Attached files
| file | filename |
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| 8-K - 8-K - XURA, INC. | form8-kq22014pressrelease.htm |
Exhibit 99.1
CONTACT: Sheila Ennis
ICR for Comverse, Inc.
(415) 430-2073
Sheila.ennis@icrinc.com
Comverse Announces Fiscal 2014 Second Quarter Results;
Conference Call to be Held Today at 8:00 AM
WAKEFIELD, MA, September 9, 2014 - Comverse, Inc. (“Comverse”; NASDAQ: CNSI) today announced its results for the second fiscal quarter ended July 31, 2014.
Consolidated Highlights: Below is selected consolidated financial information for the three and six months ended July 31, 2014 and 2013, prepared in accordance with generally accepted accounting principles (“GAAP”), except as noted.
Comverse, Inc.: | Three Months Ended July 31, | Six Months Ended July 31, | |||||||||||||
(In thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||
Total revenue | $ | 115,320 | $ | 169,753 | $ | 234,452 | $ | 325,571 | |||||||
Costs and expenses | |||||||||||||||
Cost of revenue | 75,860 | 103,484 | 156,324 | 194,448 | |||||||||||
Research and development, net | 14,746 | 16,860 | 30,278 | 32,940 | |||||||||||
Selling, general and administrative | 29,549 | 35,349 | 63,694 | 72,059 | |||||||||||
Other operating expenses | 1,912 | 2,633 | 4,655 | 6,854 | |||||||||||
Total costs and expenses | 122,067 | 158,326 | 254,951 | 306,301 | |||||||||||
(Loss) income from operations | (6,747 | ) | 11,427 | (20,499 | ) | 19,270 | |||||||||
Expense adjustments | 7,533 | 6,702 | 15,763 | 4,586 | |||||||||||
Comverse performance (1) | 786 | 18,129 | (4,736 | ) | 23,856 | ||||||||||
(Loss) income before income tax expense | (10,240 | ) | 12,848 | (22,033 | ) | 14,545 | |||||||||
Income tax expense | (6,626 | ) | (29,935 | ) | (10,964 | ) | (34,772 | ) | |||||||
Net loss | (16,866 | ) | (17,087 | ) | (32,997 | ) | (20,227 | ) | |||||||
Basic & diluted loss per share | $ | (0.75 | ) | $ | (0.77 | ) | $ | (1.48 | ) | $ | (0.92 | ) | |||
Interest expense | (231 | ) | (166 | ) | (354 | ) | (354 | ) | |||||||
Depreciation and amortization | $ | (4,822 | ) | $ | (4,748 | ) | $ | (9,561 | ) | $ | (9,317 | ) | |||
Operating margin | (5.9 | )% | 6.7 | % | (8.7 | )% | 5.9 | % | |||||||
Comverse performance margin | 0.7 | % | 10.7 | % | (2.0 | )% | 7.3 | % | |||||||
Net cash provided by (used in) operating activities (2) | $ | (13,785 | ) | $ | (222 | ) | $ | (49,384 | ) | $ | 9,641 | ||||
(1) "Comverse performance" has not been prepared in accordance with GAAP. See “Presentation of Non-GAAP Financial Measures” below.
(2) Includes approximately $10.9 million of cash proceeds related to an Italian VAT refund received during the six months ended July 31, 2013.
"As part of the on-going transformation of Comverse, we have realigned the company to focus on faster growing areas within the billing and digital services markets. We are pleased with the traction we are achieving despite the ongoing macro-economic challenges we face,” said Philippe Tartavull, President and CEO of Comverse, Inc. “Additionally, we have identified incremental areas where we can improve our efficiency without compromising our effectiveness in serving
the needs of our customers. We believe these initiatives should enable the company to achieve positive operating cash flow in the second half of our fiscal year and going forward.”
Expanded 2014 Restructuring Initiatives
On September 9, 2014, we commenced an expansion of our previously disclosed 2014 restructuring plan. We expect that as a result of the restructuring plan (as expanded), our global workforce will be reduced by approximately 14% and that our annual cost of revenue and operating expenses will decrease by approximately $30 million to $40 million. The restructuring plan has been facilitated by efficiencies gained through initiatives implemented in recent fiscal periods and the expectation that software will account for a higher portion of our revenue in future periods. The restructuring plan is designed to align operating costs and expenses with currently anticipated revenue.
