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TheStreet Open House

IRobot Reports Third-Quarter Financial Results

Stocks in this article: IRBT

iRobot Corp. (NASDAQ: IRBT), a leader in delivering robotic technology-based solutions, today announced its financial results for the third quarter ended September 28, 2013.

“I am pleased to report that we delivered Q3 results in line with our expectations. We saw strong growth in our Home Robot business, and are excited to announce a next generation home robot for the fourth quarter. Overseas, strong demand in Asia continued and we are seeing signs of recovery in Europe. We shipped additional RP-VITA robots to InTouch Health, while our Remote Presence unit gained further traction in the video collaboration market. And, our Defense & Security business performed as expected,” said Colin Angle, chairman and chief executive officer of iRobot.

“Our businesses continue to perform in line with the expectations we laid out in Q1. Accordingly we are narrowing our full year 2013 expectation ranges to: revenue of between $485 and $490 million, EPS of $0.90 to $0.95 and Adjusted EBITDA of $58 to $61 million.

“Based on our robust product pipeline and expectations over the next three years, we continue to expect to achieve by 2016:

  • Mid-high teen revenue CAGR;
  • High teen Adjusted EBITDA margin; and,
  • High single digit Operating Cash Flow margin.

For 2014, our preliminary revenue expectations are for mid-high teen growth, consistent with the financial targets.”

Financial Results

  • Revenue for the third quarter of 2013 was $124.5 million, compared with $126.3 million for the same quarter one year ago. Revenue for the first nine months of 2013 was $361.1 million compared with $335.6 million for the first nine months one year ago.
  • Net income in the third quarter of 2013 was $7.8 million, compared with $15.2 million in the third quarter of 2012. For the first nine months, net income was $24.5 million, compared with $23.2 million a year ago.
  • Quarterly earnings per share were $0.26, compared with $0.54 in the third quarter last year. Nine-month earnings per share were $0.84 in 2013, compared with $0.82 for the first nine months of 2012.
  • Adjusted EBITDA for the third quarter of 2013 was $17.2 million, compared with $29.2 million in the third quarter of 2012. For the first nine months of 2013 Adjusted EBITDA was $49.4 million, compared with $51.5 million for the same period a year ago.
  • During the third quarter of 2012, there were a number of items recorded, one of which resulted in a $7.7 million revenue increase. The positive net impact of all these items was $0.10 in earnings per share and $5.2 million in Adjusted EBITDA.

Business Highlights

  • Home Robot revenue increased 16 percent in Q3 2013, over last year, driven by strong growth in Japan.
  • Defense & Security results met our Q3 expectations. While the U.S. government shutdown hampered our efforts in both the domestic and international markets we continue to expect to deliver full year Defense & Security revenue of roughly $50 million.
  • We are in discussions to sign our first Cisco distributor for the AVA 500 video collaboration robot and plan to be in full beta with three external users for the product by early December.

Financial Expectations

Management provides the following expectations with respect to the fourth quarter and fiscal year ending December 28, 2013.

Q4 2013:

                       
Revenue $124 - $129 million
Earnings Per Share $0.06 - $0.11
Adjusted EBITDA $9 - $12 million
 

Fiscal Year 2013:

Current

Prior

Revenue $485 - $490 million $485 - $495 million
Earnings Per Share $0.90 - $0.95 $0.88 - $1.00
Adjusted EBITDA $58 - $61 million $55 - $61 million
 

Third-Quarter Conference Call

iRobot will host a conference call tomorrow at 8:30 a.m. ET to discuss its financial results for the third fiscal quarter 2013, business outlook, and outlook for fourth-quarter and fiscal year 2013 financial performance. Pertinent details include:

          Date:           Wednesday, October 23, 2013
Time: 8:30 a.m. ET
Call-In Number: 847-619-6818
Passcode: 34160574

A live, audio broadcast of the conference call will also be available at http://investor.irobot.com/phoenix.zhtml?c=193096&p=irol-EventDetails&EventId=4897484. An archived version of the broadcast will be available on the same website shortly after the conclusion of the live event. A replay of the telephone conference call will be available through October 30, and can be accessed by dialing 630-652-3000, passcode 34160574#.

About iRobot Corp.

iRobot designs and builds robots that make a difference. The company’s home robots help people find smarter ways to clean, its defense & security robots protect those in harm’s way, and its remote presence robots enable virtual presence from anywhere in the world. iRobot’s consumer and military robots feature iRobot Aware® robot intelligence systems, proprietary technology incorporating advanced concepts in navigation, mobility, manipulation and artificial intelligence. For more information about iRobot, please visit www.irobot.com.

For iRobot Investors

Certain statements made in this press release that are not based on historical information are forward-looking statements which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. This press release contains express or implied forward-looking statements relating to, among other things, iRobot Corp.’s expectations regarding future financial performance, future operating performance and growth, fiscal year 2014 revenue growth, the timing of new product introductions, the timing of our achievement of product development milestones, demand for our robots, anticipated growth and performance of our businesses, Defense & Security revenue for fiscal year 2013, and anticipated revenue, earnings per share and Adjusted EBITDA for fiscal year 2013 and the fourth quarter ending December 28, 2013. These statements are neither promises nor guarantees, but are subject to a variety of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. In particular, the risks and uncertainties include, among other things: our ability to operate in an emerging market, the financial strength of our customers and retailers, general economic conditions, market acceptance of our products, our dependence on the U.S. federal government and government contracts, the timing of government contracts and orders, changes in government policies or spending priorities, and competition. Existing and prospective investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. iRobot Corp. undertakes no obligation to update or revise the information contained in this press release, whether as a result of new information, future events or circumstances or otherwise. For additional disclosure regarding these and other risks faced by iRobot Corp., see the disclosure contained in our public filings with the Securities and Exchange Commission.

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