Record Q4 SaaS Bookings
• 2012 SaaS Revenues of $55 Million; up 23% Year-over-Year
• Full Year 2012 Gross Annual Contract Value (ACV) Bookings up 73% over full year 2011
• Full year 2012 Billings up 24% Year-over-Year
• Full year 2012 Total Revenues Reach $95 Million
• Cash Balance Increased to $29.2 Million
February 7, 2013
“In Q4 we hit the $100 million run rate as a SaaS company. Our Selling, Marketing, Learning and Hiring Clouds all contributed to our ninth consecutive double-digit revenue growth quarter,” said Leslie Stretch, President and CEO, CallidusCloud. “We signed a record 180 net new subscription customers including our largest ever SaaS conversion deal for the commissions platform. We had our strongest SaaS bookings since we started our SaaS business. I was particularly pleased that we made good progress on our cash balance and DSO’s in the quarter.”
Financial Highlights for the Fourth Quarter 2012
• Total revenue was $25.2 million for the fourth quarter, representing an increase of 12% compared to the same quarter last year. Total recurring revenues, which include SaaS revenues and maintenance and support, were $18.5 million, up approximately 9% compared to the fourth quarter of 2011. SaaS revenues of $14.6 million were up 15%, while maintenance and support revenues of $3.9 million were down 9% as compared to the fourth quarter of 2011. Service and other revenues of $6.8 million were up 21% as compared to the same quarter of 2011 driven by the release of $1.2 million in deferred service revenue upon project acceptance.
• Total GAAP gross margin was 46% for the fourth quarter up from 41% in the same quarter in 2011.
• Non-GAAP gross margin was 53% for the fourth quarter of 2012 up from 52% for the fourth quarter of 2011. Non-GAAP gross margin for the fourth quarter of 2012 excludes $717,000 of stock-based compensation expense, $535,000 in expenses to transfer India operations, and $535,000 of amortization of acquired intangibles.
• Fourth quarter 2012 GAAP recurring revenue gross margin was 59% up from 53% for the fourth quarter of 2011. Fourth quarter non-GAAP recurring revenue gross margin, which excludes $270,000 of stock-based compensation, $387,000 in expenses to transfer India operations, and $533,000 of amortization of acquired intangibles was 65%, up from 60% for the fourth quarter of 2011.
• GAAP net loss was $9.1 million, or ($0.25) per share, for the fourth quarter of 2012, which included $2.7 million of stock-based compensation expense, $837,000 of convertible note related interest and amortization expense, $827,000 of amortization of acquired intangible assets, $45,000 of acquisition-related expense, $859,000 in fees to transfer India operations, and $871,000 of patent litigation defense and restructuring costs. This compares to a GAAP net loss of $4.3 million, or ($0.13) per share, for the fourth quarter of 2011, which included $3.4 million of stock-based compensation expense, $821,000 of convertible note related expense items, gain on extinguishment of debt of $11,000, $516,000 of acquisition related expense, a tax benefit from release of valuation allowance of $2.4 million, $1.1 million of patent litigation and settlement costs, $717,000 of amortization of acquired intangible assets and $513,000 of restructuring expense.
• Non-GAAP net loss was $2.9 million, or ($0.08) per fully diluted share, for the quarter, compared to non-GAAP net income of $278,000, for the same period last year excluding the items identified above.
Financial Highlights for the Full Fiscal 2012
• Total revenue for the full fiscal year was $95.0 million, up 13% compared to $83.8 million in 2011. Total recurring revenues, which include SaaS revenues and maintenance and support, were $70.9 million, an increase of 13% from $63.0 million in 2011. SaaS revenues of $55.1 million were up 23%, while maintenance and support revenues of $15.8 million were down 12% as compared to 2011. Service and other revenues of $24.0 million were up 16% as compared to $20.8 million in 2011.
• Total GAAP gross margin was 47% for the full fiscal year, up from 40% in 2011.
• Non-GAAP gross margin was 54% for 2012, up from 48% in 2011. Non-GAAP gross margin for the full fiscal year excludes $3.6 million of stock-based compensation expense, $535,000 in expenses to transfer India operations, and $2.0 million of amortization of acquired intangibles.
