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Smith Micro Software Reports Fourth Quarter and Fiscal Year 2013 Financial Results(Marketwire Via Acquire Media NewsEdge) ALISO VIEJO, CA -- (Marketwired) -- 03/06/14 -- Smith Micro Software, Inc. (NASDAQ: SMSI), a leading provider of wireless and mobility solutions, today reported financial results for the fourth quarter and full year ended December 31, 2013. "We achieved a 35 percent sequential increase in fourth quarter revenues, primarily due to new revenues from a leading chipset manufacturer and a strong holiday season for our productivity and graphics products," said William W. Smith Jr., President and CEO of Smith Micro Software. "Fourth quarter revenues were down approximately 2 percent from the same quarter last year, but we saw a total year-over-year increase in our CommSuite, NetWise, and Productivity & Graphics product lines totaling $4.6 million. In addition, fourth quarter non-GAAP loss per share improved from $0.06 in 2012 to $0.01 loss per share in 2013, reflecting the positive impact of our third quarter restructuring." Smith Micro reported revenues of $11.8 million for the fourth quarter ended December 31, 2013, compared to $12.0 million reported in the fourth quarter of 2012. Fourth quarter 2013 gross profit on both a GAAP and non-GAAP basis (which excludes stock compensation) was $9.5 million, compared to $9.7 million reported in the fourth quarter of 2012. GAAP and non-GAAP gross profit as a percentage of revenues was 80.0 percent for the fourth quarter of 2013, compared to 80.6 percent on both a GAAP and non-GAAP basis for the fourth quarter of 2012. GAAP net loss for the fourth quarter of 2013 was $1.5 million, or $0.04 loss per share, compared to GAAP net loss of $4.1 million, or $0.12 loss per share, for the fourth quarter of 2012. Non-GAAP net loss (which excludes stock compensation and non-cash tax expense) for the fourth quarter of 2013 was $0.4 million, or $0.01 loss per share, compared to a non-GAAP net loss of $2.2 million, or $0.06 loss per share, for the fourth quarter of 2012. For the fiscal year ended December 31, 2013, the Company reported revenues of $42.7 million, compared to $43.3 million for fiscal year 2012. Fiscal year 2013 gross profit on both a GAAP and non-GAAP basis (which excludes stock compensation) was $33.0 million, compared to $34.9 million on both a GAAP and non-GAAP basis for the fiscal year 2012. GAAP and non-GAAP gross profit as a percentage of revenues was 77.3 percent for fiscal year 2013 compared to 80.5 percent for the fiscal year 2012. GAAP net loss for the fiscal year ended December 31, 2013 was $28.0 million, or $0.76 loss per share, compared to a net loss of $25.5 million, or $0.71 loss per share, for fiscal year 2012. GAAP net loss for fiscal 2013 includes a one-time charge to expense of $5.6 million for restructuring recorded in the third quarter. Non-GAAP net loss (which excludes stock compensation and non-cash tax expense) for the fiscal year ended December 31, 2013 was $14.8 million, or $0.40 loss per share, compared to a non-GAAP net loss of $13.4 million, or $0.37 loss per share, for fiscal year 2012. Excluding the one-time restructuring charge, the non-GAAP loss per share would have been $0.31 for fiscal year 2013. Total cash and cash equivalents and short-term investments at December 31, 2013 were $14.8 million. The Company uses a non-GAAP reconciliation of gross profit, loss before taxes, net loss and loss per share in the presentation of financial results in this press release. Management believes that this presentation may be more meaningful in analyzing our income generation, since stock-based compensation and non-cash tax expense are excluded from the non-GAAP earnings calculation. Since we are in a loss position, the non-GAAP income tax benefit for the fiscal fourth quarter and year 2013 was computed by using a tax rate of 38 percent using the Company's normalized combined U.S. federal, state and foreign statutory tax rates less various tax adjustments. This presentation may be considered more indicative of our ongoing operational performance. The tables below present the differences between non-GAAP earnings and net loss on an absolute and per-share basis. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP, and the non-financial measures as reported by Smith Micro Software may not be comparable to similarly titled amounts reported by other companies. Investor Conference Call: Smith Micro Software will hold an investor conference call today to discuss the Company's fourth quarter and fiscal year 2013 results at 4:30 p.m. ET, March 6, 2014. To access the call, dial (877) 941-1465 and when prompted provide the pass code "SMSI." Participants are asked to call the assigned number approximately 10 minutes before the conference call begins. In addition, the conference call will be available on the Smith Micro website in the Investor Relations section. About Smith Micro Software, Inc.: Smith Micro Software provides solutions that simplify, secure and enhance the mobile experience. Our portfolio includes a wide range of applications that manage broadband connectivity, data traffic, devices, voice and video communications over wireless networks. With 30 years of experience developing world-class client and server software, Smith Micro helps the leading mobile network operators, device manufacturers and enterprises increase efficiency and capitalize on the growth of mobile-connected consumers and workforces. For more information, visit smithmicro.com. (NASDAQ: SMSI) Safe Harbor Statement: This release contains forward-looking statements that involve risks and uncertainties, including without limitation, forward-looking statements relating to the Company's financial prospects and other projections of its performance, the existence of new market opportunities and interest in the Company's products and solutions, and the Company's ability to increase its revenue and regain profitability by