Ariba, Inc. (Nasdaq: ARBA), the leading provider of
collaborative business commerce solutions, today announced results
for the first quarter of fiscal year 2011 ended December 31,
2010.
Quarterly Financial and Operational Highlights from
Continuing Operations:
- Total revenues of $90.4 million and EPS
of $0.09 from continuing operations.
- Non-GAAP EPS of $0.18 from continuing
operations
- 12-month subscription software backlog
of $166 million, up 19% percent year-over-year
- Cash flow from continuing operations of
$15.6 million
- Ending cash, cash equivalents,
investments and restricted cash of $290.9 million
“On the heels of a very strong fiscal year 2010, Ariba continues
to perform well,” said Bob Calderoni, Chairman and CEO, Ariba. “We
see momentum accelerating with our cloud-based collaborative
commerce solutions as companies around the world increasingly seek
ways to become more connected, efficient and informed. We also made
a number of strategic moves, including the acquisition of Quadrem,
which will allow us to expand the depth and breadth of our
network-based offerings and further accelerate our growth.”
Results for the First Quarter of Fiscal Year 2011
Revenue from Continuing Operations:
Total revenues for the first quarter of fiscal year 2011 from
continuing operations were $90.4 million, as compared to $75.2
million for the first quarter of fiscal year 2010. Subscription and
maintenance revenues for the first quarter of fiscal year 2011 were
$65.9 million, as compared to $58.4 million for the first quarter
of fiscal year 2010. Within subscription and maintenance revenues,
subscription software revenue was $50.2 million for the first
quarter of fiscal year 2011, as compared to $41.2 million for the
first quarter of fiscal year 2010. Services and other revenues for
the first quarter of fiscal year 2011 were $24.6 million, as
compared to $16.8 million for the first quarter of fiscal year
2010.
Earnings Per Share from Continuing Operations:
Net income from continuing operations for the first quarter of
fiscal year 2011 was $8.5 million, or $0.09 per share, as compared
to net income from continuing operations for the first quarter of
fiscal year 2010 of $1.0 million, or $0.01 per share. Net income
from continuing operations for the first quarter of fiscal year
2011 included expenses of $1.0 million for amortization of
intangible assets, $12.8 million for stock-based compensation, and
$1.0 million of transaction-related costs and included a tax
accrual reversal benefit of $3.9 million and a restructuring
benefit of $2.9 million. Excluding these items, Non-GAAP net income
from continuing operations was $16.5 million, or $0.18 per diluted
share.
Balance Sheet and Cash:
Total cash, cash equivalents, investments and restricted cash
were $290.9 million at December 31, 2010, up $91.4 million from
December 31, 2009 and up $38.9 million from September 30, 2010. Net
cash flow from continuing operations for the three months ended
December 31, 2010 was $15.6 million, as compared to $10.3 million
for the three months ended December 31, 2009. Accounts receivable,
on a days-sales-outstanding basis, were 21 days for the first
quarter of fiscal 2011, as compared to 21 days for the first
quarter of fiscal 2010, and 20 days with the previous quarter.
Total deferred revenues were $125.2 million at December 31, 2010,
compared to $119.5 million at December 31, 2009 and $104.3 million
at September 30, 2010.
Customer Acquisition and Transactions for the
Quarter:
During the quarter, 232 companies of all sizes across
geographies purchased Ariba solutions to manage their commerce
activities, including: American Express, Amgen, BP Corporation,
Caterpillar, Hewlett-Packard, Pfizer, Accenture, Hertz, and Avon.
The company also added 31 new customers, and closed 18 transactions
over $1 million including seven software deals over $1 million, and
216 on-demand product deals.
Conference Call Information
Ariba will hold a conference call today at 5:00 p.m. ET to
discuss its results for the first quarter of fiscal 2011. To join
the call, please dial (877) 407-8031 in the United States and
Canada, or (201) 689-8031 if calling internationally. The
conference call will also be webcast live and can be accessed on
the investor relations section of the company’s website at
www.ariba.com or by logging in at www.vcall.com
A replay of the conference can be accessed by calling (877)
660-6853 in the United States and Canada or (201) 612-7415
internationally and entering account number 286 and conference ID
number: 364674.
About Ariba, Inc.
