Radiant Systems, Inc. Reports Strong Third Quarter Results; Adjusted Earnings of $.07 Per Diluted Share with Growth Projected for 2005.ATLANTA Atlanta (ətlăn`tə, ăt–), city (1990 pop. 394,017), state capital and seat of Fulton co., NW Ga., on the Chattahoochee R. and Peachtree Creek, near the Appalachian foothills; inc. 1847. -- Radiant radiant: see meteor shower. Systems, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : RADS RADS Reactive Airways Dysfunction Syndrome (type of occupational asthma) RADS Reynolds Adolescent Depression Scale RADS República Árabe Democrática Saharaui ), a leading provider of innovative technology for the hospitality, petroleum and convenience store, and entertainment industries, today announced financial results for the third quarter ended September September: see month. 30, 2004. Summary financial results for the third quarter of 2004 are as follows: --Total revenues for the period were $36.3 million, an increase of 51.5 percent over revenues of $24.0 million for the same period in 2003. --Net income before discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. for the period was $0.8 million, or approximately $0.03 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, an improvement of $1.7 million, or $0.06 per diluted share, compared to the same period in 2003. --Net income for the period was $0.8 million, or approximately $0.03 per diluted share, an improvement of $4.0 million, or $0.15 per diluted share, compared to the same period in 2003. --Adjusted net income (non-GAAP) from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the for the period, which excludes amortization of acquisition related intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. and non-recurring charges, was $2.1 million or $.07 per diluted share, an increase of $3.0 million or $.10 per diluted share, compared to the same period last year. Summary financial results for the nine months ended Sept. 30, 2004 are as follows: --Total revenues for the period were $95.5 million, an increase of 33.2 percent over revenues of $71.7 million for the same period in 2003. --Net loss from continuing operations was $0.2 million, an improvement of $2.9 million compared to the same period in 2003. --Net income for the period was $2.5 million or approximately $0.09 per diluted share, an increase of $44.9 million, or $1.61 per diluted share, compared to the same period in 2003. --Adjusted net income (non-GAAP) from continuing operations for the period, which excludes amortization of acquisition related intangible assets and non-recurring charges, was $3.4 million or $.12 per diluted share, an increase of $4.9 million or $.17 per diluted share, compared to the same period last year. On Jan. 31, 2004 the Company completed the disposition of its Enterprise Software Systems segment. The historical financial statements for Sept. 30, 2003 have been reclassified with the Enterprise Software Systems segment reported in discontinued operations for comparability with the 2004 financial statements. Additionally, on Jan. 12, 2004 the Company completed its acquisition of Aloha Technologies ("Aloha"). All Aloha operations are included in the Company's 2004 financial statements as of the date of the acquisition. The Company provides adjusted net income/(loss) and adjusted net income/(loss) per share in this press release as additional information relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the Company's operating results. The measures are not in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with, or an alternative for, generally accepted accounting practices ("GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ") and may be different from adjusted net income measures used by other companies. Net income/(loss) has been adjusted to exclude amortization of acquisition related intangible assets and non-recurring charges. The Company believes that this non-GAAP presentation provides useful information to investors regarding certain additional financial and business trends relating to the Company's financial condition and results of operations. John Heyman, the Company's chief executive officer commented, "We are very pleased with the increasing strength in our business and the results for the quarter. More importantly, we believe we have built a sustainable growth model in the business. Our continued emphasis on customer satisfaction and our expanded market reach are helping us drive revenue growth with new and existing customers and to improve efficiencies and profits. We have secured a number of new customers and extended several of our strategic client relationships. Our resellers are delivering strong results and our new products are gaining wider acceptance. These factors have positioned us for growth going forward." Business highlights for the third quarter of 2004 include: Hospitality Division --Signed 120 new contracts for eServices and added 1,730 new live sites. --Signed an agreement with California Pizza Kitchen California Pizza Kitchen (NASDAQ: CPKI, known within the food industry as CPK) is a casual dining restaurant chain that specializes in California-style pizza. The restaurant was