Company Reports Record Revenues
SAN JOSE, Calif., Aug. 25 /PRNewswire-FirstCall/ -- Agile Software
Corporation (Nasdaq: AGIL), a leading provider of product lifecycle management
(PLM) solutions, today announced results for the first quarter of fiscal 2006,
which ended July 31, 2005. Total revenues for the quarter were $34.4 million,
a 30% increase from the $26.5 million recorded in the first quarter of fiscal
2005. License revenues for the first quarter of fiscal 2006 were $13.4
million, compared to $10.3 million for the first quarter of fiscal 2005,
representing a 30% increase.
Net loss for the first quarter of fiscal 2006, on a GAAP basis, was $3.3
million, or ($0.06) per share, compared to $3.0 million, or ($0.06) per share
for the first quarter of fiscal 2005.
Non-GAAP net loss for the first quarter of fiscal 2006 (which excludes
stock compensation and amortization of intangible assets) was $1.2 million, or
$(0.02) per share, compared to a non-GAAP net income (which excludes stock
compensation, amortization of intangible assets and restructuring) of
$299,000, or $0.01 per share, for the first quarter of fiscal 2005. A
reconciliation between net loss on a GAAP basis and on a non-GAAP basis is
provided in a table immediately following the Condensed Consolidated
Statements of Operations below.
Management Commentary
"Posting record revenues is encouraging, since the first quarter of the
new fiscal year is always challenging," said Bryan Stolle, Agile chief
executive officer. "In fact, our two-year compound annual revenue growth rate
of nearly 29% far outstrips not just our peers in the PLM category, but
enterprise software overall. We continue to see many signs that PLM is a top
of mind priority for software investing amongst both the Global 2000 and the
small and medium enterprise markets. With investments in our product and
field organizations leveling off beginning in Q3, we expect positive operating
leverage and bottom-line impact in the second half of the fiscal year."
"We are pleased that our new fiscal year has started on a strong note,"
said Jay Fulcher, Agile president and chief operating officer. "We are very
satisfied with the continuing strong momentum in the PLM market, and the solid
execution in our business, particularly in North America. Both our
year-over-year and sequential growth has us excited about our future
prospects."
Customer Wins and Expansions
Organizations that purchased new or additional licenses of Agile's PLM
solutions include: Adlink, Aircell, Analogic, AMX, Ballard, Bally Gaming,
Bell Sports, CoachComm, Coherent, GE, GN Netcom, Harris, Intuitive Surgical,
Linksys, McData, Medtronic, Netgear, nVidia, Polycom, Quantum, Raytheon,
Siemens, Tellabs, Viasat and ZF.
Awards and Recognition
Agile was named to Start Magazine's Hottest Companies of 2005 for
providing significant value and rapid return of investment to its more than
1,200 PLM customers. In addition, Start Magazine honored two of Agile's
customers, Lucent and Arthrocare, with Technology and Business Awards for
clearly demonstrating their commitment and understanding of how technology can
help them effectively improve and enhance their companies and their bottom
lines.
Agile was named to the 2005 Supply and Demand Chain 100 list, published by
Supply and Demand Chain Executive Magazine. The list recognizes the top 100
organizations providing innovative enterprise-wide solutions and services that
help lead and transform the way companies do business in the area of supply
and demand chains.
Frost and Sullivan recognized Agile with its 2005 Customer Value
Enhancement Award in the PLM category. This award is presented each year to
the company that has best demonstrated the ability to expand its customer base
while maintaining its existing installed base, and has created more innovative
value and enhancement strategies than competing vendors. The award recognizes
the company's successful sales entry, customer acquisition and service
strategies and to the degree which those strategies have met customers' stated
needs and requirements. In addition, Agile was recognized as the PLM market
leader in the electronics and high tech industries.
Financial Accounting Standard 123R
As previously announced, Agile adopted Statement of Financial Accounting
Standard No. 123 (revised) (SFAS 123R) effective as of May 1, 2005. Under the
prior accounting standard (Accounting Principles Board Opinion 25 (APB 25)),
we recorded compensation expense with respect to equity-based compensation
granted to non-employees, primarily consultants, on a fair-value basis and
with respect to equity-based compensation granted to employees based on the
difference, if any, between the market value of our common stock and the
exercise price of the options granted as of the date of grant. Under APB 25,
we were generally not required to record any compensation expense in its
financial statements related to the issuance of market-value priced equity
awards to employees. Under SFAS 123R, beginning with the first quarter of
fiscal 2006, we began to recognize compensation expense for all share-based
payments made to employees and consultants based on the fair value as of the
date of grant. For the first quarter of fiscal 2006, we recorded $764,000 in
stock-related compensation expense in our GAAP financial statements under SFAS
123R. For the first quarter of fiscal 2005, we recorded $336,000 in
stock-based compensation expense in our GAAP financial statements under the
prior accounting standard.
