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ClearOne Reports Strong Second Quarter 2010 Financial Results
Aug 13, 2010 (07:08 AM EDT)


SALT LAKE CITY, Aug. 13 /PRNewswire-FirstCall/ -- ClearOne Communications, Inc. (Nasdaq: CLRO) today reported financial results for the second quarter ended June 30, 2010.

Revenue for the 2010 second quarter increased 41% to $9.9 million from $7.1 million in the same quarter of last year.  Gross profit rose to $5.7 million, or 57% of revenue, from $3.2 million, or 45% of revenue, for the prior year period.  Operating income was $520,000 compared to an operating loss of $946,000 in the same period of fiscal 2009.  Net income was $353,000, or $0.04 per diluted share, versus net loss of $402,000, or $0.04 per diluted share, for the second quarter of 2009.

"In the 2010 second quarter, our overall financial performance improved primarily due to increased sales in each of our audio conferencing product lines and the contribution of revenue from NetStreams' products," said Zee Hakimoglu, president, chief executive officer and chairman of ClearOne.  "We further strengthened the company's balance sheet during the second quarter, remaining debt free while growing our cash position by $1.5 million to $10.9 million even after fully absorbing NetStreams' operations and making investments in its sales channel and product development.  In addition, we reduced our inventory by $1.3 million during the second quarter and $5.3 million, or 34%, over the last 12 months."

For the first six months of 2010, revenue increased 25% to $18.3 million from $14.7 million for the same period of 2009.  Gross profit was $10.9 million, or 59% of revenue, from $7.2 million, or 49% of revenue, for the comparable prior year period.  Operating income was $977,000 compared to an operating loss of $516,000 for the first six months of fiscal 2009.  Net income was $570,000, or $0.06 per diluted share, versus net loss of $42,000, for the comparable prior period.

About ClearOne

ClearOne is a global communications solutions company that develops and sells conferencing, collaboration, streaming media and connectivity systems for audio, video, and web applications. The reliability, flexibility and performance of our advanced comprehensive solutions enhance the quality of life through better communication, education, and entertainment.

ClearOne develops, manufactures, markets and services a comprehensive line of high-quality audio conferencing products under personal, tabletop, premium and professional (installed audio) categories. The company occupies the number one position in the professional audio conferencing market with more than 50% of the global market share. ClearOne's conferencing solutions save organizations time and money by creating a natural environment for collaboration.

NetStreams, recently acquired by ClearOne, delivers the ultimate IP A/V experience by distributing high definition audio and video over TCP/IP networks. NetStreams' products, designed for commercial and residential use, offer unprecedented levels of performance, functionality, simplicity, reliability, and expandability. By combining audio/video content, meta-data and control signals into one stream and incorporating industry standards, NetStreams' newly patented StreamNet® solutions are a smart investment, enabling the Power of AV over IP™ – today.

NetStreams' StreamNet technology provides elegant solutions for streaming media & control applications such as digital signage, distribution of HD video and audio, LAN Cloud Matrix Switching™, and audio paging over data networks.

This release contains "forward-looking" statements that are based on present circumstances and on ClearOne's predictions with respect to events that have not occurred, that may not occur, or that may occur with different consequences and timing than those now assumed or anticipated.  Such forward-looking statements, including statements regarding the company's ability to successfully commercialize newer products and enter new markets, are not guarantees of future performance or results and involve risks and uncertainties that could cause actual events or results to differ materially from the events or results described in the forward-looking statements.  Such forward-looking statements are made only as of the date of this release and ClearOne assumes no obligation to update forward-looking statements to reflect subsequent events or circumstances.  Readers should not place undue reliance on these forward-looking statements.

http://www.b2i.us/irpass.asp?BzID=509&to=ea&s=0

FINANCIAL TABLES FOLLOW

CLEARONE COMMUNICATIONS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands of dollars, except per share amounts)

(unaudited)


Three months ended


Six months ended


June 30, 2010

June 30, 2009


June 30, 2010

June 30, 2009

Revenue

$           9,937

$           7,060


$         18,293

$         14,662

Cost of goods sold

4,276

3,886


7,437

7,435

Gross profit

5,661

3,174


10,856

7,227







Operating expenses:






Sales and marketing

2,183

1,929


4,085

3,619

Research and product development

1,744

2,111


3,648

3,921

General and administrative

1,214

1,180


2,146

1,303

Insurance settlement

-

(1,100)


-

(1,100)

Total operating expenses

5,141

4,120


9,879

7,743







Operating income (loss)

520

(946)


977

(516)







Other income (expense), net

-

225


(132)

285







Income (loss) before income taxes

520

(721)


845

(231)

(Provision for) benefit from income taxes

(167)

319


(275)

189

Net income (loss)

$              353

$             (402)


$              570

$               (42)







Basic earnings (loss) per common share

$             0.04

$            (0.05)


$             0.06

$                 -

Diluted earnings (loss) per common share

$             0.04

$            (0.04)


$             0.06

$                 -







Basic weighted average shares outstanding

8,929,281

8,928,546


8,929,277

8,921,313

Diluted weighted average shares outstanding

9,045,866

9,047,260


9,045,718

9,039,863



CLEARONE COMMUNICATIONS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands of dollars, except per share amounts)





As of
June 30, 2010

As of
December 31, 2009

ASSETS



Current assets:



Cash and cash equivalents

$         10,906

$            9,494

Receivables, net of allowance for doubtful accounts of $191 and $103, respectively

8,429

6,571

Inventories, net

6,176

6,236

Deferred income taxes

3,351

3,128

Prepaid expenses and other assets

556

1,609

Total current assets

29,418

27,038




Long-term inventory

4,178

6,412

Property and equipment, net

3,195

3,246

Intangibles

2,920

3,095

Goodwill

726

726

Deferred income taxes

852

1,037

Other assets

21

21

Total assets

$         41,310

$          41,575




LIABILITIES AND SHAREHOLDERS' EQUITY



Current liabilities:



Accounts payable

2,592

2,304

Accrued liabilities

2,066

1,768

Current maturities of long-term debt

-

2,000

Deferred product revenue

5,033

4,707

Total current liabilities

9,691

10,779




Deferred rent

603

466

Other long-term liabilities

1,188

1,232

Total liabilities

11,482

12,477




Shareholders' equity:



 Common stock, par value $0.001, 50,000,000 shares authorized, 8,929,314  and 8,929,134 shares issued and outstanding, respectively

9

9

Additional paid-in capital

38,970

38,810

Accumulated deficit

(9,151)

(9,721)

Total shareholders' equity

29,828

29,098

Total liabilities and shareholders' equity

$         41,310

$          41,575






Contact:

ClearOne Communications, Inc.


Investor Relations


(801) 303-3555



SOURCE ClearOne Communications, Inc.