started in 1985 by attorneys Rick Rosenfield and Larry Flax in Beverly Hills, California, to deploy TableService POS (1) See point of sale and packet over SONET. (2) "Parent over shoulder." See digispeak. POS - point of sale and eServices running on P1210 terminals to more than 140 existing restaurants. --Announced the deployment of eServices applications to P.F. Chang's China Bistro with more than 150 restaurants operating in 32 states. --Announced the deployment and certification of Radiant's foodservice The foodservice (or food service) industry (US English; catering industry in British English) encompasses those places, institutions, and companies responsible for any meal eaten away from home. solution for Allied Domecq Allied Domecq PLC was an international company, headquartered in Bristol, UK that operated spirits, wine, and quick service restaurant businesses. History Allied Domecq was the result of a 1994 merger between Allied Lyons and Pedro Domecq.[1]. Quick Service Restaurants, a division of Allied Domecq PLC. --Signed an agreement to install TableService POS, EDC EDC See: Export Development Corp. credit card solution and Enterprise.com running on Radiant P1510 terminals to 30 corporate-owned Tony Roma's Tony Roma's is a casual dining chain restaurant specializing in baby back ribs. The first location was established in 1972 in North Miami, Florida, by the eponymous founder, and today there are roughly 260 locations in 27 countries comprising 32 territories. . --Signed an agreement with major retailer to install TableService POS, EDC credit card solution and Enterprise.com in its more than 50 in-house In-house In the context of general equities, keeping an activity within the firm. For example, rather than go to the marketplace and sell a security for a client to anyone, an attempt is made to find a buyer to complete the transaction with the firm. restaurants. --Radiant reseller An organization that sells hardware and software to the general public. Resellers purchase products from software publishers and hardware manufacturers. DBO DBO Database Owner DBO Dragon Ball Online (gaming) DBO Design, Build, Operate DBO Demanda Bioquímica de Oxígeno (Spanish) DBO Database Operation DBO Defined Benefit Obligation DBO Database Operator Engenharia de Sistemas signed an agreement with BGK BGK Bhatnagar-Gross-Krook (kinetic-theory model for reactive collisions) BGK Bornholms Golf Klub BGK Beyonce Giselle Knowles (entertainer) DO BRASIL S.A., a Burger King franchisee to deploy QuickService POS to 50-sites across Brasil. --Radiant reseller Business Equipment Consultants signed an agreement with Paradise Bakery to deploy QuickService POS and Enterprise.com to 39-sites across 10 states. Petroleum and Convenience Store Division: --Signed an agreement with a major oil company for an extended rollout of Radiant Self-Service Kiosks The self-service kiosk rose with the development of the ATM and adoption by consumers coupled with advanced technologies such as touch-screens. Self-service kiosks are hardware devices that work in combination with self service software, allowing users to perform any number of to new markets in the U.S. --Signed an agreement with a major oil company to deploy Radiant POS in more than 500 sites in Asia Pacific next year. --Signed an agreement with a large grocery chain in fuel operations to deploy Radiant POS and fuel price rollback A DBMS feature that reverses the current transaction out of the database, returning the data to its former state. A rollback is performed when processing a transaction fails at some point, and it is necessary to start over. See two-phase commit. loyalty functionality. --Installed Radiant POS in the 500th site with Repsol YPF Repsol YPF, S.A., (IBEX-35:REP) is an integrated Spanish oil and gas company with operations in 29 countries, the bulk of its assets are located in Spain and Argentina. The product of a 1999 takeover of Argentine energy firm YPF by the Spanish conglomerate Repsol S.A. in Spain Spain, Span. España (āspä`nyä), officially Kingdom of Spain, constitutional monarchy (2005 est. pop. 40,341,000), 194,884 sq mi (504,750 sq km), including the Balearic and Canary islands, SW Europe. . --Installed Radiant POS in the 300th site with 7-Eleven Australia Australia (ôstrāl`yə), smallest continent, between the Indian and Pacific oceans. With the island state of Tasmania to the south, the continent makes up the Commonwealth of Australia, a federal parliamentary state (2005 est. pop. . --Installed Radiant POS in 354 additional sites with a major oil company in Malaysia Malaysia (məlā`zhə), independent federation (2005 est. pop. 23,953,000), 128,430 sq mi (332,633 sq km), Southeast Asia. The official capital and by far the largest city is Kuala Lumpur; Putrajaya is the adminstrative capital. . --Deployed Radiant Outdoor Self-Service Kiosks at fuel islands for Sheetz Sheetz, Inc. is a chain of gas stations/convenience stores owned by the Sheetz family. Stores are located in Maryland, North Carolina, Ohio, Pennsylvania, Virginia, and West Virginia. History Sheetz, Inc was founded by Bob Sheetz. . --Signed a pilot agreement for Radiant Self-Service Kiosks with