cloudhosting14 wrote: As you would already know that managed hosting itself is another form of Cloud hosting in which the system administrations of servers is looked upon by the CPs. Similar is the case with managed multi Cloud hosting. You can very well understand how a big burden it would be to manage multi cloud servers for organization; this is why a service known as managed multi Cloud is provided to these users. This service ensures them the seam less running of their system administrative operations while organizations focus more on t...
EMERYVILLE, Calif., Nov. 5, 2012 /PRNewswire/ -- LeapFrog Enterprises, Inc. (NYSE: LF) today announced financial results for the third quarter ended September 30, 2012.
Highlights of third quarter 2012 results compared to third quarter 2011 results:
Consolidated net sales were $193.1 million, up 28%.
Income from operations was $36.9 million, up 48%.
Net income per diluted share was $0.60, up 71% or $0.25 per share.
Cash and cash equivalents were $49.4 million as of September 30, 2012, up 93% or $23.8 million compared to the balance as of September 30, 2011.
Highlights of nine month 2012 results compared to nine month 2011 results:
Consolidated net sales were $336.6 million, up $91.6 million or 37%.
Income from operations was $20.8 million, an improvement of $30.8 million.
Net income per diluted share was $0.35, an improvement of $0.55 per share.
"The quality of execution from the LeapFrog team has been exceptional this year. We are making terrific progress in the transformation of our business while delivering market-leading financial growth," said John Barbour, Chief Executive Officer. "This summer, we introduced LeapPad2, the next generation of the #1 kids' learning tablet. In a very competitive tablet market, LeapPad2 has already won many accolades, been featured on every major top holiday toy list and is a top-selling product in key retail layaway programs.
"Our 17 years of experience in creating revolutionary products that improve children's lives through delivering fun, engaging and compelling entertainment that's filled with rich learning nutrition has helped us create the best learning tablet for children and a content library that is filled with hundreds of games, books, videos, music and apps that have all been created or selected by qualified child development and education experts. Together, our platforms and content provide a winning proposition that helps children achieve their potential while also creating significant value for our shareholders and our business partners."
Financial Overview for the Third Quarter 2012 Compared to the Third Quarter 2011
Third quarter 2012 net sales were $193.1 million, up 28% compared to $150.8 million last year, and included a 1% negative impact from changes in currency exchange rates. Net sales growth was primarily driven by the introduction of new products, continued high consumer demand for the LeapPad line, and strong content sales. In the U.S. segment, net sales were $145.7 million, up 26% compared to $116.0 million last year. In the International segment, net sales were $47.4 million, up 36% compared to $34.9 million last year, and included a 3% negative impact from changes in currency exchange rates.
Income from operations was $36.9 million for the third quarter of 2012, up 48% compared to $24.9 million a year ago. Net income was $41.7 million, up 81% compared to $23.0 million a year ago. Net income included non-recurring tax benefits of $6.4 million in the third quarter of 2012 and $2.9 million in the third quarter of 2011.
Net income per diluted share was $0.60 for the third quarter of 2012, up 71% or $0.25 per share compared to $0.35 a year ago. Excluding the impact of non-recurring tax benefits, net income per diluted share increased $0.20 per share compared to the prior year.
"We delivered a great third quarter performance with strong sales and earnings growth," said Ray Arthur, Chief Financial Officer. "Consumer demand for our educational entertainment continued to be robust. Early retail sales of LeapPads through retailer layaway programs have been very strong, although it is likely that these programs pulled forward some demand into the third quarter from the fourth quarter. Improvements in our supply chain have helped us build higher retail inventory of LeapPads as we head into the all-important holiday season."
Guidance
"We have good momentum heading into the holidays. Given the strength of our third quarter results, retail point-of-sale trends and inventory position, we are raising our full year 2012 guidance," continued Mr. Arthur. "Our guidance is based on our best view as of today, but keep in mind that our full year 2012 results will be highly dependent on the economy and consumer sales during the holiday season. In addition, please note that we expect our advertising expenditures to increase by approximately 20% to 25% in the fourth quarter compared to a year ago, as we concentrate our advertising during the key holiday weeks when consumers are shopping for gifts. Our results for the year will ultimately depend on holiday sell-through of our products."
