Attached files
Exhibit 99.1
| ITEM 6. | SELECTED FINANCIAL DATA |
The following table presents selected consolidated financial data for the periods indicated. The selected consolidated financial data set forth below should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and related notes included elsewhere in this report. Amounts shown are in thousands, except per share data. Certain non-operating expense amounts and certain balance sheet amounts have been adjusted from previously reported amounts to reflect the retrospective application of FSP APB 14-1.
| Years Ended December 31, | ||||||||||||||||||||
| 2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||||
| Consolidated Statement of Operations: |
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| Revenues: |
||||||||||||||||||||
| Software solutions |
$ | 46,852 | $ | 47,721 | $ | 76,243 | $ | 89,937 | $ | 54,155 | ||||||||||
| Services |
123,564 | 122,682 | 106,493 | 103,792 | 118,731 | |||||||||||||||
| Maintenance |
85,397 | 87,457 | 92,828 | 100,612 | 116,765 | |||||||||||||||
| Contract |
— | 2,450 | 4,113 | 42,526 | 72,877 | |||||||||||||||
| Total revenues |
255,813 | 260,310 | 279,677 | 336,867 | 362,528 | |||||||||||||||
| Costs and expenses: |
||||||||||||||||||||
| Cost of revenues: |
||||||||||||||||||||
| Software solutions |
9,316 | 8,567 | 12,862 | 14,720 | 20,137 | |||||||||||||||
| Services |
89,928 | 97,397 | 87,472 | 91,578 | 107,349 | |||||||||||||||
| Maintenance |
10,139 | 11,074 | 10,488 | 12,180 | 14,155 | |||||||||||||||
| Contract |
— | — | 311 | 1,575 | 4,718 | |||||||||||||||
| Amortization of acquired technology |
4 | 25 | 21 | — | 369 | |||||||||||||||
| Sales and marketing |
45,135 | 41,872 | 48,185 | 51,727 | 74,946 | |||||||||||||||
| Research and development |
29,241 | 33,513 | 35,200 | 37,337 | 56,279 | |||||||||||||||
| General and administrative |
42,062 | 37,770 | 56,129 | 61,117 | 71,646 | |||||||||||||||
| Amortization of intangibles |
100 | 78 | 17 | — | 39 | |||||||||||||||
| Restructuring charges and adjustments |
(95 | ) | 3,955 | (403 | ) | 11,269 | 2,688 | |||||||||||||
| Costs and expenses, subtotal |
225,830 | 234,251 | 250,282 | 281,503 | 352,326 | |||||||||||||||
| Intellectual property settlement, net |
(79,860 | ) | 921 | — | — | — | ||||||||||||||
| Total costs and expenses |
145,970 | 235,172 | 250,282 | 281,503 | 352,326 | |||||||||||||||
| Operating income |
109,843 | 25,138 | 29,395 | 55,364 | 10,202 | |||||||||||||||
| Non-operating income (expense), net: |
||||||||||||||||||||
| Interest income |
3,876 | 5,488 | 5,305 | 7,697 | 4,179 | |||||||||||||||
| Interest expense |
(7,473 | ) | (7,372 | ) | (8,395 | ) | (16,555 | ) | (17,873 | ) | ||||||||||
| Realized gains on investments, net |
— | — | 475 | 10,144 | 79 | |||||||||||||||
| Foreign currency hedge and transaction losses, net |
(1,700 | ) | (678 | ) | (219 | ) | (4,217 | ) | (3,212 | ) | ||||||||||
| (Loss) gain on early repayment of debt obligation |
— | — | — | (3,017 | ) | 2,223 | ||||||||||||||
| Other income (expense), net |
11,510 | (776 | ) | (434 | ) | (1,514 | ) | (1,069 | ) | |||||||||||
| Total non-operating income (expense), net |
6,213 | (3,338 | ) | (3,268 | ) | (7,462 | ) | (15,673 | ) | |||||||||||