Ariba, Inc. is the leading provider of collaborative business
commerce solutions. Ariba combines industry-leading technology with
the world's largest web-based trading community for business to
help companies discover, connect and collaborate with a global
network of partners – all in a cloud-based environment. Using the
Ariba® Commerce Cloud, businesses of all sizes can buy, sell and
manage cash more efficiently and effectively. Over 340,000
companies around the globe use the Ariba Commerce Cloud to simplify
inter-enterprise commerce and enhance results. Why not join them?
To get on the path to Better Commerce visit:
www.ariba.com/commercecloud/
Copyright © 1996 – 2011 Ariba, Inc.
Ariba, the Ariba logo, AribaLIVE, Ariba.com, Ariba.com Network,
Ariba Spend Management. Find it. Get it. Keep it. and PO-Flip are
registered trademarks of Ariba, Inc. Ariba Procure-to-Pay, Ariba
Buyer, Ariba eForms, Ariba PunchOut, Ariba Services Procurement,
Ariba Travel and Expense, Ariba Procure-to-Order, Ariba Procurement
Content, Ariba Sourcing, Ariba Savings and Pipeline Tracking, Ariba
Category Management, Ariba Category Playbooks, Ariba StartSourcing,
Ariba Spend Visibility, Ariba Analysis, Ariba Data Enrichment,
Ariba Contract Management, Ariba Contract Compliance, Ariba
Electronic Signatures, Ariba StartContracts, Ariba Invoice
Management, Ariba Payment Management, Ariba Working Capital
Management, Ariba Settlement, Ariba Supplier Information and
Performance Management, Ariba Supplier Information Management,
Ariba Discovery, Ariba Invoice Automation, Ariba PO Automation,
Ariba Express Content, Ariba Ready, and Ariba LIVE are trademarks
or service marks of Ariba, Inc. All other brand or product names
may be trademarks or registered trademarks of their respective
companies or organizations in the United States and/or other
countries.
Ariba Safe Harbor
Safe Harbor Statement under the Private Securities Litigation
Reform Act 1995: Information and announcements in this release
involve Ariba's expectations, beliefs, hopes, plans, intentions or
strategies regarding the future and are forward-looking statements
that involve risks and uncertainties. All forward-looking
statements included in this release are based upon information
available to Ariba as of the date of the release, and we assume no
obligation to update any such forward-looking statements. These
statements are not guarantees of future performance and actual
results could differ materially from our current expectations.
Factors that could cause or contribute to Ariba's operating and
financial results to differ materially from current expectations
include, but are not limited to: the impact of the credit crises on
Ariba’s results of operations and financial condition; delays in
development or shipment of new versions of Ariba's products and
services; lack of market acceptance of Ariba's existing or future
products or services; inability to continue to develop competitive
new products and services on a timely basis; introduction of new
products or services by major competitors;; the impact of any
acquisitions, including our recently completed acquisition of the
business of Quadrem International Holdings, Ltd., such as
difficulties with the integration process or the realization of
benefits of a transaction; the impact of our recent disposition of
our sourcing service and business process outsourcing business,
including the potential disruption of our ongoing business; the
ability to attract and retain qualified employees; long and
unpredictable sales cycles and the deferrals of anticipated orders;
declining economic conditions, including the impact of a recession;
inability to control costs; changes in the company's pricing or
compensation policies; significant fluctuations in our stock price;
the outcome of and costs associated with pending or potential
future regulatory or legal proceedings; the impact of our
acquisitions and dispositions, including the disruption or loss of
customer, business partner, supplier or employee relationships; and
the level of costs and expenses incurred by Ariba as a result of
such transactions. Factors and risks associated with its business,
including a number of the factors and risks described above, are
discussed in Ariba's Form 10-K filed with the SEC on November 23,
2010. All forward-looking statements in this press release and the
related earnings call are based on information available to Ariba
as of the date hereof. Ariba assumes not obligation to update these
forward-looking statements. Any future products, features or
related specifications that may be referenced in the release or in
the related earnings call are for information purposes only and are
not commitments to deliver any technology or enhancement. Ariba
reserves the right to modify future product plans at any time.
