FICO Announces Earnings of $0.62 per Share for Third Quarter Fiscal 2015
SAN JOSE, Calif., July 29, 2015 /PRNewswire/ -- FICO (NYSE: FICO), a leading predictive analytics and decision management software company, today announced results for its third fiscal quarter ended June 30, 2015.
Third Quarter Fiscal 2015 GAAP ResultsNet income for the quarter totaled $19.9 million, or $0.62 per share, versus $20.5 million, or $0.58 per share, reported in the prior year period. The results include restructuring and acquisition-related expenses of $2.3 million, or $0.05 per share.
Third Quarter Fiscal 2015 Non-GAAP ResultsNon-GAAP Net Income for the quarter was $32.3 million vs. $29.2 million in the prior year period. Non-GAAP EPS for the quarter was $1.00 vs. $0.83 in the prior year period. Free cash flow for the quarter was $34.5 million vs. $25.3 million in the prior year period. The Non-GAAP financial measures are described in the financial table captioned "Non-GAAP Results" and are reconciled to the corresponding GAAP results in the financial tables at the end of this release.
Third Quarter Fiscal 2015 GAAP Revenue The company reported revenues of $209.4 million for the quarter as compared to $197.6 million reported in the prior year period, an increase of 6%.
"We drove significant growth in our Scores and Tools segments," said Will Lansing, chief executive officer. "Our Scores segment is performing particularly well in both B2B and B2C, as we continue to expand our valuable FICO Score asset."
Revenues for the third quarter fiscal 2015 across each of the company's three operating segments were as follows:
- Applications revenues, which include the company's preconfigured decision management applications and associated professional services, were $127.1 million in the third quarter compared to $129.9 million in the prior year quarter, a decrease of 2%. This was due to decreased revenues in our Marketing Solutions and Fraud Solutions, partially offset by revenues from the TONBELLER acquisition.
- Scores revenues, which include the company's business-to-business (B2B) scoring solutions and associated professional services, and the myFICO® business-to-consumer (B2C) service, were $55.8 million in the third quarter, up 23% from the prior year quarter. The B2B revenue increased 5% compared to the prior year, while the B2C revenue increased 73% from the prior year quarter.
- Tools revenues, which include Blaze Advisor®, Xpress Optimization and related professional services, were $26.5 million in the third quarter compared to $22.4 million in the prior year quarter, an increase of 18%, due primarily to increased license revenue of Blaze Advisor.
Outlook The company is reiterating its previously provided guidance for fiscal 2015, which is as follows:
|
Fiscal 2015 Guidance | |
|
Revenue |
$830 million - $835 million |
|
GAAP Net Income |
$92 million - $95 million |
|
GAAP Earnings Per Share |
$2.78 - $2.88 |
|
Non-GAAP Net Income |
$131 million - $134 million |
|
Non-GAAP Earnings Per Share |
$3.97 - $4.06 |
The Non-GAAP financial measures are described in the financial table captioned "Non-GAAP Results".
Company to Host Conference CallThe company will host a webcast today at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) to report its third quarter fiscal 2015 results and provide various strategic and operational updates. The call can be accessed at FICO's Web site at www.FICO.com/investors. A replay of the webcast will be available through July 29, 2016.
The webcast will also be distributed through the Thomson StreetEvents Network to both institutional and individual investors. The webcast can be accessed via Thomson's password-protected event management site, StreetEvents (www.streetevents.com).
About FICOFICO (NYSE: FICO) delivers superior predictive analytics that drive smarter decisions. The company's groundbreaking use of mathematics to predict consumer behavior has transformed entire industries and revolutionized the way risk is managed and products are marketed. FICO's innovative solutions include the FICO® Score — the standard measure of consumer credit risk in the United States — along with the industry-leading solutions for managing credit accounts, identifying and minimizing the impact of fraud, and customizing consumer offers with pinpoint accuracy. Most of the world's top banks, as well as leading insurers, retailers, pharma businesses and government agencies rely on FICO solutions to accelerate growth, control risk, boost profits and meet regulatory and competitive demands. FICO also helps millions of individuals manage their personal credit health through www.myFICO.com. Learn more at www.fico.com. FICO: Make every decision count.
