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| 8-K - CONVIO, INC. 8-K - Convio, Inc. | a6705910.htm |
Exhibit 99.1
Convio Announces Financial Results for First Quarter 2011
AUSTIN, Texas--(BUSINESS WIRE)--May 3, 2011--Convio, Inc. (Nasdaq: CNVO), a leading provider of on-demand constituent engagement solutions for nonprofit organizations, today announced financial results for the first quarter ended March 31, 2011.
First Quarter Highlights
- Revenue of $18.3 million for the first quarter, up 9% percent from the first quarter of 2010.
- Usage revenue of $2.9 million for the first quarter, up 26% percent year-over-year.
- New clients additions increased 25% percent over the same quarter last year
- Closed the acquisition of StrategicOne, a leading provider of analytics, predictive modeling and database marketing services.
“We are off to a great start in 2011 as nonprofits of all sizes continue to realize the value of our constituent engagement solutions in helping them cultivate and strengthen relationships to fulfill their missions,” said Gene Austin, Chief Executive Officer and President. “Our online leadership and client results, continued momentum with Common Ground in the mid-market, and our investment in innovative software and services that help large, enterprise organizations reach, inspire and move people provide tremendous opportunities for Convio. Based on our progress, proven track record and pipeline, we believe our quarterly year-over-year growth rates will be significantly higher in the second half of 2011 compared to recent quarters.”
Business Highlights for the First Quarter 2011
- LIVESTRONG®/Lance Armstrong Foundation selected Convio’s entire suite of cloud-based applications to power their constituent engagement programs.
- Convio’s clients raised more than $329 million online in Q1, up 22 percent over the same quarter last year after factoring out transactions related to disaster relief efforts for events like the earthquakes in Japan and Haiti.
- Entered into a strategic partnership with Network for Good to improve donor engagement for small and medium-sized nonprofits.
- Announced a strategic relationship with Grizzard Communications Group to power an integrated fundraising and marketing offering.
Financial Results for the First Quarter of 2011
- Total revenue was $18.3 million, up 9 percent from the same period last year.
- GAAP net loss was $0.1 million for the first quarter of 2011, compared to GAAP net income of $0.2 million for the same period last year. Diluted net loss per share was zero for the first quarter of 2011, based on 17.8 million weighted average diluted shares outstanding, compared to diluted net income per share of $0.01 for the same period last year, based on 14.4 million weighted average diluted shares outstanding.
- Non-GAAP net income was $1.0 million for the first quarter of 2011, compared to $1.6 million for the same period last year. Non-GAAP diluted net income per share was $0.05 for the first quarter of 2011, based on 19.4 million weighted average diluted shares outstanding, compared to non-GAAP diluted net income of $0.11 for the same period last year, based on 14.4 million weighted average diluted shares outstanding.
- Adjusted EBITDA was $1.6 million for the first quarter of 2011, down $0.6 million compared to the same period last year due to public company costs and increased investments in sales and marketing and research and development.
2011 Guidance
Convio is reaffirming its guidance for full year 2011 revenue of approximately $77.5 million to $79.5 million, or 11 to 14 percent annual growth over full year 2010. The company expects diluted non-GAAP net income per share for 2011 to be approximately $0.38 to $0.41, assuming an average weighted diluted share count of approximately 20.1 million shares.
Use of Non-GAAP Measures
Management believes that adjusted EBITDA and non-GAAP net income are useful measures of operating performance because they exclude items that we do not consider indicative of our core performance. In the case of adjusted EBITDA, we adjust net income for such things as interest, taxes, depreciation and amortization, stock-based compensation, acquisition related costs and certain non-cash and non-recurring items. Non-GAAP net income adds to net income (loss) amortization of intangible assets, stock-based compensation, acquisition related costs and certain non-cash and non-recurring items such as the gain (loss) on preferred stock warrant revaluation. However, these non-GAAP measures should be considered in addition to, not as a substitute for or superior to, operating income and net income, or other financial measures prepared in accordance with GAAP. Reconciliation to the GAAP equivalents of these non-GAAP measures is contained in tabular form on the attached unaudited condensed consolidated financial statements.
Our management uses adjusted EBITDA and non-GAAP net income as measures of operating performance; to prepare our annual operating budget; to allocate resources to enhance the financial performance of our business; to evaluate the effectiveness of our business strategies; to provide consistency and comparability with past financial performance; to facilitate a comparison of our results with those of other companies; and in communications with our board of directors concerning our financial performance.
