(Source: Business Wire)
Unica Corporation (Nasdaq: UNCA), a leading global provider of enterprise marketing management (EMM) solutions, today announced financial results for its third quarter fiscal 2009 ended June 30, 2009.
For the third quarter fiscal 2009, the company reported total revenue of $26.9 million, an increase from $23.3 million in the previous quarter and a decrease of 19% compared with the third quarter of fiscal 2008. Subscription revenue was $5.9 million, an increase of 63%, perpetual license revenue was $4.4 million, a decrease of 64%, maintenance revenue on perpetual licenses was $11.1 million, a decrease of 2%, and services revenue was $5.5 million, a decrease of 12%, each compared to the third quarter fiscal 2008.
Yuchun Lee, chief executive officer of Unica Corporation, stated "During the third quarter, we continued to experience solid demand for our subscription-based offerings. Unica's momentum and brand awareness continues to grow in the web analytics segment of the EMM market, as evidenced by flagship customer wins and strong growth related to our overall on-demand solutions. In addition, for the second consecutive quarter we closed several sizeable subscription-based transactions for our enterprise products that customers plan on deploying on-premise. We believe the growth of our subscription-based business is a significant long-term positive for Unica as it improves our visibility into future revenue and cash flow."
Lee added, "We believe Unica's ability to provide customers with flexibility in their purchase and deployment options is a competitive advantage and will enable the company to maximize its long-term, addressable market opportunity. We believe the ultimate winners of the EMM market will need to be serious players in both on-premise and on-demand opportunities, and Unica is uniquely positioned to meet this broad set of requirements based on our go-to-market strategy and industry leading product breadth and depth."
For the quarter ended June 30, 2009, Unica reported a loss from operations, in accordance with generally accepted accounting principles (GAAP), of $785,000, compared to income from operations of $461,000 for the quarter ended June 30, 2008. GAAP loss from operations for the quarter ended June 30, 2009 includes $1.4 million of non-cash share-based compensation expense and $351,000 of amortization of acquired intangible assets. GAAP net loss for the quarter ended June 30, 2009 was $292,000, compared to GAAP net income of $411,000 for the quarter ended June 30, 2008. GAAP net loss per share for the quarter ended June 30, 2009 was $0.01, compared to GAAP net income per share of $0.02 in the corresponding quarter of the prior year.
For the quarter ended June 30, 2009, non-GAAP income from operations, which excludes non-cash share-based compensation expense and amortization of acquired intangible assets, was $921,000, compared to non-GAAP income from operations of $2.8 million for the quarter ended June 30, 2008. Non-GAAP net income was $879,000 for the quarter ended June 30, 2009, compared to non-GAAP net income of $2.0 million for the quarter ended June 30, 2008. Non-GAAP net income per diluted share was $0.04 for the quarter ended June 30, 2009, compared to net income per diluted share of $0.09 for the corresponding quarter of the prior year.
A reconciliation of GAAP to non-GAAP results has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below under the heading "Non-GAAP Financial Measures."
Kevin Shone, chief financial officer of Unica, said, "During the third quarter, Unica's total revenue benefited by approximately $2.4 million. This was the result of recognizing previously deferred revenue related to a single customer contract pursuant to which we have no further performance obligations. Unica's total revenue returned to sequential growth even without this benefit, due primarily to the strong underlying growth of our subscription revenue combined with stabilization of our perpetual license revenue."
As of June 30, 2009, Unica had cash, cash equivalents and investments of $48.7 million, an increase compared to $47.7 million at March 31, 2009, due primarily to $2.6 million cash provided by operations, offset by approximately $700,000 used to purchase property and equipment and $1.0 million used to repurchase shares of common stock as part of the previously announced share repurchase program.
At June 30, 2009, deferred revenue was $37.2 million, down slightly compared to $37.3 million at March 31, 2009 due to the above mentioned recognition of over $2 million associated with previously deferred revenue related to a single customer contract.
Additional Third Quarter and Recent Business Highlights:
Announced that FOXSports.com on MSN will utilize Unica NetInsight OnDemand to better analyze and act on visitor behavior, and create more powerful and relevant marketing programs. FOXSports.com is a leading sports site that delivers breaking news, real-time stats and fantasy games, reaching more than 15 million users per month.
