UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
FORM 8-K CURRENT REPORT
Pursuant to Section 13 or 15(d) of the |
Date of Report: November 01, 2012
(Date of earliest event reported)
Callidus Software, Inc.
(Exact name of registrant as specified in its charter)
DE
(State or other jurisdiction
of incorporation)
000-50463
(Commission File Number)
77-0438629
(IRS Employer
Identification Number)
6200 Stoneridge Mall Road Suite 500
(Address of principal executive offices)
94588
(Zip Code)
(925) 251-2200
(Registrant's telephone number, including area code)
Not Applicable
(Former Name or Former Address, if changed since last report)
Item 2.02. Results of Operations and Financial Condition Callidus Software, Inc. announces financial results for the quarter ended September 30, 2012.
Item 9.01. Financial Statements and Exhibits
(a) Financial statements:
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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Dated: November 01, 2012 |
CALLIDUS SOFTWARE, INC.
By: /s/ Ronald J. Fior |
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Exhibit No. | Description |
99.1 | Press Release of Callidus Software, Inc. dated November 01, 2012 |
PLEASANTON, CA -- (Marketwire - November 01, 2012) -
Callidus Software Inc. (NASDAQ: CALD), a leading provider of hiring, learning, marketing and selling cloud software today announced financial results for the third quarter ended September 30, 2012.
"I am pleased with our third quarter performance. This is the eighth consecutive double-digit revenue growth quarter for CallidusCloud," said Leslie Stretch, President and CEO, CallidusCloud. "Our Selling, Marketing, Learning and Hiring clouds all performed well. We had another strong SaaS bookings quarter and we exceeded the top end of our revenue guidance. We expanded our Non-GAAP recurring revenue gross margins again to a record of 65%. We added a record number of new subscription customers and signed two of the world's largest telcos for our Commissions solution making us the de-facto standard for SPM in this important vertical. We also saw increased instances of multi-product and cross-sell contracts. We were recognized as the leader in the SPM sector by Gartner Group with the only 'Strong Positive' rating in the history of the sector and we received no less than 10 International and American business awards."
Financial Highlights for the Third Quarter 2012
Business Highlights for the Third Quarter 2012
Financial Outlook
Total revenue for the fourth quarter of 2012 is expected to be between $24.8 million and $25.8 million. For the full year 2012 this translates to total revenues of between $94.5 million and $95.5 million. GAAP operating expenses are expected to be between $20.0 million and $21.0 million in the fourth quarter of 2012, which includes stock-based compensation expense of approximately $3.6 million, approximately $1.0 million in one-time transfer fees related to converting our Hyderabad contractors to employees, amortization of acquired intangibles of $825,000 and $340,000 of patent litigation defense costs.
Conference Call
A conference call to discuss the third quarter results and outlook is scheduled for 1:30 p.m. Pacific Daylight Time (PDT) today. The conference call will be available via live webcast at the Investor Relations section of Callidus Software's website.
Webcast site: http://www.calliduscloud.com/about-us/investor-relations/
Dial-in: 800-561-2693 (International callers: 617-614-3523)
Passcode: 79945512
Replay information: A webcast replay will be available on the Investor Relations section of our website under Calendar of Events.
For more information, please visit: http://www.calliduscloud.com/about-us/investor-relations/
About CallidusCloud
Callidus Software Inc. (NASDAQ: CALD), 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 1500 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.
For more information, please visit www.calliduscloud.com.
Note on Forward-Looking Statements
The forward-looking statements included in this press release, including discussion of our commercial prospects, estimates of fourth quarter and full year 2012 revenues, operating expenses, 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 second 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 and 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.
©2012. 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.
