Non-GAAP revenue for the quarter ended December 31, 2012 increased
Non-GAAP net income was
GAAP revenue for the quarter ended December 31, 2012 increased
GAAP net loss was
"We are pleased with our performance in both 2012 and against the three-year plan we developed for our business following our 2010 merger with
Recent Business Highlights:
-
Completed three acquisitions that add important domain expertise and technology capabilities that further our strategy to optimize the innovation lifecycle from research through commercialization.
- HEOS, a secure Cloud-based information management workspace for scientific collaboration, accelerates and streamlines collaborative drug-discovery.
-
Aegis Analytical Corporation (Aegis), the leading provider of process management informatics software, further expands the footprint in downstream operation with solutions that help aggregate, contextualize and analyze manufacturing, quality and product development data. -
Vialis AG , a leading systems integrator with deep experience implementing and supporting paperless laboratory solutions, further strengtheningAccelrys' position in the laboratory informatics software market.
- Delivered new product releases in the core product lines and significantly progressed the integration roadmap for the solutions acquired into the portfolio, including:
- New Accelrys Enterprise Platform (AEP), the industry's first scientifically aware, service-oriented architecture (SOA) that enables integration and deployment of broad scientific solutions (Platform)
- New biology capabilities from screening through pre-clinical development in the Accelrys Electronic Laboratory Notebook (Enterprise Lab Management)
-
New Process Management and Compliance suite, a unified approach to product development and process management which combines the capabilities of the Accelrys ELN, Accelrys Lab Execution System (LES), Accelrys Electronic Batch Records (EBR) and the
Accelrys Enterprise Platform (Enterprise Lab Management) -
New integration between
Accelrys Materials Studio and AEP, enabling computational scientists to collaborate across the enterprise; deepened biotherapeutics capabilities inAccelrys Discovery Studio (Modeling and Simulation)
Non-GAAP results for the quarter and year ended December 31, 2012 exclude the impact of business combination activities associated with the acquisitions of Aegis on
Non-GAAP revenue, non-GAAP operating income, and non-GAAP net income for the quarter and year ended December 31, 2012 include fair value adjustments to deferred revenue (
Calendar Year 2013 Outlook
For the year ending
Non-GAAP Financial Measures:
This press release describes financial measures for revenue, operating income, net income, net income per diluted share and free cash flow that exclude deferred revenue fair value adjustments, acquisition-related cost of revenue, business consolidation, transaction and restructuring costs, stock-based compensation expense, purchased intangible asset amortization, royalty income fair value adjustments, amortization of note receivable discount, gain on sale of real estate, gain on sale of equity investments, sale of intangible assets, other non-operating expense and income tax adjustments. These financial measures are not calculated in accordance with generally accepted accounting principles (GAAP) and are not based on any comprehensive set of accounting rules or principles.
Management believes these non-GAAP financial measures provide a useful measure of the Company's operating results, a meaningful comparison with historical results and with the results of other companies, and insight into the Company's ongoing operating performance. Further, management and the Board of Directors utilize these measures, in addition to GAAP measures, when evaluating and comparing the Company's operating performance against internal financial forecasts and budgets. These non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. In addition, these non-GAAP financial measures may be different from non-GAAP financial measures used by other companies.
