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INFORMATICA REPORTS THIRD QUARTER REVENUES OF $50.7 MILLION
Strengthens position through acquisition and infrastructure focus
REDWOOD CITY, Calif., October 16, 2003 - Informatica Corporation (NASDAQ: INFA), a leading provider of data integration and business intelligence software, today announced financial results for the third quarter ended September 30, 2003.
Revenues for the third quarter of 2003 were $50.7 million, up slightly from the $50.5 million recorded in the second quarter of 2003, and also up over the $47.6 million recorded in the third quarter of 2002. Net loss for the third quarter, calculated in accordance with U.S. generally accepted accounting principles (GAAP), was $0.2 million or $0.00 per share, compared with a net loss of $17.3 million or $0.22 per share in the third quarter of 2002. Pro forma net income for the third quarter of 2003 was $4.5 million or $0.05 per share, up from $0.1 million or $0.00 per share in the third quarter of 2002. Pro forma operating results discussed in this press release exclude charges related to the amortization of other intangible assets and stock-based compensation, purchased in-process research and development and restructuring charges. All of these expenses are included in Informatica's GAAP results.
For the nine-month period ending September 30, 2003, revenues were $149.8 million, an increase from the $145.3 million recorded during the first nine months of 2002. GAAP net income for the first nine months of 2003 was $4.2 million or $0.05 per share, an increase from net loss of $17.1 million or $0.21 per share for the first nine months of 2002. Pro forma net income for the first nine months of 2003 was $9.3 million or $0.11 per share, an increase from $1.0 million or $0.01 per share in the first nine months of 2002.
“This was a pivotal quarter for Informatica as we drove forward with persistent focus around our infrastructure business, while continuing to deliver customer success, product innovation and industry leadership,” said Gaurav Dhillon, president and CEO of Informatica. “With our acquisition of Striva and launch of our metadata management product SuperGlue, we have demonstrated our commitment to delivering the most comprehensive, unified platform for integrating and visualizing data anywhere in the organization at a time when CIOs are consistently ranking integration and visibility among their top needs. Our customers continue to derive tremendous ROI from our solutions, with a customer going live almost every day of the quarter.”
Significant milestones achieved in the third quarter of 2003 include:
- Signed repeat business with 124 customers. Customers continue to derive value from their investment in Informatica solutions, including American Eagle Outfitters, AXA, Best Buy, Federal Express, Hearst Corporation, GE Aircraft, Hoffman La Roche, Lockheed Martin, Motorola, T-Mobile, Union Bank of California, U.S. Secret Service and Warner Brothers.
- Signed 55 new customers. Informatica increased its customer base this quarter to 1,860 companies. New customers include Allianz Australia, Amway, Boston Children's Hospital, Equity One, Federal Bureau of Investigation, Highmark, Metro-Goldwyn Mayer, Office of the Secretary of Defense, Siemens Building Technologies, Telecom Italia, U.S. Agency for International Development and U.S. Office of Personnel Management.
- Completed acquisition of Striva Corporation. An award-winning provider of mainframe data integration solutions, Striva extends Informatica's leadership in comprehensive enterprise data integration and business intelligence with innovative mainframe technology for high-speed bulk data movement and industry-leading solutions for real-time change data capture in legacy and non-legacy environments.
- Launched Informatica SuperGlue metadata management product. Designed to empower CIOs with greater visibility and control of their enterprise information assets, Informatica SuperGlue is the industry's first completely Web-based metadata management solution for assembling, visualizing and analyzing information about data and systems across the enterprise. Leveraging Informatica's data integration and business intelligence software, SuperGlue integrates disparate enterprise metadata and vividly portrays and controls the movement, lineage and utilization of information assets, enabling organizations to reduce business risk and increase productivity while helping to reduce IT development and maintenance costs.
- Enhanced data quality offering through an OEM agreement with Firstlogic, Inc. Informatica's market-leading data integration platform now embeds powerful data-quality technology from Firstlogic, providing customers with a unified solution for best-of-breed data quality and integration capabilities.
- Strengthened focus on data integration business. In order to further extend its market leadership in data integration, Informatica transitioned its solutions business to systems integration and software application partners. With this realignment in strategy, Informatica has focused resources around its strongest product lines: the market's leading data integration infrastructure and a next-generation business intelligence platform.
