Jacada
Jacada

Press Release

Jacada Reports Third Quarter 2009 Results

ATLANTA - November 11, 2009 – Jacada Ltd. (Nasdaq: JCDA), a leading provider of customer service productivity optimization solutions, today reported financial results for the third quarter and nine month period ended September 30, 2009.

Third Quarter 2009 Highlights

  • Signed an agreement with Permanent General, a leading auto insurance provider based in Nashville, Tenn.
  • Signed an agreement with its first European utilities customer - E.ON Sweden. E.ON Sweden is part of the E.ON group, the world's largest investor-owned power and gas company.
  • Began a strategic partnership with Wipro, a global leader in product engineering and support services, to deliver the initial design for a major international electricity and gas provider, which ultimately progressed into a material agreement that was announced in the fourth quarter.

Financial Results

For the third quarter of 2009, total revenues were $3.9 million compared to $5.9 million in the third quarter of 2008, a decrease of 34%, primarily due to the challenging global economy and continued uncertainty in the business environment.

Total gross profit for the 2009 third quarter was $1.4 million or 37% of total revenues compared to $2.3 million and 39% in the 2008 third quarter.

The third quarter net loss was $2.0 million or ($0.12) per share. This is compared to a net loss of $2.6 million or ($0.13) per share in the third quarter of 2008.

For the nine month period ending on September 30, 2009 total revenues were $10.9 million compared to $18.4 million in the same period in 2008. The reduction in revenues in the three and nine month periods are directly related to global business conditions and a decline in new business during 2008. However, new business has begun to improve in recent quarters and backlog at the end of the third quarter grew to $8.6 million, up from $6.6 million at December 31, 2008.

Gross profit for nine month period ended September 30, 2009 was $3.1 million or 28% of total revenues compared to $9.2 million or 50% of total revenues for the 2008 period.

During the nine month period ending September 30, 2009, the Company incurred a net loss of $6.9 million or ($0.42) per share. In the comparable 2008 period, the Company posted net income of $15.9 million or $0.78 per share. The 2008 net income included $19.9 million or $0.98 per share in income, net of taxes, from discontinued operations, which was generated in the form of a capital gain from the sale of the Company's legacy business during the 2008 first quarter.

At the end of the 2009 third quarter, cash and investments were $26.1 million compared to $33.1 million at year end 2008.

"We've seen increased activity in our pipeline; customer adoption is accelerating; the backlog continues to grow; revenues have begun to improve compared to our revenue for the second quarter of 2009 and losses have begun to decline," said Tom Clear, chief executive officer for Jacada. "While the business and economic climate of 2009 is challenging, Jacada continues to make progress towards our objectives of improving the fundamentals of our business and better aligning our products and services with the solution needs of our customers."

Conference Call Details

To participate in the teleconference, please call toll-free 888.680.0893, or 617.213.4859 for international callers, and provide passcode 54170464 approximately 10 minutes prior to the start time. Interested parties may pre-register for the teleconference via this URL: https://www.theconferencingservice.com/prereg/key.process?key=PGQ6D9UUW. A (live audio) webcast will also be available over the Internet at www.jacada.com (under "About Us" then "Investors") or www.earnings.com.

A replay of the teleconference will be available for three days beginning at 12:30 p.m. ET on November 11, 2009. To access the replay, dial toll-free 888-286-8010, or for international callers 617-801-6888, and provide passcode 10445295.

About Jacada

Jacada is a leading global provider of unified service desktop and process optimization solutions that simplify and automate customer service processes. By bridging disconnected systems into a single, intelligent desktop, Jacada solutions create greater operational efficiency and increase agent and customer satisfaction. Founded in 1990, Jacada operates globally with offices in Atlanta, Georgia; Herzliya, Israel; London, England and Munich, Germany. Jacada can be reached at www.jacada.com.

Forward Looking Statement

This news release may contain forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. The words "may," "could," "would," "will," "believe," "anticipate," "estimate," "expect," "intend," "plan," and similar expressions or variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of the future performance and involve risks and uncertainties, many of which are beyond the Company's ability to control. Actual results may differ materially from those projected in the forward-looking statements as a result of various factors including the performance and continued acceptance of our products, general economic conditions and other Risk Factors specifically identified in our reports filed with the Securities and Exchange Commission. The Company undertakes no obligation to update or revise any forward-looking statement for events or circumstances after the date on which such statement is made. Jacada is a trademark of Jacada Inc. All other brands or product names are trademarks of their respective owners.

Jacada is a trademark of Jacada Ltd. All other brands or product names are trademarks of their respective owners.

CONTACT:
Bob Aldworth
Chief Financial Officer
Jacada
(770) 776 2267
BAldworth@jacada.com

Or

Peter Seltzberg
Hayden IR
(646) 415-8972
peter@haydenir.com

CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands, except per share data)
Three months ended
September 30,		  Nine months ended
September 30,
      2009     2008 2009     2008
    Unaudited
Revenues:
Software licenses   $ 55   $ 1,490   $ 692   $ 6,372
Services     3,327     3,866     8,431     10,424
Maintenance     492     554     1,792     1,644
Total Revenues     3,874     5,910     10,915     18,440
Cost of revenues:
Software licenses     27     233     174     467
Services     2,253     3,108     7,119     8,063
Maintenance     174     243     520     669
Total cost of revenues     2,454     3,584     7,813     9,199
Gross profit     1,420     2,326     3,102     9,241
Operating expenses:
Research and development     859     1,275     2,693     3,708
Sales and marketing     1,273     2,391     4,430     7,179
General and administrative     1,388     1,426     3,542     4,012
Total operating expenses     3,520     5,092     10,665     14,899
Operating loss     (2,100)     (2,766)     (7,563)     (5,658)
Financial income, net     44     197     669     1,023
Loss from continuing operations  before taxes     (2,056)     (2,569)     (6,894)     (4,635)
Tax (expense) benefit     19     292     (19)     639
Net loss from continuing operations     (2.037)     (2,277)     (6,913)     (3,996)
Income (loss) from discontinued operations, net of taxes     -     (315)     -     19,858
Net income (loss)   $ (2,037)   $ (2,592)   $ (6,913)   $ 15,862
Basic and diluted net earnings (loss) per share:                        
From continuing operations   $ (0.12)   $ (0.11)   $ (0.42)   $ (0.20)
From discontinued operations     -   $ (0.02)   $ -   $ 0.98
Basic and diluted net earnings (loss) per share   $ (0.12)   $ (0.13)   $ (0.42)   $ 0.78
Weighted average number of shares used in computing basic and diluted net earnings (loss) per share     16,569,721     19,687,459     16,562,959     20,313,411

CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands)
September 30,
2009		 December 31,
2008
Unaudited   Audited
ASSETS
CURRENT ASSETS:
Cash and cash equivalents *) $ 18,265   $ 11,059
Short term deposits *) 1,889 -
Marketable securities *) 4,060 8,915
Trade receivables   4,526     4,713
Restricted cash held by trustee *)   -     2,640
Restricted cash *)   557     559
Other current assets   1,609     2,022
Assets of discontinued operations   -     64
Total current assets   30,906     29,972
LONG-TERM INVESTMENTS:
Marketable securities *)   1,300     9,896
Severance pay fund   387     586
Total long-term investments   1,687     10,482
PROPERTY AND EQUIPMENT, NET   1,066     1,266
GOODWILL   3,096     3,096
Total assets $ 36,755   $ 44,816
*) Total Cash and Investments including restricted cash $ 26,071   $ 33,069
LIABILITIES AND SHAREHOLDERS' EQUITY 
CURRENT LIABILITIES:
Trade payables $ 1,225   $ 1,245
Deferred revenues   833     1,006
Accrued expenses and other liabilities   2,317     3,096
Liabilities of discontinued operations   1,051     1,363
Total current liabilities   5,426     6,710
LONG-TERM LIABILITIES:
Accrued severance pay   679     1,120
Other long-term liabilities   143     185
Total long-term liabilities   822     1,305
SHAREHOLDERS' EQUITY:          
Share capital   60     60
Additional paid-in capital   75,556     75,173
Treasury shares at cost   (17,863)     (17,863)
Accumulated other comprehensive profit   396     160
Accumulated deficit   (27,652)     (20,729)
Total shareholders' equity   30,507     36,801
Total liabilities and shareholders' equity $ 36,755   $ 44,816

CONSOLIDATED STATEMENTS OF CASH FLOWS 
U.S. dollars in thousands		   Three months ended
September 30, 		  Nine months ended
September 30,
2009 2008 2009 2008
    Unaudited
Cash flows from operating activities:                
Net Income (loss)   $      (2,037)   $      (2,592)   $      (6,913)   $      15,862
Less: Net (income) loss from discontinued operations, net of taxes   -   315   -   (19,858)
Net loss from continuing operations   (2,037)   (2,277)   (6,913)   (3,996)
Adjustments required to reconcile net loss from continuing operations to net cash used in operating activities from continuing operations:                
Depreciation and amortization   130   148   442   459
Stock-based compensation related to options granted to employees and directors   219   280   558   771
Stock-based compensation expenses related to options granted to non-employees   1   2   10   7
Accrued interest and amortization of premium on marketable securities   (16)   254   105   131
Loss (gain) from sales of marketable securities   -   6   (353)   (91)
Increase (decrease) in accrued severance pay, net   (20)   (57)   (242)   14
Decrease (increase) in trade receivables, net   (2,123)   (627)   187   (189)
Decrease (increase) in other current assets   (397)   (101)   705   (275)
Increase (decrease) in trade payables   410   (151)   (20)   50
Increase (decrease) in deferred revenues   (228)   7   (173)   (506)
Decrease in accrued expenses and other liabilities   (149)   (111)   (1,195)   (119)
Increase (decrease) in other long-term liabilities   (20)   203   (42)   203
Other   -   3   -   3
Net cash used in operating activities from continuing operations   (4,230)   (2,421)   (6,931)   (3,358)
Net cash used in operating activities from discontinued operations   (18)   (312)   (248)   (242)
Net cash used in operating activities   (4,248)   (2,733)   (7,179)   (3,780)
Cash flows from investing activities:                
Investment in available-for-sale marketable securities   -   -   (5,913)   (25,416)
Proceeds from sale and redemption of available-for-sale marketable securities   1,262   11,526   19,541   30,189
Short term deposits, net   (5)   -   (1,889)   -
Increase in restricted cash held by trustee   2,655   -   2,642   -
Purchase of property and equipment   (50)   (380)   (244)   (871)
Net cash provided by investing activities from continuing operations   3,862   11,146   14,137   3,902
Proceeds from sale of discontinued operations, net   -   -   -   22,105
Net cash provided by investing activities   3,862   11,146   14,137   26,007
Cash flows from financing activities:                
Purchase of treasury shares   -   (16,416)   -   (17,862)
Proceeds from exercise of stock options   6   133   65   722
Net cash provided by (used in) financing activities from continuing operations   6   (16,283)   65   (17,140)
Effect of exchange rate changes on cash   17   -   183   -
Increase (decrease) in cash and cash equivalents   (363)   (7,870)   7,206   5,087
Cash and cash equivalents at the beginning of the period   18,628   18,917   11,059   5,960
Cash and cash equivalents at the end of the period   $      18,265   $      11,047   $      18,265   $      11,047
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