PKTR Packeteer (MM)

CUPERTINO, Calif., April 24 /PRNewswire-FirstCall/ -- Packeteer(R), Inc. (NASDAQ:PKTR), the global leader in high-performance, intelligent WAN Application Delivery, today announced results of operations for the three months ended March 31, 2008. Net revenues for the first quarter 2008 were $37.2 million, compared to $34.7 million for the first quarter 2007, an increase of 7%. GAAP net loss for the first quarter 2008 was $3.2 million or $0.09 per diluted share. Non-GAAP net loss for the first quarter 2008 was $1.1 million or $0.03 per diluted share, compared to non-GAAP net loss for the first quarter 2007 of $3.1 million or $0.09 per diluted share. Non-GAAP net loss excludes stock- based compensation and amortization of purchased intangible assets, net of the related tax impact. Total cash and investments at March 31, 2008 were $76.3 million compared to $77.8 million at December 31, 2007. Accounts receivable of $27.7 million at March 31, 2008 represented 68 days sales outstanding (DSO), compared to $27.4 million representing 62 DSO at December 31, 2007. Total inventories decreased to $6.9 million at March 31, 2008 compared to $7.7 million at December 31, 2007. Blue Coat Acquisition On April 21, 2008, Blue Coat Systems, Inc. (NASDAQ:BCSI) and Packeteer announced that they had entered into a definitive agreement for Blue Coat to acquire Packeteer. Pursuant to this agreement, Blue Coat is to commence a tender offer to purchase for cash all outstanding shares of Packeteer for $7.10 per share. The transaction is subject to certain regulatory reviews and other conditions and is expected to close during the second quarter of 2008. As a result of the announced acquisition, Packeteer has cancelled its conference call previously scheduled for April 24, 2008. Additional investor information can be accessed at http://www.packeteer.com/ or by calling Packeteer's Investor Relations Department at (408) 873-4422. Important Information This press release is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any of Packeteer's equity securities ("Shares"). The proposed tender offer by Blue Coat Systems (the "Offer") has not yet been commenced. On the commencement date of the Offer, an offer to purchase, a letter of transmittal and related documents will be filed with the SEC, mailed to record holders of the Shares and made available for distribution to beneficial owners of the Shares. The solicitation of offers to buy Shares will only be made pursuant to the offer to purchase, the letter of transmittal and related documents. Packeteer will file a solicitation/recommendation statement with the SEC in connection with the Offer and, if required, will file a proxy statement or information statement with the SEC in connection with the second-step merger (the "Merger") following the Offer. When they are available, stockholders should read those materials carefully because they will contain important information, including the various terms of, and conditions to, the Offer. When they are available, stockholders will be able to obtain the offer to purchase, the letter of transmittal and related documents without charge from the SEC's Website at http://www.sec.gov/ or by directing a request to Packeteer, Inc., Attention: Chief Financial Officer, 10201 North De Anza Blvd., Cupertino, California 95014, Telephone No. (408) 873-4400. About Packeteer Packeteer (NASDAQ:PKTR) is the global market leader in Application Traffic Management for wide area networks. Deployed at more than 7,000 companies in 50 countries, Packeteer solutions empower IT organizations with patented network visibility, control, and acceleration capabilities delivered through a family of intelligent, scalable appliances. For more information, contact Packeteer via telephone at +1 (408) 873-4400, fax at + 1 (408) 873-4410, or by email at , or visit the Company's website at http://www.packeteer.com/. Packeteer is headquartered in Cupertino, CA. Use of Non-GAAP Financial Measures Non-GAAP net loss and net loss per share discussed in this press release exclude stock-based compensation, amortization of purchased intangible assets and the related tax impact of the applicable items. Management presents non- GAAP financial measures because it considers them to be important supplemental measures of performance. Management uses the non-GAAP financial measures for planning purposes, including analysis of the Company's performance against prior periods, the preparation of operating budgets and to determine appropriate levels of operating and capital investments. Management also believes that the non-GAAP financial measures provide additional insight for analysts and investors in evaluating the Company's financial and operational performance. However, these non-GAAP financial measures have limitations as an analytical tool, and are not intended to be an alternative to financial measures prepared in accordance with GAAP. A reconciliation between the Company's GAAP and non-GAAP financial results is provided at the end of this press release. Investors are advised to carefully review and consider this information as well as the GAAP financial results that are disclosed in the Company's SEC filings. Safe Harbor Clause The statements contained in this press release that are not purely historical are forward-looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934, as amended, including statements regarding Packeteer's expectations, beliefs, intentions or strategies regarding the future. Forward-looking