For additional information on the items excluded by the Company from its non-GAAP financial measures please refer to the Form 8-K regarding this release that was furnished today to the
The following table contains a reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures(unaudited, amounts in thousands, except per share amounts, including footnotes):
Three Months Ended | Year Ended | |||||||||||||||
|
December 31, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
GAAP revenue | $ | 44,194 | $ | 39,762 | $ | 162,526 | $ | 144,339 | ||||||||
Deferred revenue fair value adjustment1 | 3,332 | 1,081 | 11,758 | 10,652 | ||||||||||||
Non-GAAP revenue | $ | 47,526 | $ | 40,843 | $ | 174,284 | $ | 154,991 | ||||||||
GAAP operating loss | (11,203 | ) | (2,926 | ) | (19,054 | ) | (19,701 | ) | ||||||||
Deferred revenue fair value adjustment1 | 3,332 | 1,081 | 11,758 | 10,652 | ||||||||||||
Acquisition-related cost of revenue2 | (762 | ) | — | (1,921 | ) | — | ||||||||||
Business consolidation, transaction and restructuring costs3 | 6,583 | 1,538 | 7,845 | 7,772 | ||||||||||||
Stock-based compensation expense4 | 2,505 | 1,424 | 8,115 | 5,572 | ||||||||||||
Purchased intangible asset amortization5 | 5,199 | 4,638 | 17,782 | 18,239 | ||||||||||||
Non-GAAP operating income | $ | 5,654 | $ | 5,755 | $ | 24,525 | $ | 22,534 | ||||||||
Depreciation expense | 872 | 923 | 3,325 | 3,800 | ||||||||||||
Cash received for interest and royalty income | 2,002 | 2,269 | 9,265 | 9,574 | ||||||||||||
Cash (paid) for income taxes, net of refunds received | (198 | ) | (153 | ) | (2,690 | ) | 1,182 | |||||||||
Capital expenditures | (3,043 | ) | (934 | ) | (6,332 | ) | (3,908 | ) | ||||||||
Non-GAAP free cash flow | 5,287 | 7,860 | 28,093 | 33,182 | ||||||||||||
GAAP net income (loss) | $ | (8,229 | ) | $ | 14,205 | $ | (10,402 | ) | $ | 1,765 | ||||||
Deferred revenue fair value adjustment1 | 3,332 | 1,081 | 11,758 | 10,652 | ||||||||||||
Acquisition-related cost of revenue2 | (762 | ) | — | (1,921 | ) | — | ||||||||||
Business consolidation, transaction and restructuring costs 3 | 6,583 | 1,538 | 7,845 | 7,772 | ||||||||||||
Stock-based compensation expense4 | 2,505 | 1,424 | 8,115 | 5,572 | ||||||||||||
Purchased intangible asset amortization5 | 5,623 | 5,230 | 19,477 | 20,604 | ||||||||||||
Royalty income fair value adjustment6 | — | 200 | 600 | 803 | ||||||||||||
Amortization of note receivable discount7 | (270 | ) | — | (932 | ) | — | ||||||||||
Gain on sale of real estate8 | — | — | (2,744 | ) | — | |||||||||||
Gain on sale of equity method investment9 | — | (18,970 | ) | — | (18,970 | ) | ||||||||||
Sale of intangible assets10 | — | 4,303 | — | 4,303 | ||||||||||||
Other non-operating expense11 | — | — | 670 | — | ||||||||||||
Income tax12 | (4,239 | ) | (4,456 | ) | (12,855 | ) | (13,454 | ) | ||||||||
Non-GAAP net income | $ | 4,543 | $ | 4,555 | $ | 19,611 | $ | 19,047 | ||||||||
GAAP diluted net income (loss) per share | $ | (0.15 | ) | $ | 0.25 | $ | (0.19 | ) | $ | 0.03 | ||||||
Deferred revenue fair value adjustment1 | 0.06 | 0.02 | 0.21 | 0.19 | ||||||||||||
Acquisition-related cost of revenue2 | (0.01 | ) | — | (0.03 | ) | — | ||||||||||
Business consolidation, transaction and restructuring costs3 | 0.12 | 0.03 | 0.14 | 0.14 | ||||||||||||
Stock-based compensation expense4 | 0.04 | 0.03 | 0.14 | 0.10 | ||||||||||||
Purchased intangible asset amortization5 | 0.10 | 0.09 | 0.34 | 0.37 | ||||||||||||
Royalty income fair value adjustment6 | — | — | 0.01 | 0.01 | ||||||||||||
Amortization of note receivable discount7 | — | — | (0.02 | ) | — | |||||||||||
Gain on sale of real estate8 | — | — | (0.05 | ) | — | |||||||||||
Gain on sale of equity method investment9 | — | (0.34 | ) | — | (0.34 | ) | ||||||||||
Sale of intangible assets10 | — | 0.08 | — | 0.08 | ||||||||||||
Other non-operating expense11 | — | — | 0.01 | — | ||||||||||||
Income tax12 | (0.07 | ) | (0.08 | ) | (0.23 | ) | (0.24 | ) | ||||||||
Non-GAAP diluted net income per share13 | $ | 0.08 | $ | 0.08 | $ | 0.35 | $ | 0.34 | ||||||||
Weighted average shares used to compute net income per share: | ||||||||||||||||
