UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
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For the quarterly period ended March 31, 2005 |
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OR |
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Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
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For the transition period from to |
Commission File Number: 0-24081
EVOLVING SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
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Delaware |
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84-1010843 |
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(State or other jurisdiction of incorporation or organization) |
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(IRS Employer Identification No.) |
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9777 Pyramid Court, Suite 100 Englewood, Colorado |
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80112 |
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(Address of principal executive offices) |
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(Zip Code) |
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(303) 802-1000 |
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(Registrant’s telephone number) |
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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 ý No o
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý
As of May 9, 2005 there were 16,024,102 shares outstanding of Registrant’s Common Stock (par value $0.001 per share).
EVOLVING SYSTEMS, INC.
Quarterly Report on Form 10-Q
March 31, 2005
Table of Contents
ITEM 1. FINANCIAL STATEMENTS
EVOLVING SYSTEMS, INC.
(in thousands except share data)
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March 31, |
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December 31, |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ |
6,479 |
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$ |
11,386 |
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Current portion of restricted cash |
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100 |
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100 |
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Contract receivables, net of allowance of $44 at March 31, 2005 and December 31, 2004 |
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8,529 |
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11,296 |
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Unbilled work-in-progress |
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967 |
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1,323 |
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Prepaid and other current assets |
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1,896 |
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1,832 |
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Total current assets |
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17,971 |
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25,937 |
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Property and equipment, net |
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2,323 |
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2,563 |
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Intangible assets, net |
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18,202 |
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19,993 |
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Goodwill |
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36,868 |
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37,698 |
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Long-term restricted cash |
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300 |
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300 |
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Total assets |
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$ |
75,664 |
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$ |
86,491 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current liabilities: |
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Current portion of notes payable and long-term obligations |
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$ |
1,372 |
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31 |
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Short-term notes payable |
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1,995 |
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4,880 |
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Accounts payable and accrued liabilities |
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6,872 |
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8,357 |
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Payable to Tertio sellers |
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— |
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2,664 |
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Deferred foreign income taxes |
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115 |
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265 |
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Unearned revenue |
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12,426 |
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13,083 |
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Total current liabilities |
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22,780 |
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29,280 |
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Long-term liabilities: |
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Long-term obligations |
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98 |
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125 |
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Notes payable |
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11,063 |
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11,849 |
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Deferred foreign income taxes |
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4,208 |
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4,642 |
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Total liabilities |
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38,149 |
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45,896 |
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Commitments and contingencies |
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Series B convertible redeemable preferred stock; $.001 par value; 966,666 shares issued and outstanding as of March 31, 2005 and December 31, 2004. |
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11,281 |
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11,281 |
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Stockholders’ equity: |
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Common stock, $0.001 par value; 25,000,000 shares authorized; 16,024,102 and 15,987,217 shares issued and outstanding as of March 31, 2005 and December 31, 2004, respectively. |
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16 |
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16 |
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Additional paid-in capital |
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67,821 |
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67,765 |
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Other comprehensive income |
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1,006 |
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1,994 |
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Accumulated deficit |
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(42,609 |
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(40,461 |
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Total stockholders’ equity |
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26,234 |
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29,314 |
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Total liabilities and stockholders’ equity |
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$ |
75,664 |
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$ |
86,491 |
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The accompanying notes are an integral part of these consolidated financial statements.
1
EVOLVING SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except per share data)
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Three Months Ended March 31, |
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2005 |
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2004 |
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REVENUE |
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License fees and services |
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$ |
5,081 |
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$ |
3,219 |
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Customer support |
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4,757 |
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2,547 |
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Total revenue |
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9,838 |
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5,766 |
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COSTS OF REVENUE AND OPERATING EXPENSES |
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Costs of license fees and services, excluding depreciation and amortization |
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2,976 |
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1,070 |
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Costs of customer support, excluding depreciation and amortization |
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2,031 |
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1,663 |
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Sales and marketing |
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2,392 |
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936 |
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General and administrative |
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2,501 |
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935 |
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Product development |
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110 |
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491 |
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Depreciation |
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376 |
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274 |
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Amortization |
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1,421 |
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218 |
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Restructuring and other expenses (recovery) |
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(48 |
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— |
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Total costs of revenue and operating expenses |
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11,759 |
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5,587 |
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Income (loss) from operations |
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(1,921 |
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