capitalizing on these new market opportunities and interest and introducing new products and solutions. Among the important factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements are changes in demand for the Company's products from its customers and their end-users, customer concentration given that the majority of our sales depend on a few large client relationships, including Sprint, new and changing technologies, customer acceptance and timing of deployment of those technologies, new and continuing adverse economic conditions, and the Company's ability to compete effectively with other software companies. These and other factors discussed in the Company's filings with the Securities and Exchange Commission, including its filings on Forms 10-K and 10-Q, could cause actual results to differ materially from those expressed or implied in any forward-looking statements. The forward-looking statements contained in this release are made on the basis of the views and assumptions of management regarding future events and business performance as of the date of this release, and the Company does not undertake any obligation to update these statements to reflect events or circumstances occurring after the date of this release. Smith Micro and the Smith Micro logo are registered trademarks or trademarks of Smith Micro Software, Inc. All other trademarks and product names are the property of their respective companies. Smith Micro Software, Inc. Reconciliation of GAAP to Non-GAAP Results (in thousands, except per share amounts) - unaudited Stock Non- GAAP Compensation Taxes GAAP --------- ------------ -------- --------- Three Months Ended 12/31/13: -------------------------------- Gross profit $ 9,473 $ 4 $ - $ 9,477 Loss before provision for income taxes $ (1,498) $ 843 $ - $ (655) Net loss $ (1,502) $ 843 $ 253 $ (406) EPS-diluted $ (0.04) $ 0.02 $ 0.01 $ (0.01) Three Months Ended 12/31/12: -------------------------------- Gross profit $ 9,695 $ 4 $ - $ 9,699 Loss before provision for income taxes $ (4,545) $ 1,005 $ - $ (3,540) Net loss $ (4,143) $ 1,005 $ 933 $ (2,205) EPS-diluted $ (0.12) $ 0.03 $ 0.03 $ (0.06) Twelve Months Ended 12/31/13: -------------------------------- Gross profit $ 32,968 $ 21 $ - $ 32,989 Loss before provision for income taxes $ (27,800) $ 3,889 $ - $ (23,911) Net loss $ (27,953) $ 3,889 $ 9,238 $ (14,826) EPS-diluted $ (0.76) $ 0.11 $ 0.25 $ (0.40) Twelve Months Ended 12/31/12: -------------------------------- Gross profit $ 34,881 $ 13 $ - $ 34,894 Loss before provision for income taxes $ (25,697) $ 4,203 $ - $ (21,494) Net loss $ (25,463) $ 4,203 $ 7,870 $ (13,390) EPS-diluted $ (0.71) $ 0.12 $ 0.22 $ (0.37) Smith Micro Software, Inc. Statements of Comprehensive Loss for the Three Months and Twelve Months Ended December 31, 2013 and 2012 (in thousands, except per share amounts) - unaudited For the Three For the Twelve Months Months Ended December 31, Ended December 31, 2013 2012 2013 2012 -------- -------- -------- -------- Revenues $ 11,843 $ 12,032 $ 42,675 $ 43,329 Cost of revenues 2,370 2,337 9,707 8,448 -------- -------- -------- -------- Gross profit 9,473 9,695 32,968 34,881 Operating expenses: Selling and marketing 3,020 4,058 15,675 16,666 Research and development 4,114 5,645 21,305 24,767 General and administrative 3,840 4,547 18,216 20,211 Restructuring expense - - 5,602 238 -------- -------- -------- -------- Total operating expenses 10,974 14,250 60,798 61,882 -------- -------- -------- -------- Operating loss (1,501) (4,555) (27,830) (27,001) Non-operating income: Change in fair value of contingent liability - - - 1,210 Interest and other income, net 3 10 30 94 -------- -------- -------- -------- Loss before provision for income taxes (1,498) (4,545) (27,800) (25,697) -------- -------- -------- -------- Provision for income tax expense (benefit) 4 (402) 153 (234) -------- -------- -------- -------- Net loss $ (1,502) $ (4,143) $(27,953) $(25,463) -------- -------- -------- -------- Other comprehensive income (loss), before tax: Unrealized holding gains (losses) on available-for-sale securities 3 (12) 7 33 Income tax expense related to items of othercomprehensive income - - - 6 Other comprehensive income (loss), net of tax 3 (12) 7 27 -------- -------- -------- -------- Comprehensive loss $ (1,499) $ (4,155) $(27,946) $(25,436) ======== ======== ======== ======== Loss per share: Basic and diluted $ (0.04) $ (0.12) $ (0.76) $ (0.71) Weighted average shares outstanding: Basic and diluted 37,027 35,882 36,982 35,849 Smith Micro Software, Inc. Consolidated Balance Sheets (in thousands) December 31, December 31, 2013 2012 ------------- ------------- (unaudited) (audited) ASSETS Current Assets: Cash & cash equivalents $ 11,763 $ 18,873 Short term investments 3,078 13,328 Accounts receivable, net 7,563 8,953 Income tax receivable 699 681 Inventory, net 167 176 Prepaid and other assets 871 903 Deferred tax asset 152 89 ------------- ------------- Total current assets 24,293 43,003 Equipment & improvements, net 7,023 11,211 Other assets 222 181 ------------- ------------- TOTAL ASSETS $ 31,538 $ 54,395 ============= ============= LIABILITIES & STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable $ 1,632 $ 1,978 Accrued liabilities 7,734 4,829 Deferred revenue 464 1,436 ------------- ------------- Total current liabilities 9,830 8,243 Long-term liabilities 3,383 3,399 Deferred tax liability 154 91 ------------- ------------- Total non-current liabilities 3,537 3,490 Stockholders' Equity: Common stock 37 36 Additional paid in capital 214,619 211,165 Accumulated comprehensive deficit (196,485) (168,539) ------------- ------------- Total stockholders' equity 18,171 42,662 ------------- ------------- TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 31,538 $ 54,395 ============= ============= AT THE COMPANY: Suzanne Runald Public Relations 949-362-5800 Email Contact IR INQUIRIES: Todd Kehrli or Jim Byers MKR Group 323-468-2300 Email Contact Source: Smith Micro Software, Inc. |