For the full year 2012, we now expect:
Net sales to be between $535 million and $550 million, an increase of $80 million to $95 million, or 18% to 21%, compared to $455 million in 2011.
Net income per diluted share to be in the range of $0.75 to $0.81 compared to $0.30 in 2011.
Conference Call and Webcast
LeapFrog will hold a conference call to discuss third quarter 2012 financial results on November 5, 2012, at 2:00 p.m. Pacific Standard Time (5:00 p.m. Eastern Standard Time). The conference call will be webcast live and can be accessed at LeapFrog's investor relations web site at www.leapfroginvestor.com. An archive of the webcast will be available on the web site approximately three hours following completion of the call. In addition, more information about LeapFrog, including this press release and other financial and investor information, is also available on the investor relations web site.
To participate in the call, please dial (706) 634-0183 and request conference ID 47975795. A telephonic replay of the call will be available for one month. To access the replay, please dial (404) 537-3406 and use conference ID 47975795.
About LeapFrog
LeapFrog Enterprises, Inc. is the leader in educational entertainment for children. LeapFrog's award-winning product portfolio helps millions of children achieve their potential by delivering best-in-class curriculum through engaging content, fun multimedia learning platforms and toys. The Learning Path, LeapFrog's proprietary online destination for parents and extended family, provides personalized feedback on a child's learning progress and offers recommendations to enhance each child's learning experience. Through the power of play, LeapFrog's products and curriculum help children of all ages prepare for school and life success. LeapFrog's products are available in more than 45 countries and have been used by teachers in more than 100,000 U.S. classrooms. LeapFrog is based in Emeryville, California, and was founded in 1995 by a father who revolutionized technology-based learning solutions to help his child learn how to read. Come see the learning at www.leapfrog.com.
This news release contains forward-looking statements that involve risks and uncertainties, including statements regarding anticipated financial results. Our actual results may differ materially from those expressed or implied by such forward-looking statements. The risks that could cause our results to differ include, without limitation, deterioration of global economic conditions, our ability to correctly predict highly changeable consumer preferences and product trends, our ability to continue to develop new products and services, our reliance on a small group of retailers for the majority of our gross sales, our dependence on our suppliers for our components and raw materials, the seasonality of our business, our growing focus on online products and services, system failures in our online services or web store, our reliance on a limited number of manufacturers, our ability to maintain sufficient inventory levels, our ability to compete effectively with competitors, our ability to maintain or acquire licenses, third parties who claim we are infringing on their intellectual property rights, errors or defects in our products, privacy concerns about our Internet-connected products, the sufficiency of our liquidity, the risk associated with international operations, continued compliance and associated costs with and/or changes in laws and regulations, negative political developments, natural disasters, armed hostilities, terrorism, labor strikes or public health issues, the loss of members of our executive management team, continued ownership by a few stockholders of a majority of voting power in us, and the volatility of our stock price. These risks and others are discussed under "Risk Factors" in our filings with the U.S. Securities and Exchange Commission, including our 2011 annual report on Form 10-K filed on February 29, 2012. All information provided in this release is as of the date hereof, and we undertake no obligation to update this information.
