Form 8-K DETERMINE, INC. For: Feb 08

February 8, 2018 4:35 PM

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549 

 

FORM 8-K 

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

 

 

Date of report (Date of earliest event reported): February 8, 2018

 

 

DETERMINE, INC.

(Exact name of Company as specified in Charter)

 

 

 

 

 

 

 

Delaware
(State or other jurisdiction of
incorporation or organization)
 

 

000-29637
(Commission File No.)
 

 

77-0432030
(IRS Employee Identification No.)

 

615 West Carmel Drive, Suite 100

Carmel, Indiana 46032

(Address of Principal Executive Offices)

 

(650) 532-1500
(Issuer Telephone number)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Company under any of the following provisions (see General Instruction A.2 below).

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR240.14a-12)

 

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)).

 

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13(e)-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 

 

 

Item 2.02

Results of Operations and Financial Condition.

 

On February 8, 2018, Determine, Inc. (the “Company”) issued a press release announcing financial results for the third fiscal quarter ended December 31, 2017. A copy of the press release is attached hereto as Exhibit 99.1.

 

The information disclosed under this Item 2.02, including Exhibit 99.1 hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be deemed incorporated by reference into any filing made under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such filing.

 

 

Item 9.01

Financial Statements and Exhibits.

 

(d)

Exhibits

 

Exhibit

No.

 

Description

99.1

  

Press release of Determine, Inc. dated February 8, 2018

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this Current Report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Dated: February 8, 2018

 

 

DETERMINE, INC.

   
   
 

By:   /s/ John Nolan                                               

Name: John Nolan

Title:   Chief Financial Officer

 

 

 

 

EXHIBIT INDEX

 

Exhibit

No.

 

Description

99.1

  

Press release of Determine, Inc. dated February 8, 2018

 

Exhibit 99.1

 

Determine Announces 3rd Quarter Fiscal Year 2018 Financial Results

 

Business momentum driven by strong year-over-year subscription services growth contributes to robust quarterly financial performance.

 

CARMEL, IN – February 8, 2018 – Determine, Inc. (NASDAQ: DTRM), a pioneering leader in global Source-to-Pay and Enterprise Contract Lifecycle Management (ECLM) Cloud Platform solutions, announced financial results for its third quarter ended December 31st, 2017.

 

 

Q3 FY18 GAAP Financial Highlights:

 

 

GAAP Revenue was $7.5 million in Q3 FY2018, compared to $6.9 million in Q2 FY2018, representing a 8.4% increase quarter-over-quarter, and compared to $6.9 million in Q3 FY2017, representing a 9.0% increase year-over-year.

 

GAAP gross profit percentage was 55.7% in Q3 FY2018, compared to 49.8% in Q2 FY2018, and 48.8% in Q3 FY2017.

 

Deferred revenues increased to $10.4 million in Q3 FY2018 from $9.0 million in Q2 FY2018.

 

GAAP net loss was $2.3 million, or $0.16 per share, in Q3 FY2018, compared to $2.7 million, or $0.18 per share, in Q2 FY2018, representing an improvement of $0.02 per share quarter-over-quarter; in Q3 FY2017, the GAAP net loss was $2.2 million, or $0.18 per share.

 

(in thousands, except per share amounts) 

GAAP Financial Measures

 

Q3

   

Q2

   

Q3

   

Change

   

Change

   

Nine Months

 
 

FY 2018

   

FY 2018

   

FY 2017

   

Q/Q

   

Y/Y

   

FY 2018

   

FY 2017

   

Change Y/Y

 

Revenue - total

  $ 7,467     $ 6,888     $ 6,852       8.4 %     9.0 %   $ 21,343     $ 19,928       7.1 %

Revenue - recurring

  $ 5,552     $ 5,545     $ 5,054       0.1 %     9.9 %   $ 16,397     $ 15,267       7.4 %

Revenue - non-recurring

  $ 1,915     $ 1,343     $ 1,798       42.6 %     6.5 %   $ 4,946     $ 4,661       6.1 %

Gross profit - total

  $ 4,160     $ 3,432     $ 3,341       21.2 %     24.5 %   $ 11,277     $ 9,865       14.3 %

Gross profit - recurring

  $ 3,649     $ 3,371     $ 3,277       8.2 %     11.4 %   $ 10,534     $ 10,182       3.5 %

