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8-K - FORM 8-K - SCIQUEST INC | c16603e8vk.htm |
Exhibit 99.1
SciQuest Announces First Quarter 2011 Financial Results
CARY, N.C. May 5, 2011 SciQuest, Inc. (Nasdaq: SQI), a leading provider of on-demand
strategic procurement and supplier management solutions, today announced its
financial results for the first quarter ended March 31, 2011.
Stephen Wiehe, President and Chief Executive Officer of SciQuest, said, We are off to a strong
start in 2011 with first quarter revenue at the top end of our guided range and non-GAAP earnings
that were above the high end of our guidance. We continue to see strong activity levels in all of
our target markets and renewal activity at existing customers remained within historical ranges.
The integration of AECsoft is going smoothly with continued healthy standalone sales activity and a
strong reception from SciQuest customers. A solid first quarter put us on a firm foundation for
what we expect to be a year of healthy growth.
First Quarter 2011 Results
SciQuest reported total revenue of $12.5 million for the quarter ended March 31, 2011, an increase
of 24% compared to revenue of $10.1 million for the comparable period in 2010.
GAAP income from operations in the first quarter of 2011 was $0.8 million, compared to an income
from operations of $1.4 million in the first quarter of 2010. GAAP net income was $0.4 million, or
$0.02 per share, in the first quarter of 2011, compared to $1.3 million, or $0.09 per share, in the
comparable period in 2010. GAAP net income in the first quarter of 2011 included $366,000, or
$0.02 per share, in stock-based compensation for anticipated acquisition-related earnouts.
Non-GAAP income from operations was $1.9 million in the first quarter of 2011, excluding
stock-based compensation expenses, amortization of intangible assets, and acquisition-related
expenses. Non-GAAP income from operations was $2.1 million in the first quarter of 2010, excluding
stock-based compensation expenses and amortization of intangible assets.
Non-GAAP net income was $1.2 million, or $0.06 per share, for the first quarter of 2011, based on
21.3 million weighted average diluted shares outstanding. This compared to non-GAAP net income of
$1.3 million, or $0.09 per share, in the first quarter of 2010, based on 14.6 million weighted
average diluted shares outstanding.
A reconciliation of the most comparable GAAP financial measure to the non-GAAP measures used above
is included with the financial tables at the end of this release.
Other First Quarter and Recent Highlights
| Ended the first quarter with 313 customers, including 108 customers added as a result of
the AECsoft acquisition, an increase from 163 customers at the end of the first quarter of
2010 |
| Released version 11.1 of our SaaS eProcurement solution with new features and
enhancements that include improved management of group contracts, consortium capabilities
to aggregate group buying power and a multi-business unit solution for consolidating
purchasing functions, all of which can help customers achieve further cost savings |
| Completed a follow-on stock offering on April 5, followed by execution of the
underwriters overallotment option on April 13, raising a total of $15.0 million in capital
for the company following the end of the first quarter |
Business Outlook
Based on information available as of May 5, 2011, SciQuest is issuing guidance for the second
quarter and full year 2011 as follows:
Second Quarter 2011: The company expects second quarter revenue to be in the range of $12.8
million to $13.0 million. The company expects GAAP net income per share to be in the range of $0.02
to $0.03. GAAP net income per share includes stock-based compensation expense and amortization of
intangible assets.
The company expects non-GAAP net income per share of $0.05 to $0.06 based on diluted weighted
average shares outstanding of 22.7 million shares. The company expects non-GAAP net income for
future periods to be determined in a manner consistent with historical practices as set forth in
the reconciliation included with the financial tables at the end of this release.
Full Year 2011: The company expects full year 2011 revenue to be in the range of $53.5
million to $54.5 million. The company expects full year GAAP net income per share to be in the
range of $0.13 to $0.14. GAAP net income per share includes stock-based compensation expense and
amortization of intangible assets.
Non-GAAP net income per share is expected to be in the range of $0.26 to $0.27 based on diluted
weighted average shares outstanding of 22.4 million shares.
The company expects operating cash flow in 2011 to be in the range of $14.2 to $15.2 million. Free
cash flow, which is defined as cash flow from operations less purchases of property and equipment
of approximately $1.0 million and capitalization of software development costs of approximately
$0.7 million, to be in the range of $12.5 to $13.5 million in 2011.
