SOURCE: Procera Networks

May 16, 2007 08:00 ET

Procera Networks, Inc. Announces First Quarter 2007 Financial Results

Revenues Increase 40% Over the Fourth Quarter of 2006

LOS GATOS, CA -- (MARKET WIRE) -- May 16, 2007 -- Procera® Networks, Inc. ("Procera") (OTCBB: PRNW), a pioneering developer of intelligent network traffic and service management infrastructure equipment, today announced the results of its 10Q for the quarter ending March 31, 2007.

Procera Networks' financial highlights include continued worldwide selling traction and strong revenue growth from the PacketLogic line of traffic and service management appliances. During the quarter, the company posted a 40% revenue increase over the fourth quarter of 2006 to $1.985 million, and its gross margins were 78%. The company also booked an additional $241,000 in deferred service and support revenue which is not included in its GAAP revenue. The US market continued to gain traction since introducing PacketLogic in mid-2006, and the first quarter sell-through in the US was influenced by broadband service providers evaluating and selecting PacketLogic to help them meet the technical assistance requirements for the Communications Assistance for Law Enforcement Act (CALEA).

"Procera's PacketLogic family of products continues to gain validation. There are now over 350 customers with approximately 750 systems installed worldwide," states Doug Glader, CEO of Procera Networks. "PacketLogic continues to win in most head-to-head competitive evaluations, and our business model is further enhanced by the strength of our gross profit margins. Our customer list now includes some of the major cable and telco providers in Northern Europe, a host of small and mid-sized ISPs in Europe, the Pacific Rim and the US, the largest telco in the Pacific Rim outside of China, and several well recognized colleges and universities. We also have the beginning of an enterprise customer base with the likes of Lucky Goldstar, Panasonic, Volkswagen, and AstraZeneca," concludes Glader.

During the quarter, the company signed an OEM relationship under which a subset of its technology is licensed to a significant customer that could have a positive impact on the company in the second half of 2007 and throughout 2008 and beyond.

During the quarter, the company continued to build its management team. The company added Don Henry as its director of North American sales. Don was a founder and the original vice president of sales for Digi International in Minnetonka, Minnesota and was responsible for building Digi's revenue from zero to over $160M. Don has strong business skills and knowledge in building the channels that are necessary for that type of growth. The company also added Paul Eovino to its staff the first of March as its VP of finance. Paul brings a wealth of financial background that will be of great value as the company expands and implements strong controls headed toward SOX compliance. Evelyn Miller joined the company in mid-April to fill a senior marketing communications role. Evelyn brings a very relevant technology background and experience to our team at a time when we are refining market positioning, collateral and training materials for our industry-leading products.

Significantly, the company also added two independent outside directors to its board. Staffan Hillberg of Gothenburg, Sweden joined in January and Mary Losty of Baltimore, Maryland joined in late March. The addition of Ms. Losty and Mr. Hillberg give the company's board of directors a majority of independent, outside directors, which positions the company to move forward with a number of important initiatives including the filing of an application for listing on the American Stock Exchange.

The company held a conference call at 5:00 pm EDT on Tuesday, May 15, 2007, a recording of which can be heard by going to the company's web site at www.proceranetworks.com.

About Procera Networks

Founded in 2002, Procera Networks, Inc. (OTCBB: PRNW) is a global provider of intelligent network traffic identification, control and service management infrastructure equipment. Procera's core product suite, the PacketLogic™ line of appliances, provides the most accurate application identification available today by using the industry-leading connection identification engine DRDL™ (Datastream Recognition Definition Language). PacketLogic is deployed at more than 350 broadband service providers (xSPs), Telcos, colleges and universities worldwide. For more information, visit http://www.proceranetworks.com.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995 (the "Act"). In particular, when used in this press release, the words "plan," "confident that," "believe," "scheduled," "expect," or "intend to," and similar conditional expressions are intended to identify forward-looking statements within the meaning of the Act and are subject to the safe harbor created by the Act. Such statements are subject to certain risks and uncertainties and actual results could differ materially from those expressed in any of the forward-looking statements. Such risks and uncertainties include, but are not limited to, the ability of Procera to commercialize the applicable technology and introduce products and the acceptance of those products by the market, the ability of resellers to sell the Procera products, market conditions, the general acceptance of the Company's products and technologies, competitive factors, timing, and other risks described in the Company's reports and filings with the SEC (Securities and Exchange Commission) from time to time.

Contact Information

  • Contact Procera:

    Tom Williams
    Procera Networks, Inc.
    408.354.6208
    Email Contact

    John Liviakis (Investor Relations)
    Liviakis Financial Communications Inc.
    415.389.4670

    Evelyn Miller
    Procera Networks, Inc.
    Email Contact
    408.354.9238