Jacada Ltd. (Nasdaq: JCDA), a leading provider of customer
experience management and process optimization solutions, today
reported financial results for the second quarter ending June 30,
2010.
Second Quarter 2010 Highlights
- Second quarter revenues were
$4.5 million, representing a significant increase over second
quarter 2009 revenues
- A net loss of $1.7 million was
generated during the quarter as compared to net losses of $3.4
million during the 2009 second quarter
- Yesterday we implemented a
reduction in our work force and other related cost containment
programs in order to align our operations and expenses with
anticipated near term revenues and to address continuing losses.
These changes included a reduction in our workforce of
approximately 17% worldwide, or 22 employees. The cost of
implementing this realignment is estimated at $0.35 million, which
will be included in the third quarter of 2010 results. The
realignment is expected to result in a reduction in annualized
operating expenses of approximately $2.9 million
“Our total revenues are up 34% for the first half of 2010 as
compared to the first half of 2009,” commented Tom Clear, chief
executive officer of Jacada. “The increase was driven primarily by
the rollout of backlog of previously booked contracts. During the
second quarter, we successfully deployed 3 customers into
production, providing opportunities for significant follow-on
business. While the business case for our solutions continues to be
compelling and proven, our sales cycles, in the current economic
environment, continue to be long and have resulted in a slower pace
of bookings and consequently lower revenues during the 2010 second
quarter in relation to the 2010 first quarter. The recently
implemented cost reductions are designed to better align costs with
our current revenue performance and will help minimize the use of
our cash.”
Financial Results
For the second quarter of 2010, total revenues were $4.5 million
compared to $2.5 million in the second quarter of 2009,
representing an increase of 79%. Software revenues for the 2010
second quarter were $549K compared to $60K during the 2009 second
quarter. Services revenues were $3.3 million in the 2010 second
quarter and $1.8 million in the 2009 second quarter. Maintenance
revenues were $675K and $653K in the 2010 and 2009 second quarters,
respectively.
Gross margins were 39% and 11% of total revenues during the 2010
and 2009 second quarters, respectively. Gross margins in 2009 were
adversely impacted by the reduction in software revenue, which
drives higher margins, as well as the significant level of
additional hours and costs incurred with three challenging projects
during the second quarter of 2009. In 2010, we have continued the
implementation of several material contracts signed at the end of
2009 and early 2010, thus increasing revenues and improving
margins. Total operating expenses for the 2010 second quarter were
$3.5 million compared to $3.8 million during the 2009 second
quarter, declining as we continue to focus on reducing costs.
The 2010 second quarter net loss was $1.7 million or ($0.10) per
share compared to a net loss of $3.4 million or ($0.21) per share
in the second quarter of 2009, resulting from a significant growth
in revenues and reduction in operating expenses during the
periods.
For the six month periods ending on June 30, 2010 and 2009,
respectively, total revenues were $9.5 million and $7.0 million and
gross profits were $3.6 million or 38% of total revenues and $1.7
million or 24% of total revenues. During the six month period
ending June 30, 2010, we incurred a net loss of $3.5 million or
($0.21) per share. In the comparable 2009 period, we posted a net
loss of $4.9 million or ($0.29) per share.
At the end of the 2010 second quarter, cash and investments were
$19.9 million, compared to $20.2 million at the end of the 2010
first quarter and $23.8 million at December 31, 2009.
Conference Call Details
Management will hold a conference call to discuss the second
quarter 2010 financial results at 10:30 a.m. ET on August 11, 2010.
To participate in the teleconference, please call toll-free
888-713-4218 or 617-213-4870 for international
callers, and provide passcode 74116800 approximately 10
minutes prior to the start time.
Interested parties may pre-register for the teleconference via
this URL:
https://www.theconferencingservice.com/prereg/key.process?key=PUXHYCTME
A (live audio) webcast will also be available over the Internet at
www.jacada.com (under "About Us" then "Investors") or
www.earnings.com.
