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8-K - FORM 8-K - EGAIN Corpd590847d8k.htm

Exhibit 99.1

eGain Announces Fiscal 2013 Fourth Quarter

and Full Year Financial Results

 

 

Total quarterly revenue of $18.0 million, up 16% sequentially and 69% year-over-year

 

 

Total fiscal 2013 revenue of $58.9 million, up 36% over fiscal 2012

 

 

Quarterly cloud software revenue up 8% sequentially and 73% year-over-year

 

 

Fiscal 2013 cloud software revenue up 70% year-over-year

 

 

Fourth quarter operating income of $2.1 million, compared to an operating loss of $2.2 million in the fourth quarter of fiscal 2012

 

 

Fiscal 2013 operating income of $1.2 million, compared to an operating loss of $2.0 million in fiscal 2012

 

 

eGain expects fiscal 2014 total annual cloud revenue growth of between 40% and 45% year-over-year

 

 

eGain expects fiscal 2014 total annual revenue growth of between 20% and 25% year-over-year

Sunnyvale, Calif. (August 28, 2013) – eGain (NASDAQ: EGAN), a leading provider of cloud customer engagement solutions, today announced results for its fiscal 2013 fourth quarter and full year ended June 30, 2013.

“We executed well in fiscal 2013 as our investments in sales coverage, customer success, and product innovation are beginning to pay off,” said Ashu Roy, eGain’s CEO. “We are particularly pleased with our top rating in the Gartner Web Customer Service Magic Quadrant this year.”

“In fiscal 2014, we will continue to expand our sales team, even as we build out a meaningful partner ecosystem. With our market-leading platform and deep innovation pipeline, we look forward to capitalizing on the strategic market opportunity in enterprise customer engagement that we see ahead.”

Fiscal 2013 Fourth Quarter and Full Year Results:

Revenue: Total revenue for the fiscal fourth quarter was $18.0 million, an increase of 69% on a year-over-year basis. Subscription and support revenue for the fiscal fourth quarter was $9.0 million, an increase of 42% on a year-over-year basis. The cloud portion of the subscription and support revenue was $5.6 million, an increase of 73% on a year-over-year basis. License revenue for the fiscal fourth quarter was $4.6 million, an increase of 101% on a year-over-year basis. Professional services revenue for the fiscal fourth quarter was $4.4 million, an increase of 116% on a year-over-year basis

For the full fiscal year 2013, total revenue was $58.9 million, an increase of 36% over fiscal 2012. Subscription and support revenue was $32.3 million, an increase of 37% over fiscal 2012. The cloud portion of the subscription and support revenue was $19.1 million, an increase of 70% over fiscal 2012. License revenue was $12.9 million, an increase of 16% over fiscal 2012. Professional services revenue was $13.8 million, an increase of 58% over fiscal 2012.

Gross Profit: Gross profit for the fiscal fourth quarter was $13.1 million, compared to $6.7 million for the fourth quarter of fiscal 2012. Gross margin for the fiscal fourth quarter was 73%, compared to 63% in the fourth quarter last year. The subscription and support revenue gross margin for the fiscal fourth quarter increased to 83%, compared to 77% in the fourth quarter last year.


For the full fiscal year 2013, gross profit was $40.9 million, compared to $29.9 million for fiscal 2012. Gross margin was 69% in fiscal years 2013 and 2012. The subscription and support revenue gross margin increased to 83%, compared to 77% in fiscal 2012.

Earnings per Share: Net income for the fiscal fourth quarter was $1.9 million, or $0.08 per share on a basic basis and $0.07 per share on a diluted basis, compared to an adjusted net loss of $2.9 million, or a loss of $0.12 per share on a basic and diluted basis, for the fourth quarter of last year. Net income for the fiscal fourth quarter includes stock-based compensation expense of $271,000 and interest and tax expense of $246,000, compared to stock-based compensation expense of $336,000 and interest and tax expense of $392,000 in the fourth quarter last year.

