Exhibit 99.1
FOR IMMEDIATE RELEASE
Contact:
Rob Weiskopf
Aware, Inc.
781-276-4000
AWARE, INC. REPORTS 2005 THIRD QUARTER
FINANCIAL RESULTS
BEDFORD, MASS. - OCTOBER 27, 2005 - Aware, Inc. (NASDAQ: AWRE), a worldwide
leader and innovator of broadband intellectual property, today reported
financial results for its third quarter ended September 30, 2005.
Revenues for the third quarter of 2005 were $5.1 million compared to $4.6
million for the same period last year. Net income for the third quarter of 2005
was $0.6 million, or $0.02 per share, compared to net income of $0.2 million, or
$0.01 per share, for the year-ago period.
For the nine months ended September 30, 2005, revenues were $12.0 million
compared to $11.9 million in the same period last year. Net loss for the nine
months ended September 30, 2005 was $1.3 million or $0.06 per share, compared to
a net loss of $1.8 million, or $0.08 per share, for the year-ago period.
Michael Tzannes, Aware's chief executive officer commented, "Events in the
industry and interactions with existing and prospective customers continue to
build our confidence that our products and product developments are well
positioned. The markets we are addressing are going through significant changes
and we are optimistic that we can capitalize on these changes. Please join us on
our conference call today where we will elaborate on the transitions that are
underway in the DSL and biometrics industries and why they are positive for
Aware."
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Tzannes added, "From the conclusion of today's conference call until Friday,
October 28 at 5:00 p.m., we invite interested parties to submit investor
questions via email to INVESTORQUESTIONS@AWARE.COM. We will post questions and
answers next week on our website."
Note: Aware's conference call will be broadcast live over the Internet today,
October 27, 2005 at 5:00 p.m. Eastern Time. To listen to the call, please go to
WWW.AWARE.COM, and click on "Investor Relations." The conference call may also
be heard by calling (719) 457-2633 and referencing the confirmation number
1864272. A replay of the call will be archived on our website after the call.
About Aware
Aware, Inc. designs, develops, licenses and markets DSL technologies that enable
broadband communications over existing telephone networks. Its solutions,
including splitterless G.lite, full-rate ADSL, ADSL2, ADSL2+, VDSL2, Bonded
ADSL2+, Dr. DSL(R), StratiPHY(TM), StratiPHY-Bonded(TM), StratiPHY2+(TM),
StratiPHY3(TM) and G.SHDSL, address central office as well as customer premise
requirements. Aware is also a leading provider of standards-based biometric
transaction and image compression software toolkits. More information can be
found at HTTP://WWW.AWARE.COM.
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 market.
Aware wishes to caution you that there are factors that could cause actual
results to differ materially from the results indicated by such statements.
These factors include, but are not limited to: we have a unique business model,
our quarterly results are difficult to predict, we depend on a limited number of
licensees, we derive a significant amount of revenue from a small number of
customers, we depend on equipment companies to incorporate our technology into
their products, we face intense competition from other DSL vendors, DSL
technology competes with other technologies for broadband access, and our
business is subject to rapid technological change. 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 quarterly report on Form
10-Q for the quarter ended June 30, 2005 and other reports and filings made with
the Securities and Exchange Commission.
DR. DSL, STRATIPHY, STRATIPHY2+, STRATIPHY3, AND STRATIPHY-BONDED ARE TRADEMARKS
OR REGISTERED TRADEMARKS OF AWARE, INC.
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AWARE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
------------------------------ ------------------------------
2005 2004 2005 2004
-------------- -------------- -------------- --------------
Revenue:
Product sales................................. $2,417 $977 $4,163 $3,228
Contract revenue.............................. 1,920 2,556 5,061 5,625
Royalties..................................... 750 1,028 2,770 3,035
-------------- -------------- -------------- --------------
Total revenue................................ 5,087 4,561 11,994 11,888
Costs and expenses:
Cost of product sales......................... 157 198 279 730
Cost of contract revenue...................... 826 676 2,384 1,996
Research and development...................... 2,487 2,511 7,400 7,685
Selling and marketing......................... 721 521 2,064 1,792
General and administrative.................... 644 634 1,940 1,857
-------------- -------------- -------------- --------------
Total costs and expenses..................... 4,835 4,540 14,067 14,060
Income (loss) from operations..................... 252 21 (2,073) (2,172)
Interest income................................... 309 143 798 381
-------------- -------------- -------------- --------------
Income (loss) before provision for income taxes... 561 164 (1,275) (1,791)
Provision for income taxes........................ - - - -
-------------- -------------- -------------- --------------
Net income (loss)................................. $561 $164 ($1,275) ($1,791)
============== ============== ============== ==============
Net income (loss) per share - basic............... $0.02 $0.01 ($0.06) ($0.08)
Net income (loss) per share - diluted ............ $0.02 $0.01 ($0.06) ($0.08)
Weighted average shares - basic .................. 23,116 22,784 23,027 22,767
Weighted average shares - diluted ................ 25,168 22,837 23,027 22,767
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AWARE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
SEPTEMBER 30, DECEMBER 31,
2005 2004
-----------------------------------
ASSETS
Cash and investments.................................. $37,518 $38,266
Accounts receivable, net.............................. 3,606 3,070
Property and equipment, net........................... 8,063 8,287
Other assets, net..................................... 1,032 560
-------------------------------------
Total assets.......................................... $50,219 $50,183
=====================================
LIABILITIES AND STOCKHOLDERS' EQUITY
Total current liabilities............................. $1,896 $1,427
Total stockholders' equity............................ 48,323 48,756
-----------------------------------
Total liabilities and stockholders' equity............ $50,219 $50,183
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