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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
FORM 10-Q
 
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarter ended June 30, 2002
  
Commission file number: 0-25137
 
 
CONCUR TECHNOLOGIES, INC.
(Exact name of Registrant as specified in its charter)
 
Delaware
(State or other jurisdiction of
incorporation or organization)
  
91-1608052
(I.R.S. Employer
Identification No.)
 
6222 185th Avenue NE
Redmond, Washington 98052
(Address of principal executive offices)
 
(425) 702-8808
(Registrant’s telephone number, including area code)
 
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days:
 
Yes  x  No  ¨
 
As of July 31, 2002, there were 26,165,605 shares of the Registrant’s Common Stock outstanding.
 

Table of Contents
CONCUR TECHNOLOGIES, INC.
 
FORM 10-Q
JUNE 30, 2002
 
INDEX
 
    
Page
  
3
  
3
  
3
  
4
  
5
  
6
  
10
  
26
  
27
  
27

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Table of Contents
PART I.    FINANCIAL INFORMATION
 
ITEM 1.    CONSOLIDATED FINANCIAL STATEMENTS
 
Concur Technologies, Inc.
 
Consolidated Balance Sheets
(In thousands, except share data)
(Unaudited)
 
    
June 30,
2002
     
September 30,
2001
  
Assets
                  
Current assets:
                  
Cash and cash equivalents
   
$
13,461
 
   
$
21,700
 
Marketable securities
   
 
2,013
 
   
 
4,065
 
Accounts receivable (1), net of allowance for doubtful accounts of $680 at June 30, 2002 and $979 at September 30, 2001
   
 
5,265
 
   
 
6,211
 
Prepaid expenses and other current assets
   
 
1,167
 
   
 
918
 
    
  
Total current assets
   
 
21,906
 
   
 
32,894
 
Property and equipment, net
   
 
3,589
 
   
 
6,706
 
Restricted cash
   
 
1,363
 
   
 
950
 
Deposits and other assets
   
 
137
 
   
 
433
 
    
  
Total assets
   
$
26,995
 
   
$
40,983
 
    
  
Liabilities and stockholders’ equity
                  
Current liabilities:
                  
Accounts payable (2)
   
$
1,139
 
   
$
1,715
 
Accrued payroll and benefits
   
 
1,314
 
   
 
3,865
 
Accrued commissions
   
 
534
 
   
 
949
 
Other accrued liabilities
   
 
3,809
 
   
 
4,755
 
Current portion of long-term obligations
   
 
244
 
   
 
1,696
 
Deferred revenues
   
 
5,885
 
   
 
5,118
 
    
  
Total current liabilities
   
 
12,925
 
   
 
18,098
 
Long-term obligations, net of current
   
 
584
 
   
 
108
 
Stockholders’ equity:
                  
Common stock, par value $0.001 per share:
                  
Authorized shares – 60,000,000; Issued and outstanding shares – 26,153,527 and 25,814,422 at June 30, 2002 and September 30, 2001, respectively
   
 
223,498
 
   
 
223,245
 
Accumulated deficit
   
 
(210,012
)
   
 
(200,468
)
    
  
Total stockholders’ equity
   
 
13,486
 
   
 
22,777
 
    
  
Total liabilities and stockholders’ equity
   
$
26,995
 
   
$
40,983
 
    
  
See accompanying notes.
(1)
 
Includes amounts due from related parties of $218,000 and $688,000 at June 30, 2002 and September 30, 2001, respectively.
 
(2)
 
Includes amounts due to related parties of $139,000 and $255,000 at June 30, 2002 and September 30, 2001, respectively.

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Table of Contents
Concur Technologies, Inc.
 
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
 
    
Three Months Ended
June 30,
     
Nine Months Ended
June 30,
  
    
2002
     
2001
     
2002
     
2001
  
Revenues, net:
                                    
License
   
$
2,322
 
   
$
3,054
 
   
$
7,220
 
   
$
9,592
 
ASP
   
 
2,500
 
   
 
1,214
 
   
 
6,726
 
   
 
2,926
 
Services
   
 
5,929
 
   
 
5,223
 
   
 
17,484
 
   
 
16,399
 
    
  
  
  
Total revenues (1)
   
 
10,751
 
   
 
9,491
 
   
 
31,430
 
   
 
28,917
 
Cost of revenues:
                                    
License
   
 
115
 
   
 
