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
under
the Securities Exchange Act of 1934
For
the
Month of August, 2006
Commission
file number 0-30070
AUDIOCODES
LTD.
(Translation
of registrant’s name into English)
1
Hayarden Street. Airport City, Lod 70151• ISRAEL
(Address
of principal executive offices)
Indicate
by check mark whether the registrant files or will file annual reports under
cover Form 20-F or Form 40-F.
Form
20-F
√ 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.
Indicate
by check mark whether the registrant by furnishing the information contained
in
this Form is also thereby furnishing the information to the Commission pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes
No
√
If
“Yes”
is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82-__
On
July
31, 2006, AudioCodes Ltd. (the “Company”) issued a press release announcing
revenues and net income for the second quarter of 2006. A copy of this press
release is annexed hereto as Exhibit 1.
The
following document is attached hereto and incorporated by reference
herein:
Exhibit
1. Press
Release, dated July 31, 2006, announcing revenues and net income
for the
second quarter of 2006.
The
information set forth in the second paragraph, the first sentence of the third
paragraph and the fourth paragraph of, and the condensed consolidated balance
sheets, condensed consolidated statements of operations and condensed interim
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 F-3, Registration No.
333-117703; (ii) the Registrant’s Registration Statement on Form F-3,
Registration No. 333-123859; (iii)the Registrant’s Registration Statement on
Form S-8, Registration No. 333-11894; (iv) the Registrant’s Registration
Statement on Form S-8, Registration No. 333-13268; (v) the Registrant’s
Registration Statement on Form S-8, Registration No. 333-13378; and (vi) the
Registrant’s Registration Statement on Form S-8, Registration No.
333-105473.
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/
Nachum Falek
Nachum
Falek
Chief
Financial Officer and
Vice
President Finance
Dated:
August 2, 2006
EXHIBIT
INDEX
Exhibit
No. Description
1. Press
Release, dated July 31, 2006, announcing revenues and net income for the second
quarter of 2006.
 |
 |
P
R E S S R E L E A S E
|
Company
Contacts
|
IR
Agency Contact
|
|
|
Nachum
Falek,
VP
Finance & CFO
AudioCodes
Tel:
+972-3-976-4000
nachum@audiocodes.com
|
Shirley
Nakar,
Director,
Investor Relations
AudioCodes
Tel:
+972-3-976-4072
shirley@audiocodes.com
|
Erik
Knettel,
The
Global Consulting Group
Tel:
+1-646-284-9415
eknettel@hfgcg.com
|
AudioCodes
Reports Second Quarter 2006 Results
Quarterly
Revenues Increased to a Record $33.3 Million, Up 6.3% Sequentially and 16.7%
Year-over-Year
Lod,
Israel - July 31, 2006 -
AudioCodes
(NASDAQ: AUDC),
a
leading provider of Voice over Packet (VoP) technologies and Voice Network
products, today announced financial results for the second quarter ended June
30, 2006.
Revenues
for the second quarter ended June 30, 2006 were a record $33.3 million compared
to $31.3 million for the quarter ended March 31, 2006 and $28.5 million for
the
quarter ended June 30, 2005. Second quarter revenues grew 6.3% sequentially
and
increased 16.7% compared to the second quarter of 2005.
Net
income was $3.3 million, or $0.07 per diluted share, for the second quarter
of
2006 compared to net income of $2.3 million, or $0.05 per diluted share, in
the
first quarter of 2006 and net income of $3.1 million, or $0.07 per diluted
share, in the second quarter of 2005. SFAS No. 123R became applicable to the
Company effective January 1, 2006. As a result, the Company recorded $1.8
million of stock-based compensation expense in the second quarter of 2006 and
$2.1 million of stock-based compensation expense in the first quarter of 2006.
Excluding this stock-based compensation expense, net income on a non-GAAP basis
was $5.1 million, or $0.11 per diluted share1 ,
in the
second quarter of 2006 and $4.3 million, or $0.10 per diluted share, in the
first quarter of 2006. Non-GAAP net income, which excludes the effect of
stock-based compensation expense, is reported in order to facilitate financial
results tracking and comparison with previously reported financial results.