Conference Call Information
What:
|
SciQuests first quarter 2011 financial results conference call | |
When:
|
Thursday, May 5, 2011 | |
Time:
|
5:00 p.m. ET | |
Webcast:
|
http://investor.sciquest.com (live and replay) | |
Live Call:
|
(877) 430-3736, domestic (760) 298-5046, international |
|
Replay:
|
(800) 642-1687, passcode 58859774, domestic (706) 645-9291, passcode 58859774, international |
Non-GAAP Financial Measures
SciQuest provides all information required in accordance with GAAP, but believes evaluating its
ongoing operating results may not be as useful if an investor is limited to reviewing only GAAP
financial measures. Accordingly, SciQuest presents non-GAAP financial measures in reporting its
financial results to provide investors with additional tools to evaluate SciQuests operating
results in a manner that focuses on what SciQuest believes to be its ongoing business operations
and what SciQuest uses to evaluate its ongoing operations and for internal planning and forecasting
purposes. SciQuests management does not itself, nor does it suggest that investors should,
consider such non-GAAP financial measures in isolation from, or as a substitute for, financial
information prepared in accordance with GAAP. SciQuests management believes it is useful for
itself and investors to review, as applicable, both GAAP information that includes: (i) the
amortization of acquired intangible assets; (ii) the impact of stock-based compensation; (iii)
other significant items, including acquisition related expense in 2011 and gains on the sale of an
investment in 2010, and (iv) the income tax effect of non-GAAP pre-tax adjustments from the
provision for income taxes; and the non-GAAP measures that exclude such information in order to
assess the performance of SciQuests business and for planning and forecasting in subsequent
periods. Whenever SciQuest uses such a non-GAAP financial measure, it provides a reconciliation of
the non-GAAP financial measure to the most closely applicable GAAP financial measure. Investors
are encouraged to review the related GAAP financial measures and the reconciliation of these
non-GAAP financial measures to their most directly comparable GAAP financial measure as detailed
herein.
About SciQuest
SciQuest (NASDAQ:SQI) is a leading provider of an integrated, web-based end-to-end eProcurement
solution that enables users to realize significant efficiencies and savings on their purchases of
indirect goods and services. SciQuests unique industry segment expertise and innovative
source-to-settle approach to eProcurement enables Fortune 1000 companies and organizations in the
higher education, life sciences, healthcare and public sector markets, as well as other industries,
to identify savings opportunities they may otherwise have missed, while improving contract
management, compliance and supplier management. SciQuests solutions help customers turn spending
into a source of savings.
SciQuest is a registered trademark of SciQuest, Inc. Other trademarks contained herein remain the
property of their respective owners. For more information about SciQuest, please visit
www.sciQuest.com or call 888-638-7322 in the U.S. or +44 1794 341182 in Europe.
Cautionary Note Regarding Forward-Looking Statements
Any statements in this release that are not historical or current facts are forward-looking
statements. These forward-looking statements include references to sales activity and future growth
as well as all statements under the heading Business Outlook. All forward-looking statements in
this release are made pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. These statements are not guarantees of future performance and involve known and
unknown risks, uncertainties and other factors that may cause our actual results, performance or
achievements to be materially different from any future results, performances or achievements
expressed or implied by the forward-looking statements. Certain of these risks and uncertainties
are described in the Risk Factors section of our Registration Statement on Form S-1 and other
required reports, as filed with the SEC, which are available free of charge on the SECs website at
http://www.sec.gov or on our website at www.sciquest.com. Given these risks and uncertainties,
investors should not place undue reliance on forward-looking statements as a prediction of actual
results. These forward-looking statements speak only as of the date hereof, and we undertake no
obligation to update, amend or clarify any forward-looking statement for any reason.
###
SciQuest media contact:
Melissa London
SciQuest, Inc.
919-659-2228
mlondon@sciquest.com
Melissa London
SciQuest, Inc.
919-659-2228
mlondon@sciquest.com
SciQuest Investor contact:
Garo Toomajanian
ICR, LLC
1-800-550-6380
investorrelations@sciquest.com
Garo Toomajanian
ICR, LLC
1-800-550-6380
investorrelations@sciquest.com
SQI-F
SCIQUEST, INC.
