UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 6-K

 

Report of Foreign Private Issuer

 

Pursuant to Rule 13a-16 or 15d-16

of the Securities Exchange Act of 1934

 

For the Month of April 2020

 

Commission file number 0-30070

 

AUDIOCODES LTD.

(Translation of registrant’s name into English)

 

1 Hayarden Street • Airport City, Lod 7019900 • ISRAEL

(Address of principal executive office)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F x    Form 40-F ¨

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____

 

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____

 

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

  

 

 

 

 

On April 27, 2020, AudioCodes Ltd. (the “Registrant”) issued a press release announcing financial results for the first quarter of 2020, and other matters. A copy of this press release is attached hereto as Exhibit 1 and incorporated by reference herein.

 

The information set forth in (a) the first, second, third and sixth paragraphs following the heading “Details,” and the paragraph following the heading “Cash Dividend” of and (b) the condensed consolidated balance sheets, condensed consolidated statements of operations and condensed consolidated statements of cash flows contained in, the press release attached as Exhibit 1 to this Report on Form 6-K are hereby incorporated by reference into (i) the Registrant’s Registration Statement on Form S-8, File No. 333-11894; (ii) the Registrant’s Registration Statement on Form S-8, File No. 333-13268; (iii) the Registrant’s Registration Statement on Form S-8, File No. 333-105473; (iv) the Registrant’s Registration Statement on Form S-8, File No. 333-144825; (v) the Registrant’s Registration Statement on Form S-8, File No. 333-160330; (vi) the Registrant’s Registration Statement on Form S-8, File No. 333-170676; (vii) the Registrant’s Registration Statement on Form S-8, File No. 333-190437; (viii) the Registrant’s Registration Statement on Form S-8, File No. 333-210438; and (ix) the Registrant’s Registration Statement on Form S-8, File No. 333-230388.

 

 

 

 

 

 

SIGNATURE

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  AUDIOCODES LTD.  
  (Registrant)  
       
       
       
  By: /s/ NIRAN BARUCH  
    Niran Baruch  
    Vice President Finance and  
    Chief Financial Officer  

  

 

Dated: April 27, 2020

 

 

 

EXHIBIT INDEX

 

Exhibit No.   Description
1   Press release, dated April 27, 2020, announcing financial results for the first quarter of 2020, and other matters.

  

 

 

 

 

 

 

 

Exhibit 1

  

 

AudioCodes Press Release 

 

P R E S S  R E L E A S E

  

Company Contacts   IR Agency Contact

Niran Baruch,
VP Finance & Chief Financial Officer

AudioCodes

Tel: +972-3-976-4000
Niran.baruch@audiocodes.com

Shirley Nakar,
Director, Investor Relations
AudioCodes

Tel: +972-3-976-4000

shirley@audiocodes.com

Brett Maas,

Managing Director

Hayden IR

Tel: +1-646-536-7331

brett@haydenir.com

 

AudioCodes Reports First Quarter 2020 Results

 

Lod, Israel – April 27, 2020 - AudioCodes (NASDAQ: AUDC) Press Release

 

First Quarter Highlights

 

·Quarterly revenues increased by 11.7% year-over-year to $52.0 million;

 

·Quarterly service revenues increased by 25.2% year-over-year to $17.7 million;

 

·Quarterly UC-SIP revenues increased more than 20% year-over-year;

 

·GAAP results:

 

·Quarterly GAAP gross margin percentage was 65.9%;

 

·Quarterly GAAP operating margin percentage was 11.8%;

 

·Quarterly GAAP net income was $5.3 million, or $0.17 per diluted share;

 

·Non-GAAP results:

 

·Quarterly Non-GAAP gross margin percentage was 66.1%;

 

·Quarterly Non-GAAP operating margin percentage was 15.2%;

 

·Quarterly Non-GAAP net income was $7.8 million, or $0.25 per diluted share;

 

·Net cash provided by operating activities was $6.8 million for the quarter.