Cash
and
cash equivalents, short-term and long-term marketable securities, short-term
and
long-term bank deposits and structured notes were $232.9 million as of June
30,
2006 compared to $227.6 million as of March 31, 2006 and $214.7 million as
of
June 30, 2005.
“Our
continued success in achieving record revenues and profitability during the
second quarter of 2006 was driven substantially by the growth of our networking
business where revenues increased substantially compared to the first quarter
of
2006 and we continued to enjoy new customer design wins. Notably, our growth
was
supported by solid demand for our media gateways and media server products
targeting voice over broadband applications, as well as rising demand from
wireless service providers. We believe that our continued investment and
progress in these areas provides a sound foundation for future growth of our
networking business in fixed mobile convergence and IMS network deployments.
“Subsequent
to the close of the second quarter, we completed the acquisition of Nuera
Communications, a leader in the area of VoIP gateway products for cable and
broadband access networks. We also entered into a definitive agreement to
acquire Netrake Corporation, a leading provider of Session Border Controllers
and Security Gateway Solutions. We believe the integration of these new
capabilities with our existing portfolio of systems and products will increase
our customer base, enrich our VoIP product portfolio, and add scale and strength
to our positioning with the service provider customer base. With these
transactions, AudioCodes stands to significantly enhance its global positioning
as a leading supplier of key next generation converged network systems,” stated
Shabtai Adlersberg, President, Chairman and CEO of AudioCodes.
Conference
Call & Webcast Information
AudioCodes
will conduct a conference call on Tuesday, August 1, 2006 to discuss the second
quarter 2006 financial results, which will be simultaneously Webcast at 9:00
a.m. Eastern Time. Investors are invited to listen to the call live via Webcast
at the AudioCodes corporate Website at http://www.audiocodes.com.
1
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 as
well.
Page
1 of
6
About
AudioCodes
AudioCodes
Ltd. (NASDAQ: AUDC) enables the new voice infrastructure by providing
innovative, reliable and cost-effective Voice over Packet technology and
Voice
Network products to OEMs,
network
equipment providers and system integrators. AudioCodes provides its customers
and partners with a diverse range of flexible, comprehensive media gateway
and
media processing technologies, based on VoIPerfect(TM) -- AudioCodes'
underlying, best-of- breed, core media gateway architecture. The company is
a
market leader in voice compression technology and is a key originator of the
ITU
G.723.1 standard for the emerging Voice over IP market. AudioCodes voice network
products feature media gateway and media server platforms for packet-based
applications in the converged, wireline, wireless, broadband access, and
enhanced voice services markets. AudioCodes enabling technology products include
VoIP and CTI communication boards, VoIP media gateway processors and modules,
and CPE devices. Its customers include the leading telecom and data network
equipment providers globally. AudioCodes' headquarters and R&D facilities
are located in Israel with an R&D extension in the U.S. Other AudioCodes'
offices are located in Europe, the Far East, and Latin America. 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 continuing products' demand; 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; and other factors detailed in AudioCodes' filings
with the Securities and Exchange Commission. AudioCodes assumes no obligation
to
update the information in this release.
AudioCodes,
AC, Ardito, AudioCoded, NetCoder, TrunkPack, VoicePacketizer, MediaPack,
Stretto, Mediant, VoIPerfect and IPmedia and Your Gateway to VoIP are trademarks
or registered trademarks of AudioCodes Limited. All other products or trademarks
are property of their respective owners.