Results of Exchange Offer
On July 11, 2005, Agile announced that it was offering to exchange
outstanding options with an exercise price of $6.76 per share or greater for
new options with an exercise price of $0.001. The exchange ratio in the offer
was one new option share for each three old option shares tendered for
exchange, and non-employee members of the board of directors were not eligible
to participate. The purpose of the exchange offer was to both improve our
ability to retain key employees and to substantially reduce our option
"overhang." As of July 31, 2005, there were options to purchase an aggregate
of approximately 19.1 million shares of common stock outstanding, of which
options to purchase approximately 14 million shares were eligible for exchange
in the exchange offer. The exchange offer expired on Friday, August 19,
2005. Of the approximately 14 million option shares eligible to participate
in the exchange offer, options to purchase a total of approximately 11.4
million shares were surrendered, and new options to purchase approximately 3.8
million shares will be issued. As a result of the exchange, the company's
total number of options outstanding ("overhang") decreased by 7.6 million to
approximately 11.5 million. For financial accounting purposes, Agile will
record a compensation expense of $1 million to $2 million in connection with
the exchange, which will be recognized over the approximately two year vesting
term of the new options.
Conference Call Details
Agile will discuss its first quarter results and management's forward
looking guidance on a conference call today beginning at 2:00 p.m. Pacific
Time. A Webcast of the conference will be available on Agile's Website at
www.agile.com under the 'Investor Relations' section. You may access replays
of the Webcast for ninety days after the call at
http://www.agile.com/investors . Financial and statistical information to be
discussed in the call will be available on the company's Website immediately
prior to commencement of the call. Additional investor information can be
accessed at www.agile.com or by calling Agile's Investor Relations at
408-284-4042.
About Agile Software Corporation
Agile Software Corporation helps companies drive profits, accelerate
innovation, reduce costs, and ensure regulatory compliance throughout the
product lifecycle. With a broad suite of enterprise class PLM solutions,
time-to-value focused implementations, and a unique Guaranteed Business
Results(SM) program, Agile helps companies get the most from their products.
Alcatel, Boeing, Dell Inc., Flextronics International, Hitachi, Leapfrog,
Lockheed Martin, Magna Steyr, Siemens, QUALCOMM and ZF are among the over
10,000 customers in the automotive, aerospace and defense, consumer products,
electronics, high tech, industrial products, and life sciences industries that
have licensed Agile solutions. For more information, call 408-284-4000 or
visit www.agile.com.
Safe Harbor Statement Under the Private Securities Litigation Reform Act
of 1995: This release contains forward-looking statements, which are subject
to the safe harbor provisions of the Private Litigation Reform Act of 1995.
These forward-looking statements include, among other things, statements
regarding the momentum for PLM solutions and improvements in operating
leverage and profitability in future periods. Forward-looking statements
address matters that are subject to a number of risks and uncertainties that
can cause actual results to differ materially from those predicted in the
forward-looking statements, and are based upon information available to Agile
as of the release date. We assume no obligation to update any such statements.
Factors that could cause actual results to differ include, but are not limited
to: slower than anticipated expansion of the overall PLM category; unforeseen
problems in our software that results in delayed customer purchasing decisions
or higher than anticipated maintenance and services costs; and the need for
continued investments in our services, products or other organizations that
adversely affect operating leverage and profitability. These and other risk
factors and risks associated with our business are discussed in our quarterly
and annual reports filed with the SEC. The financial information contained in
this release should be read in conjunction with the consolidated financial
statements and notes thereto included in Agile's most recent report on Form
10-K, as it may be amended from time to time. Agile's results of operations
for the three months ended July 31, 2005 are not necessarily indicative of
Agile's operating results for any future periods.
NOTE: Agile and Agile Software are registered trademarks and Agile
Product Collaboration, Agile Product Cost Management, Agile Product Service
& Improvement, Agile Product Portfolio Management, Agile Engineering
Collaboration, Agile Product Governance and Compliance and the Agile logo are
trademarks of Agile Software Corporation in the U.S. and/or other countries.
Guaranteed Business Results is a service mark of Agile Software Corporation.
All other brand or product names are trademarks and registered trademarks of
their respective holders.