 

·AudioCodes declared a semiannual cash dividend of 13 cents per share. The dividend, in the aggregate amount of $3.9 million, was paid on March 4, 2020

 

 

Details

 

AudioCodes, a leading vendor of advanced voice networking and media processing solutions for the digital workplace, today announced financial results for the first quarter ended March 31, 2020.

 

   

AudioCodes Reports First Quarter 2020 Results

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AudioCodes Press Release 

 

 

Revenues for the first quarter of 2020 were $52.0 million compared to $46.6 million for the first quarter of 2019.

 

Net income was $5.3 million, or $0.17 per diluted share, for the first quarter of 2020, compared to $3.0 million, or $0.10 per diluted share, for the first quarter of 2019.

 

On a Non-GAAP basis, net income was $7.8 million, or $0.25 per diluted share, for the first quarter of 2020 compared to $5.5 million, or $0.18 per diluted share, for the first quarter of 2019.

 

Non-GAAP net income excludes: (i) share-based compensation expenses; (ii) amortization expenses related to intangible assets; (iii) expenses or income related to revaluation of an earn-out liability in connection with the acquisition of Active Communications Europe; (iv) financial income or expenses related to exchange rate differences in connection with revaluation of assets and liabilities in non-dollar denominated currencies and (v) non-cash deferred tax expenses. A reconciliation of net income on a GAAP basis to a non-GAAP basis is provided in the tables that accompany the condensed consolidated financial statements contained in this press release.

 

Net cash provided by operating activities was $6.8 million for the first quarter of 2020. Cash and cash equivalents and long- and short-term bank deposits were $74.2 million as of March 31, 2020 compared to $71.9 million as of December 31, 2019. The increase in cash and cash equivalents, long- and short-term bank deposits was the result of cash provided by operating activities offset, in part, by the use of cash in March 2020 for the payment of a cash dividend.

 

“We are pleased to report strong financial results for the first quarter of 2020,” said Shabtai Adlersberg, President and Chief Executive Officer of AudioCodes. “We continued to enjoy good business momentum in the quarter in both the enterprise and the service providers’ space. We experienced growth in all of the major market segments in which we participate, including the UCaaS market, the Contact Center market and the service providers’ all-IP migration market. As a result, we continued to improve our financial performance year-over-year with respect to both revenues and profits.  Our continued positive operating cash flow and the improved operational efficiency as exhibited by the increase in the Non-GAAP operating margin percentage to 15.2% underscores our financial success.”

 

”Turning to the impact of the COVID-19 pandemic, around the middle of the first quarter we experienced difficulties in the manufacturing of our hardware products in China. We were able to quickly recover from the associated delay and were able to ship all of our products as planned during the quarter. In compliance with the Israeli regulations meant to cope with the COVID-19 crisis, we have moved the majority of HQ employees to a work-from-home basis, a transition that went smoothly. Based on business activity during the 1Q20 and past few weeks, we believe that we should be able to meet our original targeted performance plan for the full year and the second quarter.” added Mr. Adlersberg.

 

   

AudioCodes Reports First Quarter 2020 Results

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AudioCodes Press Release 

 

 

“On a positive note, we have seen increased market activity and demand in two of our leading business activities: the Microsoft Teams application for UCaaS and the rapidly growing trend of work-from-home (WFH). Demand in both areas was driven by the stay-at-home and remote work/social distancing policies dictated by steps taken by governments worldwide to manage the COVID-19 pandemic crisis. Revenue related to MS Teams ecosystem grew above 80% year over year, and newly created opportunities more than doubled year over year. On March 23rd we announced AudioCodes Live for MS teams which provides a managed service to fully voice-enable Teams deployments. The core service includes Teams Direct Route connectivity, Microsoft tenant management, user lifecycle management and several more services. Noteworthy also is the progress made in our Voice.ai business where we introduced Meeting Insights, a productivity enhancement software tool for group collaboration, and the One-Click Telephony Gateway, a SaaS offering allowing to connect Google Dialogflow based virtual agents to telephony, a rapidly growing use case in the Covid-19 era. Looking forward, we are confident in our ability to continue to expand our business in 2020 and beyond. While the full impact of COVID-19 is still uncertain and remains a global challenge, thus far any immediate business setbacks we have encountered have been balanced by new business opportunities presented to us. We plan to continue our investment in future offerings, and focus on the return on investment to our shareholders," concluded Mr. Adlersberg.

