Attached files
| file | filename |
|---|---|
| 8-K - 8-K - KENEXA CORP | form8-k.htm |
| EX-99.2 - CONFERENCE CALL SCRIPT - KENEXA CORP | exhibit99-2.htm |
EXHIBIT 99.1
|
Kenexa Announces Financial Results for Second Quarter 2012
Second quarter revenue and profitability exceeded high end of our guidance
2012 revenue and non-GAAP profitability guidance increased
|
WAYNE, Pa. – August 7, 2012 – Kenexa (NYSE: KNXA), a global provider of business solutions for human resources, today announced operating results for the second quarter, ended June 30, 2012.
For the second quarter of 2012, Kenexa reported total GAAP revenue of $86.3 million. Non-GAAP revenue, which eliminates the GAAP adjustment to deferred revenue resulting from certain acquisitions, was $88.2 million for the second quarter of 2012, an increase of 24% compared to $71.3 million for the second quarter of 2011. Within total non-GAAP revenue, subscription revenue was $64.1 million for the second quarter of 2012, an increase of 23% compared with $52.2 million in the second quarter of 2011. Professional services and other revenue was $24.1 million for the second quarter of 2012, an increase of 26% compared to $19.1 million for the second quarter of 2011.
“We continued our strong operational performance in the second quarter with both revenue and non-GAAP profitability exceeding our guidance,” said Rudy Karsan, Chief Executive Officer of Kenexa. “While the economic environment remains volatile, HR executives are feeling increasing pressure from the C-level suite to transform their company’s workforce with improved talent and productivity levels. The short supply and significant demand for skilled knowledge workers is a growing challenge, and we see global organizations looking for a strategic HR partner to help them achieve their business goals. Kenexa is benefitting from this trend based on our highly differentiated value proposition based on our best-in-class SaaS platform, proprietary data and services.”
Karsan added, “We are increasing our revenue guidance for the full year 2012 based on the strength of our second quarter results and our ongoing business momentum. In addition, the growing number of blue chip customer wins for our Kenexa 2x SaaS platform and efficiency gains with our RPO customers are driving leverage in our business and contributing to our increased non-GAAP profitability guidance for 2012.”
A reconciliation of GAAP to non-GAAP results has been provided in the financial statement tables included at the end of this press release. An explanation of these measures is also included below under the heading “Non-GAAP Financial Measures.”
Non-GAAP income from operations was $9.8 million for the three months ended June 30, 2012. This represented an 11.1% non-GAAP operating margin and an increase of 53% compared to non-GAAP income from operations of $6.4 million for the three months ended June 30, 2011.
Non-GAAP net income available to common shareholders was $7.6 million for the three months ended June 30, 2012, compared to $4.7 million for the three months ended June 30, 2011. Non-GAAP net income available to common shareholders was $0.27 per diluted share for the second quarter of 2012, above the Company’s guidance of $0.22 to $0.23 and based on 28.3 million weighted average shares outstanding. Non-GAAP net income available to common shareholders was $0.18 per diluted share for the second quarter of 2011, based on 25.8 million weighted average shares outstanding.
Kenexa’s loss from operations for the three months ended June 30, 2012, determined in accordance with GAAP, was $116 thousand, compared to income from operations of $416 thousand for the same period of 2011. GAAP net loss allocable to common shareholders was approximately $1.7 million, or ($0.06) per basic and diluted shares for the three months ended June 30, 2012, compared to net loss of $1.6 million, or ($0.06) per basic and diluted share, in the same period of 2011.
Kenexa had cash, cash equivalents and investments of $89.7 million at June 30, 2012, compared to $83.0 million at the end of the prior quarter. The Company generated $17.2 million in cash from operations for the second quarter and used $8.5 million associated with capital expenditures and capitalized investments. Deferred revenue was $96.4 million at June 30, 2012, an increase of 14% from June 30, 2011.