The restructuring plan (as expanded) is expected to include reduction of workforce included in cost of revenue, research and development and selling, general and administrative expenses. The aggregate total cost of the 2014 restructuring plan (as expanded) is currently expected to be approximately $15.0 million to $17.0 million, primarily related to severance costs which are expected to be accrued and paid by January 31, 2015. As previously disclosed, the aggregate total cost of the 2014 restructuring plan (prior to expansion) was expected to be approximately $9.0 million. In relation to this restructuring plan, we recorded severance-related costs of $5.0 million and paid $3.5 million during the six months ended July 31, 2014.
Business Segment Highlights:
Three Months Ended July 31, | Six Months Ended July 31, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
(Dollars in thousands) | |||||||||||||||
SEGMENT RESULTS | |||||||||||||||
BSS | |||||||||||||||
Segment revenue | $ | 60,155 | $ | 74,158 | $ | 117,027 | $ | 150,422 | |||||||
Gross margin | 45.3 | % | 35.4 | % | 41.8 | % | 37.8 | % | |||||||
Income from operations | 14,900 | 7,087 | 21,355 | 22,788 | |||||||||||
Operating margin | 24.8 | % | 9.6 | % | 18.2 | % | 15.1 | % | |||||||
Segment performance | 15,600 | 7,820 | 22,752 | 24,318 | |||||||||||
Segment performance margin | 25.9 | % | 10.5 | % | 19.4 | % | 16.2 | % | |||||||
Digital Services | |||||||||||||||
Segment revenue | $ | 55,165 | $ | 95,595 | $ | 117,425 | $ | 175,149 | |||||||
Gross margin | 33.7 | % | 51.5 | % | 37.1 | % | 45.5 | % | |||||||
Income from operations | 11,107 | 40,970 | 29,499 | 63,812 | |||||||||||
Operating margin | 20.1 | % | 42.9 | % | 25.1 | % | 36.4 | % | |||||||
Segment performance | 11,109 | 41,131 | 29,503 | 64,030 | |||||||||||
Segment performance margin | 20.1 | % | 43.0 | % | 25.1 | % | 36.6 | % | |||||||
All Other | |||||||||||||||
Loss from operations | $ | (32,754 | ) | $ | (36,630 | ) | $ | (71,353 | ) | $ | (67,330 | ) | |||
Segment performance | (25,923 | ) | (30,822 | ) | (56,991 | ) | (64,492 | ) | |||||||
Selected Balance Sheet Highlights: Below is selected balance sheet data:
As of | |||||||
(In millions) | July 31, 2014 | April 30, 2014 | |||||
Cash and cash equivalents | $ | 181.6 | $ | 210.1 | |||
Restricted cash (including long-term restricted cash) and bank time deposits | 72.7 | 73.5 | |||||
Total | $ | 254.3 | $ | 283.6 | |||
On August 6, 2014, the escrow under the merger of Verint Systems Inc. and Comverse Technology, Inc. was released and the company received the escrow amount of approximately $25.0 million.
Conference Call Details
Comverse will be conducting a conference call today, September 9, 2014 at 8:00 a.m. ET. To listen to the conference call live, dial (678) 825-8369. The identification code is 92239125. Please dial-in at least five minutes before the scheduled start time. A live webcast can be accessed at www.comverse.com.
A replay of the call will be available, beginning at approximately 11:00 am on September 9, 2014 for two days, at (855) 859-2056 or (800) 585-8367, and archived via webcast at www.comverse.com. The replay access code is 92239125.
Segment Performance
We evaluate our business by assessing the performance of each of our operating segments. Our Chief Executive Officer is our chief operating decision maker (“CODM”). The CODM uses segment performance, as defined below, as the primary basis for assessing the financial results of the operating segments and for the allocation of resources. Segment performance, as we define it in accordance with the Financial Accounting Standards Board's guidance relating to segment reporting, is not necessarily comparable to other similarly titled captions of other companies.
