@Road (NASDAQ:ARDI)
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@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.
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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.
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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.
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@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
-------- -------- -------- -------- --------
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