Bethel Finance: Radcom swings to loss despite higher revenue

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Bethel Finance news:
Radcom Ltd. (Nasdaq: RDCM) today reported higher revenue but swung to a loss in 2011, but the company expects profits on further revenue growth in 2012.

Full year revenue rose 15% to $22 million from $19.2 million in 2010. The company posted a GAAP-based net loss of $1.9 million ($0.30 per share) in 2011 compared with a net profit of $570,000 in 2010, and a non-GAAP net loss of $1.1 million ($0.17 per share) compared with net income of $1.7 million.

Fourth quarter revenue rose 31% to $7 million from $5.4 million for the corresponding quarter of 2010. GAAP-based net profit declined to $64,000 ($0.01 per share) for fourth quarter from $78,000 for the corresponding quarter, and non-GAAP net profit fell to 268,000 ($0.04 per share) from $500,000. The company attributed the decline to unusually high financial expenses due to fluctuations in the exchange rate of the Brazilian real against the US dollar.

Radcom president and CEO David Ripstein said, "Our success is being driven by one of the strongest trends in the telecom industry: the explosion of smartphone traffic and its devastating effect on network quality. As a result, 2011 was a period of accelerating revenue momentum and strategic investment that enabled us to reach near-record annual bookings and gross margins, giving us an extremely strong backlog that enables us to project a much stronger 2012."

Ripstein added, "This visibility led us to invest throughout 2011 to expand our direct sales capabilities, developing our offices in Singapore, India and Brazil, while also extending our technological edge. Since we expect to maintain a similar level of operational expenses in 2012, a growing proportion of each new sale will contribute to the bottom line. We are therefore confident and excited as we move into 2012. With rising sales, growing markets and a correctly-sized organization, we are fully focused on moving to the next level and on achieving significant top-line and bottom-line growth."

Radcom's share price rose 1.3% in early trading on Nasdaq to $4.61, giving a market cap of $29 million.