Other Second Quarter and Recent Highlights
|
·
|
More than 100 “preferred partner” customers were added during the second quarter (defined as customers that spend more than $50,000 annually), an increase from the over 50 preferred partner customer additions in the year ago period.
|
|
·
|
The average annualized revenue from the company’s top 80 customers, or P-cubed metric, was greater than $1.9 million in the second quarter of 2012, an increase from the over $1.5 million level in the second quarter of 2011.
|
|
·
|
Announced the launch of Kenexa Hot Lava Mobile 3.0, a leading mobile solution used to develop, manage and analyze the results of independent device communications, snack learning, performance support, sales enablement and surveys. The launch of Hot Lava Mobile 3.0 marks Kenexa’s entry into the mobile learning marketplace. Kenexa added Hot Lava Mobile to its integrated human capital management product suite in February as part of its acquisition of OutStart.
|
Business Outlook
Based on information as of today, August 7, 2012, the Company is issuing financial guidance as follows:
Third Quarter 2012*: The Company expects GAAP revenue to be $90.7 million to $93.7 million. Excluding the GAAP adjustment to deferred revenue resulting from certain acquisitions, the Company expects non-GAAP revenue to be $92 million to $95 million, and non-GAAP operating income to be $11 million to $12 million. Assuming an effective tax rate for reporting purposes of approximately 20% and approximately 28.4 million shares outstanding, Kenexa expects its non-GAAP net income per diluted share to be $0.29 to $0.32.
Full Year 2012*: The Company expects GAAP revenue to be $352 million to $359 million. Excluding the GAAP adjustment to deferred revenue, the Company expects non-GAAP revenue to be $359 million to $366 million, and non-GAAP operating income to be $40 million to $43 million. Assuming an effective tax rate for reporting purposes of approximately 20% and approximately 28.3 million shares outstanding, Kenexa expects its non-GAAP net income per diluted share to be $1.07 to $1.16.
* Kenexa’s non-GAAP guidance excludes stock-based compensation expense, amortization of acquired intangibles, acquisition-related fees, contingent consideration adjustment, the purchase accounting reduction for Salary.com’s and OutStart’s revenue, and accretion associated with a variable interest entity.
Conference Call Information
Kenexa will host a conference call today, August 7, 2012, at 5:00 p.m. (Eastern Time) to discuss the Company's financial results. To access this call, dial 877-705-6003 (domestic) or 201-493-6725 (international). A replay of this conference call will be available through August 14, 2012, at 877-870-5176 (domestic) or 858-384-5517 (international). The replay passcode is 396968. A live webcast of this conference call will be available on the "Investor Relations" page of the Company's Web site, (www.kenexa.com) and a replay will be archived on the Web site as well.
Forward-Looking Statements
This press release includes certain “forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, plans, objectives, expectations and intentions and other statements contained in this press release that are not historical facts and statements identified by words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates" or words of similar meaning. These statements may contain, among other things, guidance as to future revenue and earnings, operations, expected benefits from acquisitions, prospects of the business generally, intellectual property and the development of products. These statements are based on our current beliefs or expectations and are inherently subject to various risks and uncertainties, including those set forth under the caption "Risk Factors" in Kenexa’s most recent Annual Report on Form 10-K as filed with the Securities and Exchange Commission and as revised or supplemented by Kenexa’s quarterly reports on Form 10-Q. Actual results may differ materially from these expectations due to changes in global political, economic, business, competitive, market and regulatory factors, Kenexa’s ability to implement business and acquisition strategies or to complete or integrate acquisitions. Kenexa does not undertake any obligation to update any forward-looking statements contained in this document as a result of new information, future events or otherwise.
Non-GAAP Financial Measures
This press release contains non-GAAP financial measures. Kenexa believes that non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to Kenexa’s financial condition and results of operations. The Company’s management uses these non-GAAP results to compare the Company’s performance to that of prior periods for trend analyses, for purposes of determining executive incentive compensation, and for budget and planning purposes. These measures are used in monthly financial reports prepared for management and in quarterly financial reports presented to the Company’s Board of Directors. The Company 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 measures with other companies in the Company’s industry, many of which present similar non-GAAP financial measures to investors.
Management of the Company does not consider such non-GAAP measures in isolation or as an alternative to such measures determined in accordance with GAAP. The principal limitation of such non-GAAP financial measures is that they exclude significant expenses that are required by GAAP to be recorded. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which charges are excluded from the non-GAAP financial measures.