• GAAP recurring revenue gross margin was 58% for the full year, up from 48% during 2011. Non-GAAP recurring revenue gross margin, which excludes $1.6 million of stock-based compensation, $387,000 in expenses to transfer India operations, and $2.0 million of amortization of acquired intangibles, was 63% for the full year, up from 54% for previous period
• GAAP net loss was $27.7 million, or ($0.78) per share for the full year, which included $13.7 million of stock-based compensation expense, $3.3 million of convertible note related interest and amortization expense, $3.2 million of amortization of acquired intangible assets, $865,000 of acquisition-related expense, $859,000 in fees to transfer India operations, $1.8 million in acquisition related adjustment, $224,000 tax benefit from release of valuation allowance, and $2.2 million of patent litigation defense and restructuring costs. This compares to a GAAP net loss of $16.1 million, or ($0.49) per share, for 2011, which included $12.3 million of stock-based compensation expense, $2.3 million of convertible note related expense items, gain on extinguishment of debt of $915,000, $1.6 million of acquisition related expense, a tax benefit from release of valuation allowance of $3.0 million, $2.1 million of patent litigation and settlement costs, $1.6 million of amortization of acquired intangible assets, $375,000 impairment of investment expense, and $649,000 of restructuring expense.
• Non-GAAP net loss was $5.6 million, or ($0.16) per share, for the full year, compared to non-GAAP net income of $950,000, for the previous year excluding the items identified above.
Business Highlights for the Fourth Quarter 2012
• CallidusCloud received the highest “Strong Positive” rating in the 2012 MarketScope for Insurance ICM Software by Gartner, the world’s leading information technology research and advisory company. The report revealed CallidusCloud as the vendor with the most new customers in a market that grew 23% in 2012.
• Launched strategic incentives module “MySalesGame” that directly addresses the limitations of traditional SPM tools by tapping into the inherent competitiveness in people. MySalesGame employs gamification techniques to engage sales professionals to adopt the tools, technology and training necessary to ensure consistent high performance.
• CallidusCloud sponsored key industry events including Cloudforce, Oracle Open World, Aberdeen Revenue-Driven Marketing Summit, Sales 2.0, the Sales Force Productivity Conference and Dev-Learn.
Business Highlights for the Full Year 2012
• Acquired a leader in next-generation marketing automation and leads management, LeadFormix. By uniting sales and marketing, LeadFormix award-winning Cloud solutions produce richer, targeted leads for sales along with easier access to qualified decision makers.
• Acquired 6FigureJobs, a premier executive career community and job board. The acquisition extends CallidusCloud’s Hiring Cloud suite into a comprehensive sales and executive focused talent recruitment solution.
• Awarded the highest “Strong Positive” in both the 2012 MarketScope for Sales Performance Management and the 2012 MarketScope for Incentive Compensation Management in the Insurance industry
Added two significant new go-to-market channels by joining the salesforce.com ISV Force reseller program in Q2 and Oracle’s ISV reseller program in Q3.
• CallidusCloud hosted over 400 customers and partners at its C3 conference in May, the largest Sales Performance and Effectiveness conference of its kind. Customers, prospects, industry analysts and partners gathered in Las Vegas to share best practice and industry insight.
• CallidusCloud collected 10 awards at the American Business Awards and International Business Awards including favorite company, best website, best new product and best new financial management cloud app for CallidusCloud’s Commissions solution.
• The CallidusCloud™ Sales Effectiveness suite was selected as a finalist for the prestigious CODiE™ Awards in the “Best Cloud Application/Service”,“Best Human Capital Management Solution”, and “Best Financial Management Solution” categories.
Total revenue for the first quarter of 2013 is expected to be between $25 million and $26 million. GAAP operating expenses are expected to be between $17.6 million and $18.6 million in the first quarter of 2013, which includes stock-based compensation expense of approximately $2.7 million, amortization of acquired intangibles of $830,000, restructuring costs of $500,000, $840,000 of convertible note related interest and amortization expense, and $380,000 of patent litigation defense costs. At the midpoint of our range we would expect to be non-GAAP profitable by up to half a million dollars. Full year total revenue is expected to be between $105 million and $110 million. Non-GAAP operating income for the full year is expected to be between $4 million and $5 million. While we will need to use some cash in Q1 for our previous acquisitions we do expect to generate GAAP positive cash flow from operations throughout 2013.