Accounts receivable, net of allowances for doubtful accounts of $3,893, $676 and $659, respectively
170,106
136,256
157,418
Inventories
115,083
70,338
34,288
Prepaid expenses and other current assets
9,522
8,089
8,078
Deferred income taxes
1,035
1,585
983
Total current assets
345,173
241,931
272,630
Long-term investments
-
2,681
2,681
Deferred income taxes
1,309
907
1,311
Property and equipment, net
20,411
17,891
17,881
Capitalized product costs, net
10,935
13,215
12,511
Goodwill
19,549
19,549
19,549
Other intangible assets, net
1,550
3,960
3,350
Other assets
1,534
1,841
1,119
Total assets
$ 400,461
$ 301,975
$ 331,032
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable
$ 82,128
$ 57,851
$ 34,629
Accrued liabilities
45,722
32,979
50,380
Income taxes payable
414
373
377
Total current liabilities
128,264
91,203
85,386
Long-term deferred income taxes
3,798
3,480
3,542
Other long-term liabilities
2,723
9,455
9,360
Stockholders' equity:
Class A Common Stock, par value $0.0001;
Authorized - 139,500 shares; Issued and outstanding: 61,905, 49,862 and 54,923, respectively
6
5
6
Class B Common Stock, par value $0.0001;
Authorized - 40,500 shares; Issued and outstanding: 5,715, 15,817 and 11,113, respectively
1
2
1
Treasury stock
(185)
(185)
(185)
Additional paid-in capital
403,187
393,230
395,627
Accumulated other comprehensive income
976
75
(225)
Accumulated deficit
(138,309)
(195,290)
(162,480)
Total stockholders' equity
265,676
197,837
232,744
Total liabilities and stockholders' equity
$ 400,461
$ 301,975
$ 331,032
LEAPFROG ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Three Months Ended September 30,
Nine Months Ended September 30,
2012
2011
2012
2011
Operating activities:
Net income (loss)
$ 41,738
$23,048
$24,171
$(12,908)
Adjustments to reconcile net income (loss) to net cash provided by
(used in) operating activities:
Depreciation and amortization
5,749
5,063
16,871
14,510
Deferred income taxes
26
345
238
456
Stock-based compensation expense
2,027
1,640
5,066
4,064
Loss on sale of long-term investments, net of tax
-
-
91
-
Loss on disposal of long-term assets
-
(45)
2
8
Allowance for doubtful accounts
119
(107)
3,371
172
Other changes in operating assets and liabilities:
Accounts receivable, net
(118,335)
(87,704)
(15,493)
21,131
Inventories
(61,856)
(7,815)
(80,149)
(23,006)
Prepaid expenses and other current assets
(133)
1,040
(1,367)
219
Other assets
58
181
(414)
(55)
Accounts payable
49,889
29,780
47,454
26,468
Accrued liabilities
14,117
9,690
(4,805)
(8,410)
Other long-term liabilities
(6,266)
(2,678)
(6,638)
(2,290)
Income taxes payable
35
144
37
206
Net cash provided by (used in) operating activities
(72,832)
(27,418)
(11,565)
20,565
Investing activities:
Purchases of property and equipment
(4,004)
(2,085)
(10,396)
(9,369)
Capitalization of product costs
(1,731)
(1,979)
(5,623)
(6,319)
Sale of investments
-
-
2,500
-
Other
-
-
-
2
Net cash used in investing activities
(5,735)
(4,064)
(13,519)
(15,686)
Financing activities:
Proceeds from stock option exercises and employee stock purchase plans
1,268
105
4,007
2,049
Net cash paid for payroll taxes on restricted stock unit releases
(301)
(107)
(1,513)
(717)
Net cash provided by (used in) financing activities
967
(2)
2,494
1,332
Effect of exchange rate changes on cash
101
(586)
154
(27)
Net change in cash and cash equivalents
(77,499)
(32,070)
(22,436)
6,184
Cash and cash equivalents, beginning of period
126,926
57,733
71,863
19,479
Cash and cash equivalents, end of period
$ 49,427
$25,663
$49,427
$ 25,663
LEAPFROG ENTERPRISES, INC.