In order to compensate for these limitations, management of the Company presents its non-GAAP financial measures in connection with its GAAP results. Kenexa urges investors and potential investors in the Company’s securities to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures which it includes in press releases announcing earnings information, including this press release, and not to rely on any single financial measure to evaluate the Company’s business.
We have not provided a reconciliation of forward-looking non-GAAP financial measures to the directly comparable GAAP measures because, due primarily to variability and difficulty in making accurate forecasts and projections, not all of the information necessary for a quantitative reconciliation is available to us without unreasonable efforts.
Kenexa presents certain non-GAAP financial measures as set forth in the tables below and may exclude the following:
Non-GAAP revenue. Non-GAAP revenue consists of GAAP revenue and the effect of the write down of the deferred revenue associated with purchase accounting for certain acquisitions. This effect is added back to GAAP revenue because the Company believes its inclusion provides a more accurate depiction of total revenue.
Share-based compensation expense. Share-based compensation expense consists of expenses for stock options and stock awards in accordance with ASC 718. Share-based compensation expenses are excluded in the Company’s non-GAAP financial measures because share-based compensation amounts are difficult to forecast. This is due in part to the magnitude of the charges which depends upon the volume and timing of stock option grants, which are unpredictable and can vary dramatically from period to period, and external factors such as interest rates and the trading price and volatility of the Company’s common stock. The Company believes that this exclusion provides meaningful supplemental information regarding the Company’s operating results because these non-GAAP financial measures facilitate the comparison of results for future periods with results from past periods. The dilutive effect of all outstanding options is included in the calculation of diluted earnings per share on both a GAAP and a non-GAAP basis.
Amortization of acquired intangible assets. In accordance with GAAP, operating expenses include amortization of acquired intangible assets which are amortized over the estimated useful lives of such assets. Amortization of acquired intangible assets is excluded from the Company’s non-GAAP financial measures because the Company believes that such exclusion facilitates comparisons to its historical operating results and to the results of other companies in the same industry, which have their own unique acquisition histories.
Acquisition-related fees. In accordance with ASC 805, Business Combinations, acquisition-related fees including advisory, legal, accounting and other professional fees are reported as expense in the periods in which the costs are incurred and the services are received. Acquisition-related fees include legal, travel, and other fees not expected to recur from our acquisitions. Acquisition-related fees are excluded in the non-GAAP financial measures because we believe that such exclusion facilitates comparisons to our historical operating results and to the results of other companies in the same industry, which have their own unique acquisition histories.
Contingent consideration adjustment. In accordance with ASC 805, Business Combinations, contingent consideration adjustments may result from changes in the preliminary earnout calculation or changes in the forecasted projections. Contingent consideration adjustments are excluded in the non-GAAP financial measures because we believe that such exclusion facilitates comparisons to our historical operating results and to the results of other companies in the same industry, which have their own unique acquisition histories.
Taleo settlement and nonrecurring litigation charges. Settlement proceeds and nonrecurring litigation fees are excluded in the non-GAAP financial measures due to their infrequent and or unusual nature. The Company believes that excluding these amounts provides meaningful supplemental information regarding the Company’s operating results because these non-GAAP financial measures facilitate the comparison of results for future periods with results from past periods.
Accretion of variable interest entity. In accordance with ASC 810, Variable Interest Entities, the Chinese joint venture is subject to periodic adjustment in its value. The accretion of the variable interest entity is excluded in the non-GAAP financial measures because the Company believes that such exclusion facilitates comparisons to its historical operating results and to the results of other companies in the same industry, which have their own unique acquisition histories.
Non-GAAP tax. Non-GAAP estimated tax adjustment is applied to the non-GAAP net income for purposes of determining the non-GAAP income allocable to common shareholders. The Company believes including this adjustment is important to determine non-GAAP income allocable to common shareholders since it depicts a more meaningful measure of the Company’s non-GAAP results.
About Kenexa
Kenexa (NYSE:KNXA) helps drive HR and business outcomes through its unique combination of technology, content and services. Enabling organizations to optimize their workforces since 1987, Kenexa’s integrated talent acquisition and talent management solutions have touched the lives of more than 110 million people. Additional information about Kenexa and its global products and services can be accessed at www.kenexa.com. Follow Kenexa on Twitter: @kenexa.