Ariba, Inc. and Subsidiaries Condensed Consolidated Balance Sheets
(Unaudited; in thousands) December 31, September 30,
2010 2010 ASSETS Current assets: Cash and cash equivalents $
221,754 $ 182,393 Short-term investments 15,706 18,449 Restricted
cash 104 104 Accounts receivable, net 23,565 21,781 Prepaid
expenses and other current assets 19,901 7,942
Total current assets 281,030 230,669 Property and
equipment, net 15,999 15,958 Long-term investments 24,219 22,283
Restricted cash, less current portion 29,137 29,137 Goodwill
394,718 406,507 Other intangible assets, net 12,129 13,154 Other
assets 4,293 4,001 Total assets $
761,525 $ 721,709 LIABILITIES AND
STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 13,617
$ 11,190 Accrued compensation and related liabilities 17,086 32,079
Accrued liabilities 20,663 18,398 Restructuring obligations 15,901
17,188 Deferred revenue 113,167 97,005
Total current liabilities 180,434 175,860 Deferred rent
obligations 8,342 9,880 Restructuring obligations, less current
portion 17,443 23,339 Deferred revenue, less current portion 12,028
7,285 Other long-term liabilities 1,508 6,391
Total liabilities 219,755 222,755
Stockholders' equity: Common stock 187 188 Additional
paid-in capital 5,237,531 5,236,265 Accumulated other comprehensive
loss (2,427 ) (1,879 ) Accumulated deficit (4,693,521 )
(4,735,620 ) Total stockholders' equity 541,770
498,954 Total liabilities and stockholders'
equity $ 761,525 $ 721,709 Ariba, Inc. and
Subsidiaries Condensed Consolidated Statements of Operations
(Unaudited; in thousands, except per share data)
Three Months Ended December 31, 2010 2009 Revenues: Subscription
and maintenance $ 65,858 $ 58,373 Services and other 24,562
16,819 Total revenues 90,420
75,192 Cost of revenues: Subscription and maintenance 14,290
12,674 Services and other 15,307 12,448 Amortization of acquired
technology and customer intangible assets 1,025
1,327 Total cost of revenues 30,622
26,449 Gross profit 59,798 48,743
Operating expenses: Sales and marketing 35,716 26,692 Research and
development 12,492 11,146 General and administrative 10,610 10,012
Amortization of other intangible assets - 104 Restructuring benefit
(2,923 ) - Total operating expenses 55,895
47,954 Operating income 3,903 789 Interest and
other expense, net 769 277 Income from
continuing operations before income taxes 4,672 1,066 (Benefit
from) provision for income taxes (3,812 ) 17 Income
from continuing operations 8,484 1,049 Discontinued
operations, net of tax: (Loss) income from discontinued operations
(5,104 ) 1,176 Gain on sale of discontinued operations
38,719 - Total discontinued operations 33,615
1,176 Net income $ 42,099 $ 2,225
Basic earnings per share: Income from continuing operations
$ 0.09 $ 0.01 Discontinued operations, net of tax
0.38
0.02 Net income per basic common share $ 0.47 $ 0.03
Diluted earnings per share: Income from continuing operations $
0.09 $ 0.01 Discontinued operations, net of tax 0.36
0.02 Net income per diluted common share $ 0.45 $
0.03 Weighted average shares - basic 88,632 85,161 Weighted
average shares - diluted 92,574 88,262 Ariba, Inc. and
Subsidiaries Cash Flows (Unaudited; in thousands)
Three Months Ended December 31, 2010 2009 Operating activities: Net
income $ 42,099 $ 2,225 Less income from discontinued operations,
net of tax
(33,615 ) (1,176 ) Income from continuing operations 8,484
1,049 Adjustments to reconcile income from continuing operations to
net cash provided by operating activities: Provision for doubtful
accounts 165 46 Depreciation 2,074 1,839 Amortization of intangible
assets 1,025 1,431 Stock-based compensation 12,834 13,106
Restructuring benefit (2,923 ) - Other-than temporary impairment of
long-term investments - 499 Changes in operating assets and
liabilities: Accounts receivable (1,949 ) (52 ) Prepaid expense and
other assets (652 ) (889 ) Accounts payable 91 79 Accrued
compensation and related liabilities (13,695 ) (11,431 ) Accrued
liabilities (6,535 ) (85 ) Deferred revenue 20,917 9,030
Restructuring obligations (4,260 ) (4,326 ) Net cash
provided by continuing operations 15,576 10,296 Net cash (used
in)/provided by discontinued operations (1,121 ) 209
Net cash provided by operating activities 14,455
10,505 Investing activities: Proceeds
from sale of discontinued operations 39,000 - Purchases of property
and equipment (2,115 ) (1,386 ) Maturities of investments, net of
purchases 459 (7,631 ) Net cash provided by (used in)
investing activities 37,344 (9,017 )
Financing activities:
Proceeds from issuance of common stock,
net
431 27 Repurchase of common stock (12,802 ) (5,056 )
Net cash used in financing activities (12,371 )
(5,029 ) Effect of exchange rates on cash and cash
equivalents (67 ) (7 ) Net change in cash and cash
equivalents 39,361 (3,548 ) Cash and cash equivalents at
beginning of period 182,393 130,881 Cash and cash
equivalents at end of period $ 221,754 $ 127,333
Non-GAAP Financial Measures
The following table reconciles financial measures prepared in
accordance with Generally Accepted Accounting Principles in the
United States of America (GAAP) to the most directly comparable
non-GAAP financial measures in the press release.