CALLIDUS SOFTWARE INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except for per share data) (unaudited) Three months ended Nine months ended September 30, September 30, ---------------------- ---------------------- 2012 2011 2012 2011 ---------- ---------- ---------- ---------- Revenues: Recurring $ 17,533 $ 16,015 $ 52,446 $ 46,067 Services and other 6,393 5,044 17,273 15,158 ---------- ---------- ---------- ---------- Total revenues 23,926 21,059 69,719 61,225 Cost of revenues: Recurring (1) (2) 6,923 8,363 22,365 24,860 Services and other (1) (2) 5,084 3,937 14,271 11,952 ---------- ---------- ---------- ---------- Total cost of revenues 12,007 12,300 36,636 36,812 ---------- ---------- ---------- ---------- Gross profit 11,919 8,759 33,083 24,413 Operating expenses: Sales and marketing (1) (2) 8,351 5,253 23,573 14,303 Research and development (1) (2) 4,023 3,145 12,116 8,416 General and administrative (1) (2) (3) (4) 4,831 4,673 14,685 12,500 Acquisition-related adjustment 50 - (1,787) - Restructuring (53) 99 561 136 ---------- ---------- ---------- ---------- Total operating expenses 17,202 13,170 49,148 35,355 ---------- ---------- ---------- ---------- Operating loss (5,283) (4,411) (16,065) (10,942) Interest and other income (expense), net (5) (6) (8) (9) (737) (638) (2,476) (1,079) ---------- ---------- ---------- ---------- Loss before provision (benefit) for income taxes (6,020) (5,049) (18,541) (12,021) Provision (benefit) for income taxes (7) 444 (478) 213 (279) ---------- ---------- ---------- ---------- Net loss $ (6,464) $ (4,571) $ (18,754) $ (11,742) ========== ========== ========== ========== Basic and diluted net loss per share $ (0.18) $ (0.14) $ (0.53) $ (0.36) ========== ========== ========== ========== Shares used in basic and diluted per share computation 35,853 32,327 35,070 32,826 ========== ========== ========== ========== ---------------------------- (1) Stock-based compensation included in amounts above by category: Cost of recurring $ 353 $ 731 $ 1,282 $ 2,523 Cost of services and other 578 370 1,623 1,054 Sales and marketing 1,026 502 2,971 1,320 Research and development 485 366 1,384 1,090 General and administrative 1,070 843 3,747 2,907 ---------- ---------- ---------- ---------- Total stock-based compensation 3,512 2,812 11,007 8,894 (2) Acquisition, acquired and settlement related asset amortization Cost of recurring 472 163 1,378 286 Cost of services and other (8) - 36 - Sales and marketing 233 222 646 519 Research and development 68 - 136 - General and administrative 59 24 180 47 ---------- ---------- ---------- ---------- Total acquisition related asset amortization 824 409 2,376 852 (3) Acquisition-related expense 182 697 820 1,080 (4) Patent litigation cost 166 494 786 1,072 (5) Interest expense on convertible notes 703 874 2,110 1,265 (6) Amortization of convertible note issuance cost 134 157 402 216 (7) Tax benefit from release of valuation allowance - (572) (224) (572) (8) Gain on extinguishment of convertible note - (904) - (904) (9) Impairment of asset - 375 - 375 CALLIDUS SOFTWARE INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (unaudited) September 30, December 31, Assets 2012 2011 ------------- ------------- Current assets: Cash and cash equivalents $ 6,631 $ 17,383 Short-term investments 19,856 35,406 Accounts receivable, net 29,490 21,778 Deferred income taxes 110 110 Prepaid and other current assets 7,773 5,831 ------------- ------------- Total current assets 63,860 80,508 Property and equipment, net 9,827 6,772 Goodwill 31,213 24,416 Intangible assets, net 22,362 17,769 Deferred income taxes, noncurrent 206 206 Deposits and other assets 3,212 3,936 ------------- ------------- Total assets $ 130,680 $ 133,607 ============= ============= Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 5,040 $ 3,515 Accrued payroll and related expenses 4,011 4,278 Accrued expenses 12,118 12,272 Deferred income taxes 596 596 Deferred revenue 32,794 30,211 Capital lease obligations 1,107 1,196 ------------- ------------- Total current liabilities 55,666 52,068 Deferred revenue, noncurrent 3,450 4,257 Deferred income taxes, noncurrent 308 197 Other liabilities 1,881 2,413 Capital lease obligations, noncurrent 128 915 Convertible notes 59,215 59,215 ------------- ------------- Total liabilities 120,648 119,065 ------------- ------------- Stockholders' equity: Common stock 34 33 Additional paid-in capital 252,948 238,798 Treasury stock (14,430) (14,430) Accumulated other comprehensive income 282 189 Accumulated deficit (228,802) (210,048) ------------- ------------- Total stockholders' equity 10,032 14,542 ------------- ------------- Total liabilities and stockholders' equity $ 130,680 $ 133,607 ============= ============= CALLIDUS SOFTWARE INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (unaudited) Nine months ended September 30, -------------------- 2012 2011 --------- --------- Cash flows from operating activities: Net loss $ (18,754) $ (11,742) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Depreciation expense 2,184 2,338 Amortization of intangible assets 3,818 2,284 Provision for doubtful accounts and service remediation reserves 188 88 Stock-based compensation 11,007 8,852 Stock-based compensation related to acquisition - 42 Release of valuation allowance (350) - Gain on disposal of property and equipment (6) - Impairment of investments - 375 Amortization of