| Income (loss) before income taxes |
116,056 | 21,800 | 26,127 | 47,902 | (5,471 | ) | ||||||||||||||
| Provision (benefit) for income taxes |
8,382 | 6,133 | 3,821 | 4,664 | (674 | ) | ||||||||||||||
| Income (loss) from continuing operations |
107,674 | 15,667 | 22,306 | 43,238 | (4,797 | ) | ||||||||||||||
| Income from discontinued operations |
— | — | — | 43,884 | 3,445 | |||||||||||||||
| Net income (loss) |
107,674 | 15,667 | 22,306 | 87,122 | (1,352 | ) | ||||||||||||||
| Preferred stock dividend and accretion of discount |
3,140 | 3,071 | 2,940 | 3,020 | 1,720 | |||||||||||||||
| Net income (loss) applicable to common stockholders |
$ | 104,534 | $ | 12,596 | $ | 19,366 | $ | 84,102 | $ | (3,072 | ) | |||||||||
| Net income (loss) per common share applicable to common stockholders: |
||||||||||||||||||||
| Total |
||||||||||||||||||||
| Basic |
$ | 3.97 | $ | 0.49 | $ | 0.76 | $ | 3.49 | $ | (0.17 | ) | |||||||||
| Diluted |
$ | 3.91 | $ | 0.47 | $ | 0.75 | $ | 3.44 | $ | (0.17 | ) | |||||||||
| Discontinued operations |
||||||||||||||||||||
| Basic |
$ | — | $ | — | $ | — | $ | 1.82 | $ | 0.19 | ||||||||||
| Diluted |
$ | — | $ | — | $ | — | $ | 1.80 | $ | 0.19 | ||||||||||
| Continuing operations including preferred stock dividend and accretion of discount |
||||||||||||||||||||
| Basic |
$ | 3.97 | $ | 0.49 | $ | 0.76 | $ | 1.67 | $ | (0.36 | ) | |||||||||
| Diluted |
$ | 3.91 | $ | 0.47 | $ | 0.75 | $ | 1.64 | $ | (0.36 | ) | |||||||||
| Weighted-average common shares outstanding: |
||||||||||||||||||||
| Basic |
26,333 | 25,816 | 25,328 | 24,084 | 18,004 | |||||||||||||||
| Diluted |
26,711 | 26,748 | 25,883 | 24,469 | 18,004 | |||||||||||||||
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| December 31, | ||||||||||||||||||
| 2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||||||
| Balance Sheet Data |
||||||||||||||||||
| Cash and cash equivalents |
$ | 238,013 | $ | 120,978 | $ | 109,419 | $ | 112,882 | $ | 133,273 | ||||||||
| Restricted cash |
$ | 5,777 | $ | 8,456 | $ | 4,626 | $ | 4,773 | $ | 7,717 | ||||||||
| Short-term investments |
$ | — | $ | — | $ | — | $ | — | $ | 144,532 | ||||||||
| Working capital |
$ | 187,435 | $ | 63,565 | $ | 17,368 | $ | (34,336 | ) | $ | 101,152 | |||||||
| Total assets |
$ | 313,025 | $ | 201,005 | $ | 188,563 | $ | 200,523 | $ | 390,673 | ||||||||
| Total long-term debt |
$ | 64,520 | $ | 61,362 | $ | 58,307 | $ | 50,565 | $ | 316,800 | ||||||||
| Total redeemable preferred stock |
$ | 106,591 | $ | 103,450 | $ | 101,686 | $ | 100,065 | $ | 97,045 | ||||||||
| Total stockholders’ equity (deficit) |
$ | 149,879 | $ | 36,436 | $ | (1,329 | ) | $ | (47,450 | ) | $ | (173,033 | ) | |||||
| Cash, cash equivalents, restricted cash, short-term and long-term investments |
$ | 243,790 | $ | 129,434 | $ | 114,045 | $ | 117,655 | $ | 285,522 | ||||||||
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The following tables set forth unaudited consolidated quarterly statements of operations data for the years ended December 31, 2008 and 2007. Amounts shown are in thousands, except per share data. Certain non-operating expense amounts have been adjusted from previously reported amounts to reflect the retrospective application of FSP APB 14-1.