Non-GAAP financial measures should not be considered as a
substitute for, or superior to, GAAP financial measures, which
should be considered as the primary financial metrics for
evaluating our financial performance. Significantly, non-GAAP
financial measures are not based on a comprehensive set of
accounting rules or principles. Instead, they are based on
subjective determinations by management designed to supplement our
GAAP financial measures. They are subject to a number of important
limitations and should be considered only in conjunction with our
consolidated financial statements prepared in accordance with GAAP.
For example, our non-GAAP financial measures have the effect of
excluding a purchase accounting adjustment, costs and expenses from
our operating results that should be properly considered under a
system of accrual accounting. In addition, our non-GAAP financial
measures differ from GAAP measures with the same names, may vary
over time and may differ from non-GAAP financial measures with the
same or similar names used by other companies. Accordingly,
investors should exercise caution when evaluating our non-GAAP
financial measures.
Despite these limitations, we believe our non-GAAP financial
measures provide meaningful supplemental information about our
operating results, primarily because they exclude a purchase
accounting adjustment and costs and expenses that we do not believe
are indicative of the ongoing operating performance of our business
and our senior management. Although these items should properly be
considered in our GAAP financial measures, we believe they should
be excluded when evaluating our current operating performance. The
non-GAAP financial measures disclosed in the accompanying press
release are used by our Board of Directors and senior management to
evaluate our current operating performance, are used in evaluating
the performance of our senior management, and are used in our
budget and planning processes. We believe that our non-GAAP
financial measures are helpful to investors by facilitating
comparisons of our current and prior operating results and by
facilitating comparisons of our operating results with those of
other software companies.
Ariba, Inc. and Subsidiaries Reconciliation of GAAP to
Non-GAAP Operating Results (Unaudited; in thousands, except per
share data) The following tables reconcile the
specific items excluded from GAAP in the calculation of non-GAAP
operating results for the period indicated below: Three
Months Ended Three Months Ended December 31, 2010 December 31, 2009
Expense
reconciliation:
GAAP revenue $ 90,420 $ 75,192 Less: GAAP net income 42,099
2,225 Total GAAP expenses 48,321 72,967
Amortization of intangible assets (1,025 ) (1,431 ) Stock-based
compensation (12,834 ) (13,106 ) Tax accrual reversal 3,942 -
Restructuring benefit 2,923 - Transaction costs (990 ) -
Discontinued operations 33,615 1,176
Total non-GAAP operating expenses $ 73,952 $ 59,606
Three Months Ended Three Months Ended December 31,
2010 December 31, 2009
Net income
reconciliation:
GAAP net income $ 42,099 $ 2,225 Amortization of intangible assets
1,025 1,431 Stock-based compensation 12,834 13,106 Tax accrual
reversal (3,942 ) - Restructuring benefit (2,923 ) - Transaction
costs 990 - Discontinued operations (33,615 ) (1,176
) Non-GAAP income from continuing operations $ 16,468 $
15,586 Three Months Ended Three Months Ended
December 31, 2010 December 31, 2009
Net income per share
reconciliation:
GAAP net income per share - basic $ 0.47 $ 0.03 Amortization of
intangible assets 0.01 0.01 Stock-based compensation 0.14 0.15 Tax
accrual reversal (0.04 ) - Restructuring benefit (0.03 ) -
Transaction costs 0.01 - Discontinued operations (0.38 )
(0.01 ) Non-GAAP income from continuing operations per share
- basic $ 0.19 $ 0.18 Non-GAAP income from
continuing operation per share - diluted $ 0.18 $ 0.18
Weighted average shares - basic 88,632 85,161 Weighted average
shares - diluted 92,574 88,262
Discussion of Specific Items Excluded From Non-GAAP Financial
Measures
Our non-GAAP financial measures exclude the results of
discontinued operations and generally exclude expenses or benefits
for (i) amortization of intangible assets related to acquisitions,
(ii) stock-based compensation, (iii) restructuring costs or
benefits, (iv) tax accrual reversal (v) transaction related costs.