 

Cash Dividend

 

On February 4, 2020, the Company declared a cash dividend of $0.13 per share. The dividend, in the aggregate amount of $3.9 million, was paid on March 4, 2020 to all of the Company’s shareholders of record on February 18, 2020.

 

 

 

 

   

AudioCodes Reports First Quarter 2020 Results

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AudioCodes Press Release 

 

 

Conference Call & Web Cast Information

 

AudioCodes will conduct a conference call at 8:30 A.M., Eastern Time today to discuss the Company's first quarter of 2020 operating performance, financial results and outlook. Interested parties may participate in the conference call by dialing one the following numbers:

 

United States Participants: +1 (877) 407-0778

 

International Participants: +1 (201) 689-8565

 

The conference call will also be simultaneously webcast. Investors are invited to listen to the call live via webcast at the AudioCodes investor website at http://www.audiocodes.com/investors-lobby

 

 

 

Follow AudioCodes’ social media channels:

 

AudioCodes invites you to join our online community and follow us on: AudioCodes Voice Blog, LinkedIn, Twitter, Facebook, and YouTube.

 

 

 

About AudioCodes

 

AudioCodes Ltd. (NASDAQ, TASE: AUDC) is a leading vendor of advanced voice networking and media processing solutions for the digital workplace. AudioCodes enables enterprises and service providers to build and operate all-IP voice networks for unified communications, contact centers, and hosted business services. AudioCodes offers a broad range of innovative products, solutions and services that are used by large multi-national enterprises and leading tier-1 operators around the world.

 

For more information on AudioCodes, visit http://www.audiocodes.com.

 

Statements concerning AudioCodes' business outlook or future economic performance; product introductions and plans and objectives related thereto; and statements concerning assumptions made or expectations as to any future events, conditions, performance or other matters, are "forward-looking statements'' as that term is defined under U.S. Federal securities laws. Forward-looking statements are subject to various risks, uncertainties and other factors that could cause actual results to differ materially from those stated in such statements. These risks, uncertainties and factors include, but are not limited to: the effect of global economic conditions in general and conditions in AudioCodes' industry and target markets in particular; shifts in supply and demand; market acceptance of new products and the demand for existing products; the impact of competitive products and pricing on AudioCodes' and its customers' products and markets; timely product and technology development, upgrades and the ability to manage changes in market conditions as needed; possible need for additional financing; the ability to satisfy covenants in the Company’s loan agreements; possible disruptions from acquisitions; the ability of AudioCodes to successfully integrate the products and operations of acquired companies into AudioCodes’ business; possible adverse impact of the COVID-19 pandemic on our business and results of operations; and other factors detailed in AudioCodes' filings with the U.S. Securities and Exchange Commission. AudioCodes assumes no obligation to update the information in this release.

 

 

   

AudioCodes Reports First Quarter 2020 Results

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AudioCodes Press Release 

 

 

©2020 AudioCodes Ltd. All rights reserved. AudioCodes, AC, HD VoIP, HD VoIP Sounds Better, IPmedia, Mediant, MediaPack, What’s Inside Matters, OSN, SmartTAP, User Management Pack, VMAS, VoIPerfect, VoIPerfectHD, Your Gateway To VoIP, 3GX, VocaNom, AudioCodes One Voice, AudioCodes Meeting Insights, AudioCodes Room Experience and CloudBond are trademarks or registered trademarks of AudioCodes Limited. All other products or trademarks are property of their respective owners. Product specifications are subject to change without notice.