Segment performance is computed by management as income (loss) from operations adjusted for the following: (i) stock-based compensation expense; (ii) amortization of intangible assets; (iii) compliance-related professional fees; (iv) compliance-related compensation and other expenses; (v) strategic-related costs (vi) impairment of property and equipment; (vii) certain litigation settlements and related costs; (viii) Italian VAT recovery recorded within operating expense; (ix) restructuring expenses; and (x) certain other gains and expenses. Compliance-related professional fees relate to fees and expenses recorded in connection with our efforts to remediate material weaknesses in internal control over financial reporting for the fiscal year ended January 31, 2014.
Presentation of Non-GAAP Financial Measures
We provide Comverse performance, a non-GAAP financial measure, as additional information for our operating results. This measure is not in accordance with, or an alternative for, GAAP financial measures and may be different from, or not comparable to similarly titled or other non-GAAP financial measures used by other companies. We believe that the presentation of this non-GAAP financial measure provides useful information to investors regarding certain additional financial and business trends relating to our results of operations as viewed by management in monitoring our businesses, reviewing financial results and for planning purposes. See “Consolidated Reconciliation of GAAP to Non-GAAP Financial Measures” below.
About Comverse, Inc.
At the core of the evolution of how we communicate, exchange information and monetize the digital world, Comverse enables the creation and monetization of innovative digital services for telecom and enterprise service providers through its proven and innovative product portfolio that includes managed BSS and Policy (PCRF), Enterprise Billing and Digital Services - all backed by Managed and Professional Services. Comverse’s extensive customer base spans more than 125 countries with solutions successfully delivered to over 450 communication service providers serving more than two billion subscribers. Comverse’s solutions are available in a variety of delivery models, including on-site, cloud, hosted/SaaS and managed services. For more information, visit www.comverse.com.
Forward-Looking Statements
This press release includes “forward-looking statements.” Forward-looking statements include financial projections, statements of plans and objectives for future operations, statements of future economic performance, and statements of assumptions relating thereto. In some cases, forward-looking statements can be identified by the use of terminology such as “may,” “expects,” “plans,” “anticipates,” “estimates,” “believes,” “potential,” “projects,” “forecasts,” “intends,” or the negative thereof or other comparable terminology. By their very nature, forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause actual results, performance and the timing of events to differ materially from those anticipated, expressed or implied by the forward-looking statements in this press release. Such risks or uncertainties may give rise to future claims and increase exposure to contingent liabilities. These risks and uncertainties relate to (among other factors) the market price of our stock, operating expenses and cash flows, variability of our tax provision, and the additional risks described in the sections entitled “Forward-Looking Statements” and Item 1A, “Risk Factors” and elsewhere in the company's Annual Report on Form 10-K filed with the SEC on April 16, 2014, or in subsequently filed periodic, current or other reports. We undertake no commitment to update or revise any forward-looking statements except as required by law.
