Exhibit 99.1
 
GRAPHIC
 
 
 

 

 
FOR IMMEDIATE RELEASE

Contact:
Rick Moberg
Aware, Inc.
781-276-4000

Aware, Inc. Reports Fourth Quarter and 2010
Financial Results

BEDFORD, MASS. – February 3, 2011 –
Aware, Inc. (NASDAQ: AWRE), a leading supplier of technology and software for the telecommunications and biometrics industries, today reported financial results for its fourth quarter and year ended December 31, 2010.
 
Revenue for the fourth quarter of 2010 was $6.8 million, an increase of 24% compared to $5.5 million in the same quarter last year. Net income for the fourth quarter of 2010 was $230,000, or $0.01 per diluted share. These results compared to net income of $5.8 million, or $0.29 per diluted share, for the same period a year ago. Net income in the fourth quarter of 2009 included a $6.2 million gain on the sale of assets.
 
For the year ended December 31, 2010, revenue increased 7% to $23.6 million, compared to $22.0 million in 2009.  Net income for the year ended December 31, 2010 was $180,000, or $0.01 per diluted share. In 2009, net income was $1.0 million, or $0.05 per diluted share, and included the previously mentioned $6.2 million gain on the sale of assets.
 
The Company reports its net income and basic and diluted net income per share in accordance with U.S. generally accepted accounting principles (GAAP), and additionally, on a non-GAAP basis. Non-GAAP net income, where applicable, excludes the effect of stock-based compensation expense. The Company uses the non-GAAP information internally to evaluate its operating performance and believes these non-GAAP measures are useful to investors as they provide additional insight into the underlying operating results. However, non-GAAP measures are not stated in accordance with, should not be considered in isolation from, and are not a substitute for, GAAP measures. A reconciliation of GAAP to non-GAAP results has been provided in the attached financial tables.
 
 

Aware, Inc.  •  40 Middlesex Turnpike  •  Bedford, MA  USA  01730-1432
Tel: (781) 276-4000  •  Fax: (781) 276-4001  •  E-mail: ir@aware.com
 
 
 

 
 
Aware, Inc. Reports Fourth Quarter and 2010 Financial Results Page 2 
 
Non-GAAP net income for the fourth quarter of 2010, excluding the effect of $326,000 of stock-based compensation, was $556,000, or $0.03 per diluted share. These results compared to non-GAAP net income of $6.1 million, or $0.31 per diluted share, for the fourth quarter of 2009, excluding the effect of $261,000 of stock-based compensation.
 
For the year ended December 31, 2010, the company had non-GAAP net income, excluding the effect of $1.5 million of stock-based compensation, of $1.7 million, or $0.08 per share. These results compared to non-GAAP net income of $2.7 million, or $0.13 per diluted share, for the year ended December 31, 2009, excluding the effect of $1.7 million of stock-based compensation.
 
Edmund Reiter, Aware’s president and chief executive officer, said, “We are pleased to have grown revenues and substantially improved our operating performance in our first full year of operations following the sale of our DSL chip licensing business.  Our goal for 2011 is to build on these results by growing revenues in our DSL test and biometrics markets with higher value products and services.”
 
Note:  Aware’s conference call will be broadcast live over the Internet today, February 3, 2011 at 5:00 p.m. Eastern Time.   To listen to the call, please go to www.aware.com/ir.  The conference call may also be heard by calling 719-457-2727 and referencing the confirmation number 4347445.  A replay of the call will be archived on our website after the call.
 
About Aware
Aware is a leading technology and software supplier for the telecommunications and biometrics industries. Aware has pioneered innovations at telecommunications standards-setting organizations for DSL and home networking. Telecom equipment vendors and phone companies use Aware's DSL test and diagnostics modules and Dr. DSL® software to provision and troubleshoot DSL circuits globally. Aware is also a veteran of the biometrics industry, providing biometric and imaging software components used in government systems worldwide since 1992. Aware's interoperable, standard-compliant, field-proven imaging products are used in a number of applications, from border management to criminal justice to medical imaging. Aware is a publicly held company (NASDAQ: AWRE) based in Bedford, Massachusetts.  www.aware.com

 
 

 
 