Announced that Batteries Plus® has selected Unica NetInsight OnDemand as its web analytics software solution. Batteries Plus, which serves more than 1.5 million customers annually, is the nation's largest chain focused on the $24 billion battery category; in addition to selling more than 1 million batteries per week, they're also the market leader in battery recycling.
Added customers for its subscription offerings, including Arbitron, CSC, FOXSports.com, Harvard Business School, Invesco Perpetual, MedPlus, Military Advantage, New Balance, and News Digital Media, among others.
Positioned as a Leader in The Forrester Wave: Web Analytics, Q3 2009 (July 23, 2009). Unica NetInsight scored highest overall for Product Strategy. The company was also recently positioned in the "Visionaries" quadrant of Gartner, Inc.'s "Magic Quadrant for Enterprise Marketing Management" report (July 15, 2009).
Continued to expand its perpetual license business with industry leaders across a broad range of vertical markets, including travel and leisure, retail, healthcare, financial services, technology, and life sciences, among others. During the third quarter, the company added new customers and expanded relationships with existing customers including: BNP Paribas Fortis, Delta Airlines, Dexia, ING, Nationwide Building Society, School Specialty, and Urban Outfitters, among others.
In July, the company announced the appointment of James Fieger as senior vice president of worldwide sales. Fieger brings more than 20 years of executive sales management experience at global technology and software organizations. He previously served as executive vice president of worldwide field operations at Interwise, Inc., (a division of AT&T), senior vice president of worldwide sales and services at 3Com Corporation, as well as executive vice president of worldwide field operations at Lotus Development Corporation.
Announced that Louis Hernandez, Jr., chairman of the board and chief executive officer of Open Solutions Inc., has been elected to the company's board of directors. Hernandez also serves on the board of HSBC North America Holdings Inc., the North American holding company for the consumer lending arm and principal banking subsidiaries in the U.S. and Canada of one of the largest banking and financial services organizations in the world. He also serves on the board of directors of HSBC USA Inc., HSBC Bank USA, N.A., as well as Avid Technology Inc. (Nasdaq: AVID).
Conference Call Details
Unica will discuss its quarterly results and related matters via a teleconference today, August 10, 2009 at 5:00 p.m. ET. To access this call, dial 888-727-7693 (domestic) or 913-981-5545 (international). Additionally, a live audio webcast of the conference call will be available through Unica's web site at http://investor.unica.com.
A replay of this conference call will be available from 8:00 p.m. ET on Monday, August 10, 2009 through 11:59 p.m. ET on Monday, August 24, 2009 at 888-203-1112 (domestic) or 719-457-0820(international). The replay passcode is 4126694. A replay of the webcast will also be available on the events portion of the Unica web site following the earnings call.
Non-GAAP Financial Measures
Unica has provided in this press release selected financial information that has not been prepared in accordance with GAAP. This information includes historical non-GAAP operating income, net income, and earnings per share.
Unica uses these non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, as a supplement to GAAP measures, in evaluating Unica's ongoing operational performance. Unica believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends, and in comparing its financial results with other companies in Unica's industry, many of which present similar non-GAAP financial measures to investors. Specifically, on both an historic and a forward-looking basis, these non-GAAP measures exclude:
Expense associated with the amortization of intangible assets related to acquisitions and the impairment of goodwill, as exclusion of these expenses allows comparisons of operating results that are consistent over time for both the company's newly acquired and long-held businesses and with both acquisitive and non-acquisitive peer companies.
Expense associated with share-based compensation related to options to purchase common stock, the employee stock purchase plan and restricted stock units because, while share-based compensation is a significant ongoing expense affecting the company's results of operations, the company's management excludes share-based compensation from the company's forecasting and planning process used to allocate resources. In addition, because of varying available valuation methodologies, subjective assumptions and the variety of award types, the company believes that excluding share-based compensation may enable useful comparisons of the company's operating results to its competitors.
Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measure as detailed above. As previously mentioned, a reconciliation of GAAP to non-GAAP results has been provided in the financial statement tables included in this press release.