Summary
financial data follows
Page
2 of
6
AUDIOCODES
LTD. AND ITS SUBSIDIARIES
CONDENSED
INTERIM CONSOLIDATED BALANCE SHEETS
U.S.
dollars in thousands
|
June
30,
|
December
31,
|
||||||
|
2006
|
2005
|
||||||
|
(Unaudited)
|
|||||||
|
ASSETS
|
|||||||
|
CURRENT
ASSETS:
|
|||||||
|
Cash
and cash equivalents
|
$
|
108,513
|
$
|
70,957
|
|||
|
Short-term
bank deposits and structured notes
|
56,850
|
61,929
|
|||||
|
Short-term
marketable securities and accrued interest
|
25,563
|
9,863
|
|||||
|
Trade
receivables, net
|
19,954
|
17,990
|
|||||
|
Other
receivables and prepaid expenses
|
6,108
|
4,891
|
|||||
|
Inventories
|
13,377
|
11,562
|
|||||
|
Total
current assets
|
230,365
|
177,192
|
|||||
|
LONG-TERM
INVESTMENTS:
|
|||||||
|
Long-term
bank deposits and structured notes
|
9,960
|
27,781
|
|||||
|
Long-term
marketable securities
|
31,968
|
49,791
|
|||||
|
Investments
in companies
|
3,191
|
1,112
|
|||||
|
Deferred
tax assets
|
4,654
|
2,489
|
|||||
|
Severance
pay funds
|
6,249
|
5,406
|
|||||
|
Total
long-term investments
|
56,022
|
86,579
|
|||||
|
PROPERTY
AND EQUIPMENT, NET
|
6,198
|
6,494
|
|||||
|
INTANGIBLE
ASSETS, DEFERRED CHARGES AND OTHER, NET
|
2,839
|
3,279
|
|||||
|
GOODWILL
|
17,496
|
18,679
|
|||||
|
Total
assets
|
$
|
312,920
|
$
|
292,223
|
|||
|
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
|||||||
|
CURRENT
LIABILITIES:
|
|||||||
|
Trade
payables
|
$
|
8,799
|
$
|
7,774
|
|||
|
Other
payables and accrued expenses
|
19,234
|
18,620
|
|||||
|
Total
current liabilities
|
28,033
|
26,394
|
|||||
|
ACCRUED
SEVERANCE PAY
|
6,801
|
5,887
|
|||||
|
SENIOR
CONVERTIBLE NOTES
|
120,925
|
120,836
|
|||||
|
Total
shareholders' equity
|
157,161
|
139,106
|
|||||
|
Total
liabilities and shareholders' equity
|
$
|
312,920
|
$
|
292,223
|
|||
Page
3 of
6
AUDIOCODES
LTD. AND ITS SUBSIDIARIES
CONDENSED
INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
U.S.
dollars in thousands, except share and per share data
|
Six
months ended
|
Three
months ended
|
||||||||||||
|
June
30,
|
June
30,
|
||||||||||||
|
2006
|
2005
|
2006
|
2005
|
||||||||||
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
|
Revenues
|
$
|
64,629
|
$
|
55,459
|
$
|
33,295
|
$
|
28,531
|
|||||
|
Cost
of revenues
|
26,257
|
22,574
|
13,564
|
11,632
|
|||||||||
|
Gross
profit
|
38,372
|
32,885
|
19,731
|
16,899
|
|||||||||
|
Operating
expenses:
|
|||||||||||||
|
Research
and development, net
|
14,544
|
11,769
|
7,255
|
6,101
|
|||||||||
|
Selling
and marketing
|
16,180
|
12,330
|
8,105
|
6,454
|
|||||||||
|
General
and administrative
|
3,698
|
2,846
|
1,888
|
1,435
|
|||||||||
|
Total
operating expenses
|
34,422
|
26,945
|
17,248
|
13,990
|
|||||||||
|
Operating
income
|
3,950
|
5,940
|
2,483
|
2,909
|
|||||||||
|
Financial
income, net
|
2,352
|
874
|
1,243
|
546
|
|||||||||
|
Equity
in losses of affiliated companies
|
386
|
470
|
213
|
214
|
|||||||||
|
Income
before taxes on income
|
5,916
|
6,344
|
3,513
|
3,241
|
|||||||||
|
Taxes
on income, net
|
386
|
288
|
260
|
148
|
|||||||||
|
Net
income
|
$
|
5,530
|
$
|
6,056
|
$
|
3,253
|
$
|
3,093
|
|||||
|
Basic
net earnings per share
|
$
|
0.13
|
$
|
0.15
|
$
|
0.08
|
$
|
0.08
|
|||||
|
Diluted
net earnings per share
|
$
|
0.13
|
$
|
0.14
|
$
|
0.07
|
$
|
0.07
|
|||||
|
Weighted
average number of shares used in computing basic net earnings per
share
(in thousands)
|
41,401
|
40,112
|
41,753
|
40,197
|
|||||||||
|
Weighted
average number of shares used in computing diluted net earnings per
share
(in thousands)
|
44,089
|
43,204
|
44,241
|
42,859
|
|||||||||
Page
4 of
6
AUDIOCODES
LTD. AND ITS SUBSIDIARIES
NON-GAAP
PROFORMA STATEMENTS OF OPERATIONS
U.S.
