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8-K - FORM 8-K DATED FEBRUARY 20, 2014 - Qumu Corp | qumu140621_8k.htm |
EX-99.2 - STATEMENTS OF SHERMAN L. BLACK AND JAMES R. STEWART - Qumu Corp | qumu140621_ex99-2.htm |
EXHIBIT 99.1
Qumu Reports Fourth Quarter 2013 Financial Results
Software Contracted Commitments Increased to
a Record $9.8 Million
Software Contracted Commitment Backlog Grew to a Record $16.7 Million
Total Revenues of $20.7 Million
Conference Call Today at 4:30 p.m. ET
Minneapolis, MN February 24, 2014 Qumu Corporation (NASDAQ: QUMU) today reported its financial results for the fourth quarter ended December 31, 2013. Software contracted commitments for the quarter set a new record and backlog grew 56% from September 30, 2013. Total revenues for the fourth quarter of 2013 were $20.7 million, virtually flat compared with revenues in the fourth quarter of 2012. Disc publishing revenues grew slightly over the prior year period while Qumu software revenues declined slightly compared with the prior years fourth quarter. Cash and marketable securities at December 31, 2013 totaled $51.0 million, an increase of $2.6 million from the balance at September 30, 2013, largely reflecting improved working capital management and a $1.9 million tax refund.
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Qumu Software Fourth Quarter Highlights |
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Contracted commitments were a record $9.8 million in the fourth quarter, up $6.0 million compared with $3.8 million in the third quarter of 2013 and up $1.1 million from the fourth quarter of 2012. |
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Backlog of contracted commitments increased to a record $16.7 million at December 31, 2013 from $10.7 million at the end of September 2013. |
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Software revenues declined slightly to $4.2 million in the fourth quarter of 2013, compared with $4.3 million in the fourth quarter of 2012 due to the timing of revenue recognition of contracted commitments. |
Sherman L. Black, president and CEO, said, We continued to demonstrate solid traction in our software business, setting new records in contracted commitments and backlog. Our new customers signed during the fourth quarter come from a cross section of industries including a global financial services institution, a leading e-commerce company, a large health care provider, a national health care insurer, a semiconductor company and a Japanese network solutions provider, which is our first customer based in Japan. Our success in the quarter is a proof point of our product differentiation around secure video delivery, breadth of enterprise integrations, flexible cloud and on-premise deployments, and rich mobile applications.
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Disc Publishing Fourth Quarter Highlights |
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Disc publishing revenues in the fourth quarter of 2013 totaled $16.5 million, slightly higher than the $16.4 million in revenues in fourth quarter of 2012. |
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The increase was the result of an 6% increase in service revenues and a slight increase in hardware sales, partially offset by lower consumables revenue. |
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Disc publishing revenues in the fourth quarter were stronger than anticipated due to some unexpected pockets of demand and the solid execution of the disc publishing team, continued Mr. Black. We generated $2.7 million in cash from operations in the fourth quarter, which included a $1.9 million tax refund. The result was we ended 2013 with $51.0 million in cash and marketable securities on the balance sheet.
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Fourth Quarter Financial Highlights |
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Gross margin for the fourth quarter of 2013 was 48% compared with 51% in the fourth quarter last year. The decrease in the margin was primarily due to software product mix and increased hiring to support the future growth of the software business. Operating expenses in the fourth quarter totaled $12.7 million, an increase of 6% from the fourth quarter of 2012. The increase was largely due to higher consulting costs, professional fees and incentive compensation expenses, partially offset by lower disc publishing research and development and sales and marketing expenses, reflecting the impact of cost cutting measures implemented during the year. |
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Net loss for the fourth quarter 2013 was $2.7 million, or $(0.32) per share. Excluding the impact of amortization of intangibles, the fourth quarter net loss was $(0.28) per share. The net loss in last years fourth quarter was $1.1 million, or $(0.12) per share. Excluding the impact of intangibles amortization, the non-GAAP net loss for the fourth quarter of 2012 was $(0.09) per share. |
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Full Year 2013 Financial Highlights |
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Total revenues for the full year 2013 were $82.5 million, an increase of 4% over 2012 revenues. |
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Software revenues for 2013 grew 80% to $17.7 million. Disc publishing revenues for 2013 declined 7% to $64.7 million. |
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The net loss for 2013 was $9.7 million, or $(1.12) per share compared to a loss of $48.3 million or $(4.85) per share in 2012. The net loss for 2012 included three non-recurring non cash charges related to the write-off of goodwill, reduction in the fair market value of intangible assets and the establishment of a valuation allowance against deferred tax assets. Excluding these charges the net loss on a non-GAAP basis for 2012 was $5.7 million, or $(0.57) per share. On a non-GAAP basis, excluding amortization and severance expense, the net loss per share for 2013 was $(0.89). |
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For the full year, the Company generated $2.4 million in cash from operations. |
The market adoption for video content management software is in the beginning stages and our offering is proving to be a compelling proposition for potential customers. Recent agreements with global companies demonstrate the value customers place on our software and provide a very good start to the year. Demand for disc publishing in select markets -- including surveillance, entertainment, medical imaging, photo retail and financial services -- remains and we anticipate our disc publishing operation will continue to serve these markets and generate positive cash flow. In addition, the actions we took in 2013 to strengthen and cost optimize our software and disc publishing operations have provided an exceptional foundation for QUMU. As we look ahead, we are very optimistic about the outlook for our continued progress in 2014, Mr. Black concluded.