About Unica
Unica Corporation (Nasdaq: UNCA) is a leading global provider of enterprise marketing management (EMM) software and services. The most comprehensive EMM suite on the market today, Unica's marketing management solutions streamline the entire marketing process from analysis and planning to project management, execution and measurement. More than 1,000 companies worldwide depend on Unica for their enterprise marketing management solution.
Unica is headquartered in Waltham, Mass. with offices around the globe. For more information, visit www.unica.com.
Note to editors: Copyright 2009 Unica Corporation. Unica, NetInsight, and the Unica logo are registered trademarks of Unica Corporation. All other product names, service marks, and trademarks mentioned herein are trademarks of their respective owners.
Forward-looking Statements
The information provided in this press release above contains forward-looking statements that relate to future events and future financial performance of Unica. These forward-looking statements are based upon Unica's historical performance and its current plans, estimates and expectations and are not a representation that such plans, estimates, or expectations will be achieved. These forward-looking statements represent Unica's expectations as of the date of this press announcement. Subsequent events may cause these expectations to change; and Unica disclaims any obligation to update or revise the forward-looking statements in the future. Matters subject to forward-looking statements involve known and unknown risks and uncertainties, including those factors listed in the Company's most recent Quarterly Report on Form 10-Q and the Company's most recent Annual Report on Form 10-K for the fiscal year ended September 30, 2008 under "Risk Factors", which factors could cause Unica's performance or achievements to be materially different from those expressed or implied by the forward-looking statements.
UNICA CORPORATION AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) June 30, September 30, 2009 2008 ASSETS Current assets: Cash and cash equivalents $ 48,368 $ 35,799 Short-term investments 362 11,482 Accounts receivable, net 19,642 21,339 Prepaid expenses and other current assets 4,364 6,116 Total current assets 72,736 74,736 Property and equipment, net 4,796 4,781 Long-term investments - 2,989 Goodwill and other acquired intangible assets, net 15,745 33,028 Other assets 957 1,375 Total assets $ 94,234 $ 116,909 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 2,124 $ 3,536 Accrued expenses 13,016 14,527 Short-term deferred revenue 35,768 35,369 Total current liabilities 50,908 53,432 Long-term deferred revenue 1,390 1,733 Other long-term liabilities 474 1,738 Total liabilities 52,772 56,903 Stockholders' equity 41,462 60,006 Total liabilities and stockholders' equity $ 94,234 $ 116,909 -------------------------------------------------------------------------------
UNICA CORPORATION AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) Three Months Ended Nine Months Ended June 30, June 30, 2009 2008 2009 2008 Revenue: License $ 4,359 $ 12,127 $ 15,024 $ 34,907 Maintenance and services 16,594 17,542 46,738 48,223 Subscription 5,907 3,621 14,448 9,411 Total revenue 26,860 33,290 76,210 92,541 Costs of revenue: License 396 866 1,537 2,453 Maintenance and services 5,383 6,962 15,154 19,392 Subscription 1,279 714 3,262 2,019 Total cost of revenue 7,058 8,542 19,953 23,864 Gross profit 19,802 24,748 56,257 68,677 Operating expenses: Sales and marketing 11,216 13,020 32,157 37,407 Research and development 5,045 5,926 15,461 17,737 General and administrative 4,204 4,949 12,093 14,526 Restructuring charges (credits) - - 748 (286 ) Goodwill impairment charge - - 15,266 - Amortization of acquired intangible assets 122 392 1,057 1,179 Total operating expenses 20,587 24,287 76,782 70,563 Income (loss) from operations (785 ) 461 (20,525 ) (1,886 ) Other income (expense), net 313 230 (887 ) 993 Income (loss) before income taxes (472 ) 691 (21,412 ) (893 ) Provision for (benefit from) income taxes (180 ) 280 (891 ) (603 ) Net income (loss) $ (292 ) $ 411 $ (20,521 ) $ (290 ) Net income (loss) per common share: Basic $ ( 0.01 ) $ 0.02 $ (0.99 ) $ (0.01 ) Diluted $ ( 0.01 ) $ 0.02 $ (0.99 ) $ (0.01 ) Shares used in computing net income (loss) per common share: Basic 20,708 20,576 20,780 20,368 Diluted 20,708 20,963 20,780 20,368 -------------------------------------------------------------------------------
