UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended January 31, 2004
OR
| ¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number 000-27071
AGILE SOFTWARE CORPORATION
(Exact name of registrant as specified in its charter)
| Delaware | 77-0397905 | |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
6373 San Ignacio Avenue, San Jose, California 95119-1200
(Address of principal executive office)
(408) 284-4000
(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 ¨
Indicate by check mark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Securities Exchange Act of 1934). Yes x No ¨
The number of shares of Common Stock of the Registrant issued and outstanding as of January 31, 2004 was 52,155,677.
FORM 10-Q
JANUARY 31, 2004
TABLE OF CONTENTS
| Page | ||||
| PART I – FINANCIAL INFORMATION | ||||
| Item 1. |
||||
| Unaudited Condensed Consolidated Balance Sheets at January 31, 2004 and April 30, 2003 |
3 | |||
| 4 | ||||
| 5 | ||||
| Notes to Unaudited Condensed Consolidated Financial Statements |
6 | |||
| Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
18 | ||
| Item 3. |
43 | |||
| Item 4. |
44 | |||
| PART II – OTHER INFORMATION | ||||
| Item 1. |
45 | |||
| Item 2. |
Changes In Securities, Use Of Proceeds and Issuer Purchases of Equity Securities |
45 | ||
| Item 3. |
45 | |||
| Item 4. |
46 | |||
| Item 5. |
46 | |||
| Item 6. |
46 | |||
| 48 | ||||
2
PART I – FINANCIAL INFORMATION
| Item 1. | Financial Statements |
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
| January 31, 2004 |
April 30, 2003 (1) |
|||||||
| ASSETS | ||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 109,149 | $ | 154,852 | ||||
| Short-term investments |
100,516 | 102,115 | ||||||
| Accounts receivable, net of allowance for doubtful accounts of $1,432 and $1,158, respectively |
17,773 | 12,061 | ||||||
| Other current assets |
5,948 | 6,295 | ||||||
| Total current assets |
233,386 | 275,323 | ||||||
| Long-term investments |
33,423 | — | ||||||
| Property and equipment, net |
9,430 | 7,389 | ||||||
| Goodwill |
33,985 | 5,150 | ||||||
| Intangible assets, net |
6,290 | 1,080 | ||||||
| Other assets |
2,555 | 2,008 | ||||||
| Total assets |
$ | 319,069 | $ | 290,950 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: |
||||||||
| Accounts payable |
$ | 5,112 | $ | 3,230 | ||||
| Accrued expenses and other current liabilities |
23,681 | 13,632 | ||||||
| Deferred revenue |
20,055 | 15,280 | ||||||
| Total current liabilities |
48,848 | 32,142 | ||||||
| Accrued restructuring, non-current |
3,387 | 2,562 | ||||||
| Other non-current liabilities |
5,848 | — | ||||||
| Total liabilities |
58,083 | 34,704 | ||||||
| Commitments and contingencies (Note 7) |
||||||||
| Stockholders’ equity: |
||||||||
| Common stock |
52 | 49 | ||||||
| Additional paid-in capital |
543,046 | 516,056 | ||||||
| Notes receivable from stockholders |
(83 | ) | (186 | ) | ||||
| Unearned stock compensation |
(1,563 | ) | (2,030 | ) | ||||
| Accumulated other comprehensive income (loss) |
(346 | ) | 93 | |||||
| Accumulated deficit |
(280,120 | ) | (257,736 | ) | ||||
| Total stockholders’ equity |
260,986 | 256,246 | ||||||
| Total liabilities and stockholders’ equity |
$ | 319,069 | $ | 290,950 | ||||
| (1) | Amounts as of April 30, 2003 have been derived from audited financial statements as of that date. |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