Gross profit (loss) - non-recurring

  $ 511     $ 61     $ 64       737.7 %     (698.4% )   $ 743     $ (317 )     334.4 %

Gross margin - total

    55.7 %     49.8 %     48.8 %  

5.9 pts

   

6.9 pts

      52.8 %     49.5 %  

3.3 pts

 

Gross margin - recurring

    65.7 %     60.8 %     64.8 %  

4.9 pts

   

0.9 pts

      64.2 %     66.7 %  

(2.5 pts)

 

Gross margin - non recurring

    26.7 %     4.5 %     3.6 %  

22.2 pts

   

23.1 pts

      15.0 %     (6.8% )  

21.8 pts

 

Net loss

  $ (2,346 )   $ (2,671 )   $ (2,193 )     (12.2% )     7.0 %   $ (7,127 )   $ (7,743 )     (8.0% )

EPS

  $ (0.16 )   $ (0.18 )   $ (0.18 )   $ 0.02     $ 0.02     $ (0.51 )   $ (0.67 )   $ 0.16  

 

 

 

 

Q3 FY18 Non-GAAP Financial Highlights:

 

Non-GAAP revenue was $7.5 million in Q3 FY2018, compared to $6.9 million in Q2 FY2018, representing a 8.4% increase quarter-over-quarter, and compared to $6.9 million in Q3 FY2017, representing a 9.0% increase year-over-year.

 

Non-GAAP gross profit percentage was 60.1% in Q3 FY2018, compared to 54.9% in Q2 FY2018, and 54.4% in Q3 FY2017.

 

Non-GAAP net loss was $1.3 million, or $0.09 per share, in Q3 FY 2018, compared to a net loss of $1.5 million, of $0.10 per share, in Q2 FY2018, representing an improvement of $0.01 per share quarter-over-quarter. Q3 FY2017 had a non-GAAP net loss of $1.0 million, or $0.08 per share, representing an additional loss of $0.01 share year-over-year.

 

Billings increased 17.4% to $8.9 million in Q3 FY2018 from $7.5 million in Q3 FY2017. Billings, a non-GAAP measure, is defined as revenue plus the change in deferred revenues.

 

Non-GAAP EBITDA was a $0.5 million loss in Q3 FY2018, compared to a loss of $0.2 million in Q3 FY2017, representing an additional loss of $0.3 million year-over-year.

 

(in thousands, except per share amounts)

                                                 

Non-GAAP Financial Measures

 

Q3

   

Q2

   

Q3

   

Change

   

Change

   

Nine Months

 
 

FY 2018

   

FY 2018

   

FY 2017

   

Q/Q

   

Y/Y

   

FY 2018

   

FY 2017

   

Change Y/Y

 

Revenue - total

  $ 7,467     $ 6,888     $ 6,852       8.4 %     9.0 %   $ 21,343     $ 19,936       7.1 %

Revenue - recurring

  $ 5,552     $ 5,545     $ 5,054       0.1 %     9.9 %   $ 16,397     $ 15,275       7.3 %

Revenue - non-recurring

  $ 1,915     $ 1,343     $ 1,798       42.6 %     6.5 %   $ 4,946     $ 4,661       6.1 %

Gross profit - total

  $ 4,484     $ 3,784     $ 3,726       18.5 %     20.3 %   $ 12,271     $ 10,896       12.6 %

Gross profit - recurring

  $ 3,916     $ 3,675     $ 3,590       6.6 %     9.1 %   $ 11,405     $ 11,037       3.3 %

Gross profit ( loss) - non-recurring

  $ 568     $ 109     $ 136       421.1 %     317.6 %   $ 866     $ (141 )     714.2 %

Gross margin - total

    60.1 %     54.9 %     54.4 %  

5.2 pts

   

5.7 pts

      57.5 %     54.7 %  

2.8 pts

 

Gross margin - recurring

    70.5 %     66.3 %     71.0 %  

4.2 pts

   

(0.5 pts)

      69.6 %     72.3 %  

(2.7 pts)

 

Gross margin - non recurring

    29.7 %     8.1 %     7.6 %  

21.6 pts

   

22.1 pts

      17.5 %     (3.0% )  

20.5 pts

 