 

 

 

 

 

Summary financial data follows

 

 

 

 

 

 

 

   

AudioCodes Reports First Quarter 2020 Results

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AudioCodes Press Release 

 

 

AUDIOCODES LTD. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

U.S. dollars in thousands

 

   March 31,   December 31, 
   2020   2019 
   (Unaudited)   (Audited) 
ASSETS          
           
CURRENT ASSETS:          
Cash and cash equivalents  $67,373   $64,773 
Short-term and restricted bank deposits   6,266    6,416 
Trade receivables, net   28,276    27,501 
Other receivables and prepaid expenses   6,595    5,626 
Inventories   26,892    28,275 
Total current assets   135,402    132,591 
           
LONG-TERM ASSETS:          
Long-term and restricted bank deposits  $544   $694 
Deferred tax assets   18,435    20,466 
Operating lease right-of-use assets   28,195    29,688 
Severance pay funds   18,438    19,370 
Total long-term assets   65,612    70,218 
           
PROPERTY AND EQUIPMENT, NET   4,351    4,392 
           
GOODWILL, INTANGIBLE ASSETS AND OTHER, NET   37,040    37,123 
           
Total assets  $242,405   $244,324 
           
LIABILITIES AND SHAREHOLDERS’ EQUITY          
           
CURRENT LIABILITIES:          
Current maturities of long-term bank loans  $2,142   $2,473 
Trade payables   5,353    6,628 
Other payables and accrued expenses   22,783    24,692 
IIA settlement liability   10,446    10,750 
Deferred revenues   35,690    33,538 
Short-term operating lease liabilities   8,231    8,579 
Total current liabilities   84,645    86,660 
           
LONG-TERM LIABILITIES:          
Accrued severance pay  $19,693   $20,313 
Long-term bank loans   900    1,200 
IIA settlement liability   10,447    10,749 
Deferred revenues and other liabilities   10,363    9,831 
Long-term operating lease liabilities   19,584    23,097 
Total long-term liabilities   60,987    65,190 
           
Total shareholders’ equity   96,773    92,474 
Total liabilities and shareholders' equity  $242,405   $244,324 

 

 

   

AudioCodes Reports First Quarter 2020 Results

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AudioCodes Press Release 

 

 

AUDIOCODES LTD. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

U.S. dollars in thousands, except per share data

 

   Three months ended 
   March 31, 
   2020   2019 
   (Unaudited) 
Revenues:        
Products  $34,334   $32,453 
Services   17,688    14,126 
Total Revenues   52,022    46,579 
Cost of revenues:          
Products   13,762    13,778 
Services   3,981    3,572 
Total Cost of revenues   17,743    17,350 
Gross profit   34,279    29,229 
Operating expenses:          
Research and development, net   11,582    9,480 
Selling and marketing   13,269    12,561 
General and administrative   3,265    2,671 
Total operating expenses   28,116    24,712 
Operating income   6,163    4,517 
Financial income (expenses), net   1,306    (799)
Income before taxes on income   7,469    3,718 
Taxes on income, net   (2,205)   (669)
Net income  $5,264   $3,049 
Basic net earnings per share  $0.18   $0.10 
Diluted net earnings per share  $0.17   $0.10 
Weighted average number of shares used in computing basic net earnings per share (in thousands)   29,540    29,213 
Weighted average number of shares used in computing diluted net earnings per share (in thousands)   31,046    30,729 

 

   

AudioCodes Reports First Quarter 2020 Results

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AudioCodes Press Release 

 

 

AUDIOCODES LTD. AND ITS SUBSIDIARIES

RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME

U.S. dollars in thousands, except per share data

 

   Three months ended 
   March 31, 
   2020   2019 
   (Unaudited) 
GAAP net income  $5,264   $3,049 
GAAP net earnings per share  $0.17   $0.10 
Cost of revenues:          
Share-based compensation (1)   50    36 
Amortization expenses (2)   68    68 
    118    104 
Research and development, net:          
Share-based compensation (1)   243    212 
Selling and marketing:          
Share-based compensation (1)   759    333 
Amortization expenses (2)   15    15 
    774    348 
General and administrative:          
Share-based compensation (1)   607    366 
Revaluation of earn-out liability (3)   -    (23)
    607    343 
Financial expenses (income):          
Exchange rate differences (4)   (1,282)   900 
           