These risks and uncertainties discussed above, as well as others, are discussed in greater detail in our filings with the SEC. The documents and reports we file with the SEC are available through us, or our website, www.comverse.com, or through the SEC's Electronic Data Gathering, Analysis, and Retrieval system (EDGAR) at www.sec.gov.
COMVERSE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(In thousands, except share and per share data)
Three Months Ended July 31, | Six Months Ended July 31, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
Revenue: | |||||||||||||||
Product revenue | $ | 20,931 | $ | 56,491 | $ | 48,286 | $ | 109,395 | |||||||
Service revenue | 94,389 | 113,262 | 186,166 | 216,176 | |||||||||||
Total revenue | 115,320 | 169,753 | 234,452 | 325,571 | |||||||||||
Costs and expenses: | |||||||||||||||
Product costs | 11,003 | 28,751 | 25,808 | 56,385 | |||||||||||
Service costs | 64,857 | 74,733 | 130,516 | 138,063 | |||||||||||
Research and development, net | 14,746 | 16,860 | 30,278 | 32,940 | |||||||||||
Selling, general and administrative | 29,549 | 35,349 | 63,694 | 72,059 | |||||||||||
Other operating expenses: | |||||||||||||||
Restructuring expenses | 1,912 | 2,633 | 4,655 | 6,854 | |||||||||||
Total other operating expenses | 1,912 | 2,633 | 4,655 | 6,854 | |||||||||||
Total costs and expenses | 122,067 | 158,326 | 254,951 | 306,301 | |||||||||||
(Loss) income from operations | (6,747 | ) | 11,427 | (20,499 | ) | 19,270 | |||||||||
Interest income | 100 | 143 | 215 | 315 | |||||||||||
Interest expense | (231 | ) | (166 | ) | (354 | ) | (354 | ) | |||||||
Foreign currency transaction gain (loss), net | (2,949 | ) | 888 | (930 | ) | (5,028 | ) | ||||||||
Other expense, net | (413 | ) | 556 | (465 | ) | 342 | |||||||||
(Loss) income before income tax expense | (10,240 | ) | 12,848 | (22,033 | ) | 14,545 | |||||||||
Income tax expense | (6,626 | ) | (29,935 | ) | (10,964 | ) | (34,772 | ) | |||||||
Net loss | $ | (16,866 | ) | $ | (17,087 | ) | (32,997 | ) | (20,227 | ) | |||||
Weighted average common shares outstanding: | |||||||||||||||
Basic & diluted | 22,401,902 | 22,186,729 | 22,348,835 | 22,097,619 | |||||||||||
Loss per share: | |||||||||||||||
Basic & diluted | $ | (0.75 | ) | $ | (0.77 | ) | $ | (1.48 | ) | $ | (0.92 | ) | |||
COMVERSE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(In thousands, except share and per share data)
July 31, 2014 | January 31, 2014 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 181,587 | $ | 254,580 | |||
Restricted cash and bank deposits | 63,650 | 34,343 | |||||
Accounts receivable, net of allowance of $4,631 and $6,945, respectively | 106,465 | 89,361 | |||||
Inventories | 22,011 | 16,166 | |||||
Deferred cost of revenue | 12,322 | 14,500 | |||||
Deferred income taxes | 2,089 | 2,329 | |||||
Prepaid expenses | 23,008 | 17,000 | |||||
Other current assets | 6,731 | 1,680 | |||||
Total current assets | 417,863 | 429,959 | |||||
Property and equipment, net | 47,335 | 41,541 | |||||
Goodwill | 150,630 | 150,346 | |||||
Intangible assets, net | 3,813 | 5,153 | |||||
Deferred cost of revenue | 36,314 | 45,717 | |||||
Deferred income taxes | 1,141 | 1,720 | |||||
Long-term restricted cash | 9,017 | 33,815 | |||||
Other assets | 39,025 | 40,586 | |||||
Total assets | $ | 705,138 | $ | 748,837 | |||
LIABILITIES AND EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable and accrued expenses | $ | 158,549 | $ | 168,406 | |||
Deferred revenue | 247,797 | 239,902 | |||||
Deferred income taxes | 833 | 514 | |||||
Income taxes payable | 1,501 | 2,102 | |||||
Total current liabilities | 408,680 | 410,924 | |||||
Deferred revenue | 100,714 | 113,426 | |||||
Deferred income taxes | 45,728 | 43,735 | |||||
Other long-term liabilities | 149,709 | 147,942 | |||||
Total liabilities | 704,831 | 716,027 | |||||