Statement Concerning Forward-Looking InformationExcept for historical information contained herein, the statements contained in this news release that relate to FICO or its business are forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including the success of the Company's Decision Management strategy and reengineering initiative, the maintenance of its existing relationships and ability to create new relationships with customers and key alliance partners, its ability to continue to develop new and enhanced products and services, its ability to recruit and retain key technical and managerial personnel, competition, regulatory changes applicable to the use of consumer credit and other data, the failure to realize the anticipated benefits of any acquisitions, continuing material adverse developments in global economic conditions or in the markets we serve, and other risks described from time to time in FICO's SEC reports, including its Annual Report on Form 10-K for the year ended September 30, 2014 and Form 10-Q for the quarter ended June 30, 2015. If any of these risks or uncertainties materializes, FICO's results could differ materially from its expectations. FICO disclaims any intent or obligation to update these forward-looking statements.
|
FAIR ISAAC CORPORATION | |||
|
CONDENSED CONSOLIDATED BALANCE SHEETS | |||
|
(In thousands) | |||
|
(Unaudited) | |||
|
June 30, |
September 30, | ||
|
2015 |
2014 | ||
|
ASSETS: |
|||
|
Current assets: |
|||
|
Cash and cash equivalents |
$ 84,358 |
$ 105,075 | |
|
Accounts receivable, net |
147,304 |
155,295 | |
|
Prepaid expenses and other current assets |
37,428 |
28,157 | |
|
Total current assets |
269,090 |
288,527 | |
|
Marketable securities and investments |
20,865 |
19,784 | |
|
Property and equipment, net |
38,706 |
36,677 | |
|
Goodwill and intangible assets, net |
870,221 |
827,842 | |
|
Other assets |
17,245 |
19,468 | |
|
$ 1,216,127 |
$ 1,192,298 | ||
|
LIABILITIES AND STOCKHOLDERS' EQUITY: |
|||
|
Current liabilities: |
|||
|
Accounts payable and other accrued liabilities |
$ 56,009 |
$ 58,235 | |
|
Accrued compensation and employee benefits |
36,648 |
56,650 | |
|
Deferred revenue |
54,260 |
56,519 | |
|
Current maturities on debt |
72,000 |
170,000 | |
|
Total current liabilities |
218,917 |
341,404 | |
|
Long-term debt |
576,000 |
376,000 | |
|
Other liabilities |
24,548 |
20,280 | |
|
Total liabilities |
819,465 |
737,684 | |
|
Stockholders' equity |
396,662 |
454,614 | |
|
$ 1,216,127 |
$ 1,192,298 | ||
|
FAIR ISAAC CORPORATION | |||||||
|
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||||||
|
(In thousands, except per share data) | |||||||
|
(Unaudited) | |||||||
|
Quarter Ended |
Nine Months Ended | ||||||
|
June 30, |
June 30, | ||||||
|
2015 |
2014 |
2015 |
2014 | ||||
|
Revenues: |
|||||||
|
Transactional and maintenance |
$ 144,695 |
$ 132,254 |
$ 414,788 |
$ 394,278 | |||
|
Professional services |
37,998 |
38,522 |
111,142 |
107,427 | |||
|
License |
26,673 |
26,834 |
80,095 |
65,710 | |||
|
Total revenues |
209,366 |
197,610 |
606,025 |
567,415 | |||
|
Operating expenses: |
|||||||
|
Cost of revenues |
66,202 |
62,752 |
203,493 |
178,254 | |||
|
Research & development |
25,610 |
23,240 |
72,588 |
61,022 | |||
|
Selling, general and administrative |
74,645 |
71,557 |
221,309 |
204,490 | |||
|
Amortization of intangible assets |
3,599 |
3,019 |
10,046 |
8,940 | |||
|
Restructuring and acquisition-related |
2,256 |
621 |
2,256 |
4,281 | |||
|
172,312 |
161,189 |
509,692 |
456,987 | ||||
|
Operating income |
37,054 |
36,421 |
96,333 |
110,428 | |||
|
Other expense, net |
(6,590) |
(6,120) |
(21,512) |
(21,657) | |||
|
Income before income taxes |
30,464 |
30,301 |
74,821 |
88,771 | |||
|
Provision for income taxes |
10,558 |
9,753 |
21,638 |
30,495 | |||
|
Net income |
$ 19,906 |
$ 20,548 |
$ 53,183 |
$ 58,276 | |||
|
Basic earnings per share: |
$ 0.64 |
$ 0.60 |
$ 1.69 |
$ 1.69 | |||
|
Diluted earnings per share: |
$ 0.62 |
$ 0.58 |
$ 1.63 |
$ 1.65 | |||
|
Shares used in computing earnings per share: |
|||||||
|
Basic |
31,118 |
34,210 |
31,465 |
34,458 | |||
|
Diluted |
32,363 |
35,162 |
32,648 |