We exclude these items because we believe they are not closely
related to the ongoing operating performance of our business and
the performance of our senior management and are generally excluded
from our budget and planning process. In addition to these reasons,
we believe our non-GAAP financial measures are also helpful to
investors by facilitating comparisons of our operating results over
different time periods and by facilitating comparisons of our
financial performance with that of other companies. In addition,
except for costs and expenses related to restructuring and
transaction related costs, these items are non-cash items that do
not affect cash flows.
(1) Discontinued Operations. We exclude the
results of discontinued operations from our non-GAAP financial
measures because they are unrelated to our ongoing operations. We
believe excluding the results of discontinued operations helps
investors compare our operating performance with that of other
companies. We recognize, however, that the discontinued operations
impact cash flow and that we and investors should carefully
consider the impact of this on cash flow.
(2) Amortization of Acquired Intangible
Assets. In accordance with GAAP, we amortize intangible assets
acquired in connection with acquisitions over the estimated useful
lives of the assets. We exclude these amortization costs in our
non-GAAP financial measures because they (i) result from prior
acquisitions, rather than the ongoing operating performance of our
business, and (ii) absent additional acquisitions, are expected to
decline over time as the remaining carrying amounts of these assets
are amortized. We believe excluding these costs helps investors
compare our financial performance with that of other companies with
different acquisition histories. However, as with impairment
charges, we recognize that amortization costs provide a helpful
measure of the financial impact and performance of prior
acquisitions and consider our non-GAAP financial measures in
conjunction with our GAAP financial results that include
amortization costs.
(3) Stock-Based Compensation Expenses. We
exclude stock-based compensation expense associated with stock
options and stock granted to employees and non-executive directors
in our non-GAAP financial measures. While stock-based compensation
is a significant component of our expenses, we believe that
investors wish to be able to exclude the effects of stock-based
compensation expense in comparing our financial performance with
that of other companies.
(4) Restructuring benefit. We recorded a
restructuring benefit related to lease abandonment accruals in the
three months ended December 31, 2010. We exclude this from our
non-GAAP financial measures because it is unrelated to our ongoing
operations and is significantly impacted by factors outside our
control. We believe excluding restructuring costs helps investors
compare our operating performance with that of other companies. We
recognize, however, that restructuring costs will impact cash flows
and that we and investors should carefully consider the impact of
these costs on future cash flows.
(5) Release of tax reserve. We released a tax
reserve of approximately $3.9 million in the three months ended
December 31, 2010. We exclude this from our non-GAAP financial
measures because it is unrelated to our ongoing operations. We
believe excluding the tax reserve release helps investors compare
our operating performance with that of other companies.
(6) Transaction related costs. We recorded
approximately $1.0 million of transaction related costs in the
three months and twelve months ended December 31, 2010. We exclude
these from our non-GAAP financial measures because they are
unrelated to our ongoing operations. We believe excluding the
transaction related costs helps investors compare our operating
performance with that of other companies. We recognize, however,
that the transaction related costs impact cash flow and that we and
investors should carefully consider the impact of this on cash
flow.