Quarterly Conference Call
Convio will host a conference call today at 8:30 a.m. Eastern to discuss the Company's financial results for the first quarter ended March 31, 2011. The call will be hosted by Gene Austin, Chief Executive Officer and President, and James R. Offerdahl, Chief Financial Officer and Vice President of Administration. The live webcast of Convio's earnings call will be accessible at http://www.convio.com/investor.
The webcast will be archived within 24 hours of the event and will be available through the same link for 90 days following the call. Participants who choose to call in to the conference call can do so by dialing domestically 877-638-9569, and international callers may dial 914-495-8536. A replay will be available at 800-642-1687 for domestic callers and 706-645-9291 for international callers. All calls can be accessed by referencing passcode: 59334591. The call replay will be available from March 3rd, 2011 until May 10th, 2011.
About Convio
Convio is a leading provider of on-demand constituent engagement solutions that enable nonprofit organizations to more effectively raise funds, advocate for change and cultivate relationships with donors, activists, volunteers, alumni and other constituents.
For more information, please visit www.convio.com
Forward-looking Statements
This press release may contain forward-looking statements intended to convey expectations as to the future based on plans, estimates and projections. Although we believe that the expectations reflected in such forward-looking statements are reasonable, future circumstances might differ from the assumptions on which such statements are based. In addition, these statements can be affected by inaccurate assumptions and the impact of a variety of risks and uncertainties that could cause actual results to differ materially from those described in this press release including, among others: unfavorable economic and business conditions, in particular with respect to the nonprofit market in which we operate; challenges and risks relating to attracting and retaining customers; a loss of significant customers or a substantial reduction in orders from our existing customers; a reduction in usage of our systems by our customers or their clients and a corresponding reduction in usage revenue; an inability of customers to pay for our solutions and services; risks related to challenges associated with developing new and enhanced solutions that meet the needs of our clients; risks related to technological changes or alternative technologies that could make our products and services less competitive; risks associated with successful implementation of multiple integrated software products; risks associated with acquisitions and their integration; and the ability to attract and retain key personnel. Other risks that could impact our business adversely are those risks generally associated with management of growth; lengthy sales and implementation cycles; intellectual property infringement claims and other litigation; reliance on certain third-parties, including hosting facilities, software and application providers; the ability to access sufficient funding to finance desired growth and operations; and legislative actions which could reduce the effectiveness of our solutions and increase the costs of our business. These factors and other risks and uncertainties are described in more detail, from time to time, in Convio’s filings with the Securities and Exchange Commission which are available free of charge at www.sec.gov or on our website at www.convio.com/investor. Should one or more of these risks materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expressed or implied in any forward-looking statements. Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Convio does not undertake to update or revise any of these statements as a result of new information, future events or otherwise.
Financial Tables
| Convio, Inc. | ||||||||
| Condensed Consolidated Balance Sheets | ||||||||
| (dollars in thousands) | ||||||||
| March 31, | December 31, | |||||||
| 2011 | 2010 | |||||||
| (unaudited) | ||||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 11,087 | $ | 18,447 | ||||
| Restricted Cash | 1,248 | 1,248 | ||||||
| Marketable securities | 37,719 | 36,774 | ||||||
| Accounts receivable, net | 11,204 | 8,154 | ||||||
| Prepaid expenses and other current assets | 1,791 | 1,558 | ||||||
| Total current assets | 63,049 | 66,181 | ||||||
| Property and equipment, net | 4,924 | 4,609 | ||||||