SUPPLEMENTAL FINANCIAL INFORMATION
(In thousands)
(Unaudited)
Three Months Ended September 30,
Nine Months Ended September 30,
2012
2011
2012
2011
Net sales
$193,072
$150,832
$336,562
$244,930
Cost of sales (1)
115,771
89,025
200,974
152,385
Gross profit
77,301
61,807
135,588
92,545
Operating expenses: (2) (3)
Selling, general and administrative
21,257
17,875
65,158
56,012
Research and development
9,164
8,276
26,902
24,648
Advertising
7,179
7,790
13,932
13,617
Depreciation and amortization
2,838
2,917
8,751
8,261
Total operating expenses
40,438
36,858
114,743
102,538
Income (loss) from operations
36,863
24,949
20,845
(9,993)
Other income (expense):
Interest income
37
35
226
104
Interest expense
(49)
(22)
(49)
(102)
Other, net
(898)
(3,632)
(2,014)
(4,475)
Total other income (expense), net
(910)
(3,619)
(1,837)
(4,473)
Income (loss) before income taxes
35,953
21,330
19,008
(14,466)
Benefit for income taxes
(5,785)
(1,718)
(5,163)
(1,558)
Net income (loss)
$ 41,738
$ 23,048
$ 24,171
$ (12,908)
(1)
Includes depreciation and amortization
2,911
2,146
8,120
6,249
(2)
Includes stock-based compensation as follows:
Selling, general and administrative
1,794
1,366
4,438
3,484
Research and development
233
274
628
580
(3)
Includes severance costs as follows:
Selling, general and administrative
6
1
266
2,422
Research and development
208
-
208
22
Segment data:
Net sales:
U.S. segment
145,691
115,974
247,050
181,449
International segment
47,381
34,858
89,512
63,481
Income (loss) from operations*:
U.S. segment
24,781
17,956
2,059
(17,760)
International segment
12,082
6,993
18,786
7,767
*
Certain corporate-level operating expenses associated with sales and marketing, product support, human resources, legal, finance, information technology, corporate development, procurement activities, research and development, legal settlements and other corporate costs are charged entirely to our U.S. segment, rather than being allocated between the U.S. and International segments.
SYS-CON Events announced today that Wowrack will exhibit at SYS-CON's 12th International Cloud Expo, which will take place on June 10–13, 2013, at the Javits Center in New York City, New York.
Wowrack’s core expertise lies in high-availability Private and Public Cloud IaaS Hosti...
Cloud computing must have been brushing up on its bedside manner.
HIPAA requirements now stipulate everyone in the health-care industry must begin migrating patient records and other data to cloud computing. By 2015, all medical professionals with access to patient records must ...
As enterprises deploy private IaaS clouds into production they are reevaluating their future application delivery models. SUSE and WSO2 believe that private PaaS will leverage the automation and scalability of Private IaaS solutions, such as OpenStack-based SUSE Cloud, to deliver...
Join us for an exclusive briefing with Gartner where they will talk about how IT Executives are modernizing data centers and transforming operations to focus resources on business value.
During the session they will discuss how innovative IT solutions are needed to help IT deli...
Organizations across the world are increasingly starting to see the benefits of moving more and more services to the cloud. The focus on the cost-saving potential of cloud is rapidly shifting to completely transforming the business with cloud. As organizations are investing enorm...
.gif)
SYS-CON Events announced today that Wowrack will exhibit at SYS-CON's 12th International Cloud Expo, which will take place on June 10–13, 2013, at the Javits Center in New York City, New York.
Wowrack’s core expertise lies in high-availability Private and Public Cloud IaaS Hosti...
Cloud computing must have been brushing up on its bedside manner.
HIPAA requirements now stipulate everyone in the health-care industry must begin migrating patient records and other data to cloud computing. By 2015, all medical professionals with access to patient records must ...
As enterprises deploy private IaaS clouds into production they are reevaluating their future application delivery models. SUSE and WSO2 believe that private PaaS will leverage the automation and scalability of Private IaaS solutions, such as OpenStack-based SUSE Cloud, to deliver...
Join us for an exclusive briefing with Gartner where they will talk about how IT Executives are modernizing data centers and transforming operations to focus resources on business value.
During the session they will discuss how innovative IT solutions are needed to help IT deli...
Organizations across the world are increasingly starting to see the benefits of moving more and more services to the cloud. The focus on the cost-saving potential of cloud is rapidly shifting to completely transforming the business with cloud. As organizations are investing enorm...
