“I am also pleased to announce that Paolo Pirjanian, CEO of Evolution Robotics, will be joining iRobot as Chief Technology Officer, continuing to be based in the Pasadena office. I have known Paolo for many years and his extensive experience as an industry-leading roboticist will greatly enhance our team,” Angle added.
“I am very excited about Evolution Robotics and iRobot joining together as a formidable force in robotic technology and look forward to my new role as iRobot’s CTO,” said Paolo Pirjanian, CEO of Evolution Robotics, Inc.
The acquisition is expected to contribute additional revenue of $4-6 million in 2012 and $22-24 million in 2013. On a GAAP basis, iRobot expects the acquisition to be dilutive in 2012 and 2013, subject to final purchase price accounting determinations. The acquisition is expected to be accretive by Q4 2013, excluding non-cash charges, one-time charges and integration costs. Please refer to the supplemental data sheet attached hereto for detailed information about the financial impact of the transaction.
Conference CalliRobot will host a conference call tomorrow at 8:30 a.m. ET to discuss the acquisition. Pertinent details include:
|Date:||Tuesday, September 18, 2012|
|Time:||8:30 a.m. ET|
|Deal Financial Highlights*:|
|-Cash purchase price of $74M (subject to working capital adjustments and other customary transaction price adjustments)|
-Cash purchase price is 3.0x 2013 expected revenue with impact of federal net operating losses (NOLs), and 3.2x 2013 expected revenue without impact of NOLs
|-Preliminary tax-effected net present value of ER's NOLs of approximately $6M|
|-Acquisition expected to be accretive in Q4 2013, excluding non-cash charges, one-time charges and integration costs|
|-Estimated net revenue of $4-6M in Q4 2012 and $22-24M in 2013|
|-Estimated EPS impact of acqusition of ($0.18)-($0.22) in Q4 2012 and ($0.22)-($0.26) in 2013|
|-Estimated Adjusted EPS impact of acquisition of ($0.09)-($0.13) in Q4 2012 and ($0.06)-($0.10) in 2013.|
|See definition of Adjusted EPS impact below.|
|-ER domestic revenue is expected to be 97% of 2012 sales; limited International sales to date|
|-65% of ER's 2012 revenue comes from current iRobot domestic accounts|
|-ER currently utilizes 2 contract manufacturers in China|
|-Pasadena, CA office will be maintained|
|*all financial data subject to purchase price accounting determinations and final closing details|
|Use of Non-GAAP Financial Measures|
In evaluating this acquisition, iRobot considers and uses Adjusted EPS (earnings per share) impact as a supplemental measure of the impact. The Company defines Adjusted EPS impact as earnings per share impact excluding the impact of deal-related estimated intangible asset amortization, merger and acquisition expenses, ASC805 inventory accounting adjustments and non-cash stock compensation expense.
The term Adjusted EPS impact is not defined under U.S. generally accepted accounting principles, or U.S. GAAP, and is not a measure of operating income, operating performance or liquidity presented in accordance with U.S. GAAP. Adjusted EPS impact has limitations as an analytical tool, and when assessing the Company's operating performance, investors should not consider Adjusted EPS impact in isolation, or as a substitute for earnings (loss) per share or other consolidated income statement data prepared in accordance with U.S. GAAP. Other companies may calculate similar measure differently than iRobot, limiting their usefulness as comparative tools. iRobot compensates for these limitations by relying primarily on its GAAP results and using Adjusted EPS impact only supplementally.