Net loss

  $ (1,303 )   $ (1,506 )   $ (1,010 )     (13.5% )     29.0 %   $ (3,761 )   $ (4,253 )     (11.6% )

EPS

  $ (0.09 )   $ (0.10 )   $ (0.08 )   $ 0.01     $ (0.01 )   $ (0.27 )   $ (0.37 )   $ 0.10  

Billings

  $ 8,856     $ 5,991     $ 7,545       47.8 %     17.4 %   $ 21,619     $ 19,595       10.3 %

 

Momentum is the key word for Determine now as we continue to build on our success quarter over quarter. Our financial performance in Q318 was strong as measured by key metrics - notably year over year recurring revenue, which grew at an impressive 10%. We continue to bolster and refine our management, product, and sales and marketing strategies, resulting in significant growth in SQL-grade lead generation and pipeline activity. The latest release of the Determine Cloud Platform breaks new ground again, providing unparalleled capabilities to our customers, and in the coming quarters our product roadmap will introduce new innovations in key areas including, blockchain, AI and machine learning as it continues to roll out. Significantly, this past quarter was notable for our numerous customer satisfaction initiatives, capped by the Determine User Conference in France which surpassed attendance estimates. At all levels of the company, we are renewing our commitment every day to ensuring “Customer Experience” is the focus of everything we do. Our goal, as always, is to exceed customer expectations at every stage.”

 

Patrick Stakenas, President and CEO, Determine, Inc.

 

 

 

 

Q3 FY18 Determine Business Highlights: 

 

 

The first Determine User Group in Paris, France – was a full-day event with leading CPO’s and platform administrators – including 40+ European customer participants representing more than a dozen companies. The event was part of Determine’s ongoing customer experience enhancement program, which includes a series of regular one-on-one meetings, workshops and roundtables with customers.

 

 

Industry-Disrupting Determine Cloud Platform Solutions Sweep Across Spend Matters SolutionMapsSM: The Determine Cloud Platform was recognized in seven of the Spend Matters SolutionMapSM vendor comparison rankings, expanding its scoring and impressively maintaining its Value Leader ranking in E-Procurement.

 

 

Industry-Leading Source-to-Pay Provider Determine Empowers Customer Success Through New DetermineAlliance Partner Program: The launch of the DetermineAlliance Partner Program with an expanded global footprint establishes a truly collaborative partner forum to meet the end-to-end needs of customers today and into the future.

 

     The Q3 FY2018 Release of the Determine Cloud Platform further expanded advanced capabilities across Source-to-Pay solutions. Highlights include:

     Contract Management:

     Associate multiple legal entities to a contract or contract request

     The flexibility to create virtual contract templates that can be used to generate a contract in word documents

     Expanded functionality for self-service business users

     Procure to Pay:

     Automatic invoice processing rules

     Discrepancy tolerance rules, no-PO invoice rules, invoice re-processing rules

     Specific features for North American Market

     US Sales Tax, 1099 forms, Blanket PO, Canadian Compound Tax

 

 

Q3 FY2018 Customer Announcements: During Q3 FY2018, Determine announced new customer accounts in the US and Europe across its Determine Cloud Platform Source-to-Pay and Enterprise Contract Lifecycle Management solutions, in key verticals including financial, retail and healthcare/life sciences, among others.

 

Source-to-Pay Leader Determine, Inc. Empowers 100% of New Customers on the Determine Cloud Platform: The company accelerated performance to a whole new level by achieving 100% new customer growth in Q3 FY2018 on the industry-leading Determine Cloud Platform.

 

Bethpage Federal Credit Union Banks on Determine, Inc. to Optimize its Procure-to-Pay Processes: Bethpage Federal Credit Union, the largest credit union in the Northeast region and in New York State, has selected Determine for its best-in-class Procure-to-Pay functionality, including eInvoicing, P-Card, and Travel & Entertainment capabilities.

 

Leading Danish DIY Retailer SILVAN Builds Future On the Determine Cloud Platform: Silvan of Denmark, one of the largest DIY consumer retailers in the Nordic region, is leveraging the Determine Cloud Platform for Sourcing, Contract Management and Supplier Management.

 

 

Annualized Bookings: In Q3 FY2018, the revenue team delivered approximately $416K in annualized bookings. Financial Services, Healthcare/Life Sciences and Retail were particularly standout industry verticals.