Income taxes:          
Deferred tax (5)   2,030    544 
Non-GAAP net income  $7,754   $5,500 
Non-GAAP diluted net earnings per share  $0.25   $0.18 

 

(1)Share-based compensation expenses related to options and restricted share units granted to employees and others.
(2)Amortization of intangible assets related to the acquisitions of Active Communications Europe assets.
(3)Expenses or income related to revaluation of an earn-out liability in connection with the acquisition of Active Communications Europe.
(4)Financial income or expenses related to exchange rate differences in connection with revaluation of assets and liabilities in non-dollar denominated currencies.
(5)Non-cash deferred tax expenses.

 

Note: Non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP. The Company believes that non-GAAP information is useful because it can enhance the understanding of its ongoing economic performance and therefore uses internally this non-GAAP information to evaluate and manage its operations. The Company has chosen to provide this information to investors to enable them to perform comparisons of operating results in a manner similar to how the Company analyzes its operating results and because many comparable companies report this type of information.

 

   

AudioCodes Reports First Quarter 2020 Results

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AudioCodes Press Release 

 

 

AUDIOCODES LTD. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

U.S. dollars in thousands

 

   Three months ended 
   March 31, 
   2020   2019 
   (Unaudited) 
Cash flows from operating activities:          
Net income  $5,264   $3,049 
Adjustments required to reconcile net income to net cash provided by operating activities:          
Depreciation and amortization   568    474 
Amortization of marketable securities premiums and accretion of discounts, net   -    56 
Decrease in accrued severance pay, net   312    161 
Share-based compensation expenses   1,659    947 
Decrease in deferred tax assets, net   2,017    425 
Increase in accrued interest and exchange rate effect of loans, marketable securities and bank deposits   (12)   (11)
Decrease in operating lease right-of-use assets   1,876    1,904 
Decrease in operating lease liabilities   (4,244)   (2,337)
Changes in IIA settlement liability, net   (606)   - 
Increase in trade receivables, net   (775)   (4,860)
Increase in other receivables and prepaid expenses   (75)   (254)
Decrease (increase) in inventories   1,287    (2,899)
Increase (decrease) in trade payables   (1,275)   627 
Increase (decrease) in other payables and accrued expenses   (1,909)   4,466 
Increase in deferred revenues   2,698    6,547 
Net cash provided by operating activities   6,785    8,295 
Cash flows from investing activities:          
Proceeds from short-term deposits   150    5,971 
Proceeds from long-term deposits   150    300 
Proceeds from redemption of marketable securities   -    7,291 
Purchase of property and equipment   (348)   (1,116)
Net cash provided by (used in) investing activities   (48)   12,446 

 

   

AudioCodes Reports First Quarter 2020 Results

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AudioCodes Press Release 

 

 

AUDIOCODES LTD. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

U.S. dollars in thousands

 

   Three months ended 
   March 31, 
   2020   2019 
   (Unaudited) 
Cash flows from financing activities:          
Purchase of treasury shares   -    (951)
Repayment of bank loans   (619)   (618)
Cash dividends paid to shareholders   (3,866)   (3,218)
Payment related to the acquisition of ACS   -    (410)
Proceeds from issuance of shares upon exercise of options and warrants   348    1,114 
Net cash used in financing activities   (4,137)   (4,083)
           
Net increase in cash, cash equivalents, and restricted cash   2,600    16,658 
Cash, cash equivalents and restricted cash at beginning of period   69,773    31,503 
Cash, cash equivalents and restricted cash at end of period  $72,373   $48,161 

 

  

 

   

AudioCodes Reports First Quarter 2020 Results

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