| Goodwill | 8,076 | 5,527 | ||||||
| Intangible assets, net | 5,765 | 3,990 | ||||||
| Other assets | 120 | 104 | ||||||
| Total assets | $ | 81,934 | $ | 80,411 | ||||
| Liabilities and stockholders' equity (deficit) | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | $ | 6,061 | $ | 6,066 | ||||
| Deferred revenue | 15,722 | 15,917 | ||||||
| Current portion of long-term debt and capital lease obligations | 7 | 14 | ||||||
| Total current liabilities | 21,790 | 21,997 | ||||||
| Long-term liabilities | 500 | - | ||||||
| Total liabilities | 22,290 | 21,997 | ||||||
| Stockholders equity (deficit): | ||||||||
| Common stock | 18 | 18 | ||||||
| Additional paid-in capital | 112,490 | 111,218 | ||||||
| Accumulated other comprehensive loss | 9 | (21 | ) | |||||
| Accumulated deficit | (52,873 | ) | (52,801 | ) | ||||
| Total stockholders' equity (deficit) | 59,644 | 58,414 | ||||||
| Total liabilities and stockholders' equity (deficit) | $ | 81,934 | $ | 80,411 | ||||
| Convio, Inc. | |||||||
| Condensed Consolidated Statements of Operations | |||||||
| (dollars in thousands, except per share data) | |||||||
| Three Months Ended March 31, | |||||||
| 2011 | 2010 | ||||||
| (unaudited) | (unaudited) | ||||||
| With | |||||||
| adoption of | |||||||
| ASU 2009-13 | |||||||
| Revenue: | |||||||
| Subscription | $ | 11,788 | $ | 11,392 | |||
| Services | $ | 3,533 | $ | 2,971 | |||
| Usage | 2,942 | 2,330 | |||||
| Total revenue | 18,263 | 16,693 | |||||
| Cost of revenue: | |||||||
| Cost of subscription and usage (1)(3) | 3,221 | 3,037 | |||||
| Cost of services (2)(3) | 4,130 | 3,260 | |||||
| Total cost of revenue | 7,351 | 6,297 | |||||
| Gross profit | 10,912 | 10,396 | |||||
| Operating expenses: | |||||||
| Sales and marketing (3) | 6,000 | 5,324 | |||||
| Research and development (3) | 2,775 | 2,525 | |||||
| General and administrative (3) | 2,030 | 1,538 | |||||
| Amortization of other intangibles | 210 | 272 | |||||
| Total operating expenses | 11,015 | 9,659 | |||||
| Income (loss) from operations | (103 | ) | 737 | ||||
| Interest income | 23 | 1 | |||||
| Interest expense | - | (63 | ) | ||||
| Other income (expense) | 1 | (469 | ) | ||||
| Income (loss) before income taxes | (79 | ) | 206 | ||||
| Provision for income taxes | (7 | ) | 24 | ||||
| Net income (loss) | $ | (72 | ) | $ | 182 | ||
| Net income (loss) attributable to common stockholders: | |||||||
| Basic | $ | (72 | ) | $ | 104 | ||
| Diluted | $ | (72 | ) | $ | 182 | ||
| Net income (loss) per share attributable to common stockholders: | |||||||
| Basic | $ | (0.00 | ) | $ | 0.01 | ||
| Diluted | $ | (0.00 | ) | $ | 0.01 | ||
| Weighted average shares outstanding used in computing per share amounts: | |||||||
| Basic | 17,786 | 7,356 | |||||
| Diluted | 17,786 | 14,350 | |||||
| (1) Includes amortization of acquired technology of $98 and $127 for the three months ended March 31, 2011 and 2010, respectively. | |||||||
| (2) Includes compensation expense related to earnout provisions of the StrategicOne acquisition of $56 and zero for the three months ended March 31, 2011 and 2010, respectively. | |||||||
| Three Months Ended March 31, | |||||||
| 2011 | 2010 | ||||||
| (unaudited) | (unaudited) | ||||||
| (3) Includes stock-based compensation expense as follows: | |||||||
| Cost of subscription and usage | $ | 47 | $ | 40 | |||
| Cost of services | 114 | 78 | |||||
| Sales and marketing | 192 | 164 | |||||
| Research and development | 102 | 83 | |||||
| General and administrative | 169 | 164 | |||||
| Convio, Inc. | |||||||
| Condensed Consolidated Statements of Cash Flows | |||||||
| (dollars in thousands) | |||||||
| Three Months Ended March 31, | |||||||
| 2011 | 2010 | ||||||
| (unaudited) | (unaudited) | ||||||
| Cash flows from operating activities: | |||||||
| Net income (loss) | $ | (72 | ) | $ | 182 | ||
| Adjustments to reconcile net income (loss) to net cash | |||||||
| provided by (used in) operating activities: | |||||||
| Depreciation and amortization | 959 | 980 | |||||
| Other non-cash charges | 624 | 998 | |||||
| Changes in operating assets and liabilities | (3,055 | ) | (1,709 | ) | |||
| Net cash provided by (used in) operating activities | (1,544 | ) | 451 | ||||
| Cash flows from investing activities: | |||||||
| Purchases of marketable securities | (15,111 | ) | - | ||||
| Proceeds from sales/maturieis of marketable securities | 13,881 | - | |||||
| Purchases of property and equipment, net | (408 | ) | (528 | ) | |||