 

 

 

 

 

Determine Continues Thought Leadership: In Q3 FY2018, Determine continued to provide meaningful educational resources to inform customers and prospects on the ever-changing Source-to-Pay and Enterprise Contract Lifecycle Management landscape:

 

Source-to-Pay Pioneer Determine, Inc. Delivers Game Changing Procurement Thought Leadership at the CPO Rising 2017 Summit: As a Silver Sponsor, the Determine team provided expertise on leveraging the industry-defining Determine Cloud Platform, with three valued customers featured as panel speakers — Biogen, Digital First Media and VSP Global.

 

Determine Brings Innovation Best Practices to IACCM Conference: As a featured event speaker, Determine presented a contract management case study, and showed attendees the latest contract innovations and how to put them to practical use through integrated contract management on the Determine Cloud Platform.

 

Determine, Inc. and Spend Matters Co-Host a Webinar on Contract Compliance—Why it Matters to Procurement: Julien Nadaud, Chief Product Officer and Rick Geneva, Director of Product Management at Determine, along with Jason Busch of Spend Matters, explore the thought leadership and best practices around contract compliance and what procurement’s role should be in managing it.

 

Determine, Inc. Shares Industry-Leading Supplier Relationship Expertise in PayStream Webinar: Sophie Pope, Director of Professional Services at Determine shared how managing suppliers involves vastly different forms, functions, and strategies depending on the department, team, and specific industry.

 

Determine Brings Platformance to SIG Executive Summit: This four-day forum for leading technology providers and practitioners combines roundtables, keynote sessions, workshops, breakout sessions and networking events in which Determine provided industry best practices, innovative processes and risk-mitigation strategies.

 

 

Conference Call and Webcast Thursday, February 8, 2018 at 5:00 PM (Eastern Time)

 

Participant Dial-In Numbers:

 

Toll-Free:                  1-877-407-0789

 

Toll/International:   1-201-689-8562

 

 

 

 

Participant Webcast Link: http://public.viavid.com/index.php?id=128017

 

Replay Dial-In Numbers:

 

Toll-Free:                  1-844-512-2921

 

Toll/International:   1-412-317-6671

 

From:  02/08/18 at 8:00 pm Eastern Time

 

To:  02/15/18 at 11:59 pm Eastern Time

 

Replay Pin Number:  13675586

 

 

Related: http://investor.determine.com

 

 

Non-GAAP Financial Measures

 

To supplement our financial results presented in accordance with Generally Accepted Accounting Principles (GAAP), this press release and the accompanying tables contain certain non-GAAP financial measures, including non-GAAP revenue, non-GAAP gross profit, non-GAAP net income and non-GAAP earnings per share, which we believe are helpful in understanding our past financial performance and future results. For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled, “GAAP to Non-GAAP Reconciliations”. Our non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read in conjunction with our consolidated financial statements prepared in accordance with GAAP.

 

The difference between GAAP and non-GAAP revenue is due to the impact of revaluing the deferred revenue balances acquired from primarily b-pack as required by GAAP purchase accounting.

 

The difference between GAAP and non-GAAP gross profit is the difference in GAAP versus non-GAAP revenues as well as the elimination of the amortization of acquisition related intangibles, stock based compensation and severance expense from the costs of revenue. Non-GAAP net loss excludes the non-GAAP gross profit items as well as acquisition related costs.

 

 

 

 

Our management regularly uses our supplemental non-GAAP financial measures internally to understand and manage our business and forecast future periods; as such, we believe it is useful for investors to understand the effects of these items on our total operations. Further, please note that our non-GAAP revenue is intended to reflect the full amount of revenues that would have been otherwise recorded by the acquired entities of Iasta and b-pack, while our non-GAAP gross profit also excludes the amortization of intangibles that occurred due to the acquisition of the entities of Iasta and b-pack.

 

Annualized Bookings are an operating measure not derived from the company’s revenues or any other amounts presented in accordance with GAAP in the company’s statement of income, balance sheet or statement of cash flows or other equivalent statements.