BALANCE SHEETS
(in thousands except share and per share amounts)
BALANCE SHEETS
(in thousands except share and per share amounts)
As of March 31, | As of December 31, | |||||||
2011 | 2010 | |||||||
(unaudited) | ||||||||
Assets |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 9,519 | $ | 17,494 | ||||
Short-term investments |
21,790 | 20,000 | ||||||
Accounts receivable |
5,799 | 6,400 | ||||||
Prepaid expenses and other current assets |
1,229 | 1,297 | ||||||
Deferred tax asset |
236 | 207 | ||||||
Total current assets |
38,573 | 45,398 | ||||||
Property and equipment, net |
2,342 | 1,993 | ||||||
Goodwill |
15,719 | 6,765 | ||||||
Intangible assets, net |
6,215 | 1,039 | ||||||
Deferred project costs |
5,518 | 5,667 | ||||||
Deferred tax asset |
14,410 | 15,675 | ||||||
Other |
550 | 150 | ||||||
Total assets |
$ | 83,327 | $ | 76,687 | ||||
Liabilities |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 90 | $ | 51 | ||||
Accrued liabilities |
3,508 | 4,200 | ||||||
Deferred revenues |
29,280 | 28,305 | ||||||
Total current liabilities |
32,878 | 32,556 | ||||||
Deferred revenues, less current portion |
10,519 | 9,896 | ||||||
Stockholders Equity |
||||||||
Common stock, $0.001 par value; 50,000,000 shares authorized;
20,911,238 and 20,532,443 shares issued and outstanding as of March 31, 2011 and December 31, 2010, respectively |
21 | 20 | ||||||
Additional paid-in capital |
55,727 | 50,462 | ||||||
Notes receivable from stockholders |
(10 | ) | (15 | ) | ||||
Accumulated deficit |
(15,808 | ) | (16,232 | ) | ||||
Total stockholders equity |
39,930 | 34,235 | ||||||
Total liabilities and stockholders equity |
$ | 83,327 | $ | 76,687 | ||||
SCIQUEST, INC.
STATEMENTS OF OPERATIONS
(in thousands except per share amounts)
STATEMENTS OF OPERATIONS
(in thousands except per share amounts)
Three Months Ended March 31, | ||||||||
2011 | 2010 | |||||||
(unaudited) | ||||||||
Revenues |
$ | 12,524 | $ | 10,126 | ||||
Cost of revenues (1)(2) |
2,827 | 2,109 | ||||||
Gross profit |
9,697 | 8,017 | ||||||
Operating expenses: (1)
Research and development |
2,753 | 2,037 | ||||||
Sales and marketing |
3,784 | 3,138 | ||||||
General and administrative |
2,116 | 1,380 | ||||||
Amortization of intangible assets |
209 | 76 | ||||||
Total operating expenses |
8,862 | 6,631 | ||||||
Income from operations |
835 | 1,386 | ||||||
Other income (expense), net: |
||||||||
Interest income |
23 | 7 | ||||||
Interest expense |
| (2 | ) | |||||
Other (expense) income, net |
13 | 1,682 | ||||||
Total other income, net |
36 | 1,687 | ||||||
Income before income taxes |
871 | 3,073 | ||||||
Income tax expense |
(447 | ) | (1,143 | ) | ||||
Net income |
$ | 424 | $ | 1,930 | ||||
Dividends on redeemable preferred stock |
| 671 | ||||||
Net income attributable to common stockholders |
$ | 424 | $ | 1,259 | ||||
Net income attributable to common stockholders per share |
||||||||
Basic |
$ | 0.02 | $ | 0.09 | ||||
Diluted |
$ | 0.02 | $ | 0.09 | ||||
Weighted average shares outstanding used in computing per share
amounts |
||||||||
Basic |
20,679 | 14,078 | ||||||
Diluted |
21,334 | 14,648 |
(1) | Amounts include stock-based compensation expense, as follows: |
Three Months Ended March 31, | ||||||||
2011 | 2010 | |||||||
(unaudited) | ||||||||
Cost of revenues |
$ | 47 | $ | 11 | ||||
Research and development |
242 | 153 | ||||||
Sales and marketing |
266 | 97 | ||||||
General and administrative |
147 | 347 | ||||||
$ | 702 | $ | 608 | |||||
(2) Cost of revenues includes amortization of capitalized software
development costs of: |
||||||||
Amortization of capitalized software development costs: |
$ | 72 | $ | 48 | ||||
Amortization of acquired software: |
42 | | ||||||
$ | 114 | $ | 48 | |||||
SCIQUEST, INC.