Basic | 55,713 | 55,587 | 55,696 | 55,489 | ||||||||||||
Diluted | 56,848 | 55,933 | 56,563 | 56,037 |
1Deferred revenue fair value adjustment relates to our acquisitions of Aegis,
2Acquisition-related cost of revenue relates to our acquisition of
3Business consolidation, transaction and restructuring costs are included in the business consolidation, transaction and restructuring costs line in our consolidated statements of operations and consist of accounting, legal, litigation and other costs incurred in connection with our acquisition activities, including our merger with
4Stock-based compensation expense is included in our consolidated statements of operations as follows:
Three Months Ended | Year Ended | ||||||||||||||
|
December 31, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
Cost of revenue | $ | 262 | $ | 117 | $ | 755 | $ | 333 | |||||||
Product development | 517 | 313 | 1,763 | 1,136 | |||||||||||
Sales and marketing | 853 | 362 | 2,545 | 1,672 | |||||||||||
General and administrative | 867 | 620 | 3,093 | 2,428 | |||||||||||
Business consolidation, transaction and restructuring costs | 6 | 12 | (41 | ) | 3 | ||||||||||
Total stock-based compensation expense | $ | 2,505 | $ | 1,424 | $ | 8,115 | $ | 5,572 |
5Purchased intangible asset amortization is included in our consolidated statements of operations as follows:
Three Months Ended | Year Ended | ||||||||||||||
|
December 31, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
Amortization of completed technology | $ | 2,580 | $ | 2,135 | $ | 8,843 | $ | 8,393 | |||||||
Purchased intangible asset amortization | 2,619 | 2,503 | 8,939 | 9,846 | |||||||||||
Royalty and other income, net | 424 | 592 | 1,695 | 2,365 | |||||||||||
Total purchased intangible amortization expense | $ | 5,623 | $ | 5,230 | $ | 19,477 | $ | 20,604 |
6Royalty income fair value adjustment relates to our merger with
7Amortization of note receivable discount adjusts the amortization of the discount on our promissory note receivable from Intermolecular in connection with the sale of intellectual property in
8Gain on sale of real estate relates to the sale of real property, comprised of land and an office building located in
9Gain on sale of equity investment reflects the gain recognized upon the sale of our investment in Intermolecular in
10Sale of intangible asset reflects the write off of our cost basis in the intellectual property sold to Intermolecular in
11Other non-operating expense relates to the write off in
12Income tax adjustments relate to adjusting our non-GAAP operating results to reflect an effective tax rate of 40% that would be applied if the Company was in a taxable income position and was not able to utilize its net operating loss carryforwards. The income tax adjustment also excludes any impact of a release of our valuation allowance against deferred tax assets.
13Earnings per share amounts for the three months and year ended
Conference Call Details:
At
A replay of the conference call will be available online at www.accelrys.com and via telephone by dialing (855) 859-2056 (+1 (404) 537-3406 outside
About
Forward-Looking Statements:
Statements contained in this press release relating to the Company's or management's intentions, hopes, beliefs, expectations or predictions of the future, including, but not limited to, statements relating to the Company's expected non-GAAP revenue and diluted earnings per share for the year ending
ACCELRYS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts) (unaudited) |
||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||
|
December 31, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Revenue: | ||||||||||||||||
License and subscription revenue | 23,149 | $ | 21,231 | $ | 89,440 | $ | 79,425 | |||||||||
Maintenance on perpetual licenses | 10,035 | 9,301 | 38,254 | 34,862 | ||||||||||||
Content | 2,991 | 4,270 | 12,485 | 16,838 | ||||||||||||
Professional services and other | 8,019 | 4,960 | 22,347 | 13,214 | ||||||||||||
Total revenue | 44,194 | 39,762 | 162,526 | 144,339 | ||||||||||||