Commitments and contingencies | |||||||
Equity: | |||||||
Common stock, $0.01 par value - authorized, 100,000,000 shares; issued 22,570,673 and 22,286,123 shares, respectively; outstanding, 22,358,589 and 22,251,226 shares, respectively | 226 | 223 | |||||
Treasury stock, at cost, 212,084 and 34,897 shares, respectively | (5,569 | ) | (1,024 | ) | |||
Accumulated deficit | (57,248 | ) | (24,251 | ) | |||
Additional paid in capital | 40,490 | 34,530 | |||||
Accumulated other comprehensive income | 22,408 | 23,332 | |||||
Total equity | 307 | 32,810 | |||||
Total liabilities and equity | $ | 705,138 | $ | 748,837 | |||
COMVERSE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In thousands)
Six Months Ended July 31, | |||||||
2014 | 2013 | ||||||
Cash flows from operating activities: | |||||||
Net loss | $ | (32,997 | ) | $ | (20,227 | ) | |
Non-cash operating items: | |||||||
Depreciation and amortization | 9,561 | 9,317 | |||||
Provision for doubtful accounts | 331 | 890 | |||||
Stock-based compensation expense | 5,923 | 5,343 | |||||
Deferred income taxes | 3,131 | 4,023 | |||||
Inventory write-downs | 1,108 | 2,913 | |||||
Other non-cash items, net | 446 | (1,217 | ) | ||||
Changes in assets and liabilities: | |||||||
Accounts receivable | (16,392 | ) | 3,521 | ||||
Inventories | (8,624 | ) | (663 | ) | |||
Deferred cost of revenue | 11,592 | 21,802 | |||||
Prepaid expense and other current assets | (5,580 | ) | (1,509 | ) | |||
Accounts payable and accrued expense | (16,195 | ) | (7,649 | ) | |||
Income taxes | (1,053 | ) | 14,332 | ||||
Deferred revenue | (5,750 | ) | (30,985 | ) | |||
Tax contingencies | 3,598 | 5,519 | |||||
Other assets and liabilities | 1,517 | 4,231 | |||||
Net cash (used in) provided by operating activities | (49,384 | ) | 9,641 | ||||
Cash flows from investing activities: | |||||||
Proceeds from sales and maturities of investments | — | 100 | |||||
Purchases of property and equipment | (11,472 | ) | (4,630 | ) | |||
Advanced payment for a planned acquisition | (2,678 | ) | — | ||||
Net change in restricted cash and bank deposits | (4,027 | ) | (27,569 | ) | |||
Proceeds from asset sales | 46 | 61 | |||||
Other, net | — | 743 | |||||
Net cash used in investing activities | (18,131 | ) | (31,295 | ) | |||
Cash flows from financing activities: | |||||||
CTI capital contribution | — | 25,000 | |||||
Payment for repurchase of common stock in connection with tax liabilities upon settlement of stock awards | (972 | ) | (770 | ) | |||
Payment for repurchase of common stock under repurchase program | (3,573 | ) | — | ||||
Proceeds from exercises of stock options | 40 | 556 | |||||
Net cash (used in) provided by financing activities | (4,505 | ) | 24,786 | ||||
Effects of exchange rates on cash and cash equivalents | (973 | ) | (2,049 | ) | |||
Net (decrease) increase in cash and cash equivalents | (72,993 | ) | 1,083 | ||||
Cash and cash equivalents, beginning of period | 254,580 | 262,921 | |||||
Cash and cash equivalents, end of period | $ | 181,587 | $ | 264,004 | |||
Non-cash investing transactions: | |||||||
Accrued but unpaid purchases of property and equipment | $ | 4,587 | $ | 3,278 | |||
Inventory transfers to property and equipment | $ | 1,673 | $ | 2,495 | |||
COMVERSE, INC. AND SUBSIDIARIES
CONSOLIDATED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
Table of Reconciliation from GAAP Income (loss) from operations to Non GAAP Comverse Performance | Three Months Ended July 31, | Six Months Ended July 31, | |||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
(Dollars in thousands) | |||||||||||||||
(Loss) income from operations | $ | (6,747 | ) | $ | 11,427 | $ | (20,499 | ) | $ | 19,270 | |||||
Expense Adjustments: | |||||||||||||||
Stock-based compensation expense | 2,985 | 2,249 | 5,923 | 5,343 | |||||||||||