Ariba, Inc. and Subsidiaries Reconciliation of Outlook for
the Quarter Ending March 31, 2011 (Unaudited; in thousands, except
per share data) The following tables reconcile the
specific items excluded from GAAP in the calculation of non-GAAP
projected operating results for the period indicated below:
Range for the Three Months Ending March 31, 2011 Low High
Projected
revenue:
$ 103,000 $ 106,000 Range for the Three Months Ending
March 31, 2011
Projected expense
reconciliation:
Low High GAAP projected total expenses $ 103,300 $ 104,300
Amortization of intangible assets (3,000 ) (3,000 ) Stock-based
compensation (12,000 ) (12,000 ) Transaction costs (1,300 )
(1,300 ) Non-GAAP projected total expenses $ 87,000 $
88,000 Range for the Three Months Ending March
31, 2011
Projected net income
reconciliation:
Low High GAAP projected net income $ (300 ) $ 1,700 Amortization of
intangible assets 3,000 3,000 Stock-based compensation 12,000
12,000 Transaction costs 1,300 1,300
Non-GAAP projected net income $ 16,000 $ 18,000
Range for the Three Months Ending March 31, 2011
Projected net income
per share reconciliation:
Low High GAAP projected net income per share - basic $ (0.00 ) $
0.02 Amortization of intangible assets 0.03 0.03 Stock-based
compensation 0.13 0.13 Transaction costs 0.01
0.01 Non-GAAP projected net income per share - basic $ 0.17
$ 0.20 Non-GAAP projected net income per share
- diluted $ 0.17 $ 0.19 Projected weighted average shares -
basic 91,900 91,900 Projected weighted average shares - diluted
94,700 94,700 Ariba, Inc. and Subsidiaries Condensed
Consolidated Statements of Operations (Unaudited; in thousands,
except per share data) Three
Months Ended Three Months Ended December 31, December 31,
2010Reported
Adj
2010 Non-GAAP
2009Reported
Adj
2009 Non-GAAP
Revenues: Subscription and maintenance $ 65,858 $ - $ 65,858 $
58,373 $ - $ 58,373 Services and other 24,562
- 24,562 16,819 - 16,819
Total revenues 90,420 - 90,420
75,192 - 75,192 Cost of
revenues: Subscription and maintenance (3) 14,290 (788 ) 13,502
12,674 (934 ) 11,740 Services and other (2) 15,307 (889 ) 14,418
12,448 (1,186 ) 11,262 Amortization of acquired technology and
customer intangible assets (2) 1,025 (1,025 )
- 1,327 (1,327 ) - Total cost of
revenues 30,622 (2,702 ) 27,920
26,449 (3,447 ) 23,002 Gross profit 59,798
2,702 62,500 48,743 3,447
52,190 Operating expenses: Sales and marketing
(3) 35,716 (6,450 ) 29,266 26,692 (5,546 ) 21,146 Research and
development (3) 12,492 (1,863 ) 10,629 11,146 (1,377 ) 9,769
General and administrative (3) (6) 10,610 (3,834 ) 6,776 10,012
(4,063 ) 5,949 Amortization of other intangible assets (2) - - -
104 (104 ) - Restructuring benefit (4) (2,923 ) 2,923
- - - - Total operating
expenses 55,895 (9,224 ) 46,671
47,954 (11,090 ) 36,864 Operating income 3,903
11,926 15,829 789 14,537 15,326 Interest and other expense, net
769 - 769 277 -
277 Income from continuing operations before income
taxes 4,672 11,926 16,598 1,066 14,537 15,603 (Benefit from)
provision for income taxes (5) (3,812 ) 3,942
