologies apply the benefits of LEDs as a highly efficient, long
lasting, environmentally friendly, and inherently digital source of
illumination -- reinventing light itself as a highly controllable
medium. Color Kinetics also enables widespread adoption of LED
lighting through OEM and licensing partnerships in diverse markets.
The company is headquartered in Boston, MA with offices in the UK
and China. More information is available at
http://www.colorkinetics.com/. Color Kinetics is a registered
trademark and the Color Kinetics logo is a trademark of Color
Kinetics Incorporated. All other trademarks mentioned are the
property of their respective owners. "Safe Harbor" Statement under
the Private Securities Litigation Reform Act of 1995: Statements in
this press release regarding Color Kinetics Incorporated's business
that are not historical facts are "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. Readers are cautioned that these statements involve risks
and uncertainties, are only predictions and may differ materially
from actual future events and results. For a discussion of such
risks and uncertainties, see "Risk Factors" in the Company's Annual
Report on Form 10-K for the Twelve Months Ended December 31, 2005,
File Number 000-50798, and most recent 10-Q, each as filed with the
Securities and Exchange Commission. Color Kinetics Incorporated and
Subsidiaries Consolidated Balance Sheets (In thousands, except per
share data) December 31, 2006 2005 ASSETS CURRENT ASSETS: Cash and
equivalents $60,997 $43,032 Investments 38,985 14,137 Restricted
cash 500 100 Accounts receivable, net of allowance for doubtful
accounts of approximately $430 and $461 in 2006 and 2005,
respectively 11,480 7,813 Accounts receivable from related party 82
249 Inventory 6,805 7,159 Prepaid expenses and other current assets
3,159 1,436 Total current assets 122,008 73,926 PROPERTY AND
EQUIPMENT-net 2,199 1,026 INTANGIBLE ASSETS-net 282 - INVESTMENT IN
JOINT VENTURE - 887 RESTRICTED CASH-Non-current portion - 900 TOTAL
ASSETS $ 124,489 $76,739 LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES: Accounts payable $3,690 $1,019 Accounts
payable to related party - 63 Accrued expenses 2,238 2,169 Accrued
compensation 3,073 2,251 Accrued restructuring 243 385 Accrued
warranty 1,007 876 Deferred revenue 195 231 Total current
liabilities 10,446 6,994 ACCRUED RESTRUCTURING-Non-current portion
- 243 COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY: Common
stock, $0.001 par value 21 18 Additional paid-in capital 140,498
99,210 Accumulated other comprehensive loss (112) (120) Accumulated
deficit (26,364) (29,606) Total stockholders' equity 114,043 69,502
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 124,489 $76,739 Color
Kinetics Incorporated and Subsidiaries Consolidated Statements of
Income (In thousands, except per share data) Three Months Ended
December 31, 2006 2005 GAAP SFAS 123R Non-GAAP REVENUES: Lighting
systems $15,908 $15,908 $12,484 OEM and licensing 2,254 2,254 1,995
Total revenues 18,162 18,162 14,479 COST OF REVENUES: Lighting
systems 7,354 $(22) 7,332 5,860 OEM and licensing 636 - 636 791
Total cost of revenues 7,990 (22) 7,968 6,651 GROSS PROFIT 10,172
22 10,194 7,828 OPERATING EXPENSES: Selling and marketing 4,084
(135) 3,949 3,262 Research and development 1,916 (110) 1,806 1,238
General and administrative 3,578 (372) 3,206 2,557 Total operating
expenses 9,578 (617) 8,961 7,057 INCOME FROM OPERATIONS 594 639
1,233 771 INTEREST INCOME 994 - 994 477 EQUITY IN EARNINGS (LOSS)
OF JOINT VENTURE (35) - (35) 113 NET INCOME $1,553 $639 $2,192
$1,361 EARNINGS PER SHARE: Basic $0.08 $0.03 $0.11 $0.07 Diluted
$0.07 $0.03 $0.10 $0.07 WEIGHTED AVERAGE SHARES OUTSTANDING: Basic
19,969 19,969 19,969 18,368 Diluted 21,180 21,180 21,180 19,840
Color Kinetics Incorporated and Subsidiaries Consolidated
Statements of Income (In thousands, except per share data) Twelve
Months Ended December 31, 2006 2005 GAAP SFAS 123R Non-GAAP
REVENUES: Lighting systems $58,300 $58,300 $44,156 OEM and
licensing 7,124 7,124 8,751 Total revenues 65,424 65,424 52,907
COST OF REVENUES: Lighting systems 26,297 $(75) 26,222 21,006 OEM
and licensing 2,507 - 2,507 3,894 Total cost of revenues 28,804
(75) 28,729 24,900 GROSS PROFIT 36,620 75 36,695 28,007 OPERATING
EXPENSES: Selling and marketing 16,242 (497) 15,745 11,519 Research
and development 7,134 (442) 6,692 4,607 General and administrative
12,845 (1,386) 11,459 9,396 Total operating expenses 36,221 (2,325)
33,896 25,522 INCOME FROM OPERATIONS 399 2,400 2,799 2,485 INTEREST
INCOME 2,892 - 2,892 1,624 EQUITY IN EARNINGS (LOSS) OF JOINT
VENTURE (49) - (49) 223 NET INCOME $3,242 $2,400 $5,642 $4,332
EARNINGS PER SHARE: Basic $0.17 $0.13 $0.30 $0.24 Diluted $0.16
$0.12 $0.28 $0.22 WEIGHTED AVERAGE SHARES OUTSTANDING: Basic 18,871
18,871 18,871 18,177 Diluted 20,276 20,276 20,276 19,630 Color
Kinetics Incorporated and Subsidiaries Consolidated Statements of
Cash Flows (In thousands) Twelve Months Ended December 31, 2006
2005 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $3,242 $
4,332 Adjustments to reconcile net income to cash from operating
activities: Depreciation and amortization 1,274 1,124 Stock-based
compensation 2,429 31 Loss on disposal of property and equipment 35
4 Equity in (earnings) loss of joint venture 49 (223) Common stock
issued for services 101 51 Changes in assets and liabilities:
Accounts receivable (3,500) (2,685) Inventory 354 (2,429) Prepaid
expenses and other current assets (1,723) 640 Accounts payable
2,608 (530) Accrued expenses 922 1,130 Deferred revenue (36) (148)
Accrued restructuring (385) (405) Cash flows from operating
activities 5,370 892 CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of investments (50,818) (48,082) Maturities of
investments 26,042 62,906 Purchases of property and equipment
(2,464) (1,007) Purchase of patent (300) - Restricted cash 500 100
Proceeds from dissolution of joint venture 887 - Cash flows from
investing activities (26,153) 13,917 CASH FLOWS FROM FINANCING
ACTIVITIES: Proceeds from the exercise of stock options 2,037 1,792
Proceeds from the exercise of stock warrants 1,117 - Proceeds from
issuance of common stock - net of issuance costs 35,607 277 Cash
flows from financing activities 38,761 2,069 EFFECT OF EXCHANGE
RATE CHANGES ON CASH (13) (44) INCREASE IN CASH AND EQUIVALENTS
17,965 16,834 CASH AND EQUIVALENTS-Beginning of period 43,032
26,198 CASH AND EQUIVALENTS-End of period $60,997 $43,032
DATASOURCE: Color Kinetics Incorporated CONTACT: Felicia Spagnoli,
Media Relations, +1-617-701-2292, or , or Justine Alonzo, Investor
Relations, +1-617-701-2272, or , both of Color Kinetics
Incorporated Web site: http://www.colorkinetics.com/
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