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Press Release

 

@Road^® Reports Second Quarter Results

Meets Consensus Estimates and Expects Fourth Quarter GAAP Profitability

FREMONT, Calif. – July 28, 2005 – @Road®, Inc. (Nasdaq: ARDI), a global provider of Mobile Resource Management (MRM) and intelligent field service automation solutions, today announced its results for the quarter and six months ended June 30, 2005.

Total revenues for the second quarter of 2005 were $20.6 million, a 13% increase compared to $18.3 million for the second quarter of 2004. Hosted revenues for the second quarter of 2005 were $19.7 million, and licensed revenues for the second quarter of 2005 were $0.9 million.

Net loss attributable to common stockholders for the second quarter of 2005 was $1.1 million, or a loss of $0.02 per diluted share, compared to net income of $1.1 million, or net income of $0.02 per diluted share, for the second quarter of 2004. Included in the results for the second quarter 2005 were a benefit from income taxes of $3.2 million, $1.0 million in intangibles amortization associated with the VidusTM Limited acquisition and $0.6 million in depreciation.

For the six months ended June 30, 2005, total revenues were $40.6 million, a 12% increase compared to the $36.2 million the same period last year. Hosted revenues for the first six months were $39.2 million, and licensed revenues for the first six months were $1.4 million. Net loss attributable to common stockholders for the first six months of 2005 was $8.5 million, or a loss of $0.14 per diluted share, compared to net income of $4.2 million, or net income of $0.07 per diluted share, for the first six months of 2004. Included in the results for the first six months of 2005 were the operations of Vidus from the February 18, 2005 closing date, as well as $5.6 million in one-time in-process research and development costs, a benefit from income taxes of $3.2 million, $1.5 million in intangibles amortization associated with the Vidus acquisition and $1.1 million in depreciation.

“I’m pleased to report that the majority of the AT&T Wireless CDPD migration is now behind us,” said Krish Panu, president and CEO of @Road. “The one-time CDPD migration is a legacy technology transition required by some of our customers to upgrade to newer wireless networks. This is a transformation year for the company and we believe that we are making good progress in reducing the risks in our business and preparing the company for its next stage of growth,” commented Mr. Panu.

The Company’s condensed consolidated balance sheet at June 30, 2005 included $108.2 million of cash, cash equivalents and short-term investments. “We have invested our cash in inventory associated with the SBC ramp up and CDPD migration. Due to the nature of our business model, large customer deployments typically require upfront cash outlays. These are investments that we have made during the quarter which we expect will lead to increases in revenue in the second half of 2005 and beyond as customers pay us for the hardware and the recurring monthly service,” stated Mr. Panu.

The company’s business outlook for the third quarter calls for an increase in revenue of approximately 15% sequentially over the second quarter to approximately $23.5 million, with diluted GAAP loss per share anticipated to be between $0.04 and $0.05. For the fourth quarter, the business outlook calls for an increase of approximately 20% sequentially over the estimated third quarter to approximately $28.5 million, with diluted earnings per share anticipated to be positive on a GAAP basis, and be approximately $0.01 per share.

Year to Date Highlights

About @Road

@Road, Inc. is a global provider of solutions that intelligently automate the management of mobile resources and which are designed to optimize the service delivery process for customers across a variety of industries. By providing real-time Mobile Resource Management infrastructure integrating wireless communications, location-based technologies, software applications, transaction processing and the Internet, @Road solutions are designed to provide a secure, scalable, upgradeable, enterprise-class platform, and are offered in hosted, on-premise or hybrid environments that seamlessly connect mobile workers in the field to real-time corporate data on-demand. @Road is headquartered in Fremont, Calif., and has a global presence with offices in North America, Europe and Asia. For more information on @Road solutions, visit www.road.com.

Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements involving risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. Numerous factors, risks and uncertainties affect the company’s operating results and could cause the company’s actual results to differ materially from forecasts and estimates or from any other forward-looking statements made by, or on behalf of, @Road, and there can be no assurance that future results will meet expectations, estimates or projections. These factors, risks and uncertainties include, but are not limited to, @Road historical and future operating results and profitability; the ability of @Road to integrate Vidus operations successfully; the ability of @Road to transition its customers from CDPD wireless networks; the ability of @Road to accelerate or continue to grow as a result of its investment initiatives; the ability of @Road and its partners to market, sell and support @Road products and services; the timing of purchasing and implementation decisions by SBC and other prospects and customers; competitive and pricing pressures; the dependence of @Road on mobile data systems technology, wireless networks, network infrastructure and positioning systems owned and controlled by others; and general economic and political conditions. The company cautions the reader that the planned appearances of @Road personnel, time and/or manner of the live teleconference, webcast and replays may change for administrative or other reasons outside the company’s control. Further information regarding these and other risks is included in the @Road Report on Form 10-K dated March 15, 2005, the @Road Report on Form 10-Q dated May 10, 2005 and in its other filings with the Securities and Exchange Commission.

@Road is a registered trademark of @Road, Inc. The @Road logo, Vidus, Internet Wireless Manager and taskforce are trademarks of @Road, Inc. All other product names and services are the property of their respective owners.