For the full fiscal year 2013, net income was $684,000, or $0.03 per share on a basic and diluted basis, compared to an adjusted net loss of $3.8 million, or a loss of $0.16 per share on a basic and diluted basis, for fiscal 2012. Net income for fiscal 2013 includes stock-based compensation expense of $1.1 million and interest and tax expense of $862,000, compared to stock-based compensation expense of $856,000 and interest and tax expense of $1.1 million in fiscal 2012.

Cash: Total cash, cash equivalents and restricted cash increased to $17.2 million at June 30, 2013, up from $10.9 million at June 30, 2012. Net cash provided by operations was $10.2 million for fiscal 2013, compared to adjusted net cash provided by operations of $1.0 million for fiscal 2012.

Deferred Revenue: Total deferred revenue (which includes both deferred revenue on the balance sheet of $19.7 million and unbilled deferred revenue that remains off balance sheet of $24.8 million, collectively representing contractual commitments that have not been recognized as revenue) was $44.5 million at June 30, 2013, compared to $28.8 million at June 30, 2012.

Fiscal 2014 Guidance: eGain is estimating fiscal 2014 annual total revenue growth to be between 20% and 25% and annual cloud revenue growth to be between 40% and 45%.

Quarterly Conference Call

eGain will discuss its quarterly results today via teleconference at 5:00 p.m. Eastern Daylight Time. To access the live call, please dial (866) 206-6509, or outside the U.S. (703) 639-1108, at least five minutes prior to the start time. A live webcast of the call can be accessed from the investors section at www.egain.com. An audio replay of the conference call can be accessed at (888) 266-2081 (U.S. toll-free) or (703) 925-2533 (international). The replay will be available starting two hours after the call and remain in effect for one week. The required pass code is #1621215. An archive of the webcast will also be available on the investors section at www.egain.com.

About eGain

eGain’s customer engagement solutions power digital transformation strategies for leading brands. Our top-rated cloud applications for social, mobile, web, and contact centers help clients deliver connected customer journeys in a multichannel world. To find out more about eGain investor relations, visit http://www.egain.com/company/investors/


Headquartered in Sunnyvale, California, eGain has operating presence in North America, EMEA, and APAC. To learn more about us, visit www.eGain.com or call the company’s offices: +1-800-821-4358 (US), +44-(0)-1753-464646 (EMEA), or +91-(0)-20-6608-9200 (APAC).

# # #

Cautionary Note Regarding Forward-Looking Statements. This press release contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among other matters, statements about the Company’s market opportunities, statements about the Company’s expected financial results for the fiscal fourth quarter ended June 30, 2013 and for the full 2013 fiscal year with respect to total revenue, cloud revenue and business mix, and statements regarding our fiscal 2014 guidance, including sources of revenue and business mix . The achievement or success of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, the company’s results could differ materially from the results expressed or implied by the forward-looking statements we make. The risks and uncertainties referred to above include—but are not limited to—risks that our hybrid revenue model and lengthy sales cycles may negatively affect our operating results; risks related to our reliance on a relatively small number of customers for a substantial portion of our revenue; our ability to compete successfully and manage growth; our ability to develop and expand strategic and third party distribution channels; risks related to our international operations; our ability to invest resources to improve our products and continue to innovate; and other risks detailed from time to time in eGain’s filings with the Securities and Exchange Commission, including eGain’s annual report on Form 10-K filed on September 25, 2012, and eGain’s quarterly reports on Form 10-Q, which are available on the Securities and Exchange Commission’s Web site at www.sec.gov. These forward-looking statements are based on current expectations and speak only as of the date hereof. The Company assumes no obligation to update these forward-looking statements.

Note: eGain is a registered trademark, and the other eGain product and service names appearing in this release are trademarks or service marks, of eGain. All other company names and products are trademarks or registered trademarks of their respective companies.