STATEMENTS OF CASH FLOWS
(in thousands)
STATEMENTS OF CASH FLOWS
(in thousands)
Three Months Ended March 31, | ||||||||
2011 | 2010 | |||||||
(unaudited) | ||||||||
Cash flows from operating activities |
||||||||
Net income |
$ | 424 | $ | 1,930 | ||||
Adjustments to reconcile net income to net cash provided by operating
activities: |
||||||||
Depreciation and amortization |
491 | 262 | ||||||
Gain on sale of investment |
| (1,700 | ) | |||||
Stock-based compensation expense |
702 | 608 | ||||||
Deferred taxes |
412 | 1,085 | ||||||
Changes in operating assets and liabilities: |
||||||||
Accounts receivable |
1,432 | 1,993 | ||||||
Prepaid expense and other current assets |
369 | 207 | ||||||
Deferred project costs and other assets |
(117 | ) | (540 | ) | ||||
Accounts payable |
39 | 216 | ||||||
Accrued liabilities and other |
(1,216 | ) | (559 | ) | ||||
Deferred revenues |
(764 | ) | (3,134 | ) | ||||
Net cash provided by operating activities |
1,772 | 368 | ||||||
Cash flows from investing activities |
||||||||
Business acquisition, net of cash acquired |
(7,346 | ) | | |||||
Addition of capitalized software development costs |
(195 | ) | (202 | ) | ||||
Purchase of property and equipment |
(312 | ) | (102 | ) | ||||
Purchase of short-term investments |
(1,790 | ) | | |||||
Proceds from sale of investment |
| 1,700 | ||||||
Restricted cash |
| 350 | ||||||
Net cash (used in) provided by investing activities |
(9,643 | ) | 1,746 | |||||
Cash flows from financing activities |
||||||||
Public offering costs |
(134 | ) | | |||||
Issuance of common and restricted stock |
| 39 | ||||||
Repurchases of restricted stock |
| (273 | ) | |||||
Repayment of notes payable |
| (350 | ) | |||||
Repayment of notes receivable from stockholders |
5 | 4 | ||||||
Proceeds from exercise of common stock options |
25 | 3 | ||||||
Net cash (used in) financing activities |
(104 | ) | (577 | ) | ||||
Net (decrease) increase in cash and cash equivalents |
(7,975 | ) | 1,537 | |||||
Cash and cash equivalents at beginning of the period |
17,494 | 17,132 | ||||||
Cash and cash equivalents at end of the period |
$ | 9,519 | $ | 18,669 | ||||
RECONCILIATION DATA
(UNAUDITED)
(in thousands except share and per share amounts)
(UNAUDITED)
(in thousands except share and per share amounts)
Reconciliation of Net Income to non-GAAP Net
Income:
Three Months Ended March 31, | ||||||||
2011 | 2010 | |||||||
Net Income |
$ | 424 | $ | 1,930 | ||||
Amortization of intangible assets |
209 | 76 | ||||||
Amortization of acquired software |
42 | | ||||||
Stock-based compensation |
702 | 608 | ||||||
Acquisition-related costs |
134 | | ||||||
Gain on sale of investment |
| (1,700 | ) | |||||
Tax effect of adjustments |
(315 | ) | 378 | |||||
Non-GAAP net income |
$ | 1,196 | $ | 1,292 | ||||
Non-GAAP net income per share: |
||||||||
Basic |
$ | 0.06 | $ | 0.09 | ||||
Diluted |
$ | 0.06 | $ | 0.09 | ||||
Weighted average shares outstanding used in
computing per share amounts: |
||||||||
Basic |
20,679 | 14,078 | ||||||
Diluted |
21,334 | 14,648 |
Reconciliation of Income from Operations to non-
GAAP Income from Operations:
Three Months Ended March 31, | ||||||||
2011 | 2010 | |||||||
Income from Operations |
$ | 835 | $ | 1,386 | ||||
Amortization of intangible assets |
209 | 76 | ||||||
Amortization of acquired software |
42 | | ||||||
Stock-based compensation |
702 | 608 | ||||||
Acquisition-related costs |
134 | | ||||||
Non-GAAP income from operations |
$ | 1,922 | $ | 2,070 | ||||
Reconciliation of Operating Expenses to non-GAAP
Operating Expenses:
Three Months Ended March 31, | ||||||||
2011 | 2010 | |||||||
Operating expenses |
$ | 8,862 | $ | 6,631 | ||||
Amortization of intangible assets |
(209 | ) | (76 | ) | ||||
Stock-based compensation |
(655 | ) | (597 | ) | ||||
Acquisition-related costs |
(134 | ) | | |||||
Non-GAAP operating expenses |
$ | 7,864 | $ | 5,958 | ||||
Reconciliation of Net Cash Provided by Operating
Activities to Adjusted Free Cash Flow:
Three Months Ended March 31, | ||||||||
2011 | 2010 | |||||||
Net cash provided by operating activities |
$ | 1,772 | $ | 368 | ||||
Purchase of property and equipment |
(312 | ) | (102 | ) | ||||
Capitalization of software development costs |
(195 | ) | (202 | ) | ||||
Free cash flow |
1,265 | 64 | ||||||
Acquisition-related costs |
124 | | ||||||
Adjusted free cash flow |
$ | 1,389 | $ | 64 | ||||