# # #
Note to editors: Trademarks and registered trademarks referenced herein remain the property of their respective owners.
Contact
MEDIA CONTACT:
|
Mark Derowitsch
Kenexa
(402) 419-5216
mark.derowitsch@kenexa.com
|
INVESTOR CONTACT:
Brian Denyeau
ICR
(646) 277-1251
brian.denyeau@icrinc.com
Kenexa Corporation and Subsidiaries
Consolidated Balance Sheets
(In thousands, except share and per share data)
|
June 30,
|
December 31,
|
|||||||
|
2012
|
2011
|
|||||||
|
(unaudited)
|
||||||||
|
ASSETS
|
||||||||
|
Current assets:
|
||||||||
|
Cash and cash equivalents
|
$ | 82,758 | $ | 67,459 | ||||
|
Short-term investments
|
6,930 | 51,807 | ||||||
|
Accounts receivable, net of allowance for doubtful accounts of $2,646 and $3,045
|
58,609 | 52,664 | ||||||
|
Unbilled receivables
|
4,506 | 3,385 | ||||||
|
Income tax receivable
|
76 | 196 | ||||||
|
Deferred income taxes
|
6,442 | 5,477 | ||||||
|
Prepaid expenses and other current assets
|
13,439 | 9,555 | ||||||
|
Total current assets
|
172,760 | 190,543 | ||||||
|
Long-term investments
|
- | 9,710 | ||||||
|
Property and equipment, net
|
20,799 | 18,632 | ||||||
|
Software, net
|
30,643 | 27,179 | ||||||
|
Goodwill
|
67,343 | 43,265 | ||||||
|
Intangible assets, net
|
83,732 | 73,074 | ||||||
|
Deferred income taxes, non-current
|
29,867 | 35,092 | ||||||
|
Deferred financing costs, net
|
248 | 354 | ||||||
|
Other long-term assets
|
7,704 | 7,795 | ||||||
|
Total assets
|
$ | 413,096 | $ | 405,644 | ||||
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
|
Current liabilities:
|
||||||||
|
Accounts payable
|
$ | 11,519 | $ | 7,909 | ||||
|
Notes payable, current
|
11 | 11 | ||||||
|
Term loan, current
|
5,000 | 5,000 | ||||||
|
Commissions payable
|
4,302 | 3,673 | ||||||
|
Accrued compensation and benefits
|
15,518 | 18,061 | ||||||
|
Other accrued liabilities
|
15,655 | 13,970 | ||||||
|
Deferred revenue
|
90,528 | 81,795 | ||||||
|
Capital lease obligations
|
416 | 282 | ||||||
|
Total current liabilities
|
142,949 | 130,701 | ||||||
|
Revolving credit line and term loan
|
22,500 | 25,000 | ||||||
|
Capital lease obligations, less current portion
|
360 | 218 | ||||||
|
Deferred revenue, less current portion
|
5,908 | 7,042 | ||||||
|
Deferred income taxes
|
1,310 | 1,823 | ||||||
|
Other long-term liabilities
|
4,490 | 5,330 | ||||||
|
Total liabilities
|
177,517 | 170,114 | ||||||
|
Commitments and Contingencies
|
||||||||
|
Temporary equity
|
||||||||
|
Noncontrolling interest
|
4,804 | 4,990 | ||||||
|
Shareholders' equity
|
||||||||
|
Preferred stock, $0.01 par value; authorized 10,000,000 shares; issued and outstanding: none
|
- | - | ||||||
|
Common stock, par value $0.01; authorized 100,000,000 shares; shares issued and outstanding: 27,387,715 and 27,124,276, respectively
|
274 | 271 | ||||||
|
Additional paid-in-capital
|
390,916 | 385,511 | ||||||
|
Accumulated deficit
|
(153,554 | ) | (149,376 | ) | ||||
|
Accumulated other comprehensive loss
|
(6,861 | ) | (5,866 | ) | ||||
|
Total shareholders' equity
|
230,775 | 230,540 | ||||||
|
Total liabilities and shareholders' equity
|
$ | 413,096 | $ | 405,644 | ||||