 

Forward-looking Statements

 

Certain statements in this release and elsewhere by Determine are forward-looking statements within the meaning of the federal securities laws and the Private Securities Litigation Reform Act of 1995. Such statements may include, without limitation, statements regarding business outlook, assessment of market conditions, anticipated financial and operating results, strategies, product and channel development, future plans, contingencies and contemplated transactions of the company. Such forward-looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors which may cause or contribute to actual results of company operations, or the performance or achievements of the company or industry results, to differ materially from those expressed, or implied by the forward-looking statements. In addition to any such risks, uncertainties and other factors discussed elsewhere herein, risks, uncertainties and other factors that could cause or contribute to actual results differing materially from those expressed or implied for the forward-looking statements include, but are not limited to fluctuations in demand for Determine’s products and services, risks of losing key personnel or customers, protection of the company’s intellectual property and government policies and regulations, including, but not limited to those affecting the company’s industry. Determine undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Additional risk factors concerning the company can be found in the company’s most recent Form 10-K as filed by the company with the Securities and Exchange Commission.

 

 

 

 

Inducement Grant

 

Determine also announced today that Kevin Turner, the Company’s recently appointed Senior Vice President – Customer Success, was granted a non-qualified stock option to purchase 100,000 shares of Determine’s Common Stock effective February 13, 2018. The non-qualified options will have an exercise price per share equal to the closing price of Determine’s common stock on NASDAQ on February 13, 2018. The options have a 10-year term and vest over a 48-month period, with 25 percent of the option shares vesting after completion of 12 months of continuous service to Determine, and the remaining option shares vesting in equal monthly installments over the following 36 months of continuous service to Determine. The grant was made as an inducement that was a material component of Mr. Turner’s compensation and subsequent acceptance of employment with the company and was granted as an employment inducement award pursuant to NASDAQ Listing Rule 5635(c)(4) approved by the members of the independent compensation committee of the board of directors of Determine.

 

Supporting Resources

Determine blog

 

Determine on LinkedIn

 

Determine on Twitter

 

Determine Resources

 

About Determine, Inc.

Determine, Inc. (NASDAQ: DTRM) is a leading global provider of SaaS Source-to-Pay and Enterprise Contract Lifecycle Management (ECLM) solutions. The Determine Cloud Platform provides procurement, legal and finance professionals analytics of their supplier, contract and financial performance. Our technologies empower customers to drive new revenue, identify savings, improve compliance and mitigate risk.

 

The Determine Cloud Platform seamlessly integrates with major ERP or third-party systems such as SAP, Oracle, Sage, QAD and Microsoft. Modular solutions can be configured to add more as needed to provide additional value beyond spend management. Our unified master database and business process approach empower users at every level to make more informed and smarter decisions.

 

For more information, please visit: www.determine.com.

 

Contact

 

Media Relations:

Mike Mitchell

Determine, Inc.

+1.650.532.1590

pr@determine.com

 

 

 

 

Determine, Inc.

Condensed Consolidated Statements of Operations

(In thousands, except per share amounts)

(Unaudited)

 

   

Three Months Ended

   

Nine Months Ended

 
   

December 31,

   

December 31,

 
   

2017

   

2016

   

2017

   

2016

 
                                 

Revenues:

                               

Recurring revenues

  $ 5,552     $ 5,054     $ 16,397     $ 15,267  

Non-recurring revenues

    1,915       1,798       4,946       4,661  

Total revenues

    7,467       6,852       21,343       19,928  
                                 

Cost of revenues:

                               

Cost of recurring revenues

    1,903       1,777       5,863       5,085  

Cost of non-recurring revenues

    1,404       1,734       4,203       4,978  

Total cost of revenues

    3,307       3,511       10,066       10,063  
                                 

Gross profit:

                               

Recurring gross profit

    3,649       3,277       10,534       10,182  

Non-recurring profit (loss)

    511       64       743       (317 )

Total gross profit

    4,160       3,341       11,277       9,865  
                                 

Operating expenses:

                               

Research and development

    1,289       1,049       3,363       3,052  

Sales and marketing

    2,733       2,273       7,923       7,843  

General and administrative

    1,986       1,761       5,863       5,432  

Total operating expenses

    6,008       5,083       17,149       16,327  
                                 

Loss from operations

    (1,848 )     (1,742 )     (5,872 )     (6,462 )
                                 

Other expense, net

    (534 )     (462 )     (1,280 )     (1,388 )

Net loss before income tax

    (2,382 )     (2,204 )     (7,152 )     (7,850 )
                                 

Benefit from income taxes

    36       35       25       143  

Consolidated net loss

    (2,346 )     (2,169 )     (7,127 )     (7,707 )
                                 

Net loss attributable to non-conrolling interest

    -       (24 )     -       (36 )

Net loss attributable to common stockholders

  $ (2,346 )   $ (2,193 )   $ (7,127 )   $ (7,743 )
                                 
                                 

Basic and diluted net loss per share

  $ (0.16 )   $ (0.18 )   $ (0.51 )   $ (0.67 )

 

 

 

 

Determine, Inc.