UNICA CORPORATION AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands) Nine Months Ended June 30, 2009 2008 Cash flows from operating activities: Net loss $ (20,521 ) $ (290 ) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation of property and equipment 1,994 1,612 Amortization of capitalized software development costs 139 53 Amortization of acquired intangible assets 1,825 2,180 Goodwill impairment charge 15,266 - Share-based compensation expense 3,992 4,928 Foreign currency translation loss 226 - Excess tax benefits from share-based compensation - (132 ) Deferred tax benefits (1,435 ) (991 ) Changes in operating assets and liabilities: Accounts receivable 1,491 (1,559 ) Prepaid expenses and other current assets 1,774 (1,047 ) Other assets 449 545 Accounts payable (1,318 ) 1,505 Accrued expenses (1,145 ) (806 ) Deferred revenue 155 2,249 Other long-term liabilities - 444 Net cash provided by operating activities 2,892 8,691 Cash flows from investing activities: Purchases of property and equipment (1,576 ) (2,003 ) Capitalization of software development costs (575 ) (237 ) Cash collected from license acquired in acquisition 115 122 Proceeds from sales and maturities of investments 15,043 33,836 Purchases of investments (898 ) (20,270 ) Increase in restricted cash (69 ) - Net cash provided by investing activities 12,040 11,448 Cash flows from financing activities: Proceeds from issuance of common stock under stock option and employee stock purchase plans 370 1,012 Excess tax benefits from share-based compensation - 132 Treasury shares purchased (1,920 ) - Payment of withholding taxes in connection with settlement of restricted stock units (308 ) (802 ) Net cash provided by (used in) financing activities (1,858 ) 342 Effect of exchange rate changes on cash and cash equivalents (505 ) 173 Net increase in cash and cash equivalents 12,569 20,654 Cash and cash equivalents at beginning of period 35,799 18,493 Cash and cash equivalents at end of period $ 48,368 $ 39,147 -------------------------------------------------------------------------------
UNICA CORPORATION AND SUBSIDIARIES UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (In thousands, except per share data) Three Months Ended Nine Months Ended June 30, June 30, 2009 2008 2009 2008 Non-GAAP financial measures and reconciliation: GAAP income (loss) from operations $ (785 ) $ 461 $ (20,525 ) $ (1,886 ) Add: Share-based compensation 1,355 1,647 3,992 4,928 Add: Amortization of acquired intangible assets 351 726 1,825 2,180 Add: Goodwill impairment charge - - 15,266 - Non-GAAP income from operations $ 921 $ 2,834 $ 558 $ 5,222 GAAP income (loss) before income taxes $ (472 ) $ 691 $ (21,412 ) $ (893 ) Add: Share-based compensation 1,355 1,647 3,992 4,928 Add: Amortization of acquired intangible assets 351 726 1,825 2,180 Add: Goodwill impairment charge - - 15,266 - Adjusted provision for income taxes (355 ) (1,106 ) - (2,051 ) Non-GAAP net income (loss) $ 879 $ 1,958 $ (329 ) $ 4,164 Diluted non-GAAP net income (loss) per common share $ 0.04 $ 0.09 $ (0.01 ) $ 0.19 Shares used in computing non-GAAP net income (loss) per diluted common share: 22,387 22,058 22,383 21,945 -------------------------------------------------------------------------------
UNICA CORPORATION AND SUBSIDIARIES UNAUDITED SUMMARY OF SHARE-BASED COMPENSATION EXPENSE AND AMORTIZATION OF ACQUIRED INTANGIBLE ASSETS (In thousands) Three Months Ended Nine Months Ended June 30, June 30, 2009 2008 2009 2008 Share-based compensation: Cost of license revenue $ 7 $ 10 $ 37 $ 33 Cost of maintenance and services revenue 251 245 726 650 Sales and marketing expense 615 618 1,657 1,755 Research and development expense 248 298 722 975 General and administrative expense 234 476 850 1,515 Total share-based compensation expense $ 1,355 $ 1,647 $ 3,992 $ 4,928 Amortization of acquired intangible assets: Cost of license revenue $ 229 $ 333 $ 768 $ 1,000 Operating expenses 122 393 1,057 1,180 Total amortization of acquired intangible assets $ 351 $ 726 $ 1,825 $ 2,180 -------------------------------------------------------------------------------
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