Agile Software Corporation
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended
July 31,
------------------------------------
2005 2004
-------------- --------------
Revenues:
License $13,401 $10,314
Service 20,983 16,167
---------------- ----------------
Total revenues 34,384 26,481
---------------- ----------------
Cost of revenues:
License 772 1,077
Service (1) 11,682 7,569
Amortization of intangible assets 725 178
---------------- ----------------
Total cost of revenues 13,179 8,824
---------------- ----------------
Gross profit 21,205 17,657
---------------- ----------------
Operating expenses:
Sales and marketing (1) 12,830 10,336
Research and development (1) 8,221 5,330
General and administrative (1) 3,446 2,733
Amortization of intangible assets 602 656
Restructuring charges -- 2,132
---------------- ----------------
Total operating expenses 25,099 21,187
---------------- ----------------
Loss from operations (3,894) (3,530)
Interest and other income, net 870 800
---------------- ----------------
Loss before income taxes (3,024) (2,730)
Provision for income taxes 296 273
---------------- ----------------
Net loss $(3,320) $(3,003)
========= =========
Net loss per share:
Basic and diluted $(0.06) $(0.06)
========= =========
Weighted average shares 53,591 52,442
========= =========
(1) Effective May 1, 2005, Agile adopted FAS 123(R), "Share-Based
Payments," and uses the modified prospective method to value its share-based
payments. Accordingly, for the three months ended July 31, 2005, stock
compensation was accounted under FAS 123(R) while for the three months ended
July 31, 2004, stock compensation was accounted under APB 25, "Accounting for
Stock Issued to Employees." The amounts in the tables above include stock
compensation as follows:
Cost of service revenue $92 $90
Sales and marketing 413 159
Research and development 61 15
General and administrative 198 72
---------------- ----------------
Total stock compensation $764 $336
========= =========
Agile Software Corporation
Non-GAAP Financial Measures and Reconciliations
(In thousands, except per share data)
(Unaudited)
Three Months Ended
July 31,
-----------------------------------
2005 2004
---------------- ----------------
GAAP net loss to non-GAAP net
income (loss) reconciliation:
GAAP net loss $(3,320) $(3,003)
Stock compensation (1) 764 336
Amortization of intangible assets 1,327 834
Restructuring charges -- 2,132
---------------- ----------------
Non-GAAP net income (loss) $(1,229) $299
========= =========
GAAP basic and diluted to non-GAAP
basic and
diluted earnings (loss) per share
reconciliation:
GAAP basic and diluted loss per share $(0.06) $(0.06)
Stock compensation (1) 0.01 0.01
Amortization of intangible assets 0.03 0.02
Restructuring charges -- 0.04
---------------- ----------------
Non-GAAP basic and diluted
earnings
(loss) per share $(0.02) $0.01
========= =========
Weighted average shares used in
calculating
non-GAAP diluted net income per
share 53,591 54,068 (2)
(1) Effective May 1, 2005, Agile adopted FAS 123(R), "Share-Based
Payments," and uses the modified prospective method to value its share-based
payments. Accordingly, for the three months ended July 31, 2005, stock
compensation was accounted under FAS 123(R) while for the three months ended
July 31, 2004, stock compensation was accounted under APB 25, "Accounting for
Stock Issued to Employees."
(2) Weighted average shares used in calculating non-GAAP diluted net
income per share for the three months ended July 31, 2004 were computed while
giving effect to all dilutive potential common shares, which were
anti-dilutive for the purpose of calculating GAAP diluted net loss per share.
Agile Software Corporation
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
July 31, April 30,
2005 2005
---------------- ----------------
ASSETS
Current assets:
Cash and cash equivalents $77,356 $81,760
Short-term investments 99,106 93,444
Accounts receivable, net 27,024 26,899
Other current assets 5,327 5,157
---------------- ----------------
Total current assets 208,813 207,260
Long-term investments 21,921 23,176
Property and equipment, net 10,087 10,067
Intangible assets, net 11,108 12,735
Other assets 1,056 1,127
Goodwill 66,769 66,658
---------------- ----------------
Total assets $319,754 $321,023
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and other
liabilities $25,944 $26,694
Deferred revenue 26,757 25,190
---------------- ----------------
Total current liabilities 52,701 51,884
Other non-current liabilities 7,360 8,258
---------------- ----------------
Total liabilities 60,061 60,142
Total stockholders' equity 259,693 260,881
---------------- ----------------
Total liabilities and
stockholders' equity $319,754 $321,023
========= =========
CONTACT:
Terri Pruett of Agile Software Corporation,
+1-408-284-4048, or
Terri.Pruett@agile.com
Web site: http://www.agile.com
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