127
 
   
 
337
 
   
 
439
 
ASP
   
 
2,489
 
   
 
2,471
 
   
 
7,626
 
   
 
6,387
 
Services
   
 
2,594
 
   
 
3,466
 
   
 
7,982
 
   
 
10,971
 
    
  
  
  
Total cost of revenues (2)
   
 
5,198
 
   
 
6,064
 
   
 
15,945
 
   
 
17,797
 
    
  
  
  
Gross Profit
   
 
5,553
 
   
 
3,427
 
   
 
15,485
 
   
 
11,120
 
Operating expenses:
                                    
Sales and marketing
   
 
3,921
 
   
 
5,448
 
   
 
11,967
 
   
 
19,189
 
Research and development
   
 
2,649
 
   
 
3,210
 
   
 
8,013
 
   
 
13,483
 
General and administrative
   
 
1,417
 
   
 
2,681
 
   
 
5,208
 
   
 
8,938
 
Restructuring charges
   
 
—  
 
   
 
—  
 
   
 
—  
 
   
 
338
 
    
  
  
  
Total operating expenses
   
 
7,987
 
   
 
11,339
 
   
 
25,188
 
   
 
41,948
 
    
  
  
  
Loss from operations
   
 
(2,434
)
   
 
(7,912
)
   
 
(9,703
)
   
 
(30,828
)
Interest income
   
 
80
 
   
 
375
 
   
 
310
 
   
 
1,748
 
Interest expense
   
 
(40
)
   
 
(185
)
   
 
(162
)
   
 
(649
)
Other income (expense), net
   
 
10
 
   
 
(35
)
   
 
11
 
   
 
(69
)
    
  
  
  
Net loss
   
$
(2,384
)
   
$
(7,757
)
   
$
(9,544
)
   
$
(29,798
)
    
  
  
  
Basic and diluted net loss per share
   
$
(0.09
)
   
$
(0.30
)
   
$
(0.37
)
   
$
(1.17
)
    
  
  
  
Shares used in calculation of basic and diluted net loss per share
   
 
26,060
 
   
 
25,713
 
   
 
25,911
 
   
 
25,494
 
    
  
  
  
(1)
 
Includes sales to related parties of $350,000 and $623,000 in the three months ended June 30, 2002 and 2001, and $1.3 million and $2.7 million in the nine months ended June 30, 2002 and 2001, respectively.
 
(2)
 
Includes payments to related parties of $290,000 and $191,000 in the three months ended June 30, 2002 and 2001, and $789,000 and $416,000 in the nine months ended June 30, 2002 and 2001, respectively.
 
See accompanying notes.

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Table of Contents
Concur Technologies, Inc.
 
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
 
<
    
Nine Months Ended
June 30,
  
    
2002
     
2001
  
Operating activities
                  
Net loss
   
$
(9,544
)
   
$
(29,798
)
Adjustments to reconcile net loss to net cash used in operating activities:
                  
Amortization of deferred stock compensation
   
 
—  
 
   
 
134
 
Depreciation
   
 
4,517
 
   
 
4,873
 
Provision for bad debts
   
 
(225
)
   
 
780
 
Restructuring charges
   
 
—  
 
   
 
(635
)
Changes in operating assets and liabilities:
                  
Accounts receivable
   
 
1,171
 
   
 
4,507
 
Prepaid expenses, deposits, and other assets
   
 
47
 
   
 
928
 
Accounts payable
   
 
(576
)
   
 
(687
)
Accrued liabilities and accrued commissions
   
 
(3,970
)
   
 
(2,158
)
Deferred revenues
   
 
767
 
   
 
1,812
 
    
  
Net cash used in operating activities
   
 
(7,813
)
   
 
(20,244
)
    
  
Investing activities
                  
Purchases of property and equipment
   
 
(1,400
)
   
 
(1,903
)
Purchase of marketable securities
   
 
(3,948
)
   
 
(13,468
)
Maturity of marketable securities
   
 
6,000
 
   
 
50,500
 
    
  
Net cash provided by investing activities
   
 
652
 
   
 
35,129
 
    
  
Financing activities
                  
Proceeds from issuance of common stock from exercise of stock options
   
 
71
 
   
 
30
 
Issuance of common stock in connection with Employee Stock Purchase Plan
   
 
182
 
   
 
636
 
Proceeds from borrowings