130 17 - 17 Income from
continuing operations 8,484 7,984 16,468 1,049 14,537 15,586
Discontinued operations, net of tax: (Loss) income from
discontinued operations (1) (5,104 ) 5,104 - 1,176 (1,176 ) - Gain
on sale of discontinued operations (1) 38,719
(38,719 ) - - - - Total
discontinued operations 33,615 (33,615 )
- 1,176 (1,176 ) - Net income $
42,099 $ (25,631 ) $ 16,468 $ 2,225 $ 13,361 $ 15,586
Basic earnings per share: Income from continuing operations
$ 0.09 $ 0.19 $ 0.01 $ 0.18 Discontinued operations, net of tax
0.38 - 0.02 - Net income per
basic common share $ 0.47 $ 0.19 $ 0.03 $ 0.18
Diluted earnings per share: Income from continuing operations $
0.09 $ 0.18 $ 0.01 $ 0.18 Discontinued operations, net of tax
0.36 - 0.02 - Net income per
diluted common share $ 0.45 $ 0.18 $ 0.03 $ 0.18
Weighted average shares - basic 88,632 88,632 85,161 85,161
Weighted average shares - diluted 92,574 92,574 88,262 88,262
Ariba, Inc. and Subsidiaries Q1 Fiscal 2011
Supplemental Information (in millions, except for percentages)
FY 2008 FY2009
FY2010 FY2011
2008-Q1 2008-Q2 2008-Q3 2008-Q4
2009-Q1 2009-Q2 2009-Q3 2009-Q4
2010-Q1 2010-Q2 2010-Q3 2010-Q4
2011-Q1 REVENUE ANALYSIS Network
Software Revenue 4.7 7.4 7.1 6.9 8.2 7.5 7.7 8.6 9.8 9.4 10.7
11.2 13.8
Subscription software revenue 20.8 28.6
30.3 32.6 35.9 36.4 37.9 41.1 41.2 42.3 44.0 46.5 50.2 Purchase
accounting adjustment to acquired Procuri contracts
0.4 2.3 1.4 0.9
0.4 - - -
- - - -
-
Non-GAAP subscription software revenue 21.2
30.8 31.7 33.5 36.2 36.4 37.9 41.1 41.2 42.3 44.0 46.5 50.2
Subscription software revenue growth rates (Yr/Yr)
Subscription software revenue 37 % 83 % 68 % 74 % 72 % 27 % 25 % 26
% 15 % 16 % 16 % 13 % 22 % Non-GAAP subscription software revenue
40 % 97 % 76 % 78 % 71 % 18 % 19 % 23 % 14 % 16 % 16 % 13 % 22 %
CASH
FLOW METRICS Continuing Operations => Cash
Flow from Operations $ 1.2 $ 1.5
$ 8.7 $ 10.2 $ 10.8
$ 16.3 $ 20.0 $ 18.8
$ 10.3 $ 24.9 $ 16.3
$ 10.5 $ 15.6 Cash used for
lease loss (Restructuring Obligations) 4.4 4.5 5.9 4.7 4.7 4.5 4.4
4.3 $ 4.3 $ 4.2 $ 4.3 $ 4.3 $ 4.3 Cash used for Procuri-related
integration & other severances (Restructuring Obligations) 0.2
1.8 0.8 1.2 1.0 1.7 1.4 0.7 - - - - - Cash for Procuri-related
M&A activities (Accrued liabilities) - 3.1 - - - - - - - - - -
- Cash used for Sky settlement (Prepaids, Accrued liabilities) -
5.9 - - - - - - - - - - - Cash Received for Emptoris Litigation
Judgment
- -
- -
- -
- -
- (7.0 )
- -
- Cash from Operations used for Procuri, Sky,
Lease Loss less Emptoris Receipt 4.6 15.3 6.7 5.9 5.7 6.2 5.8 5.0
4.3 (2.8 ) 4.3 4.3 4.3
Cash Flow from Ops, before Procuri, Sky,
Lease Losses & Emptoris Receipt 5.8 16.8
15.4 16.1 16.5 22.5 25.9
23.8 14.6 22.1 20.6 14.8
19.8
Capital
Expenditures 0.9 1.8 2.5 2.5 2.3 1.2 1.4 1.8 1.4 4.4 2.0 1.6 2.1
Free Cash Flow 0.3 (0.3 )
6.2 7.7 8.6 15.2 18.7
17.0 8.9 20.4 14.3 8.9
13.5 Free Cash Flow, before Procuri, Sky and Lease
Losses 4.9 15.0 12.9 13.7
14.3 21.4 24.5 22.0 13.2
17.6 18.6 13.2 17.7 Ariba, Inc.