| March 31, 2008 |
June 30, 2008 |
September 30, 2008 |
December 31, 2008 |
|||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||
| Revenues: |
||||||||||||||||
| Software solutions |
$ | 11,672 | $ | 12,569 | $ | 10,562 | $ | 12,049 | ||||||||
| Services |
28,842 | 30,508 | 33,316 | 30,898 | ||||||||||||
| Maintenance |
22,063 | 21,651 | 20,875 | 20,808 | ||||||||||||
| Contract |
— | — | — | — | ||||||||||||
| Total revenues |
62,577 | 64,728 | 64,753 | 63,755 | ||||||||||||
| Costs and expenses: |
||||||||||||||||
| Cost of revenues: |
||||||||||||||||
| Software solutions |
2,615 | 2,874 | 2,296 | 1,531 | ||||||||||||
| Services |
22,471 | 23,624 | 22,218 | 21,615 | ||||||||||||
| Maintenance |
2,843 | 2,655 | 2,368 | 2,273 | ||||||||||||
| Sales and marketing |
11,950 | 13,072 | 10,518 | 9,595 | ||||||||||||
| Research and development |
7,633 | 7,541 | 7,384 | 6,683 | ||||||||||||
| General and administrative |
9,513 | 10,919 | 9,402 | 12,232 | ||||||||||||
| Amortization of intangibles |
25 | 25 | 25 | 25 | ||||||||||||
| Restructuring charges and adjustments |
— | — | — | (95 | ) | |||||||||||
| Costs and expenses, subtotal |
57,050 | 60,710 | 54,211 | 53,859 | ||||||||||||
| Intellectual property settlement, net |
1,455 | (81,315 | ) | — | — | |||||||||||
| Total costs and expenses (benefit) |
58,505 | (20,605 | ) | 54,211 | 53,859 | |||||||||||
| Operating income |
4,072 | 85,333 | 10,542 | 9,896 | ||||||||||||
| Non-operating income (expense), net: |
||||||||||||||||
| Interest income |
1,194 | 932 | 1,212 | 538 | ||||||||||||
| Interest expense |
(1,860 | ) | (1,864 | ) | (1,872 | ) | (1,877 | ) | ||||||||
| Foreign currency hedge and transaction losses, net |
(141 | ) | (464 | ) | (639 | ) | (456 | ) | ||||||||
| Other income (expense), net |
717 | (236 | ) | (5,575 | ) | 16,604 | ||||||||||
| Total non-operating income (expense), net |
(90 | ) | (1,632 | ) | (6,874 | ) | 14,809 | |||||||||
| Income before income taxes |
3,982 | 83,701 | 3,668 | 24,705 | ||||||||||||
| Income tax expense |
1,127 | 2,714 | 1,508 | 3,033 | ||||||||||||
| Net income |
$ | 2,855 | $ | 80,987 | $ | 2,160 | $ | 21,672 | ||||||||
| Preferred stock dividend and accretion of discount |
776 | 776 | 794 | 794 | ||||||||||||
| Net income applicable to common stockholders |
$ | 2,079 | $ | 80,211 | $ | 1,366 | $ | 20,878 | ||||||||
| Net income per common share applicable to common stockholders: |
||||||||||||||||
| Basic |
$ | 0.08 | $ | 3.07 | $ | 0.05 | $ | 0.79 | ||||||||
| Diluted |
$ | 0.08 | $ | 3.03 | $ | 0.05 | $ | 0.78 | ||||||||
| Weighted-average common shares outstanding: |
||||||||||||||||
| Basic |
26,055 | 26,105 | 26,337 | 26,596 | ||||||||||||
| Diluted |
26,441 | 26,475 | 26,851 | 26,784 | ||||||||||||
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| March 31, 2007 |