- Acknowledged as industry's leading data integration vendor. The Data Warehousing Institute (TDWI) issued a survey on data integration highlighting Informatica as the clear market leader, with market share over 200 percent larger than the nearest vendor. Informatica was also named one of the top “10 most influential” companies in the areas of application development and data integration by Computer Business Review alongside industry heavyweights such as Sun, IBM and Microsoft. International Data Corporation also ranked Informatica as the leading vendor in the data movement and replication space for the third-consecutive year.
- Gained further traction in the business intelligence market. Informatica was positioned in the “Visionary” quadrant in Gartner's August 25, 2003 report, “Magic Quadrants for EBIS/Reporting and BI Platforms, 2H03.” According to a study by Ventana Research, the Informatica PowerAnalyzer business intelligence platform also demonstrated the lowest overall total cost of ownership among leading business intelligence vendors in the most use case scenarios - beating out Cognos, MicroStrategy, Information Builders and Actuate. Finally, Motorola's implementation of Informatica's PowerAnalyzer business intelligence platform beat nominations from other BI vendors for CMP Media's RealWare Award for Best Strategic Business Performance Management solution - recognizing Motorola's “outstanding achievements in innovative IT solutions powered by Informatica products that produce business value.”
To supplement our condensed consolidated financial statements presented on a GAAP basis, Informatica uses pro forma measures of net income and net income per share, which are adjusted to exclude certain charges and expenses discussed above which we believe are appropriate to enhance an overall understanding of our past financial performance. These adjustments to our current period GAAP results are made with the intent of providing both management and investors a more complete understanding of our underlying operational results and trends and our marketplace performance. For example, the pro forma results are an indication of our baseline performance before losses or other charges that are considered by management to be outside of our core operating results. In addition, these pro forma results are among the primary indicators management uses as a basis for our planning and forecasting of future periods. The presentation of this additional information is not meant to be considered in isolation or as a substitute for net income or net income per share prepared in accordance with generally accepted accounting principles in the United States.
Informatica will be discussing its third quarter 2003 results on a conference call today beginning at 2:00 p.m. PDT. A live Webcast and replay of the conference call will be available at http://www.informatica.com/investor. A replay of the call will also be available by dialing 888-286-8010, passcode 20124210. The telephone replay will be available until 4:00 p.m. on October 23, 2003.
About Informatica
Informatica Corporation (NASDAQ: INFA) is a leading provider of data integration and business intelligence software. Using Informatica products, Global 2000 companies can leverage their existing information assets for enterprise insight that helps them improve business performance, increase customer profitability, streamline supply chain operations and proactively manage regulatory compliance. More than 1,800 companies worldwide rely on Informatica to meet their end-to-end needs for enterprise data integration and business intelligence. For more information, call 1.650.385.5000 (1.800.970.1179 in the U.S.), or visit the Informatica Web site at http://www.informatica.com/
Note: Informatica and SuperGlue are the trademarks or registered trademarks of Informatica Corporation in the United States and in jurisdictions throughout the world. All other company and product names may be trade names or trademarks of their respective owners.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2003 2002 2003 2002
Revenues:
License $22,774 $22,270 $70,552 $75,176
Service 27,903 25,375 79,220 70,142
Total revenues 50,677 47,645 149,772 145,318
Cost of revenues:
License 974 1,377 2,198 4,483
Service 9,745 9,764 28,661 29,362
Total cost of
revenues 10,719 11,141 30,859 33,845
Gross profit 39,958 36,504 118,913 111,473
Operating expenses:
Research and
development 12,071 11,278 34,750 34,884
Sales and
marketing 20,350 20,981 62,272 64,851
General and
administrative 5,190 5,270 15,981 15,093
Amortization of
intangible assets 99 285 524 855
Amortization of
stock-based
compensation 22 52 65 190
Purchased in-process
research and