 

eGain    MKR Group Investor Relations
Charles Messman, VP Finance    Todd Kehrli or Jim Byers
Phone: 408-636-4500    Phone: 323-468-2300
Email: iregain@egain.com    Email: egan@mkr-group.com


eGain Corporation

Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

(unaudited)

 

     Three Months Ended     Years Ended  
     June 30,     June 30,  
     2013     2012     2013     2012  
           As Adjusted           As Adjusted  

Revenue:

        

Subscription and support

   $ 8,955      $ 6,302      $ 32,281      $ 23,594   

License

     4,616        2,300        12,853        11,067   

Professional services

     4,398        2,034        13,755        8,703   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total revenue

     17,969        10,636        58,889        43,364   
  

 

 

   

 

 

   

 

 

   

 

 

 

Cost of subscription and support

     1,536        1,467        5,495        5,363   

Cost of license

     26        (38     151        (39

Cost of professional services

     3,265        2,486        12,360        8,112   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total cost of revenue

     4,827        3,915        18,006        13,436   
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     13,142        6,721        40,883        29,928   

Operating expenses:

        

Research and development

     2,226        1,760        8,419        6,132   

Sales and marketing

     6,912        5,669        24,434        20,086   

General and administrative

     1,858        1,457        6,787        5,743   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     10,996        8,886        39,640        31,961   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income/(loss) from operations

     2,146        (2,165     1,243        (2,033

Interest expense, net

     (107     (134     (483     (722

Other income (expense), net

     (3     (371     303        (677
  

 

 

   

 

 

   

 

 

   

 

 

 

Income /(loss) before income tax provision

     2,036        (2,670     1,063        (3,432

Income tax provision

     (139     (258     (379     (390
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income/(loss)

   $ 1,897      $ (2,928   $ 684      $ (3,822
  

 

 

   

 

 

   

 

 

   

 

 

 

Per share information:

        

Basic net income/(loss) per common share

   $ 0.08      $ (0.12   $ 0.03      $ (0.16

Diluted net income/(loss) per common share

   $ 0.07      $ (0.12   $ 0.03      $ (0.16

Weighted average shares used in computing basic net income / (loss) per common share

     25,050        24,450        24,780        24,329   

Weighted average shares used in computing diluted net income / (loss) per common share

     26,504        24,450        26,089        24,329   

Summary of stock-based compensation included in the costs and expenses above:

        

Cost of revenue

   $ 34      $ 24      $ 121      $ 77   

Research and development

   $ 49      $ 75      $ 261      $ 180   

Sales and marketing

   $ 104      $ 93      $ 360      $ 274   

General and administrative

   $ 84      $ 144      $ 339      $ 325   


eGain Corporation

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

 

     June 30,     June 30,  
     2013     2012  
           As Adjusted  

ASSETS

    

Current assets:

    

Cash and cash equivalents

   $ 16,206      $ 9,911   

Restricted cash

     29        35   

Accounts receivable, net

     12,307        6,535   

Deferred commissions

     1,745        955   

Prepaid and other current assets

     2,377        795   
  

 

 

   

 

 

 

Total current assets

     32,664        18,231   

Property and equipment, net

     3,544        2,295   

Deferred commissions, net of current portion

     776        643   

Goodwill

     4,880        4,880   

Restricted cash, net of current portion

     1,000        1,000   

Other assets

     672        894   
  

 

 

   

 

 

 

Total assets

   $ 43,536      $ 27,943   
  

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

    

Current liabilities:

    

Accounts payable

   $ 2,583      $ 1,875   

Accrued compensation

     4,339        3,385   

Accrued liabilities

     2,478        1,549   

Deferred revenue

     15,679        6,896   

Bank borrowings

     2,667        1,666   

Related party notes payable

     2,897          
  

 

 

   

 

 

 

Total current liabilities

     30,643        15,371   

Deferred revenue, net of current portion

     4,057        1,187   

Bank borrowings, net of current portion

     2,000        1,667   

Related party notes payable

            5,563   

Other long term liabilities

     848        242   
  

 

 

   

 

 

 

Total liabilities

     37,548        24,030   
  

 

 

   

 

 

 

Stockholders’ equity:

    

Common stock

     25        24   

Additional paid-in capital

     328,552        326,742   

Notes receivable from stockholders

     (87     (85

Accumulated other comprehensive loss

     (1,168     (750

Accumulated deficit

     (321,334     (322,018
  

 

 

   

 

 

 

Total stockholders’ equity

     5,988        3,913   
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 43,536      $ 27,943