| Software development costs | (429 | ) | (225 | ) | |||
| Cash utilized for purchase of StrategicOne | (4,416 | ) | - | ||||
| Net cash used in investing activities | (6,483 | ) | (753 | ) | |||
| Cash flows from financing activities | |||||||
| Payments on long-term debt and capital lease obligations | (7 | ) | (259 | ) | |||
| Proceeds from issuance of common stock | 674 | 93 | |||||
| Net cash provided by (used in) financing activities | 667 | (166 | ) | ||||
| Net change in cash and cash equivalents | (7,360 | ) | (468 | ) | |||
| Cash and cash equivalents at beginning of period | 18,447 | 16,662 | |||||
| Cash and cash equivalents at end of period | $ | 11,087 | $ | 16,194 | |||
| Convio, Inc. | |||||||
| Reconciliation of Non-GAAP Measures | |||||||
| (dollars in thousands, except per share data) | |||||||
| Three Months Ended March 31, | |||||||
| 2011 | 2010 | ||||||
| (unaudited) | (unaudited) | ||||||
|
Reconciliation of GAAP net income (loss) to non-GAAP net income: |
|||||||
| Net income (loss) | $ | (72 | ) | $ | 182 | ||
| Stock-based compensation | 624 | 529 | |||||
| Amortization of intangible assets | 308 | 399 | |||||
| (Gain) loss on warrant revaluation | - | 469 | |||||
| Acquisition related costs | 146 | - | |||||
| Non-GAAP net income | $ | 1,006 | $ | 1,579 | |||
| GAAP basic net income (loss) per share | |||||||
| Numerator: | |||||||
| Net income (loss) | $ | (72 | ) | $ | 182 | ||
|
Less: Undistributed earnings allocated to participating preferred stock (1) |
$ | - | $ | (78 | ) | ||
| Net income (loss) attributable to common stockholders | $ | (72 | ) | $ | 104 | ||
| Denominator: | |||||||
| Weighted average common shares outstanding, basic | 17,786 | 7,356 | |||||
| GAAP basic net income (loss) per common share | $ | (0.00 | ) | $ | 0.01 | ||
| GAAP diluted net income (loss) per share | |||||||
| Numerator: | |||||||
| Net income (loss) | $ | (72 | ) | $ | 182 | ||
| Denominator: | |||||||
| Weighted average common shares outstanding, basic | 17,786 | 7,356 | |||||
| Add: Outstanding convertible preferred stock | - | 5,316 | |||||
| Add: Outstanding convertible preferred stock warrants | - | 122 | |||||
| Add: Options to purchase common stock | - | 1,556 | |||||
| Add: Restricted stock units | - | - | |||||
| Weighted average common shares outstanding, diluted (2) | 17,786 | 14,350 | |||||
| GAAP diluted net income (loss) per common share | $ | (0.00 | ) | $ | 0.01 | ||
| Non-GAAP basic net income per share | |||||||
| Numerator: | |||||||
| Non-GAAP net income | $ | 1,006 | $ | 1,579 | |||
|
Less: Undistributed earnings allocated to participating preferred stock |
$ | - | $ | (680 | ) | ||
| Non-GAAP net income attributable to common stockholders | $ | 1,006 | $ | 899 | |||
| Denominator: | |||||||
| Weighted average common shares outstanding, basic | 17,786 | 7,356 | |||||
| Non-GAAP basic net income per common share | $ | 0.06 | $ | 0.12 | |||
| Non-GAAP diluted net income per share | |||||||
| Numerator: | |||||||
| Non-GAAP net income | $ | 1,006 | $ | 1,579 | |||
| Denominator: | |||||||
| Weighted average common shares outstanding, basic | 17,786 | 7,356 | |||||
| Add: Outstanding convertible preferred stock | - | 5,316 | |||||
| Add: Outstanding convertible preferred stock warrants | 33 | 122 | |||||
| Add: Options to purchase common stock | 1,516 | 1,556 | |||||
| Add: Restricted stock units | 32 | - | |||||
| Weighted average common shares outstanding, diluted | 19,367 | 14,350 | |||||
| Non-GAAP diluted net income per common share | $ | 0.05 | $ | 0.11 | |||
| Reconciliation of Adjusted EBITDA to net income (loss): | |||||||
| Net income (loss) | $ | (72 | ) | $ | 182 | ||
| Interest (income) expense, net | (23 | ) | 62 | ||||
| Depreciation and amortization | 959 | 980 | |||||
| Stock-based compensation | 624 | 529 | |||||
| Loss on warrant revaluation | - | 469 | |||||
| Acquisition related costs | 146 | - | |||||
| Provision for income taxes | (7 | ) | 24 | ||||
| Adjusted EBITDA | $ | 1,627 | $ | 2,246 | |||
|
(1) Preferred stocks do not participate in Company losses and thus in periods of GAAP net losses, 100% of GAAP net loss is attributable to common stockholders. |
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(2) In periods in which the Company is in a GAAP net loss position, all common stock equivalents are anti-dilutive and are not included in GAAP diluted shares outstanding. |
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CONTACT:
Convio
Tad Druart, 512-652-7826
Tdruart@convio.com