35,420 | |||
|
FAIR ISAAC CORPORATION | |||
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
|
(In thousands) | |||
|
(Unaudited) | |||
|
Nine Months Ended | |||
|
June 30, | |||
|
2015 |
2014 | ||
|
Cash flows from operating activities: |
|||
|
Net income |
$ 53,183 |
$ 58,276 | |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|||
|
Depreciation and amortization |
26,093 |
24,196 | |
|
Share-based compensation |
32,762 |
25,631 | |
|
Changes in operating assets and liabilities |
(25,264) |
2,375 | |
|
Other, net |
(374) |
(6,665) | |
|
Net cash provided by operating activities |
86,400 |
103,813 | |
|
Cash flows from investing activities: |
|||
|
Purchases of property and equipment |
(18,266) |
(7,088) | |
|
Cash paid for acquisitions, net of cash acquired |
(56,992) |
(7,253) | |
|
Other, net |
75 |
- | |
|
Net cash used in investing activities |
(75,183) |
(14,341) | |
|
Cash flows from financing activities: |
|||
|
Proceeds from revolving line of credit |
241,000 |
96,000 | |
|
Payments on revolving line of credit |
(68,000) |
(28,000) | |
|
Payment on Senior Notes |
(71,000) |
(8,000) | |
|
Proceeds from issuances of common stock |
13,643 |
18,041 | |
|
Taxes paid related to net share settlement of equity awards |
(18,102) |
(10,790) | |
|
Repurchases of common stock |
(130,719) |
(152,329) | |
|
Other, net |
9,482 |
3,860 | |
|
Net cash used in financing activities |
(23,696) |
(81,218) | |
|
Effect of exchange rate changes on cash |
(8,238) |
1,677 | |
|
Increase (decrease) in cash and cash equivalents |
(20,717) |
9,931 | |
|
Cash and cash equivalents, beginning of period |
105,075 |
83,178 | |
|
Cash and cash equivalents, end of period |
$ 84,358 |
$ 93,109 | |
|
FAIR ISAAC CORPORATION | |||||||||
|
REVENUE BY SEGMENT | |||||||||
|
(In thousands) | |||||||||
|
(Unaudited) | |||||||||
|
Quarter Ended |
Nine Months Ended | ||||||||
|
June 30, |
June 30, | ||||||||
|
2015 |
2014 |
2015 |
2014 | ||||||
|
Applications revenues: |
|||||||||
|
Transactional and maintenance |
$ 79,731 |
$ 78,915 |
$ 238,597 |
$ 233,592 | |||||
|
Professional services |
31,009 |
31,898 |
90,500 |
87,058 | |||||
|
License |
16,394 |
19,043 |
47,923 |
36,732 | |||||
|
Total applications revenues |
$ 127,134 |
$ 129,856 |
$ 377,020 |
$ 357,382 | |||||
|
Scores revenues: |
|||||||||
|
Transactional and maintenance |
$ 54,255 |
$ 44,077 |
$ 145,006 |
$ 133,955 | |||||
|
Professional services |
615 |
801 |
2,369 |
2,167 | |||||
|
License |
884 |
452 |
2,257 |
4,246 | |||||
|
Total scores revenues |
$ 55,754 |
$ 45,330 |
$ 149,632 |
$ 140,368 | |||||
|
Tools revenues: |
|||||||||
|
Transactional and maintenance |
$ 10,709 |
$ 9,262 |
$ 31,185 |
$ 26,731 | |||||
|
Professional services |
6,374 |
5,823 |
18,273 |
18,202 | |||||
|
License |
9,395 |
7,339 |
29,915 |
24,732 | |||||
|
Total tools revenues |
$ 26,478 |
$ 22,424 |
$ 79,373 |
$ 69,665 | |||||
|
Total revenues: |
|||||||||
|
Transactional and maintenance |
$ 144,695 |
$ 132,254 |
$ 414,788 |
$ 394,278 | |||||
|
Professional services |
37,998 |
38,522 |
111,142 |
107,427 | |||||
|
License |
26,673 |
26,834 |
80,095 |
65,710 | |||||
|
Total revenues |
$ 209,366 |
$ 197,610 |
$ 606,025 |
$ 567,415 | |||||
|
FAIR ISAAC CORPORATION | |||||||
|
NON-GAAP RESULTS | |||||||
|
(In thousands, except per share data) | |||||||
|
(Unaudited) | |||||||
|
Quarter Ended |
Nine Months Ended | ||||||
|
June 30, |
June 30, | ||||||
|
2015 |
2014 |
2015 |
2014 | ||||
|
GAAP net income |
$ 19,906 |
$ 20,548 |
$ 53,183 |
$ 58,276 | |||
|
Amortization of intangible assets (net of tax) |
2,469 |
2,022 |
6,997 |
5,948 | |||
|
Restructuring and acquisition-related (net of tax) |
1,547 |
416 |
1,547 |
2,840 | |||
|
Stock-based compensation expense (net of tax) |
8,345 |
6,260 |
22,814 |
17,060 | |||
|
Non-GAAP net income |
$ 32,267 |
$ 29,246 |
$ 84,541 |
$ 84,124 | |||
|
GAAP diluted earnings per share |
$ 0.62 |
$ 0.58 |
$ 1.63 |
$ 1.65 | |||
|
Amortization of intangible assets (net of tax) |
0.08 |
0.06 |
0.21 |
0.17 | |||
|
Restructuring and acquisition-related (net of tax) |
0.05 |
0.01 |
0.05 |
0.08 | |||
|
Stock-based compensation expense (net of tax) |
0.26 |