Kenexa Corporation and Subsidiaries
Consolidated Statements of Operations
(Unaudited; in thousands, except share and per share data)
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
|
2012
|
2011
|
2012
|
2011
|
|||||||||||||
|
Revenues:
|
||||||||||||||||
|
Subscription
|
$ | 62,213 | $ | 49,867 | $ | 117,549 | $ | 96,070 | ||||||||
|
Other
|
24,071 | 19,148 | 46,537 | 32,923 | ||||||||||||
|
Total revenues
|
86,284 | 69,015 | 164,086 | 128,993 | ||||||||||||
|
Cost of revenues
|
33,121 | 26,867 | 65,390 | 50,212 | ||||||||||||
|
Gross profit
|
53,163 | 42,148 | 98,696 | 78,781 | ||||||||||||
|
Operating expenses:
|
||||||||||||||||
|
Sales and marketing
|
20,207 | 15,688 | 37,740 | 29,963 | ||||||||||||
|
General and administrative
|
14,533 | 13,219 | 28,600 | 25,967 | ||||||||||||
|
Research and development
|
7,546 | 4,819 | 13,978 | 9,264 | ||||||||||||
|
Depreciation and amortization
|
10,993 | 8,006 | 21,516 | 15,924 | ||||||||||||
|
Total operating expenses
|
53,279 | 41,732 | 101,834 | 81,118 | ||||||||||||
|
(Loss) income from operations
|
(116 | ) | 416 | (3,138 | ) | (2,337 | ) | |||||||||
|
Interest expense, net
|
(321 | ) | (344 | ) | (605 | ) | (784 | ) | ||||||||
|
Gain (loss) on change in fair market value of investments, net
|
41 | (264 | ) | 41 | (264 | ) | ||||||||||
|
Loss before income taxes
|
(396 | ) | (192 | ) | (3,702 | ) | (3,385 | ) | ||||||||
|
Income tax expense
|
(1,328 | ) | (596 | ) | (660 | ) | (570 | ) | ||||||||
|
Net loss
|
$ | (1,724 | ) | $ | (788 | ) | $ | (4,362 | ) | $ | (3,955 | ) | ||||
|
(Income) loss allocated to noncontrolling interest
|
- | (149 | ) | 184 | (149 | ) | ||||||||||
|
Accretion associated with variable interest entity
|
- | (652 | ) | - | (652 | ) | ||||||||||
|
Net loss allocable to common shareholders'
|
$ | (1,724 | ) | $ | (1,589 | ) | $ | (4,178 | ) | $ | (4,756 | ) | ||||
|
Basic and diluted net loss per share
|
$ | (0.06 | ) | $ | (0.06 | ) | $ | (0.15 | ) | $ | (0.20 | ) | ||||
|
Weighted average common shares - basic & diluted
|
27,330,887 | 24,876,801 | 27,255,857 | 23,964,869 | ||||||||||||
Kenexa Corporation and Subsidiaries
Reconciliation of GAAP to Non-GAAP Financial Measures
(Unaudited; in thousands, except share and per share data)
|
Three Months Ended June 30,
|
||||||||
|
2012
|
2011
|
|||||||
|
Revenue and Gross Profit:
|
||||||||
|
GAAP subscription revenue
|
$
|
62,213
|
$
|
49,867
|
||||
|
Deferred revenue associated with acquisitions
|
1,883
|
2,298
|
||||||
|
Non-GAAP subscription revenue
|
64,096
|
52,165
|
||||||
|
Other revenue
|
24,071
|
19,148
|
||||||
|
Non-GAAP revenue
|
$
|
88,167
|
$
|
71,313
|
||||
|
GAAP cost of revenues
|
$
|
33,121
|
$
|
26,867
|
||||
|
Share-based compensation expense
|
102
|
72
|
||||||
|
Cost of revenue adjustment
|
102
|
72
|
||||||
|
Non-GAAP gross profit
|
$
|
55,148
|
$
|
44,518
|
||||
|
Expenses:
|
||||||||
|
GAAP operating expenses
|
$
|
53,279
|
$
|
41,732
|
||||
|
Share-based compensation expense
|
(2,331)
|
(1,587)
|
||||||
|
Amortization of acquired intangibles
|
(5,838)
|
(3,583)
|
||||||
|
Acquisition-related fees
|
17
|
(76)
|
||||||
|