statements include, but are not limited to, express or implied statements regarding the proposed acquisition of Packeteer by Blue Coat, future revenue growth and profitability, spending levels by existing and prospective customers, the markets for our products, new product development, liquidity and macro economic conditions. All forward- looking statements included in this press release are based upon information available to Packeteer as of the date hereof. Packeteer assumes no obligation to update any such forward-looking statements. Forward-looking statements involve risks and uncertainties, which could cause actual results to differ materially from those projected. Actual results may differ materially due to a number of factors including the perceived need for our products, our ability to convince potential customers of our value proposition, the costs of competitive solutions, continued capital spending by prospective customers and macro economic conditions. Further risks and uncertainties associated with the proposed acquisition of the Packeteer by Blue Coat include: the risk that customers may delay or refrain from purchasing the Company's products due to uncertainties about the Company's future and the availability of product support and upgrades; the risk that key employees may pursue other employment opportunities; and the outcome of any litigation related to the proposed acquisition. These and other risks relating to Packeteer's business are set forth in Packeteer's Form 10-K filed with the Securities and Exchange Commission on March 4, 2008, and Packeteer's Form 10-Qs and other reports filed from time to time with the Securities and Exchange Commission. Copyright (C)2008 Packeteer, Inc. All rights reserved. Packeteer, the Packeteer logo, PacketWise, PacketShaper, PacketShaper Xpress, PacketSeeker, Intelligence Center, PolicyCenter, ReportCenter, SkyX, iShared, Mobiliti, iShaper, IntelligenceCenter, Raptor, and Talon are trademarks or registered trademarks of Packeteer, Inc. in the United States and other countries. All other products and services are the trademarks of their respective owners. PACKETEER, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (unaudited) Three months ended March 31, 2008 2007 Net revenues Product revenues $24,574 $23,841 Service revenues 12,609 10,887 Total net revenues 37,183 34,728 Cost of revenues Product costs 7,065 7,735 Service 3,461 3,570 Amortization of purchased intangible assets 618 635 Total cost of revenues 11,144 11,940 Gross profit 26,039 22,788 Operating expenses: Research and development 8,872 9,227 Sales and marketing (includes amortization of purchased intangible assets of $317 for both the three months ended March 31, 2008 and 2007) 17,051 17,348 General and administrative 4,545 4,080 Total operating expenses 30,468 30,655 Operating loss (4,429) (7,867) Other income, net 662 832 Loss before provision for income taxes (3,767) (7,035) Provision (benefit) for income taxes (568) (948) Net loss $(3,199) $(6,087) Basic net loss per share $(0.09) $(0.17) Diluted net loss per share $(0.09) $(0.17) Shares used in computing basic net loss per share 36,389 35,740 Shares used in computing diluted net loss per share 36,389 35,740 PACKETEER, INC. RECONCILIATION OF GAAP NET LOSS TO NON-GAAP NET LOSS (in thousands, except per share amounts) (unaudited) Three months ended March 31, 2008 2007 GAAP net loss $(3,199) $(6,087) Stock-based compensation from options and employee stock purchase plan 2,030 3,267 Amortization of purchased intangible assets 934 952 Tax impact of above (860) (1,264) Non-GAAP net loss $ (1,095) $(3.132) Basic non-GAAP net loss per share excluding amortization of purchased intangible assets, stock-based compensation, net of taxes $(0.03) $(0.09) Diluted non-GAAP net loss per share excluding amortization of purchased intangible assets and stock-based compensation, net of taxes $(0.03) $(0.09) Shares used in computing basic net loss per share 36,389 35,740 Shares used in computing diluted net loss per share 36,389 35,740 PACKETEER, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) (unaudited) March 31, December 31, 2008 2007 Assets: Cash, cash equivalents and investments $ 76,299 $ 77,779 Accounts receivable, net 27,708 27,353 Inventories 6,900 7,665 Property and equipment, net 4,989 4,962 Other assets 28,282 27,604 Goodwill and other intangible assets, net 73,308 74,242 Total assets $217,486 $219,605 Liabilities and Stockholders' Equity Liabilities: Accounts payable and accrued liabilities $ 18,320 $ 21,591 Other liabilities 4,904 4,569 Deferred revenue 33,695 31,934 Total liabilities 56,919 58,094 Stockholders' equity 160,567 161,511 Total liabilities and stockholders' equity $217,486 $219,605 PACKETEER, INC. CONDENSED CONSOLIDATED CASH FLOW DATA (in thousands) (unaudited) Three Months ended March 31, 2008 2007 Net cash provided by (used in) operating activities $(962) $3,704 Net cash provided by (used in) investing activities (7,941) 7,345 Net cash provided by financing activities 864 5,199 Net increase (decrease) in cash and cash equivalents (8,039) 16,248 Cash and cash equivalents at beginning of period 40,926 39,640 Cash and cash equivalents at end of period 32,887 55,888 Investments 43,412 28,209 Total cash, cash equivalents and investments $76,299 $84,097 DATASOURCE: Packeteer, Inc. CONTACT: Investors, David C. Yntema, Chief Financial Officer of Packeteer, +1-408-873-4518, Web site: http://www.packeteer.com/

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