Cost of revenue: | ||||||||||||||||
Cost of revenue | 11,961 | 9,501 | 41,695 | 36,065 | ||||||||||||
Amortization of completed technology | 2,580 | 2,135 | 8,843 | 8,393 | ||||||||||||
Total cost of revenue | 14,541 | 11,636 | 50,538 | 44,458 | ||||||||||||
Gross profit | 29,653 | 28,126 | 111,988 | 99,881 | ||||||||||||
Operating expenses: | ||||||||||||||||
Product development | 9,892 | 8,779 | 38,849 | 33,977 | ||||||||||||
Sales and marketing | 17,528 | 14,173 | 57,971 | 51,517 | ||||||||||||
General and administrative | 4,229 | 4,047 | 17,480 | 16,467 | ||||||||||||
Business consolidation, transaction and restructuring costs | 6,588 | 1,550 | 7,803 | 7,775 | ||||||||||||
Purchased intangible asset amortization | 2,619 | 2,503 | 8,939 | 9,846 | ||||||||||||
Total operating expenses | 40,856 | 31,052 | 131,042 | 119,582 | ||||||||||||
Operating loss | (11,203 | ) | (2,926 | ) | (19,054 | ) | (19,701 | ) | ||||||||
Net gain on sale of cost method investment | — | 18,970 | — | 18,970 | ||||||||||||
Royalty and other income, including gain on sale of real estate, net | 1,763 | (3,259 | ) | 8,870 | 1,740 | |||||||||||
Income (loss) before income taxes | (9,440 | ) | 12,785 | (10,184 | ) | 1,009 | ||||||||||
Income tax expense (benefit) | (1,211 | ) | (1,420 | ) | 218 | (756 | ) | |||||||||
Net income (loss) | $ | (8,229 | ) | $ | 14,205 | $ | (10,402 | ) | $ | 1,765 | ||||||
Net income (loss) per share amounts: | ||||||||||||||||
Basic | $ | (0.15 | ) | $ | 0.26 | $ | (0.19 | ) | $ | 0.03 | ||||||
Diluted | $ | (0.15 | ) | $ | 0.25 | $ | (0.19 | ) | $ | 0.03 | ||||||
Weighted average shares used to compute net income (loss) per share: | ||||||||||||||||
Basic | 55,713 | 55,587 | 55,696 | 55,489 | ||||||||||||
Diluted | 55,713 | 55,933 | 55,696 | 56,037 | ||||||||||||
ACCELRYS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) |
|||||||
December 31, |
December 31, |
||||||
(unaudited) | (audited) | ||||||
Assets | |||||||
Cash, cash equivalents, and marketable securities1 | $ | 115,646 | $ | 143,624 | |||
Trade receivables, net | 47,196 | 40,706 | |||||
Notes receivable | 34,796 | 34,720 | |||||
Other assets, net2 | 208,204 | 188,836 | |||||
Total assets | $ | 405,842 | $ | 407,886 | |||
Liabilities and stockholders' equity | |||||||
Current liabilities, excluding deferred revenue | 37,877 | 36,582 | |||||
Deferred revenue, including current portion3 | 89,151 | 86,012 | |||||
Deferred gain, including current portion4 | 25,895 | 25,974 | |||||
Non-current liabilities, excluding deferred revenue and deferred gain5 | 10,098 | 10,634 | |||||
Total stockholders' equity | 242,821 | 248,684 | |||||
Total liabilities and stockholders' equity | $ | 405,842 | $ | 407,886 |
1Cash, cash equivalents, and marketable securities consist of the following line items in our consolidated balance sheet: Cash and cash equivalents; Restricted cash; Marketable securities; Marketable securities, net of current portion; and Restricted cash, net of current portion.
2Other assets, net, consists of the following line items in our consolidated balance sheet: Prepaid expenses, deferred tax assets and other current assets; Property and equipment, net; Goodwill; Purchased intangible assets, net; and Other assets.
3Total deferred revenue consists of the following line items in our consolidated balance sheet: Current portion of deferred revenue; and Deferred revenue, net of current portion.
4Total deferred gain consists of the following line items in our consolidated balance sheet: Current portion of deferred gain on sale of intellectual property; and Deferred gain on sale of intellectual property, net of current portion.
5Noncurrent liabilities, excluding deferred revenue and deferred gain consists of the following line items in our consolidated balance sheet: Accrued income tax; Accrued restructuring charges, net of current portion and Lease-related liabilities, net of current portion.
Executive Vice President &
Chief Financial Officer
858-799-5200
or
Investor Relations
323-468-2300
[email protected]
Source:
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