a large convenience store operator. --Announced Radiant POS integration certification with PDI/RMS through the NAXML NAXML NACS XML Data Interchange standard. Entertainment Division: --Contracted and have begun installations for a chain wide rollout of hardware and software for Reading Cinemas in Australia and New Zealand New Zealand (zē`lənd), island country (2005 est. pop. 4,035,000), 104,454 sq mi (270,534 sq km), in the S Pacific Ocean, over 1,000 mi (1,600 km) SE of Australia. The capital is Wellington; the largest city and leading port is Auckland. . --Went live with the Radiant Film Management solution with Pacific Theatres for more than 400 screens throughout California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). and Hawaii Hawaii, island, United States Hawaii, island (1990 pop. 120,217), 4,037 sq mi (10,456 sq km), largest and southernmost island of the state of Hawaii and coextensive with Hawaii co.; known as the Big Island. . --Began selling POS to a new top five cinema chain, and a new top 15 cinema chain in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. . --Released a solution addressing CISP CISP Cardholder Information Security Program (Visa) CISP Comitato Internazionale per lo Sviluppo dei Popoli CISP Certified IRA Services Professional (American Bankers Association) standards to mitigate mit·i·gate v. To moderate in force or intensity. mit  i·ga tion n. fraud
and security concerns with credit card transactions, the first and only
software available to the industry with this functionality.Mark Haidet, the Company's chief financial officer commented, "The Company generated more than $2.6 million of free cash flow during the quarter with working capital remaining consistent over the prior quarter. We expect both working capital and free cash flow to increase as we grow the business." The Company provided guidance for the fourth quarter with a revenue range of $35 million to $38 million and adjusted earnings of $.06 to $.08 per share. The Company also provided guidance for 2005 with a revenue range of $145 million to $155 million and adjusted earnings of $.28 to $.36 per share. Haidet added, "Our financial results have continued to track ahead of our plans providing us with good visibility into achieving our fourth quarter estimates. Our 2005 guidance range represents growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. of approximately 10 to 15 percent in revenues and over 40 percent in earnings, driven primarily by the success of our market expansion strategy in the food service segment." Radiant will hold its second quarter 2004 conference call today at approximately 5 p.m. Eastern Time. This call is being webcast by CCBN CCBN Central Coast Bancorp CCBN Charles County Business Network and can be accessed at http://phx.corporate-ir.net/phoenix.zhtml?c=115271&p=irol-irhome. The call will also be available via telephone at telephone at 1-877-323-2090 - reference reservation #T528563R. Founded in 1985, Radiant Systems, Inc. provides innovative store technology for the hospitality, petroleum and convenience store, and entertainment industries. Radiant's point-of-sale point of sale n. pl. points of sale A business or place where a product or service can be purchased. Also called point of purchase. point , self-service kiosk, and back-office technology enables operators to drive top-line growth and improve bottom-line performance. Headquartered in Atlanta, Radiant (www.radiantsystems.com) has deployed its solutions in more than 50,000 sites worldwide. Certain statements contained in this press release are "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995, such as statements relating to financial results and plans for future business development activities, and are thus prospective. These statements appear in a number of places in this release and include all statements that are not statements of historical fact regarding intent, belief or current expectations of the Company, its directors or its officers with respect to, among other things: (i) the Company's financing plans; (ii) trends affecting the Company's financial condition or results of operations, including the Company's projected revenues and earnings per share guidance; (iii) the Company's growth strategy and operating strategy; (iv) the Company's new or future product offerings, and (v) the declaration and payment of dividends. The words "may," "would," "could," "will," "expect," "estimate," "anticipate," "believe," "intend," "plans," and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the Company's ability to control. Actual results may differ materially from those projected in the forward-looking statements as a result of various factors. Among the key risks, assumptions and factors that may affect operating results, performance and financial condition are the Company's reliance on a small number of clients for a large portion of its revenues, fluctuations in its quarterly results, its ability to continue and manage its growth, liquidity and other capital resources issues, competition and the other factors discussed in detail in the Company's filings with the Securities and Exchange Commission.