0.18 |
0.70 |
0.48 | |||
|
Non-GAAP diluted earnings per share |
$ 1.00 |
$ 0.83 |
$ 2.59 |
$ 2.38 | |||
|
Free cash flow |
|||||||
|
Net cash provided by operating activities |
$ 43,119 |
$ 28,725 |
$ 86,401 |
$ 103,813 | |||
|
Capital expenditures |
(8,015) |
(2,791) |
(18,266) |
(7,088) | |||
|
Dividends paid |
(622) |
(683) |
(1,883) |
(2,072) | |||
|
Free cash flow |
$ 34,482 |
$ 25,251 |
$ 66,252 |
$ 94,653 | |||
|
Note: The numbers may not sum to total due to rounding. |
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|
About Non-GAAP Financial Measures |
||||||||
|
To supplement the consolidated GAAP financial statements, the company uses the following non-GAAP financial measures: non-GAAP net income, non-GAAP EPS, and free cash flow. Non-GAAP net income and non-GAAP EPS exclude the impact of amortization expense, share-based compensation expense, restructuring and acquisition-related, and adjustment to tax valuation allowance items. Free cash flow excludes capital expenditures and dividends paid. The presentation of these financial measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. | ||||||||
|
Management uses these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. Our management believes these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain items that may not be indicative of recurring business results including significant non-cash expenses. We believe management and investors benefit from referring to these non-GAAP financial measures in assessing our performance when planning, forecasting and analyzing future periods. These non-GAAP financial measures also facilitate management's internal comparisons to historical performance and liquidity as well as comparisons to our competitors' operating results. We believe these non-GAAP financial measures are useful to investors because they allow for greater transparency with respect to key measures used by management in its financial and operating decision-making. | ||||||||
|
FAIR ISAAC CORPORATION | |||
|
RECONCILIATION OF NON-GAAP GUIDANCE | |||
|
(In millions, except per share data) | |||
|
(Unaudited) | |||
|
Low |
High | ||
|
GAAP net income |
$ 92 |
$ 95 | |
|
Amortization of intangible assets (net of tax) |
9 |
9 | |
|
Stock-based compensation expense (net of tax) |
31 |
31 | |
|
Non-GAAP net income |
$ 131 |
$ 134 | |
|
GAAP diluted earnings per share |
$ 2.78 |
$ 2.88 | |
|
Amortization of intangible assets (net of tax) |
0.26 |
0.26 | |
|
Stock-based compensation expense (net of tax) |
0.94 |
0.94 | |
|
Non-GAAP diluted earnings per share |
$ 3.97 |
$ 4.06 | |
|
Note: The numbers may not sum to total due to rounding. |
|||
|
About Non-GAAP Financial Measures |
|||
|
To supplement the consolidated GAAP financial statements, the company uses the following non-GAAP financial measures: non-GAAP net income, non-GAAP EPS, and free cash flow. Non-GAAP net income and non-GAAP EPS exclude the impact of amortization expense, share-based compensation expense, restructuring and acquisition-related, and adjustment to tax valuation allowance items. Free cash flow excludes capital expenditures and dividends paid. The presentation of these financial measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. | |||
|
Management uses these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. Our management believes these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain items that may not be indicative of recurring business results including significant non-cash expenses. We believe management and investors benefit from referring to these non-GAAP financial measures in assessing our performance when planning, forecasting and analyzing future periods. These non-GAAP financial measures also facilitate management's internal comparisons to historical performance and liquidity as well as comparisons to our competitors' operating results. We believe these non-GAAP financial measures are useful to investors because they allow for greater transparency with respect to key measures used by management in its financial and operating decision-making. | |||
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SOURCE FICO