Amortization of intangible assets | 700 | 729 | 1,395 | 1,378 | |||||||||||
Compliance-related professional fees | 335 | 370 | 704 | 806 | |||||||||||
Compliance-related compensation and other expenses | — | 155 | (70 | ) | 207 | ||||||||||
Strategic related costs | 1,100 | — | 2,390 | — | |||||||||||
Impairment of property and equipment | 169 | 5 | 178 | 43 | |||||||||||
Certain litigation settlements and related costs | 41 | 1 | 5 | (23 | ) | ||||||||||
Italian VAT refund recovery recorded within operating expenses | — | — | — | (10,861 | ) | ||||||||||
Restructuring expenses | 1,912 | 2,633 | 4,655 | 6,854 | |||||||||||
Gain on sale of fixed assets | (14 | ) | (7 | ) | (17 | ) | (18 | ) | |||||||
Other | 305 | 567 | 600 | 857 | |||||||||||
Total expense adjustments | 7,533 | 6,702 | 15,763 | 4,586 | |||||||||||
Comverse performance | $ | 786 | $ | 18,129 | $ | (4,736 | ) | $ | 23,856 | ||||||
COMVERSE, INC. AND SUBSIDIARIES
BUSINESS SEGMENT INFORMATION
(UNAUDITED)
BSS | Digital Services | All Other | Consolidated | ||||||||||||
(In thousands) | |||||||||||||||
Three Months Ended July 31, 2014 | |||||||||||||||
Total revenue | $ | 60,155 | $ | 55,165 | $ | — | $ | 115,320 | |||||||
Total costs and expenses | $ | 45,255 | $ | 44,058 | $ | 32,754 | $ | 122,067 | |||||||
Income (loss) from operations | $ | 14,900 | $ | 11,107 | $ | (32,754 | ) | $ | (6,747 | ) | |||||
Computation of segment performance: | |||||||||||||||
Segment revenue | $ | 60,155 | $ | 55,165 | $ | — | |||||||||
Total costs and expenses | $ | 45,255 | $ | 44,058 | $ | 32,754 | |||||||||
Segment expense adjustments: | |||||||||||||||
Stock-based compensation expense | — | — | 2,985 | ||||||||||||
Amortization of intangibles assets | 700 | — | — | ||||||||||||
Compliance-related professional fees | — | — | 335 | ||||||||||||
Strategic-related costs | — | — | 1,100 | ||||||||||||
Impairment of property and equipment | — | 2 | 167 | ||||||||||||
Certain litigation settlements and related cost | — | — | 41 | ||||||||||||
Restructuring expenses | — | — | 1,912 | ||||||||||||
Gain on sale of fixed assets | — | — | (14 | ) | |||||||||||
Other | — | — | 305 | ||||||||||||
Segment expense adjustments | 700 | 2 | 6,831 | ||||||||||||
Segment expenses | 44,555 | 44,056 | 25,923 | ||||||||||||
Segment performance | $ | 15,600 | $ | 11,109 | $ | (25,923 | ) | ||||||||
Interest expense | $ | — | $ | — | $ | (231 | ) | $ | (231 | ) | |||||
Depreciation | $ | (862 | ) | $ | (1,260 | ) | $ | (2,000 | ) | $ | (4,122 | ) | |||
COMVERSE, INC. AND SUBSIDIARIES
BUSINESS SEGMENT INFORMATION
(UNAUDITED)
BSS | Digital Services | All Other | Consolidated | ||||||||||||
(In thousands) | |||||||||||||||
Three Months Ended July 31, 2013 | |||||||||||||||
Total revenue | $ | 74,158 | $ | 95,595 | $ | — | $ | 169,753 | |||||||
Total costs and expenses | $ | 67,071 | $ | 54,625 | $ | 36,630 | $ | 158,326 | |||||||
Income (loss) from operations | $ | 7,087 | $ | 40,970 | $ | (36,630 | ) | $ | 11,427 | ||||||
Computation of segment performance: | |||||||||||||||
Segment revenue | $ | 74,158 | $ | 95,595 | $ | — | |||||||||
Total costs and expenses | $ | 67,071 | $ | 54,625 | $ | 36,630 | |||||||||
Segment expense adjustments: | |||||||||||||||
Stock-based compensation expense | — | — | 2,249 | ||||||||||||
Amortization of intangibles assets | 729 | — | — | ||||||||||||
Compliance-related professional fees | — | — | 370 | ||||||||||||
Compliance-related compensation and other expenses | — | 162 | (7 | ) | |||||||||||
Impairment of property and equipment | 3 | — | 2 | ||||||||||||
Certain litigation settlements and related cost | — | — | 1 | ||||||||||||
Restructuring expenses | — | — | 2,633 | ||||||||||||
Gain on sale of fixed assets | 1 | (1 | ) | (7 | ) | ||||||||||
Other | — | — | 567 | ||||||||||||