BHI contingent consideration adjustment
|
224
|
-
|
||||||
|
Taleo settlement
|
-
|
3,000
|
||||||
|
Nonrecurring litigation charges
|
-
|
(1,416)
|
||||||
|
Total operating expense adjustment
|
(7,928)
|
(3,662)
|
||||||
|
Non-GAAP operating expenses
|
$
|
45,351
|
$
|
38,070
|
||||
|
Results:
|
||||||||
|
GAAP (loss) income from operations
|
$
|
(116)
|
$
|
416
|
||||
|
Deferred revenue associated with acquisitions
|
1,883
|
2,298
|
||||||
|
Cost of revenue adjustment
|
102
|
72
|
||||||
|
Operating expense adjustment
|
7,928
|
3,662
|
||||||
|
Non-GAAP income from operations
|
$
|
9,797
|
$
|
6,448
|
||||
|
GAAP net loss allocable to common shareholders'
|
$
|
(1,724)
|
$
|
(1,589)
|
||||
|
Deferred revenue associated with acquisitions
|
1,883
|
2,298
|
||||||
|
Cost of revenue adjustment
|
102
|
72
|
||||||
|
Operating expense adjustment
|
7,928
|
3,662
|
||||||
|
Accretion associated with variable interest entity
|
-
|
652
|
||||||
|
Non-GAAP net income allocated to common shareholders'
|
$
|
8,189
|
$
|
5,095
|
||||
|
Non-GAAP estimated income tax adjustment
|
(575)
|
(437)
|
||||||
|
Non-GAAP net income allocated to common shareholders' after tax adjustment
|
$
|
7,614
|
$
|
4,658
|
||||
|
GAAP basic net loss per share
|
$
|
(0.06)
|
$
|
(0.06)
|
||||
|
Non-GAAP basic net income per share
|
$
|
0.28
|
$
|
0.19
|
||||
|
GAAP diluted net loss per share
|
$
|
(0.06)
|
$
|
(0.06)
|
||||
|
Non-GAAP diluted net income per share
|
$
|
0.27
|
$
|
0.18
|
||||
|
Weighted average shares - basic
|
27,330,887
|
24,876,801
|
||||||
|
Dilutive effect of options and restricted stock
|
955,629
|
962,061
|
||||||
|
Weighted average shares - diluted
|
28,286,516
|
25,838,862
|
||||||
Kenexa Corporation and Subsidiaries
Reconciliation of GAAP to Non-GAAP Financial Measures
(Unaudited; in thousands, except share and per share data)
|
Three Months Ended June 30,
|
||||||||
|
2012
|
2011
|
|||||||
|
Classification of non-GAAP measures:
|
||||||||
|
Gross profit
|
$
|
53,163
|
$
|
42,148
|
||||
|
Add: share-based compensation expense
|
102
|
72
|
||||||
|
Add: deferred revenue associated with acquisitions
|
1,883
|
2,298
|
||||||
|
Non-GAAP gross profit
|
$
|
55,148
|
$
|
44,518
|
||||
|
Sales and marketing
|
$
|
20,207
|
$
|
15,688
|
||||
|
Less: share-based compensation expense
|
(419)
|
(282)
|
||||||
|
Non-GAAP sales and marketing
|
$
|
19,788
|
$
|
15,406
|
||||
|
General and administrative
|
$
|
14,533
|
$
|
13,219
|
||||
|
Less: share-based compensation expense
|
(1,740)
|
(1,169)
|
||||||
|
Less: acquisition-related fees
|
17
|
(76)
|
||||||
|
Add: BHI contingent consideration adjustment
|
224
|
-
|
||||||
|
Add: net litigation settlement
|
1,584
|
|||||||
|
Non-GAAP general and administrative
|
$
|
13,034
|
$
|
13,558
|
||||
|
Research and development
|
$
|
7,546
|
$
|
4,819
|
||||
|
Less: share-based compensation expense
|
(172)
|
(136)
|
||||||
|
Non-GAAP research and development
|
$
|
7,374
|
$
|
4,683
|
||||
Kenexa Corporation and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited; in thousands)
|
Six months ended June 30,
|
||||||||
|
2012
|
2011
|
|||||||
|
Cash flows from operating activities