A replay of the teleconference will be available for three days
beginning at 12:30 p.m. ET on Aug 11, 2010. To access the replay,
dial toll-free 888-286-8010, or for international callers
617-801-6888, and provide passcode 75076686.
About Jacada
Jacada provides solutions that optimize and improve the
effectiveness of customer interactions. Jacada unified desktop and
process optimization solutions help companies reduce the cost of
their operations, drive customer satisfaction and provide a
complete return on investment in as little as 12 months after
deployment.
Founded in 1990, Jacada operates globally with offices in
Atlanta, USA; Herzliya, Israel; London, England; Munich, Germany;
and Stockholm, Sweden. More information is available at
www.jacada.com, www.jacada.com/blog, www.jacada.com/facebook and
www.jacada.com/twitter.
This news release may contain forward-looking statements as that
term is defined in the Private Securities Litigation Reform Act of
1995. The words "may," "could," "would," "will," "believe,"
"anticipate," "estimate," "expect," "intend," "plan," and similar
expressions or variations thereof are intended to identify
forward-looking statements. Investors are cautioned that any such
forward-looking statements are not guarantees of the 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 including the performance and
continued acceptance of our products, general economic conditions
and other Risk Factors specifically identified in our reports filed
with the Securities and Exchange Commission. The Company undertakes
no obligation to update or revise any forward-looking statement for
events or circumstances after the date on which such statement is
made. Jacada is a trademark of Jacada Inc. All other brands or
product names are trademarks of their respective owners.
Jacada is a trademark of Jacada Ltd. All other brands or product
names are trademarks of their respective owners.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(U.S. dollars in thousands,
except per share data)
Three months ended
June 30,
Six months ended
June 30,
2010 2009
2010 2009
Unaudited Revenues: Software licenses $ 549 $ 60 $ 1,130 $
637 Services 3,274 1,797 7,132 5,104 Maintenance 675
653 1,205 1,300
Total revenues 4,498 2,510 9,467
7,041 Cost of revenues: Software
licenses 66 33 132 147 Services 2,481 2,022 5,341 4,866 Maintenance
199 170 383 346
Total cost of revenues 2,746
2,225 5,856 5,359 Gross
profit 1,752 285 3,611 1,682 Operating expenses: Research
and development 924 890 1,820 1,834 Sales and marketing 1,373 1,551
2,905 3,157 General and administrative 1,169
1,342 2,453 2,154 Total
operating expenses 3,466 3,783
7,178 7,145 Operating loss (1,714 )
(3,498 ) (3,567 ) (5,463 ) Financial income, net 28
94 49 625 Loss
before taxes (1,686 ) (3,404 ) (3,518 ) (4,838 ) Taxes (1 )
(26 ) (1 ) (38 ) Net loss $ (1,687 ) $
(3,430 ) $ (3,519 ) $ (4,876 ) Basic and diluted net
loss per share $ (0.10 ) $ (0.21 ) $ (0.21 ) $ (0.29 )
Weighted average number of shares used in computing basic and
diluted net loss per share 16,636,534
16,565,468 16,630,178 16,559,724
CONSOLIDATED BALANCE
SHEETS
(U.S. dollars in
thousands)
June 30,
December 31, 2010 2009
Unaudited Audited ASSETS
CURRENT ASSETS: Cash and cash equivalents *) $ 8,933 $
12,624 Marketable securities *) 1,265 6,210 Trade receivables 4,911
4,949 Restricted cash *) 416 557 Other current assets 1,031
1,885 Total current assets
16,556 26,225 LONG-TERM INVESTMENTS:
Marketable securities *) 9,303 4,456 Severance pay fund 185
286 Tota
l long-term