| Three Months Ended January 31, |
Nine Months Ended January 31, |
|||||||||||||||
| 2004 |
2003 |
2004 |
2003 |
|||||||||||||
| Revenues: |
||||||||||||||||
| License |
$ | 9,527 | $ | 7,324 | $ | 25,154 | $ | 21,792 | ||||||||
| Professional services and maintenance |
16,656 | 10,554 | 43,960 | 29,613 | ||||||||||||
| Total revenues |
26,183 | 17,878 | 69,114 | 51,405 | ||||||||||||
| Cost of revenues: |
||||||||||||||||
| License |
988 | 605 | 2,774 | 1,904 | ||||||||||||
| Professional services and maintenance |
8,461 | 4,415 | 21,014 | 13,787 | ||||||||||||
| Stock compensation |
95 | 9 | 147 | 37 | ||||||||||||
| Acquisition-related compensation |
339 | — | 595 | — | ||||||||||||
| Amortization of intangible assets |
212 | — | 372 | — | ||||||||||||
| Total cost of revenues |
10,095 | 5,029 | 24,902 | 15,728 | ||||||||||||
| Gross margin |
16,088 | 12,849 | 44,212 | 35,677 | ||||||||||||
| Operating expenses: |
||||||||||||||||
| Sales and marketing: |
||||||||||||||||
| Other sales and marketing |
9,828 | 9,752 | 27,499 | 32,141 | ||||||||||||
| Stock compensation |
315 | 751 | 2,988 | 1,683 | ||||||||||||
| Research and development: |
||||||||||||||||
| Other research and development |
6,038 | 5,613 | 17,214 | 20,777 | ||||||||||||
| Stock compensation |
53 | 51 | 165 | 175 | ||||||||||||
| General and administrative: |
||||||||||||||||
| Other general and administrative |
2,246 | 1,825 | 6,507 | 5,203 | ||||||||||||
| Stock compensation |
101 | 27 | 592 | 101 | ||||||||||||
| Acquisition-related compensation |
529 | — | 1,091 | — | ||||||||||||
| Amortization of intangible assets |
679 | — | 1,435 | — | ||||||||||||
| Acquired in-process research and development |
— | 300 | 500 | 300 | ||||||||||||
| Restructuring and other charges |
— | — | 9,201 | 7,836 | ||||||||||||
| Total operating expenses |
19,789 | 18,319 | 67,192 | 68,216 | ||||||||||||
| Loss from operations |
(3,701 | ) | (5,470 | ) | (22,980 | ) | (32,539 | ) | ||||||||
| Other income (expense): |
||||||||||||||||
| Interest and other income, net |
754 | 1,196 | 2,347 | 3,863 | ||||||||||||
| Loss from foreign currency translation |
(743 | ) | — | (743 | ) | — | ||||||||||
| Impairment of investments |
— | (1,113 | ) | — | (3,673 | ) | ||||||||||
| Loss before provision for income taxes |
(3,690 | ) | (5,387 | ) | (21,376 | ) | (32,349 | ) | ||||||||
| Provision for income taxes |
348 | 301 | 1,008 | 740 | ||||||||||||
| Net loss |
$ | (4,038 | ) | $ | (5,688 | ) | $ | (22,384 | ) | $ | (33,089 | ) | ||||
| Net loss per share: |
||||||||||||||||
| Basic and diluted |
$ | (0.08 | ) | $ | (0.12 | ) | $ | (0.45 | ) | $ | (0.68 | ) | ||||
| Weighted average shares |
51,947 | 48,591 | 50,139 | 48,383 | ||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
| Nine Months Ended January 31, |
||||||||
| 2004 |
2003 |
|||||||
| Cash flows from operating activities: |
||||||||
| Net loss |
$ | (22,384 | ) | $ | (33,089 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: |
||||||||
| Acquired in-process research and development |
500 | 300 | ||||||
| Provision for doubtful accounts |
390 | 100 | ||||||
| Depreciation and amortization |
5,757 | 5,982 | ||||||
| Stock compensation |
3,892 | 1,996 | ||||||
| Loss from foreign currency translation |
743 | |||||||