QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For Quarterly Period Ended
March 31, 2003

Commission File Number:
0-22065

RADIANT SYSTEMS, INC.

(Exact name of registrant as specified in its charter),

Georgia

11-2749765

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

3925 Brookside Parkway, Alpharetta, Georgia

30022

(Address of principal executive offices)

(Zip Code)

Issuer’s telephone number, including area code:

(770) 576-6000

(Former name, former address and former fiscal year, if changed since last report)

Yes   x

No   o

Yes   x

No   o

PAGE NO.

PART I:

FINANCIAL INFORMATION

Item 1:

Financial Statements

Condensed Consolidated Balance Sheets as of March 31, 2003 (unaudited) and
December 31, 2002

3

Condensed Consolidated Statements of Operations for the Three Months Ended
March 31, 2003 (unaudited) and 2002 (unaudited)

4

Condensed Consolidated Statements of Cash Flows for the Three Months Ended
March 31, 2003 (unaudited) and 2002 (unaudited)

5

Notes to Condensed Consolidated Financial Statements (unaudited)

6

Item 2:

Management’s Discussion and Analysis of Financial Condition and Results of
Operations

13

Item 3:

Quantitative and Qualitative Disclosures About Market Risks

21

Item 4:

Controls and Procedures

21

PART II:

OTHER INFORMATION

Item 6:

Exhibits and Reports on Form 8-K

22

Signatures:

22

March 31,
2003

December 31,
2002

(unaudited)

ASSETS

Current assets

Cash and cash equivalents

$

42,394

$

43,382

Accounts receivable, net of allowances for doubtful accounts of $2,433 and $2,597, respectively

21,828

31,167

Inventories

14,903

13,542

Other short-term assets

4,288

4,122

Total current assets

83,413

92,213

Property and equipment, net

12,323

11,948

Software development costs, net

17,168

16,969

Goodwill, net

12,521

12,521

Intangible assets, net

1,939

2,155

TriYumf Asset and other long-term assets

14,071

9,450

$

141,435

$

145,256

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities

Accounts payable

$

7,020

$

9,741

Accrued liabilities

6,811

5,271

Client deposits and unearned revenue

11,336

10,509

Current portion of long-term debt

499

491

Total current liabilities

25,666

26,012

Client deposits and unearned revenue, less current portion

3,590

2,994

Deferred tax liability

880

880

Long-term debt, less current portion

532

660

Total liabilities

30,668

30,546

Shareholders’ equity

Common stock, $0.00001 par value; 100,000,000 shares authorized; 27,964,425 and 28,021,689 shares issued and outstanding, respectively

0

0

Additional paid-in capital

116,030

116,752

Accumulated deficit

(5,263

)

(2,042

)

Total shareholders’ equity

110,767

114,710

$

141,435

$

145,256

For the three months ended

March 31, 2003

March 31, 2002

Revenues:

System sales

$

13,661

$

17,128

Client support, maintenance and other services

15,846

14,160

Total revenues

29,507

31,288

Cost of revenues:

System sales

8,076

7,834

Client support, maintenance and other services

11,426

8,529

Total cost of revenues

19,502

16,363

Gross profit

10,005

14,925

Operating expenses:

Product development

3,389

3,462

Sales and marketing

4,737

4,807

Depreciation and amortization

1,114

1,332

Non-recurring charges

550

—  

General and administrative

3,481

2,912

(Loss) income from operations

(3,266

)

2,412

Interest income, net

151

206

(Loss) income before income tax provision

(3,115

)

2,618

Income tax provision

106

1,120

Net (loss) income

$

(3,221

)

$

1,498

Basic and diluted (loss) income per share:

Basic (loss) income per share

$

(0.11

)

$

0.05

Diluted (loss) income per share

$

(0.11

)

$

0.05

Weighted average shares outstanding:

Basic

28,011

27,560

Diluted

28,011

29,006

For the three months ended
March 31,

2003

2002

CASH FLOWS FROM OPERATING ACTIVITIES:

Net (loss) income

$

(3,221

)

$

1,498

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

Depreciation and amortization

2,632

2,243

Changes in assets and liabilities:

Accounts receivable

9,338

(4,465

)

Inventories

(1,361

)

1,211

Other assets

(181

)

402

Accounts payable

(2,720

)

452

Accrued liabilities

1,539

1,221

Client deposits and deferred revenue

1,424

(49

)

Net cash provided by operating activities

7,450

2,513

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of property and equipment

(1,567

)

(504

)

Purchase of TriYumf Asset and capitalized professional services costs

(4,607

)

(5,250

)

Capitalized software development costs

(1,423

)

(1,913

)

Net cash used in investing activities

(7,597

)

(7,667

)

CASH FLOWS FROM FINANCING ACTIVITIES:

Exercise of employee stock options

120

177

Repurchase of common stock

(879

)

(196

)

Principal payments under capital lease obligations

(120

)

(112

)

Proceeds from repayments of shareholder loans

—  

100

Other

38

—  

Net cash used in financing activities

(841

)

(31

)

Decrease in cash and cash equivalents

(988

)

(5,185

)

Cash and cash equivalents at beginning of period

43,382

33,924

Cash and cash equivalents at end of period

$

42,394

$

28,739

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:

Cash paid during the period for:

Interest

$

18

$

25

Income taxes

$

174

$

452