Aware, Inc. Reports Fourth Quarter and 2010 Financial Results Page 3 
 
Safe Harbor Warning
Portions of this release contain forward-looking statements regarding future events and are subject to risks and uncertainties, such as estimates or projections of future revenue and earnings and the growth of the DSL test and diagnostics and biometrics markets. Aware wishes to caution you that there are factors that could cause actual results to differ materially from the results indicated by such statements. General factors include, but are not limited to: our quarterly results are unpredictable and may fluctuate significantly; our business is subject to rapid technological change; we face intense competition from a wide range of competitors; current economic conditions, including the credit crisis affecting the financial markets; our intellectual property is subject to limited protection; our ability to obtain or enforce patents could be affected by new laws, regulations or rules; and our business may be affected by government regulations. DSL test and diagnostic factors include, but are not limited to: our DSL test and diagnostic businesses depend upon a limited number of customers; the success of our DSL test and diagnostics products businesses requires telephone companies to install DSL service in volume; our test and diagnostic hardware and software products could have quality problems; we depend on a single source contract manufacturer for the manufacture of our DSL hardware products; and we are dependent on single source suppliers for components in our DSL hardware products. Biometric factors include, but are not limited to: market acceptance of our biometric technologies and products; changes in contracting practices of government or law enforcement agencies; the failure of the biometrics market to experience continued growth; announcements or introductions of new technologies or products by our competitors; failures or problems in our biometric software products; delays in the adoption of new industry biometric standards; growth of proprietary biometric systems which do not conform to industry standards; our ability to sell services contracts in a manner that is consistent with our business model; our ability to deliver services contract milestones; and our dependence on third party contractors and consultants to deliver certain services contract milestones. We refer you to the documents Aware files from time to time with the Securities and Exchange Commission, specifically the section titled Risk Factors in our annual report on Form 10-K for the fiscal year ended December 31, 2009 and other reports and filings made with the Securities and Exchange Commission.

Aware and Dr. DSL are trademarks or registered trademarks of Aware, Inc.
Any other trademarks appearing herein are the property of their respective owners.
 
 
 

 
 
Aware, Inc. Reports Fourth Quarter and 2010 Financial Results Page 4 
 
AWARE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
 (unaudited)


   
Three Months Ended
December 31,
   
Year Ended
December 31,
 
   
2010
   
2009
   
2010
   
2009
 
Revenue:
                       
Product sales
  $ 5,326     $ 4,044     $ 18,914     $ 15,376  
Contract revenue
    949       887       1,992       4,611  
Royalties
    547       555       2,654       2,055  
Total revenue
    6,822       5,486       23,560       22,042  
                                 
Costs and expenses:
                               
Cost of product sales (1)
    1,250       475       4,362       2,887  
Cost of contract revenue (1)
    362       362       714       2,896  
Research and development (1)
    1,898       2,576       8,096       11,920  
Selling and marketing (1)
    1,135       1,190       4,283       4,707  
General and administrative (1)
    1,969       1,302       6,438       5,114  
Total costs and expenses
    6,614       5,905       23,893       27,524  
                                 
Income (loss) from operations
    208       (419 )     (333 )     (5,482 )
Gain on sale of assets
    -       6,230       -       6,230  
Other income
    -       -       425       -  
Interest income
    22       21       90       238  
                                 
Income before provision for income taxes
    230       5,832       182       986  
Benefit from/(provision for) income taxes
    -       2       (2 )     (4 )
                                 
Net income
  $ 230     $ 5,834     $ 180     $ 982  
                                 
Net income per share – basic
  $ 0.01     $ 0.29     $ 0.01     $ 0.05  
Net income per share – diluted
  $ 0.01     $ 0.29     $ 0.01     $ 0.05  
                                 
Weighted average shares – basic
    20,040       19,796       19,971       20,869  
Weighted average shares – diluted
    20,527       19,802       20,182       20,874  



(1)  
The amounts in the Consolidated Statements of Operations above include stock-based compensation as follows (in thousands):

 
 
     
Three Months Ended
December 31,
   
Year Ended
December 31,
 
     
2010
   
2009
   
2010
   
2009
 
 
Cost of product sales 
  $ 2     $ 3     $ 10     $ 10  
 
Cost of contract revenue
    7       9       19       114  
 
Research and development
    69       63       337       521  
 
Sales and marketing
    22       44       98       293  
 
General and administrative
    226       142       1,031       799  
 
Total stock-based compensation costs
  $ 326     $ 261     $ 1,495     $ 1,737  

 
 

 
 