|
||||||||
|
Net loss from operations
|
$ | (4,362 | ) | $ | (3,955 | ) | ||
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
||||||||
|
Depreciation and amortization
|
21,516 | 15,924 | ||||||
|
Loss on disposal of property and equipment
|
22 | 81 | ||||||
|
Amortization of bond premium
|
479 | - | ||||||
|
Realized loss on available-for-sale securities
|
32 | - | ||||||
|
Share-based compensation expense
|
4,350 | 2,786 | ||||||
|
Amortization of deferred financing costs
|
106 | 106 | ||||||
|
Bad debt (recoveries) expense, net
|
(629 | ) | 802 | |||||
|
Deferred income tax benefit
|
(1,804 | ) | (961 | ) | ||||
|
Changes in assets and liabilities, net of business combinations
|
||||||||
|
Accounts and unbilled receivables
|
(2,918 | ) | (3,246 | ) | ||||
|
Prepaid expenses and other current assets
|
(3,663 | ) | (1,541 | ) | ||||
|
Income taxes receivable
|
146 | 16 | ||||||
|
Other long-term assets
|
(169 | ) | 1,240 | |||||
|
Accounts payable
|
2,828 | 1,519 | ||||||
|
Accrued compensation and other accrued liabilities
|
155 | (185 | ) | |||||
|
Commissions payable
|
504 | (269 | ) | |||||
|
Deferred revenue
|
3,217 | 8,389 | ||||||
|
Other liabilities
|
(880 | ) | (121 | ) | ||||
|
Net cash provided by operating activities
|
18,930 | 20,585 | ||||||
|
Cash flows from investing activities
|
||||||||
|
Capitalized software and purchases of property and equipment
|
(15,604 | ) | (12,097 | ) | ||||
|
Purchases of available-for-sale securities
|
(1,469 | ) | (57,161 | ) | ||||
|
Sales of available-for-sale securities
|
55,545 | - | ||||||
|
Acquisitions, net of cash acquired
|
(42,236 | ) | (9,682 | ) | ||||
|
Net cash used in investing activities
|
(3,764 | ) | (78,940 | ) | ||||
|
Cash flows from financing activities
|
||||||||
|
Borrowings under revolving credit line and term loan
|
- | 3,000 | ||||||
|
Repayments under revolving credit line and term loan
|
(2,500 | ) | (27,000 | ) | ||||
|
Repayments of notes payable
|
(74 | ) | (87 | ) | ||||
|
Repayments of capital lease obligations
|
(279 | ) | (351 | ) | ||||
|
Proceeds from common stock issued through Employee Stock Purchase Plan
|
339 | 236 | ||||||
|
Shares authorized, but not issued, to settle employees withholding liability
|
(76 | ) | - | |||||
|
Net proceeds from option exercises
|
2,992 | 8,209 | ||||||
|
Net proceeds from public offering
|
- | 91,669 | ||||||
|
Net cash provided by financing activities
|
402 | 75,676 | ||||||
|
Effect of exchange rate changes on cash and cash equivalents
|
(269 | ) | 638 | |||||
|
Net increase in cash and cash equivalents
|
15,299 | 17,959 | ||||||
|
Cash and cash equivalents at beginning of period
|
67,459 | 52,455 | ||||||
|
Cash and cash equivalents at end of period
|
$ | 82,758 | $ | 70,414 | ||||
|
Supplemental disclosures of cash flow information
|
||||||||
|
Cash paid during the period for:
|
||||||||
|
Interest expense
|
$ | 582 | $ | 810 | ||||
|
Income taxes
|
$ | 1,838 | $ | 3,448 | ||||
|
Income taxes refunded
|
$ | 245 | $ | - | ||||
|
Noncash investing and financing activities
|
||||||||
|
Capital lease obligations incurred
|
$ | 555 | $ | 568 | ||||