GAAP to Non-GAAP Reconciliations

(In thousands)

(Unaudited)

 

   

Three Months Ended

   

Nine Months Ended

 
   

December 31,

   

December 31,

 
   

2017

   

2016

   

2017

   

2016

 

Reconciliation of total revenue:

                               

U.S. GAAP as reported

  $ 7,467     $ 6,852     $ 21,343     $ 19,928  

Adjustments:

                               

Deferred revenue adjustment

    -       -       -       8  

Non-GAAP revenue

  $ 7,467     $ 6,852     $ 21,343     $ 19,936  
                                 

Reconciliation of gross profit:

                               

U.S. GAAP as reported

  $ 4,160     $ 3,341     $ 11,277     $ 9,865  

Adjustments:

                               

Deferred revenue adjustment

    -       -       -       8  

Amortizaton of acquisition

    257       250       768       758  

Stock based compensation

    23       111       144       241  

Severance

    44       24       82       24  

Non-GAAP gross profit

  $ 4,484     $ 3,726     $ 12,271     $ 10,896  
                                 

Reconciliation to non-GAAP net loss:

                               

Net loss attributable to Determine, Inc.

  $ (2,346 )   $ (2,193 )   $ (7,127 )   $ (7,743 )

Stock-based compensation expense

    443       630       1,649       1,867  

Deferred revenue adjustment

    -       -       -       8  

Amortization on intangibles

    540       526       1,614       1,594  

Benefit for income taxes

    -       -       -       (13 )

Severance costs

    60       27       103       34  

Non-GAAP net loss

  $ (1,303 )   $ (1,010 )   $ (3,761 )   $ (4,253 )
                                 

Non-GAAP basic and diluted net loss per share

  $ (0.09 )   $ (0.08 )   $ (0.27 )   $ (0.37 )
                                 

Weighted average shares outstanding for basic and diluted net loss per share

    14,953       11,944       14,068       11,466  

 

 

 

 

Determine, Inc.

Condensed Consolidated Statements of Comprehensive Loss

(In thousands)

(Unaudited)

 

   

Three Months Ended

   

Nine Months Ended

 
   

December 31,

   

December 31,

 
   

2017

   

2016

   

2017

   

2016

 
                                 

Consolidated net loss

  $ (2,346 )   $ (2,169 )   $ (7,127 )   $ (7,707 )

Foreign currency translation adjustments, net

    257       (18 )     1,028       (31 )

Other comprehensive income

    (69 )     -       (80 )     -  

Comprehensive loss

    (2,158 )     (2,187 )     (6,179 )     (7,738 )

Less: Net loss attributable to non-controlling interest

    -       (24 )     -       (36 )

Comprehensive loss attributable to Determine, Inc.

  $ (2,158 )   $ (2,211 )   $ (6,179 )   $ (7,774 )

 

 

 

 

Determine, Inc.

Condensed Consolidated Balance Sheets

(In thousands)

 

   

December 31,

   

March 31,

 
   

2017

   

2017

 
   

(Unaudited)

   

(Audited)

 

ASSETS

               

Current assets

               

Cash and cash equivalents

  $ 10,077     $ 9,429  

Accounts receivable, net

    9,031       7,042  

Restricted cash

    27       34  

Prepaid expenses and other current assets

    1,243       1,553  

Total current assets

    20,378       18,058  
                 

Property and equipment, net

    83       85  

Capitalized software development costs, net

    2,907       2,341  

Goodwill

    15,256       14,448  

Other intangibles, net

    4,452       5,860  

Other assets

    1,100       1,599  

Total assets

  $ 44,176     $ 42,391  
                 
                 

LIABILITIES AND STOCKHOLDERS' EQUITY

               

Current liabilities

               

