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MELVILLE, N.Y., March 18, 2013 (GLOBE NEWSWIRE) --
FalconStor Software, Inc. (Nasdaq:FALC), a market leader in disk-based data protection, today announced financial results for its fourth quarter and full year that ended December 31, 2012. FalconStor closed the year with over 30 percent sequential revenue growth in the fourth quarter.
"Though 2012 was a challenging year for FalconStor, our year-long efforts paid off with a strong fourth quarter, international recognition for product innovation and great strides in product development that we expect will come to fruition this year," said James P. McNiel, president and CEO of FalconStor Software. "With the Company's major outstanding legal issues resolved, FalconStor is moving forward aggressively with its suite of data protection solutions designed to help businesses modernize backup, automate disaster recovery, migrate data and optimize existing storage resources. We continue to address a lucrative market opportunity with the right products at the right time for an IT industry still adjusting to explosive data growth, virtualization, round-the-clock demand for data center services and the advent of Big Data and the cloud."
Financial and Business Highlights:
Fourth quarter total revenue increased more than 30 percent compared with the third quarter of 2012.
Positive cash flow from operations in the fourth quarter of $4.3 million.
Full year 2012 support and services revenue increased 2 percent compared with fiscal year 2011.
Full year 2012 total revenue declined 9 percent over fiscal year 2011.
The Company announced the settlement of government investigations in June 2012, an agreement to settle a class action lawsuit in January 2013 and the dismissal of a derivative action lawsuit on March 5, 2013.
Product innovation in 2012 focused on deduplication with enhancements to the FalconStor ® Virtual Tape Library (VTL) solution, which was the Backup & Recovery Solution winner in the Network World Asia Information Management Awards.
Industry recognition for RecoverTrac™ technology as a Best of VMworld 2012 award gold winner in the Business Continuity and Data Protection category demonstrates the importance of automating disaster recovery strategies and testing.
FalconStor ® Network Storage Server (NSS) VS Series HA Appliance received a silver medal in the Best Hardware: Appliance category in the 2012 Windows IT Pro 2012 Editors' Best Awards, highlighting the product's strategic importance, value to customers and competitive advantage within the storage virtualization, data migration and data protection markets.
For the year ended December 31, 2012, revenues decreased to $75.4 million, compared with $82.9 million for the same period a year ago. GAAP loss from operations for 2012 was $13.7 million, compared with an operating loss of $22.2 million for the same period a year ago. GAAP net loss for 2012 was $15.0 million, or $0.32 per share, compared with $23.4 million, or $0.50 per share, in 2011. The 2012 operating results include a net reduction of $0.3 million of investigation, litigation and settlement costs. The net reduction of $0.3 million resulted from the Company recording a receivable during 2012 for the recovery of $4.9 million of costs, including any settlements associated with the Class Action and Derivative suits and the reversal of previously accrued costs related to the government investigations of $1.7 million. These amounts were partially offset by $5.0 million for the settlement of the Class Action and $1.3 million of overall legal fees not recoverable through insurance. During the same period in 2011, the Company had recorded $10.3 million of costs associated with the then outstanding government investigations and related class actions, which was comprised of $2.8 million of legal fees and an accrual of $7.5 million for certain costs associated with the then outstanding resolution of the investigations.