Segment expense adjustments | 733 | 161 | 5,808 | ||||||||||||
Segment expenses | 66,338 | 54,464 | 30,822 | ||||||||||||
Segment performance | $ | 7,820 | $ | 41,131 | $ | (30,822 | ) | ||||||||
Interest expense | $ | — | $ | — | $ | (166 | ) | $ | (166 | ) | |||||
Depreciation | $ | (1,049 | ) | $ | (1,289 | ) | $ | (1,681 | ) | $ | (4,019 | ) | |||
COMVERSE, INC. AND SUBSIDIARIES
BUSINESS SEGMENT INFORMATION
(UNAUDITED)
BSS | Digital Services | All Other | Consolidated | ||||||||||||
(In thousands) | |||||||||||||||
Six Months Ended July 31, 2014 | |||||||||||||||
Total revenue | $ | 117,027 | $ | 117,425 | $ | — | $ | 234,452 | |||||||
Total costs and expenses | $ | 95,672 | $ | 87,926 | $ | 71,353 | $ | 254,951 | |||||||
Income (loss) from operations | $ | 21,355 | $ | 29,499 | $ | (71,353 | ) | $ | (20,499 | ) | |||||
Computation of segment performance: | |||||||||||||||
Segment revenue | $ | 117,027 | $ | 117,425 | $ | — | |||||||||
Total costs and expenses | $ | 95,672 | $ | 87,926 | $ | 71,353 | |||||||||
Segment expense adjustments: | |||||||||||||||
Stock-based compensation expense | — | — | 5,923 | ||||||||||||
Amortization of intangibles assets | 1,395 | — | — | ||||||||||||
Compliance-related professional fees | — | — | 704 | ||||||||||||
Compliance-related compensation and other expenses | — | 1 | (71 | ) | |||||||||||
Strategic-related costs | — | — | 2,390 | ||||||||||||
Impairment of property and equipment | — | 2 | 176 | ||||||||||||
Certain litigation settlements and related cost | — | — | 5 | ||||||||||||
Restructuring expenses | — | — | 4,655 | ||||||||||||
Gain on sale of fixed assets | 2 | 1 | (20 | ) | |||||||||||
Other | — | — | 600 | ||||||||||||
Segment expense adjustments | 1,397 | 4 | 14,362 | ||||||||||||
Segment expenses | 94,275 | 87,922 | 56,991 | ||||||||||||
Segment performance | $ | 22,752 | $ | 29,503 | $ | (56,991 | ) | ||||||||
Interest expense | $ | — | $ | — | $ | (354 | ) | $ | (354 | ) | |||||
Depreciation | $ | (1,745 | ) | $ | (2,524 | ) | $ | (3,897 | ) | $ | (8,166 | ) | |||
COMVERSE, INC. AND SUBSIDIARIES
BUSINESS SEGMENT INFORMATION
(UNAUDITED)
BSS | Digital Services | All Other | Consolidated | ||||||||||||
(In thousands) | |||||||||||||||
Six Months Ended July 31, 2013 | |||||||||||||||
Total revenue | $ | 150,422 | $ | 175,149 | $ | — | $ | 325,571 | |||||||
Total costs and expenses | $ | 127,634 | $ | 111,337 | $ | 67,330 | $ | 306,301 | |||||||
Income (loss) from operations | $ | 22,788 | $ | 63,812 | $ | (67,330 | ) | $ | 19,270 | ||||||
Computation of segment performance: | |||||||||||||||
Segment revenue | $ | 150,422 | $ | 175,149 | $ | — | |||||||||
Total costs and expenses | $ | 127,634 | $ | 111,337 | $ | 67,330 | |||||||||
Segment expense adjustments: | |||||||||||||||
Stock-based compensation expense | — | — | 5,343 | ||||||||||||
Amortization of intangibles assets | 1,378 | — | — | ||||||||||||
Compliance-related professional fees | — | — | 806 | ||||||||||||
Compliance-related compensation and other expenses | 122 | 218 | (133 | ) | |||||||||||
Impairment of property and equipment | 29 | 1 | 13 | ||||||||||||
Certain litigation settlements and related cost | — | — | (23 | ) | |||||||||||
Italian VAT refund recovery recorded within operating expense | — | — | (10,861 | ) | |||||||||||
Restructuring expenses | — | — | 6,854 | ||||||||||||
Gain on sale of fixed assets | 1 | (1 | ) | (18 | ) | ||||||||||
Other | — | — | 857 | ||||||||||||
Segment expense adjustments | 1,530 | 218 | 2,838 | ||||||||||||
Segment expenses | 126,104 | 111,119 | 64,492 | ||||||||||||
Segment performance | $ | 24,318 | $ | 64,030 | $ | (64,492 | ) | ||||||||
Interest expense | $ | — | $ | — | $ | (354 | ) | $ | (354 | ) | |||||
Depreciation | $ | (1,886 | ) | $ | (2,509 | ) | $ | (3,544 | ) | $ | (7,939 | ) | |||