Aware, Inc. Reports Fourth Quarter and 2010 Financial Results Page 5 
 
AWARE, INC.
NON-GAAP FINANCIAL MEASURES AND RECONCILIATION
(In thousands, except per share data)
 (unaudited)


 
   
Three Months Ended
December 31,
   
Year Ended
December 31,
 
   
2010
   
2009
   
2010
   
2009
 
GAAP net income
  $ 230     $ 5,834     $ 180     $ 982  
Stock-based compensation
    326       261       1,495       1,737  
Non-GAAP net income
  $ 556     $ 6,095     $ 1,675     $ 2,719  



   
Three Months Ended
December 31,
   
Year Ended
December 31,
 
   
2010
   
2009
   
2010
   
2009
 
GAAP net income per share
  $ 0.01     $ 0.29     $ 0.01     $ 0.05  
Stock-based compensation
    0.02       0.02       0.07       0.08  
Non-GAAP net income per share
  $ 0.03     $ 0.31     $ 0.08     $ 0.13  

 
 

 
 
Aware, Inc. Reports Fourth Quarter and 2010 Financial Results Page 6 
 
AWARE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(unaudited)


   
December 31,
2010
   
December 31,
2009
 
ASSETS
           
     Cash and investments
  $ 39,949     $ 39,669  
     Accounts receivable, net
    4,968       3,565  
     Inventories, net
    1,863       1,113  
     Property and equipment, net
    6,360       6,744  
     Other assets, net
    260       363  
                 
     Total assets
  $ 53,400     $ 51,454  
                 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
               
                 
     Total current liabilities
  $ 3,197     $ 2,501  
                 
     Long-term deferred revenue
    320       593  
                 
     Total stockholders’ equity 
    49,883       48,360  
                 
     Total liabilities and stockholders’ equity
  $ 53,400     $ 51,454  


 
 
###
 
 
 
 

Aware, Inc.  •  40 Middlesex Turnpike  •  Bedford, MA  USA  01730-1432
Tel: (781) 276-4000  •  Fax: (781) 276-4001  •  E-mail: ir@aware.com
 
 
 
 
 
 
 

The following information was filed by Aware Inc (AWRE) on Thursday, February 3, 2011 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

View differences made from one year to another to evaluate Aware Inc's financial trajectory

Compare SEC Filings Year-over-Year (YoY) and Quarter-over-Quarter (QoQ)
Sample 10-K Year-over-Year (YoY) Comparison

Compare this 10-K Annual Report to its predecessor by reading our highlights to see what text and tables were  removed  ,   added    and   changed   by Aware Inc.

Continue

Never Miss A New SEC Filing Again


Real-Time SEC Filing Notifications
Screenshot taken from Gmail for a new 10-K Annual Report
Last10K.com Member Feature

Receive an e-mail as soon as a company files an Annual Report, Quarterly Report or has new 8-K corporate news.

Continue

We Highlighted This SEC Filing For You


SEC Filing Sentiment Analysis - Bullish, Bearish, Neutral
Screenshot taken from Wynn's 2018 10-K Annual Report
Last10K.com Member Feature

Read positive and negative remarks made by management in their entirety without having to find them in a 10-K/Q.

Continue

Widen Your SEC Filing Reading Experience


Increased Reading Area for SEC Filings
Screenshot taken from Adobe Inc.'s 10-Q Quarterly Report
Last10K.com Member Feature

Remove data columns and navigations in order to see much more filing content and tables in one view

Continue

Uncover Actionable Information Inside SEC Filings


SEC Filing Disclosures
Screenshot taken from Lumber Liquidators 10-K Annual Report
Last10K.com Member Feature

Read both hidden opportunities and early signs of potential problems without having to find them in a 10-K/Q

Continue

Adobe PDF, Microsoft Word and Excel Downloads


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshots of actual 10-K and 10-Q SEC Filings in PDF, Word and Excel formats
Last10K.com Member Feature

Export Annual and Quarterly Reports to Adobe PDF, Microsoft Word and Excel for offline viewing, annotations and analysis

Continue

FREE Financial Statements


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshot of actual balance sheet from company 10-K Annual Report
Last10K.com Member Feature

Get one-click access to balance sheets, income, operations and cash flow statements without having to find them in Annual and Quarterly Reports

Continue for FREE

Log in with your credentials

or    

Forgot your details?

Create Account