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Earnings per Share Reconciliation |
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Fourth Quarter 2013 |
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Full Year 2013 |
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GAAP earnings (loss) per share |
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$(0.32) |
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$(1.12) |
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Impact of amortization of intangibles |
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$0.04 |
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$0.14 |
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Severance |
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$0.00 |
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$0.09 |
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Non-GAAP earnings (loss) per share |
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$(0.28) |
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$(0.89) |
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Fourth Quarter 2012 |
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Full Year 2012 |
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GAAP earnings (loss) per share |
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$(0.12) |
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$(4.85) |
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Impact of amortization of intangibles |
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$0.03 |
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$0.12 |
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Impact of non cash charges for goodwill impairment, intangible asset impairment and deferred tax valuation allowance |
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$0.00 |
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$4.16 |
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Non-GAAP earnings (loss) per share |
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$(0.09) |
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$(0.57) |
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About Qumu
Qumu Corporation (NASDAQ: QUMU) provides the tools businesses need to create, manage, secure, distribute and measure the success of their videos. Qumus innovative solutions release the power in video to engage and empower employees, partners and clients. Qumu helps thousands of organizations around the world realize the greatest possible value from video and other rich content they create and publish. Whatever the audience size, viewer device or network configuration, Qumu solutions are how business does video. Additional information can be found at www.qumu.com.
Investor Contacts:
James
Stewart, CFO
Qumu Corporation
952/683-7878
Leigh Salvo/Doug Sherk
EVC Group
415/568-9348
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QUMU CORPORATION
Selected Consolidated Financial Information
(In thousands except per share data)
(Unaudited)
Consolidated Statements of Operations Information:
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Three Months Ended |
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Years Ended |
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2013 |
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2012 |
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2013 |
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2012 |
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Revenues |
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$ |
20,655 |
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$ |
20,749 |
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$ |
82,472 |
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$ |
79,443 |
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Cost of revenues |
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10,701 |
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10,096 |
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42,912 |
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40,782 |
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Gross profit |
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9,954 |
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10,653 |
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39,560 |
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38,661 |
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Operating expenses: |
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Research and development |
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2,847 |
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2,909 |
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12,203 |
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11,866 |
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Selling, general and administrative |
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9,727 |
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8,900 |
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36,414 |
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36,039 |
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Goodwill & intangible assets impairment |
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29,548 |
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Amortization of purchased intangibles |
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157 |
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157 |
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628 |
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952 |
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Total operating expenses |
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12,731 |
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11,966 |
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49,245 |
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78,405 |
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Operating loss |
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(2,777 |
) |
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(1,313 |
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(9,685 |
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(39,744 |
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Other expense, net |
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(29 |
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(44 |
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(193 |
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(44 |
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Loss before income taxes |
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(2,806 |
) |
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(1,357 |
) |
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(9,878 |
) |
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(39,788 |
) |
Income tax expense (benefit) |
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(57 |
) |
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(199 |
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(59 |
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8,809 |
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Net loss |
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(2,749 |
) |
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(1,158 |
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(9,819 |
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(48,597 |
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Net loss attributable to noncontrolling interest |
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43 |
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125 |
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259 |
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Net loss attributable to Qumu |
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$ |
(2,749 |
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$ |
(1,115 |
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$ |
(9,694 |
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$ |
(48,338 |
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Net loss per basic and diluted share |
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$ |
(0.32 |
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$ |
(0.12 |
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$ |
(1.12 |
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$ |
(4.85 |
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Basic and diluted weighted average shares outstanding |
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8,697 |
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9,320 |
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8,691 |
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9,971 |
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Non-Cash Charges Included in Consolidated Statements of Operations Information:
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Three Months Ended |
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Years Ended |
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2013 |
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2012 |
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2013 |
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2012 |
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Depreciation |
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$ |
357 |
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$ |
587 |
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$ |
1,628 |
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$ |
2,382 |
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Amortization of intangibles |
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Cost of revenues |
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193 |
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192 |
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772 |
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998 |
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Amortization of purchased intangibles |
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157 |
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157 |
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628 |
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952 |
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Equity compensation |
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Cost of revenues |
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33 |
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34 |
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141 |
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137 |
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Research and development |
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38 |
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128 |
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398 |
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471 |
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Selling, general and administrative |
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329 |
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333 |
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1,239 |
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1,516 |
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Goodwill & intangible assets impairment |
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29,548 |
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5
QUMU CORPORATION
Selected Consolidated Financial Information
(In thousands except per share data)
(Unaudited)
Consolidated Balance Sheets Information:
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Years Ended December 31, |
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2013 |
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2012 |
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Cash and marketable securities |
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$ |
50,958 |
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$ |
50,140 |
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Receivables |
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12,236 |
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13,055 |
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Inventories |
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4,102 |
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6,036 |
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Total current assets |
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71,749 |
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75,950 |
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Property and equipment, net |
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5,419 |
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5,966 |
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Total assets |
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89,146 |
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95,563 |
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Current liabilities |
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23,028 |
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19,807 |
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Long-term liabilities |
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3,537 |
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5,129 |
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Noncontrolling interest |
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103 |
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Qumu stockholders equity |
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62,581 |
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70,524 |
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