ThinkEngine Networks Announces Q4 and Fiscal Year 2007 Results
Marlborough, Mass. - March 19, 2008 (BUSINESS WIRE) - ThinkEngine Networks, Inc. (Pink Sheets symbol: THNK) today reported results for its fourth quarter and fiscal year ended December 31, 2007.
Revenue for the fourth quarter and year ended December 31, 2007 was $1.8 million and $7.4 million, respectively, compared to $2.7 million and $9.6 million, respectively, for the three and twelve-month periods ended December 31, 2006.
Net loss for the fourth quarter ended December 31, 2007 was $3.0 million, or ($0.45) per share, compared to a net loss of $0.9 million, or ($0.13) per share, in the prior year's fourth quarter. Net loss for the year ended December 31, 2007 was $7.5 million, or ($1.12) per share, compared to a net loss of $5.6 million, or ($0.81) per share, for the year ended December 31, 2006.
Michael Mitchell, President and Chief Executive Officer, stated, "the net loss for the 2007 fourth quarter and fiscal year includes a non-cash charge of $2.9 million related to the write-down of intangible assets recorded as part of a 2005 acquisition. The quarter and the year also were impacted by the lower than expected level of orders for the VSR1000 product due to the dispute over fees between a number of independent local exchange carriers, who were hosting our customers, and some large long distance telephone carriers. Our latest product release is intended for the full service audio conferencing service provider marketplace which is a market in which we have not previously competed".
ThinkEngine Networks, Inc.
Condensed Balance Sheets
(in thousands)
(unaudited)
| Dec. 31, | Dec. 31, | |
| Assets | 2007 (A) | 2006 (A) |
| Cash and marketable securities | $415 | $2,764 |
| Accounts receivable, net | 990 | 1,354 | Note and interest receivable | 392 | 0 |
| Inventory, net | 766 | 1,439 |
| Other current assets | 102 | 270 |
| Total current assets | 2,665 | 5,827 | Officer loans | - | 444 | Fixed assets, net | 591 | 970 |
| Other assets, net | 123 | 3,405 |
| Total assets | $3,379 | $10,646 |
| Liabilities and Stockholders' (Deficit) Equity | ||
| Accounts payable and accrued expenses | $1,113 | $2,012 |
| Notes payable – current portion | 850 | 0 |
| Deferred revenue | 368 | 522 | Total current liabilities | 2,331 | 2,534 |
| Non-current liabilities | 1,431 | 964 |
| Stockholders' (deficit) equity | (383) | 7,148 |
| Total liabilities and stockholders’ (deficit) equity | $3,379 | $10,646 |
| (A) December 31 amounts are derived from audited financial statements. | ||
ThinkEngine Networks, Inc.
Condensed Statements of Operations
(in thousands, except per share amounts)
(unaudited)
| Three Months Ended December 31, |
Twelve Months Ended December 31, |
|||
| 2007 | 2006 | 2007 | 2006 | |
| Revenue | $1,845 | $2,693 | $7,371 | $9,633 |
| Cost of revenues | 598 | 1,165 | 2,783 | 4,557 |
| Gross margin | 1,247 | 1,528 | 4,588 | 5,076 |
| Research and development | 891 | 1,176 | 4,778 | 5,506 |
| Selling, general and administrative | 945 | 1,328 | 4,945 | 5,497 |
| Impairment of intangible assets | 2,887 | - | 2,887 | - |
| Interest expense | 49 | 10 | 285 | 10 |
| Other (income)/expense, net | (505) | (25) | (638) | (306) |
| Total | 4,267 | 2,489 | 12,257 | 10,707 |
| Pretax loss | (3,020) | (961) | (7,669) | (5,631) |
| Income tax benefit | - | (45) | (129) | - |
| Loss from operations | (3,020) | (916) | (7,540) | (5,631) |
| Cumulative effect of change in accounting principle, net of tax | - | - | - | 36 |
| Net loss | ($3,020) | ($916) | ($7,540) | ($5,595) |
| Pension liability adjustment | (43) | 51 | 86 | 51 |
| Comprehensive loss | ($3,063) | ($865) | ($7,626) | ($5,544) |
| Net loss per share - basic and diluted: | ||||
| Loss from operations | ($0.45) | ($0.13) | ($1.12) | ($0.82) |
| Cumulative effect of change in accounting principle, net of tax | - | - | - | $0.01 |
| Net loss - basic and diluted | ($0.45) | ($0.13) | ($1.12) | ($0.81) |
| Weighted average common shares used in computing net loss: | ||||
| Basic and diluted | 6,705 | 6,709 | 6,732 | 6,899 |
About ThinkEngine Networks
ThinkEngine Networks, Inc. is a provider of TDM and IP capable conferencing bridges and media servers. The VSR1000 includes both TDM and IP interfaces as standard equipment and is capable of processing 968 simultaneous sessions in a compact 1U platform. This NEBS 3 certified platform has been deployed by customers to implement reservationless conferencing, prepaid calling, and IVR applications. The Company's CX Series - Exchange Network Media Servers are a cost-effective and highly scalable family of carrier-class media server platforms. They deliver advanced network media solutions in VoIP networks as well as in traditional AIN and TDM circuit switched and mixed network environments. ThinkEngine is a disruptive force in the marketplace - drastically reducing the cost of implementation while giving customers a migration path from TDM to VoIP. For more information about the Company, visit http://www.thinkengine.com.
Safe Harbor Statement
This news release contains forward-looking statements that involve risks, uncertainties and assumptions. All statements contained herein which are not historical facts are forward-looking statements. The forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated. Such risks and uncertainties include, but are not limited to, the continuance of reduced capital expenditures throughout the telecommunications market, variability of sales volume from quarter to quarter, product demand, market acceptance, litigation, dependence on significant customers, third party suppliers and intellectual property rights, risks in product and technology development and other risk factors detailed in the company's most recent Form 10-K, as amended, and other subsequent Securities and Exchange Commission filings. ThinkEngine Networks does not undertake any duty to update forward-looking statements.
Contact: John Steinkrauss
Chief Financial Officer
ThinkEngine Networks, Inc.
jsteinkrauss@thinkengine.com
508-597-0452