June 30, 2007 |
September 30, 2007 |
December 31, 2007 |
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| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||
| Revenues: |
||||||||||||||||
| Software solutions |
$ | 13,433 | $ | 11,412 | $ | 10,522 | $ | 12,354 | ||||||||
| Services |
28,695 | 31,553 | 33,365 | 29,069 | ||||||||||||
| Maintenance |
21,009 | 22,018 | 22,571 | 21,859 | ||||||||||||
| Contract |
2,450 | — | — | — | ||||||||||||
| Total revenues |
65,587 | 64,983 | 66,458 | 63,282 | ||||||||||||
| Costs and expenses: |
||||||||||||||||
| Cost of revenues: |
||||||||||||||||
| Software solutions |
2,474 | 2,175 | 2,066 | 1,852 | ||||||||||||
| Services |
23,843 | 24,467 | 24,752 | 24,335 | ||||||||||||
| Maintenance |
2,937 | 2,800 | 2,668 | 2,669 | ||||||||||||
| Sales and marketing |
11,698 | 12,957 | 7,928 | 9,289 | ||||||||||||
| Research and development |
8,805 | 8,750 | 8,224 | 7,734 | ||||||||||||
| General and administrative |
10,387 | 10,535 | 8,839 | 8,112 | ||||||||||||
| Restructuring charges and adjustments |
(25 | ) | (49 | ) | 3,921 | 108 | ||||||||||
| Costs and expenses, subtotal |
60,119 | 61,635 | 58,398 | 54,099 | ||||||||||||
| Intellectual property settlement, net |
— | 45 | 456 | 420 | ||||||||||||
| Total costs and expenses |
60,119 | 61,680 | 58,854 | 54,519 | ||||||||||||
| Operating income |
5,468 | 3,303 | 7,604 | 8,763 | ||||||||||||
| Non-operating expense, net: |
||||||||||||||||
| Interest income |
1,346 | 1,302 | 1,413 | 1,427 | ||||||||||||
| Interest expense |
(1,837 | ) | (1,839 | ) | (1,845 | ) | (1,851 | ) | ||||||||
| Foreign currency hedge and transaction losses, net |
(117 | ) | (74 | ) | (107 | ) | (380 | ) | ||||||||
| Other expense, net |
(255 | ) | (134 | ) | (203 | ) | (184 | ) | ||||||||
| Total non-operating expense, net |
(863 | ) | (745 | ) | (742 | ) | (988 | ) | ||||||||
| Income before income taxes |
4,605 | 2,558 | 6,862 | 7,775 | ||||||||||||
| Income tax expense |
859 | 740 | 2,057 | 2,477 | ||||||||||||
| Net income |
$ | 3,746 | $ | 1,818 | $ | 4,805 | $ | 5,298 | ||||||||
| Preferred stock dividend and accretion of discount |
757 | 765 | 773 | 776 | ||||||||||||
| Net income applicable to common stockholders |
$ | 2,989 | $ | 1,053 | $ | 4,032 | $ | 4,522 | ||||||||
| Net income per common share applicable to common stockholders: |
||||||||||||||||
| Basic |
$ | 0.12 | $ | 0.04 | $ | 0.16 | $ | 0.17 | ||||||||
| Diluted |
$ | 0.11 | $ | 0.04 | $ | 0.15 | $ | 0.17 | ||||||||
| Weighted-average common shares outstanding: |
||||||||||||||||
| Basic |
25,610 | 25,770 | 25,900 | 25,985 | ||||||||||||
| Diluted |
26,954 | 26,806 | 26,541 | 26,587 | ||||||||||||
Amortization of intangibles is not material and is included in general and administrative expense.
4