Credit facility

  $ 11,821     $ 11,861  

Accounts payable

    2,279       2,478  

Accrued payroll and related liabilities

    1,985       1,729  

Other accrued liabilities

    2,408       2,042  

Deferred revenue

    10,179       10,070  

Income tax payable

    77       23  

COFACE loan

    20       174  

Total current liabilities

    28,769       28,377  
                 

Long-term deferred revenue

    177       10  

Convertible note, net of debt discount

    7,260       7,599  

Other long-term liabilities

    1,306       1,306  

Total liabilities

    37,512       37,292  
                 

Total stockholders' equity

    6,664       5,099  

Total liabilities and stockholders' equity

  $ 44,176     $ 42,391  

 

 

 

 

Determine, Inc.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

 

   

Nine Months Ended

 
   

December 31,

   

December 31,

 
   

2017

   

2016

 
                 

Operating activities

               

Net loss

  $ (7,127 )   $ (7,707 )

Adjustments to reconcile net loss to net cash used in operating activities:

               

Depreciation and amortization

    2,910       2,478  

Stock-based compensation expense

    1,649       1,867  

Interest expense paid in kind as convertible note debt

    587       -  

Income tax benefit

    (25 )     (143 )

Loss on fixed asset disposal

    2       -  

Unrealized currency translation gains

    (43 )     -  

Changes in assets and liabilities:

               

Accounts receivable, net

    (1,989 )     272  

Prepaid expenses and other current assets

    308       143  

Other assets

    691       435  

Accounts payable

    (199 )     462  

Accrued payroll and related liabilities

    256       147  

Accrued restructuring costs

    -       (403 )

Other accrued liabilities and other long-term liabilities

    365       (422 )

Deferred revenue

    276       (333 )

Net cash used in operating activities

    (2,339 )     (3,204 )
                 

Investing activities

               

Purchase of property and equipment

    (34 )     (39 )

Capitalized software development costs, net

    (1,780 )     (1,267 )

Net cash used in investing activities

    (1,814 )     (1,306 )
                 

Financing activities

               

Proceeds from issuance of stock, net of issuance costs

    4,909       -  

Credit facility borrowing

    29,415       3,000  

Credit facility payment

    (29,455 )     (1,139 )

Net employee witholding taxes paid in connection to issuance of restricted stock

    (39 )     78  

Issuance of stock under employee stock purchase plan

    73       80  

Repayment of loan

    (154 )     (185 )

Proceeds from exercise of stock options

    6       -  

Issuance of debt, net of costs

    -       2,429  

Net cash provided by financing activities

    4,755       4,263  
                 

Effect of exchange rate changes on cash

    46       216  
                 

Net increase (decrease) in cash and cash equivalents

    648       (31 )

Cash and cash equivalents at beginning of the period

    9,429       9,418  

Cash and cash equivalents at end of the period

  $ 10,077     $ 9,387  

 

 

 

 

Determine, Inc.

Billings Reconciliation

(In thousands)

(Unaudited)

 

   

Three Months Ended

   

Nine Months Ended

 
   

December 31,

   

December 31,

 
   

2017

   

2016

   

2017

   

2016

 
                                 

Total revenues

  $ 7,467     $ 6,852     $ 21,343     $ 19,928  

Deferred revenue:

                               

End of period

    10,356       10,033       10,356       10,033  

Beginning of period

    8,967       9,340       10,080       10,366  

Change in deferred revenue

    1,389       693       276       (333 )

Total billings (total revenues plus the change in deferred revenue)

  $ 8,856     $ 7,545     $ 21,619     $ 19,595  

 

 

 

 

Determine, Inc.

Non-GAAP EBITDA Reconciliation

(In thousands)

(unaudited)

 

   

Three Months Ended

   

Nine Months Ended

 
   

December 31,

   

December 31,

 
   

2017

   

2016

   

2017

   

2016

 

Reconciliation to non-GAAP EBITDA net loss:

                               

Non-GAAP net loss

  $ (1,303 )   $ (1,010 )   $ (3,761 )   $ (4,253 )

Interest

    409       461       1,301       1,299  

Depreciation

    473       348       1,244       916  

Income taxes and minority shareholder

    (36 )     (11 )     (25 )     (107 )

Non-GAAP EBITDA net loss

  $ (457 )   $ (212 )   $ (1,241 )   $ (2,145 )

 

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