dollars in thousands, except share and per share data
|
Six
months ended
|
Three
months ended
|
||||||||||||
|
June
30,
|
June
30,
|
||||||||||||
|
2006
|
2005
|
2006
|
2005
|
||||||||||
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
|
Revenues
|
$
|
64,629
|
$
|
55,459
|
$
|
33,295
|
$
|
28,531
|
|||||
|
Cost
of revenues *)
|
26,005
|
22,574
|
13,446
|
11,632
|
|||||||||
|
Gross
profit
|
38,624
|
32,885
|
19,849
|
16,899
|
|||||||||
|
Operating
expenses:
|
|||||||||||||
|
Research
and development, net *)
|
13,178
|
11,769
|
6,597
|
6,101
|
|||||||||
|
Selling
and marketing *)
|
14,586
|
12,330
|
7,364
|
6,454
|
|||||||||
|
General
and administrative *)
|
3,023
|
2,846
|
1,569
|
1,435
|
|||||||||
|
Total
operating expenses
|
30,787
|
26,945
|
15,530
|
13,990
|
|||||||||
|
Operating
income
|
7,837
|
5,940
|
4,319
|
2,909
|
|||||||||
|
Financial
income, net
|
2,352
|
874
|
1,243
|
546
|
|||||||||
|
Equity
in losses of affiliated companies
|
386
|
470
|
213
|
214
|
|||||||||
|
Income
before taxes on income
|
9,803
|
6,344
|
5,349
|
3,241
|
|||||||||
|
Taxes
on income, net
|
386
|
288
|
260
|
148
|
|||||||||
|
Non-GAAP
net income
|
$
|
9,417
|
$
|
6,056
|
$
|
5,089
|
$
|
3,093
|
|||||
|
Non-GAAP
diluted net earnings per share
|
$
|
0.21
|
$
|
0.14
|
$
|
0.11
|
$
|
0.07
|
|||||
|
Weighted
average number of shares used in computing non-GAAP diluted net earnings
per share (in thousands)
|
50,770
|
43,204
|
50,922
|
42,859
|
|||||||||
*)
Excluding stock-based compensation expenses related to options granted to
employees and others as a result of the adoption of SFAR 123R as of January
1,
2006.
Page
5 of
6
AUDIOCODES
LTD. AND ITS SUBSIDIARIES
CONDENSED
INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
U.S.