	@Road, Inc.
	Condensed Consolidated Balance Sheets
	(In thousands, unaudited)
		June 30, 2005		December 31, 2004
	ASSETS
Current Assets:
	Cash, cash equivalents, and short-term investments	$ --------108,183		$ --------117,716
	Accounts receivable, net	7,558		7,960
	Inventories	7,237		3,593
	Deferred product costs and other current assets	18,090		12,646
	Total current assets	141,068		141,915
	Property and equipment, net	5,165		3,668
	Deferred tax assets	88		-
	Goodwill	21,055		-
	Intangible assets, net	31,623		-
	Deferred product costs and other assets	7,549		6,627
	Total assets	$ --------206,548		$ --------152,210
		===============		===============
	LIABILITIES, REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY
Current liabilities:
	Accounts payable and accrued liabilities	$ --------19,595		$ --------11,195
	Deferred revenue and customer deposits	13,308		11,347
	Total current liabilities	32,903		22,542
Deferred revenue		9,454		4,830
Other long term liabilities		473		2
	Total liabilities	42,380		27,374
Redeemable preferred stock		7,929		-
Stockholders' equity:
	Common Stock	271,194		232,016
	Notes receivable from stockholders	(8)		-
	Accumulated other comprehensive loss	(81)		(179)
	Accumulated deficit	(115,316)		(107,001)
	Total stockholders' equity	155,789		124,836
	Total liabilities, redeemable preferred stock and stockholders' equity	$ --------206,548		$ --------152,210
		===============		===============

* Derived rom the audited December 31, 2004 consolidated financial statements.

@Road, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(unaudited)
	Three months ended						Six months ended
	June 30, 2005		March 31, 2005		June 30, 2004		June 30, 2005		June 30, 2005
Revenues:
Hosted	$ --------19,685		$ --------19,499		$ --------18,331		$ --------39,175		$ --------36,223
Licensed	941		502		-		1,443		-
Total revenues	20,626		19,992		18,331		40,618		36,223
Costs and expenses:
Cost of hosted revenue (excluding intangible amortization included below)	9,227		9,524		8,669		18,751		17,037
Cost of licensed revenue (excluding intangible amortization included below)	1,473		700		-		2,173		-
Intangibles amortization	1,010		457		11		1,467		21
In-process research and development	-		5,640		-		5,640		-
Sales and marketing	5,832		4,647		3,082		10,479		6,193
Research and development	3,849		2,575		1,431		6,424		2,798
General and administrative	3,942		4,447		2,371		8,389		4,553
Terminated acquisition costs	-		-		2,017		-		2,017
Stock compensation	-		-		-		-		4
Total costs and expenses	25,333		27,990		17,581		53,323		32,623
(Loss) income from operations	(4,707)		(7,998)		750		(12,705)		3,600
Other income, net	575		620		316		1,195		576
Net (loss) income before tax	(4,132)		(7,378)		1,066		(11,510)		4,176
Benefit from income taxes	3,195		-		-		3,195		-
Net (loss) income	(937)		(7,378)		1,066		(8,315)		4,176
Preferred stock dividends	(124)		(57)		-		(181)		-
Net (loss) income attributable to common stockholders	$ --------(1,061)		$ --------(7,435)		$ --------1,066		$ --------(8,496)		$ --------4,176
	============		============		============		============		============
Net (loss) income per share:
Basic	$ --------(0.02)		$ --------(0.13)		$ --------0.02		$ --------(0.14)		$ --------0.08
	============		============		============		============		============
Diluted	$ --------(0.02)		$ --------(0.13)		$ --------0.02		$ --------(0.14)		$ --------0.07
	============		============		============		============		============
Shares used in calculating net (loss) income per share:
Basic	60,551		57,385		54,185		58,977		53,978
	============		============		============		============		============
Diluted	60,551		57,385		57,414		58,977		57,856
	============		============		============		============		============
Stock compensation
Cost of hosted revenue	$ ---------------- -		$ ---------------- -		$ ---------------- -		$ ---------------- -		$ ---------------- -
Cost of licensed revenue	-		-		-		-		-
Sales and marketing	-		-		-		-		1
Research and development	-		-		-		-		1
Genereal and administrative	-		-		-		-		2
Total stock compensation	$ -----------------		$ -----------------		$ -----------------		$ -----------------		$ ----------------4

Contact:
Michael Martini @Road Chief Financial Officer 510-870-1099 mmartini@road-inc.com		David J. Lebedeff @Road Vice President Investor Relations 510-870-1317 dlebedeff@road-inc.com
or
Bob Stern @Road Media Relations 510-870-1360 bstern@road-inc.com

Media Contact

Michael Martini
@Road Chief Financial Officer
510-870-1099
mmartini@road-inc.com

David J. Lebedeff
@Road Vice President Investor Relations
510-870-1317
dlebedeff@road-inc.com

Bob Stern, @Road Public Relations
(510) 870-1360
bstern@road-inc.com

 

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