and Subsidiaries Condensed Consolidated Statements of Operations
(Unaudited; in thousands, except per share data)
Q1 '10 Non-GAAPReported
Q1 '10 Non-GAAPSMS
Q1 '10 Non-GAAPContinuing Ops
Q2 '10 Non-GAAPReported
Q2 '10 Non-GAAPSMS
Q2 '10 Non-GAAPContinuing Ops
Q3 '10 Non-GAAPReported
Q3 '10 Non-GAAPSMS
Q3 '10 Non-GAAPContinuing Ops
Q4 '10 Non-GAAPReported
Q4 '10 Non-GAAPSMS
Q4 '10 Non-GAAPContinuing Ops
2010 Non-GAAPReported
2010 Non-GAAPSMS
2010 Non-GAAPContinuing Ops
Revenues: Subscription and maintenance $ 58,373 $ - $ 58,373 $
58,756 $ - $ 58,756 $ 60,768 $ - $ 60,768 $ 62,892 $ - $ 62,892 $
240,789 $ - $ 240,789 Services and other 27,298
10,479 16,819 28,374
9,822 18,552 32,481
10,243 22,238 32,204
10,203 22,001
120,357 40,747 79,610
Total revenues 85,671 10,479
75,192 87,130 9,822
77,308 93,249 10,243
83,006 95,096
10,203 84,893 361,146
40,747 320,399 Cost of
revenues: Subscription and maintenance 11,740 - 11,740 11,803 -
11,803 12,270 - 12,270 11,948 - 11,948 47,761 - 47,761 Services and
other 18,028 6,766 11,262
18,626 6,498 12,128
20,421 6,792 13,629
20,256 6,884
13,372 77,331 26,940
50,391 Total cost of revenues 29,768
6,766 23,002 30,429
6,498 23,931 32,691
6,792 25,899
32,204 6,884 25,320
125,092 26,940
98,152 Gross profit 55,903 3,713
52,190 56,701 3,324
53,377 60,558 3,451
57,107 62,892
3,319 59,573 236,054
13,807 222,247 Operating
expenses: Sales and marketing 22,587 1,441 21,146 23,212 1,408
21,804 25,659 1,564 24,095 26,425 1,254 25,171 97,883 5,667 92,216
Research and development 9,769 - 9,769 10,133 - 10,133 10,226 -
10,226 10,348 - 10,348 40,476 - 40,476 General and administrative
6,634 685 5,949 6,420
685 5,735 6,977
684 6,293 6,663
683 5,980 26,694
2,737 23,957 Total
operating expenses 38,990 2,126
36,864 39,765 2,093
37,672 42,862 2,248
40,614 43,436 1,937
41,499 165,053
8,404 156,649 Income from
operations 16,913 1,587 15,326 16,936 1,231 15,705 17,696 1,203
16,493 19,456 1,382 18,074 71,001 5,403 65,598 Interest and other
expense, net 321 44 277
74 (69 ) 143 (454 )
(160 ) (294 ) (676 ) 67
(743 ) (735 ) (118 )
(617 ) Income before income taxes 17,234 1,631 15,603 17,010
1,162 15,848 17,242 1,043 16,199 18,780 1,449 17,331 70,266 5,285
64,981 Provision for income taxes 55 38
17 515 37 478
423 38 385
425 37 388
1,418 150 1,268 -
Net income $ 17,179 $ 1,593 $ 15,586 $ 16,495
$ 1,125 $ 15,370 $ 16,819 $ 1,005
$ 15,814 18,355 $ 1,412
$ 16,943 $ 68,848 $ 5,135
$ 63,713 Net income per share Basic $ 0.20 $ 0.02 $
0.18 $ 0.19 $ 0.01 $ 0.18 $ 0.19 $ 0.01 $ 0.18 $ 0.21 $ 0.02 $ 0.19
$ 0.79 $ 0.06 $ 0.73 Diluted $ 0.19 $ 0.02 $ 0.18 $ 0.19 $ 0.01 $
0.17 $ 0.19 $ 0.01 $ 0.18 $ 0.20 $ 0.02 $ 0.18 $ 0.77 $ 0.06 $ 0.71
Weighted average shares Basic 85,161 85,161 85,161 86,578 86,578
86,578 87,163 87,163 87,163 87,565 87,565 87,565 87,565 87,565
87,565 Diluted 88,262 88,262 88,262 88,753 88,753 88,753 89,336
89,336 89,336 91,868 91,868 91,868 89,221
89,221 89,221
To supplement our financial results presented on a GAAP basis,
we use non-GAAP measures of net income and earnings per share,
which exclude expenses that we believe are helpful in understanding
our past financial performance and prospects for the future,
including stock-based compensation associated with stock options
and restricted shares issued to executive officers and employees,
amortization of intangible assets in connection with our
acquisitions, restructuring costs related to lease abandonment
accruals, litigation benefit related to a patent infringement
judgement, transaction-related costs and release of tax
reserves.
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