dollars in thousands
|
Six
months ended
June
30,
|
Three
months ended
June
30,
|
||||||||||||
|
2006
|
2005
|
2006
|
2005
|
||||||||||
|
(Unaudited)
|
(Unaudited)
|
||||||||||||
|
Cash
flows from operating activities:
|
|||||||||||||
|
Net
income
|
$
|
5,530
|
$
|
6,056
|
$
|
3,253
|
$
|
3,093
|
|||||
|
Adjustments
required to reconcile net income to net cash provided by operating
activities:
|
|||||||||||||
|
Depreciation
and amortization
|
1,724
|
1,580
|
856
|
841
|
|||||||||
|
Net
loss from sale of marketable securities
|
15
|
-
|
-
|
-
|
|||||||||
|
Amortization
of marketable securities premiums and accretion of discounts, net
|
121
|
23
|
61
|
23
|
|||||||||
|
Equity
in losses of affiliated companies
|
386
|
470
|
213
|
214
|
|||||||||
|
Increase
(decrease) in accrued severance pay, net
|
71
|
(9
|
)
|
(58
|
)
|
(52
|
)
|
||||||
|
Stock-based
compensation expenses
|
3,887
|
20
|
1,836
|
9
|
|||||||||
|
Amortization
of senior convertible notes discount and deferred charges
|
99
|
94
|
50
|
48
|
|||||||||
|
Increase
in accrued interest on marketable securities, bank deposits and structured
notes
|
(251
|
)
|
(69
|
)
|
(265
|
)
|
(35
|
)
|
|||||
|
Decrease
(increase) in deferred tax assets
|
(209
|
)
|
-
|
96
|
-
|
||||||||
|
Increase
in trade receivables, net
|
(1,964
|
)
|
(3,254
|
)
|
(2,035
|
)
|
(3,296
|
)
|
|||||
|
Increase
in other receivables and prepaid expenses
|
(904
|
)
|
(153
|
)
|
(554
|
)
|
(60
|
)
|
|||||
|
Decrease
(increase) in inventories
|
(1,815
|
)
|
700
|
(357
|
)
|
(187
|
)
|
||||||
|
Increase
in trade payables
|
1,025
|
2,279
|
2,702
|
2,917
|
|||||||||
|
Increase
(decrease) in other payables and accrued expenses
|
614
|
(1,038
|
)
|
(15
|
)
|
1,831
|
|||||||
|
Other
|
-
|
(12
|
)
|
-
|
-
|
||||||||
|
Net
cash provided by operating activities
|
8,329
|
6,687
|
5,783
|
5,346
|
|||||||||
|
Cash
flows from investing activities:
|
|||||||||||||
|
Investment
in short-term marketable securities
|
-
|
(1,039
|
)
|
-
|
(1,039
|
)
|
|||||||
|
Proceeds
from sale and maturity of marketable securities
|
1,979
|
-
|
1,000
|
-
|
|||||||||
|
Proceeds
from bank deposits
|
23,000
|
-
|
5,791
|
-
|
|||||||||
|
Investments
in companies
|
(2,115
|
)
|
(308
|
)
|
(978
|
)
|
(101
|
)
|
|||||
|
Purchase
of property and equipment
|
(996
|
)
|
(960
|
)
|
(537
|
)
|
(462
|
)
|
|||||
|
Proceeds
from sale of property and equipment
|
-
|
96
|
-
|
-
|
|||||||||
|
Investment
in structured notes
|
-
|
(10,000
|
)
|
-
|
(10,000
|
)
|
|||||||
|
Investment
in long-term marketable securities
|
-
|
(18,279
|
)
|
-
|
(18,279
|
)
|
|||||||
|
Payment
for acquisition of Ai-Logix
|
-
|
(10,000
|
)
|
-
|
-
|
||||||||
|
Net
cash provided by (used in) investing activities
|
21,868
|
(40,490
|
)
|
5,276
|
(29,881
|
)
|
|||||||
|
Cash
flows from financing activities:
|
|||||||||||||
|
Issuance
costs for senior convertible notes
|
-
|
(84
|
)
|
-
|
(84
|
)
|
|||||||
|
Proceeds
from issuance of shares upon exercise of options and employee stock
purchase plan
|
7,359
|
2,181
|
1,044
|
347
|
|||||||||
|
Net
cash provided by financing activities
|
7,359
|
2,097
|
1,044
|
263
|
|||||||||
|
Increase
(decrease) in cash and cash equivalents
|
37,556
|
(31,706
|
)
|
12,103
|
(24,272
|
)
|
|||||||
|
Cash
and cash equivalents at the beginning of the period
|
70,957
|
166,832
|
96,410
|
159,398
|
|||||||||
|
Cash
and cash equivalents at the end of the period
|
$
|
108,513
|
$
|
135,126
|
$
|
108,513
|
$
|
135,126
|
|||||
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