investments 9,488 4,742 PROPERTY
AND EQUIPMENT, NET 1,033 994
GOODWILL 3,096 3,096 Total
assets $ 30,173 $ 35,057 *) Total Cash and
Investments including restricted cash $ 19,917 $ 23,847
LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT
LIABILITIES: Trade payables $ 1,356 $ 1,194 Deferred revenues 1,092
685 Accrued expenses and other liabilities 1,779
2,398 Total current liabilities 4,227
4,277 LONG-TERM LIABILITIES: Accrued
severance pay 396 505 Other long-term liabilities 84
123 Total long-term liabilities 480
628 SHAREHOLDERS' EQUITY: Share capital
60 60 Additional paid-in capital 75,786 75,422 Treasury shares at
cost (17,863 ) (17,863 ) Accumulated other comprehensive profit
(loss) (1,253 ) 278 Accumulated deficit (31,264 )
(27,745 ) Total shareholders' equity 25,466
30,152 Total liabilities and shareholders'
equity $ 30,173 $ 35,057
CONSOLIDATED STATEMENTS OF CASH
FLOWS
U.S. dollars in
thousands
Three months ended
June 30,
Six months ended
June 30,
2010 2009
2010
2009 Unaudited Cash flows from
operating activities: Net Income (loss) $ (1,687 ) $
(3,430 ) $ (3,519 ) $ (4,876 ) Less: Net (income) loss from
discontinued operations, net of taxes - -
- - Net loss from
continuing operations (1,687 ) (3,430 ) (3,519
) (4,876 ) Adjustments required to reconcile net loss
from continuing operations to net cash used in operating activities
from continuing operations: Depreciation and amortization 123 138
247 312 Stock-based compensation related to options granted to
employees, non-employees and directors 117 204 289 348 Accrued
interest and amortization of premium on marketable securities 20
(17 ) 127 121 Gain from sales of marketable securities - - (9 )
(353 ) Decrease in accrued severance pay, net (25 ) (120 ) (8 )
(222 ) Decrease in trade receivables, net 2,064 1,022 38 2,310
Decrease in other current assets 799 391 764 1,102 Decrease in
trade payables (571 ) (191 ) (319 ) (430 ) Increase (decrease) in
deferred revenues 300 (174 ) 598 55 Decrease in accrued expenses
and other liabilities (20 ) (315 ) (181 ) (1,046 ) Decrease in
other long-term liabilities (19 ) (19 ) (39 ) (22 ) Other (6
) - 41 - Net cash
provided by (used in) operating activities from continuing
operations 1,095 (2,511 ) (1,971 )
(2,701 ) Net cash used in operating activities from
discontinued operations - (168 ) - (230 ) Net cash provided
by (used in) operating activities 1,095 (2,679 ) (1,971 ) (2,931 )
Cash flows from investing activities:
Investment in available-for-sale marketable securities - (1,017 )
(10,992 ) (5,913 ) Proceeds from sale and redemption of
available-for-sale marketable securities - 6,902 9,727 18,279 Short
term deposits, net - (1,884 ) - (1,884 ) Decrease (increase) in
restricted cash 157 (2 ) 141 (13 ) Proceeds from sale of property
and equipment 7 - 7 - Purchase of property and equipment
(143 ) (37 ) (338 ) (194 ) Net cash
provided by (used in) investing activities. 21
3,962 (1,455 ) 10,275
CONSOLIDATED STATEMENTS OF CASH
FLOWS
U.S. dollars in
thousands
Three months ended
June 30,
Six months ended
June 30,
2010 2009 2010
2009 Unaudited Cash flows from
financing activities: Proceeds from exercise of stock
options - 5 75 59 Net cash provided by financing
activities. - 5 75 59 Effect of exchange rate changes
on cash 78 254 (185 ) 166 Increase (decrease) in cash and
cash equivalents 1,039 1,542 (3,691 ) 7,569 Cash and cash
equivalents at the beginning of the period 7,894 17,086 12,624
11,059 Cash and cash equivalents at the end of the
period 8,933 18,628 8,933 18,628
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