A conference call to discuss the fourth quarter results and outlook is scheduled for 1:30 pm. Pacific Daylight Time (PDT) today. The conference call will be available via live webcast at the Investor Relations section of Callidus Software’s website.
Dial-in: 866-383-8119 (International callers: 617-597-5344)
Replay information: A webcast replay will be available on the Investor Relations section of our website under Calendar of Events.
Callidus Software, Inc. (calliduscloud.com), doing business as CallidusCloud, is a leading provider of cloud software. CallidusCloud enables organizations to drive performance and productivity across their business with our hiring, learning, marketing and selling clouds. From back office to the field, from desktop to mobile, we ensure organizations have the right tools to be more effective and perform better. The combined power of our clouds, our people, and our partners fuels growth, empowers the work force and delivers real value. CallidusCloud drives performance and productivity for over 1,700 leading organizations. Small, medium and large enterprises across multiple industries and geographies rely on CallidusCloud for quicker hiring, simpler learning, better marketing, and smarter selling.
Note on Forward-Looking Statements
The forward-looking statements included in this press release, including discussion of our commercial prospects, estimates of first quarter and full year 2013 revenues, operating expenses, non-GAAP EPS, stock-based compensation expense and amortization of acquired intangibles expenses reflect management’s best judgment based on factors currently known and involve risks and uncertainties. These risks and uncertainties include, but are not limited to, potential disruption of customer purchase decisions resulting from global economic conditions, timing and size of orders, potential material fluctuations in financial results and future growth rates, decreases in customer spending, uncertainty regarding purchasing trends in the SPM market, customer cancellations or non-renewal of maintenance contracts or on-demand services, our potential inability to manage effectively any growth we experience, uncertainty regarding the demand for and profitability of our on-demand services, increased competition or new entrants in the marketplace, and other risks detailed in Callidus’ reports filed with the Securities and Exchange Commission (SEC), including its Form 10-K for 2011 and its third quarter 2012 Form 10-Q which may be obtained by contacting Callidus Software’s Investor Relations department at 925-251-2248, or from the Investor Relations section of Callidus Software’s website (CallidusCloud Investor Relations). Actual results may differ materially from those presently reported. We assume no obligation to update the information contained in this release.
Non-GAAP Financial Measures
Callidus has provided in this release financial information that has not been prepared in accordance with GAAP. This information includes non-GAAP gross margin, non-GAAP recurring revenue gross margin, non-GAAP net loss, non-GAAP net loss per share. Callidus uses non-GAAP measures internally in analyzing its financial results and believes that they are useful to investors, as a supplement to GAAP measures, in evaluating Callidus’ operating performance. Callidus believes that the use of these non-GAAP measures provides additional insight for investors to use in evaluation of ongoing operating results and trends and in comparing its financial measures with other companies in Callidus’ industry, many of which present similar non-GAAP financial measures to investors. As noted, the non-GAAP financial measures exclude stock-based compensation expense, a benefit from a purchase acquisition-related adjustment, restructuring expense, acquisition related expense, patent litigation defense cost, convertible note interest expense, amortization of convertible note issuance cost and amortization of acquired intangibles. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.
©2013. Callidus Software Inc. All rights reserved. Callidus, Callidus Software, the Callidus Software logo, CallidusCloud, the CallidusCloud logo, TrueComp Manager, ActekSoft, ACom3, ForceLogix, Salesforce Assessments, iCentera, Webcom, LeadFormix, Litmos, the Litmos logo, Rapid Intake, and 6FigureJobs are trademarks, service marks, or registered trademarks of Callidus Software Inc. and its affiliates in the United States and other countries. All other brand, service or product names are trademarks or registered trademarks of their respective companies or owners.
Investor Relations Contact
Carolyn Bass, Market Street Partners
P: 415-445-3232 - E: carolyn[.]marketstreetpartners.com.