RADIANT SYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)
ASSETS
September 30, December 31,
2004 2003
(unaudited)
-------------- --------------
Current assets
Cash and cash equivalents $ 14,332 33,774
Accounts receivable, net 25,104 18,614
Inventories 18,146 13,098
Other short-term assets 2,544 4,688
-------------- --------------
Total current assets 60,126 70,174
Property and equipment, net 9,175 11,229
Software development costs, net 2,341 2,844
Goodwill 33,346 7,537
Intangibles and other long-term assets 23,340 920
-------------- --------------
$ 128,328 92,704
============== ==============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued
liabilities $ 25,440 12,864
Accrued contractual obligations 1,719 -
Customer deposits and unearned
revenue 9,399 12,257
Current portion of long-term debt 5,865 524
-------------- --------------
Total current
liabilities 42,423 25,645
Client deposits and deferred revenues,
net of current portion 1,527 -
Long-term debt, less current portion 13,738 136
Other long-term liabilities 499 -
-------------- --------------
Total liabilities 58,187 25,781
-------------- --------------
Shareholders' equity
Common stock, no par value;
100,000,000 shares authorized;
28,919,476 and 28,105,095 shares
issued and outstanding - -
Additional paid-in capital 117,128 116,480
Accumulated other comprehensive
income 250 217
Accumulated deficit (47,237) (49,774)
-------------- --------------
Total shareholders'
equity 70,141 66,923
-------------- --------------
$ 128,328 92,704
============== ==============
RADIANT SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(Unaudited)
For the three For the nine
months ended months ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2004 2003 2004 2003
--------- --------- --------- ---------
Revenues:
System sales $ 20,349 $ 10,632 $ 48,241 $ 33,159
Client support, maintenance
and other services 15,989 13,347 47,262 38,527
--------- --------- --------- ---------
Total revenues 36,338 23,979 95,503 71,686
Cost of revenues:
System sales 10,334 6,135 23,491 18,779
Impairment of capitalized
software and acquired
software technologies - - - 903
Client support, maintenance
and other services 10,761 9,324 29,234 25,110
--------- --------- --------- ---------
Total cost of revenues 21,095 15,459 52,725 44,792
--------- --------- --------- ---------
Gross profit 15,243 8,520 42,778 26,894
Operating Expenses:
Product development 3,135 2,717 9,800 7,439
Sales and marketing 4,889 3,166 13,941 11,174
Depreciation of fixed assets 967 829 2,826 2,612
Amortization of intangible
assets 1,281 - 3,607 -
Non-recurring charges - - - 761
General and administrative 3,879 2,802 11,961 8,175
--------- --------- --------- ---------
Income (loss) from operations 1,092 (994) 643 (3,267)
Interest (expense) income, net (256) 171 (690) 428
--------- --------- --------- ---------
Income (loss) from continuing
operations before income
taxes 836 (823) (47) (2,839)
Income tax provision 32 88 129 252
--------- --------- --------- ---------
Income (loss) from continuing
operations 804 (911) (176) (3,091)
Discontinued operations
Loss from operations of
Enterprise business, net - (2,341) (913) (39,231)
Gain on disposal of Enterprise
business, net - - 3,626 -
--------- --------- --------- ---------
Income (loss) from
discontinued operations - (2,341) 2,713 (39,231)
--------- --------- --------- ---------
Net income (loss) $ 804 $ (3,252) $ 2,537 $(42,322)
========= ========= ========= =========
Income (loss) per share from continuing
operations
Basic $ 0.03 $ (0.03) $ (0.01) $ (0.11)
========= ========= ========= =========
Diluted $ 0.03 $ (0.03) $ (0.01) $ (0.11)
========= ========= ========= =========
Net income (loss) per share
Basic $ 0.03 $ (0.12) $ 0.09 $ (1.52)
========= ========= ========= =========
Diluted $ 0.03 $ (0.12) $ 0.09 $ (1.52)
========= ========= ========= =========
Weighted average shares
outstanding:
Basic 28,705 27,714 28,796 27,860
========= ========= ========= =========
Diluted 29,404 27,714 28,796 27,860
========= ========= ========= =========
Reconciliation of Adjusted Net
Income (Loss):
Net income (loss) $ 804 $ (3,252) $ 2,537 $(42,322)
Operations of discontinued
business - 2,341 913 39,231
Gain on disposal of
discontinued business - - (3,626) -
Impairment of capitalized
software and acquired
software technologies - - - 903
Lease termination and
severance costs - - - 761
Amortization of purchased
intangibles 1,281 - 3,607 -
--------- --------- --------- ---------
Adjusted net income (loss) $ 2,085 $ (911) $ 3,431 $ (1,427)
========= ========= ========= =========
Adjusted net income (loss) per
diluted share $ 0.07 $ (0.03) $ 0.12 $ (0.05)
========= ========= ========= =========
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