development 4,524 -- 4,524 --
Restructuring
charges -- 17,030 -- 17,030
Total operating
expenses 42,256 54,896 118,116 132,903
Income (loss)
from operations (2,298) (18,392) 797 (21,430)
Interest income
and other, net 2,895 1,176 5,275 4,655
Income (loss)
before income taxes 597 (17,216) 6,072 (16,775)
Income tax provision 781 64 1,870 325
Net income (loss) $(184) $(17,280) $4,202 $(17,100)
Net income (loss)
per share:
Basic and Diluted $(0.00) $(0.22) $0.05 $(0.21)
Weighted shares
used to compute
net income
(loss) per share:
Basic 80,380 79,999 80,381 79,659
Diluted 80,380 79,999 83,097 79,659
Pro forma
information,
excluding
amortization
of intangible
assets and
stock-based
compensation,
purchased
in-process
research
and development
and restructuring
charges:
Income (loss)
from operations,
GAAP basis $(2,298) $(18,392) $797 $(21,430)
Amortization
of intangible
assets 99 285 524 855
Amortization of
stock-based
compensation 22 52 65 190
Purchased
in-process
research and
development 4,524 -- 4,524 --
Restructuring
charges -- 17,030 -- 17,030
Income (loss)
from operations,
pro forma 2,347 (1,025) 5,910 (3,355)
Interest income
and other, net 2,895 1,176 5,275 4,655
Income before
income taxes,
pro forma 5,242 151 11,185 1,300
Income tax
provision 781 64 1,870 325
Net income,
pro forma $4,461 $87 $9,315 $975
Net income
per share,
pro forma:
Basic $0.06 $0.00 $0.12 $0.01
Diluted $0.05 $0.00 $0.11 $0.01
Weighted shares
used to compute
net income
per share,
pro forma:
Basic 80,380 79,999 80,381 79,659
Diluted 83,394 82,820 83,097 83,187
INFORMATICA CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
September 30, June 30, Dec. 31,
2003 2003 2002
(unaudited) (unaudited)
ASSETS
Current assets:
Cash and cash equivalents $160,489 $130,791 $122,490
Short-term investments 57,800 111,088 113,385
Accounts receivable, net 27,093 26,119 29,982
Prepaid expenses and
other current assets 4,683 5,376 8,680
Total current assets 250,065 273,374 274,537
Property and equipment, net 40,862 42,861 47,370
Restricted cash 12,166 12,166 12,166
Goodwill and intangible
assets, net 87,694 30,366 30,791
Other assets 355 355 330
Total assets $391,142 $359,122 $365,194
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and
other current liabilities $44,368 $41,762 $41,383
Deferred revenue 48,020 50,478 51,702
Accrued restructuring charges 4,857 4,866 4,812
Accrued merger costs 1,431 - -
Total current liabilities 98,676 97,106 97,897
Accrued restructuring
charges, less current
portion 11,435 12,548 14,894
Accrued merger costs,
less current portion 603 -- --
Stockholders' equity 280,428 249,468 252,403
Total liabilities and
stockholders' equity $391,142 $359,122 $365,194
INFORMATICA CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2003 2002 2003 2002
Operating activities
Net income (loss) $(184) $(17,280) $4,202 $(17,100)
Adjustments to
reconcile
net income (loss)
to net cash
provided by
operating
activities:
Depreciation
and amortization 2,655 2,540 8,406 7,265
Provision for
doubtful accounts -- 772 177 1,433
Amortization of
stock-based
compensation 22 52 65 190
Amortization of
intangible assets 99 285 524 855
Purchased
in-process
research and
development 4,524 -- 4,524 --
Non-cash
restructuring
charges - 1,887 -- 1,887
Gain on the sale
of investments (103) -- (121) (154)
Loss on disposal
of property
and equipment -- -- 4 357
Other -- 181 76 181
Changes in
operating
assets and
liabilities:
Accounts
receivable 423 740 4,109 (2,475)
Prepaid expenses
and other
current assets 1,205 (848) 4,509 719
Other assets 7 205 (18) 546
Accounts payable
and other
current liabilities 681 (4,552) 1,061 828
Accrued
restructuring
charges (1,121) 14,296 (3,414) 11,752
Deferred
revenue (3,387) 5,084 (4,611) 7,237
Net cash
provided by
operating
activities 4,821 3,362 19,493 13,521
Investing
activities
Purchases of
property and
equipment, net (512) (650) (1,758) (5,365)
Purchases of
investments (25,458) (89,370) (92,745) (218,350)
Sales and
maturities of
investments 78,499 66,700 147,889 153,013
Acquisitions,
net of cash
acquired (30,279) -- (30,279) --
Net cash
provided
(used) by
investing
activities 22,250 (23,320) 23,107 (70,702)
Financing
activities
Proceeds from
issuance of
common stock,
net of payments
for repurchases 3,480 3,737 6,532 7,531
Treasury stock
purchases (1,003) -- (11,448) --
Net cash
provided
(used) by
financing
activities 2,477 3,737 (4,916) 7,531
Effect of foreign
currency
translation 150 11 315 388
Increase (decrease)
in cash and cash
equivalents 29,698 (16,210) 37,999 (49,262)
Cash and cash
equivalents at
beginning of
period 130,791 98,212 122,490 131,264
Cash and cash
equivalents
at end of period $160,489 $82,002 $160,489 $82,002
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