convertible note issuance cost 402 217 Gain on extinguishment of convertible notes - (904) Net amortization on investments 310 351 Acquisition-related adjustment (1,787) - Changes in operating assets and liabilities: Accounts receivable (7,628) (593) Prepaid and other current assets (1,875) 1,594 Other assets 322 (2,923) Accounts payable (114) (302) Accrued expenses 742 (257) Accrued payroll and related expenses (267) 313 Accrued restructuring 37 (251) Deferred revenue 1,635 (1,648) Deferred income taxes 111 144 --------- --------- Net cash used in operating activities (10,025) (2,022) --------- --------- Cash flows from investing activities: Purchases of investments (16,536) (47,864) Proceeds from maturities and sale of investments 31,811 22,595 Purchases of property and equipment (4,927) (1,827) Proceeds from disposal of property and equipment 6 - Purchases of intangible assets (4,485) (1,381) Acquisitions, net of cash acquired (7,721) (12,237) --------- --------- Net cash used in investing activities (1,852) (40,714) --------- --------- Cash flows from financing activities: Proceeds from issuance of common stock 5,223 5,424 Repurchases of common stock - (14,430) Repurchase of common stock from employees for payment of taxes onvesting of restricted stock units (2,079) (1,046) Payment of consideration related to acquisitions (1,160) (1,175) Repurchase of convertible notes - (19,188) Proceeds from issuance of convertible notes, net of issuance costs - 77,369 Repayment of debt assumed through acquisition (30) - Payment of principal under capital lease (887) (896) --------- --------- Net cash provided by financing activities 1,067 46,058 --------- --------- Effect of exchange rates on cash and cash equivalents 58 1 --------- --------- Net increase (decrease) in cash and cash equivalents (10,752) 3,323 Cash and cash equivalents at beginning of period 17,383 12,830 --------- --------- Cash and cash equivalents at end of period $ 6,631 $ 16,153 ========= ========= CALLIDUS SOFTWARE INC. RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (In thousands, except for percentages and per share data) (unaudited) Three months ended Nine months ended September 30, September 30, ------------------- ------------------ 2012 2011 2012 2011 --------- -------- -------- -------- Non-GAAP gross profit reconciliation Gross profit $ 11,919 $8,759 $33,083 $24,413 Profit margin, as a % of total revenues 50% 42% 47% 40% Add back: Non-cash stock-based compensation 931 1,101 2,905 3,577 Non-cash amortization of acquired intangible assets 464 163 1,414 286 --------- -------- -------- -------- Non-GAAP gross profit $ 13,314 $10,023 $37,402 $28,276 --------- -------- -------- -------- Profit margin, as a % of total revenues 56% 48% 54% 46% Non-GAAP recurring revenue gross profit reconciliation Recurring revenue gross profit $ 10,610 $7,652 $30,081 $21,207 Recurring revenue profit margin, as a % of recurring revenues 61% 48% 57% 46% Add back: Non-cash stock-based compensation 353 731 1,282 2,523 Non-cash amortization of acquired intangible assets 472 163 1,378 286 --------- -------- -------- -------- Non-GAAP Recurring revenue gross profit $ 11,435 $8,546 $32,741 $24,016 --------- -------- -------- -------- Recurring revenue profit margin, as a % of recurring revenues 65% 53% 62% 52% Non-GAAP operating expense reconciliation: Operating expenses $ 17,202 $13,170 $49,148 $35,355 Operating expenses, as a % of total revenues 72% 63% 70% 58% Add back: Non-cash stock-based compensation (2,581) (1,711) (8,102) (5,317) Non-cash amortization of acquired intangible assets (360) (246) (962) (566) Acquisition-related expense (182) (697) (820) (1,080) Patent litigation cost (166) (494) (786) (1,072) Acquisition-related adjustment (50) - 1,787 - Restructuring 53 (99) (561) (136) --------- -------- -------- -------- Non-GAAP Operating Expenses $ 13,916 $9,923 $39,704 $ 27,184 --------- -------- -------- -------- Non-GAAP Operating expenses, as a % of total revenues 58% 49% 57% 44% Non-GAAP operating income (loss) reconciliation: Operating loss $ (5,283) $(4,411) $(16,065) $(10,942) Operating loss, as a % of total revenues -22% -21% -23% -18% Add back: Non-cash stock-based compensation 3,512 2,812 11,007 8,894 Non-cash amortization of acquired intangible assets 824 409 2,376 852 Acquisition-related expense 182 697 820 1,080 Patent litigation cost 166 494 786 1,072 Acquisition-related adjustment 50 - (1,787) - Restructuring (53) 99 561 136 --------- -------- -------- -------- Non-GAAP Operating income (loss) $ (602) $100 $(2,302) $1,092 --------- -------- -------- -------- Non-GAAP Operating income (loss), as a % of total revenues -3% 0% -3% 2% CALLIDUS SOFTWARE INC. RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (In thousands, except for percentages and per share data) (unaudited) Three months ended Nine months ended September 30, September 30, ------------------ ------------------ 2012 2011 2012 2011 -------- -------- -------- -------- Non-GAAP net loss reconciliation: Net loss $ (6,464) $ (4,571) $(18,754) $(11,742) Net loss, as a % of total revenues -27% -22% -27% -19% Add back: Non-cash stock-based compensation 3,512 2,812 11,007 8,894 Non-cash amortization of acquired intangible assets 824 409 2,376 852 Acquisition related expenses 182 697 820 1,080 Patent litigation costs 166 494 786 1,072 Acquisition-related adjustment 50 - (1,787) - Restructuring (53) 99 561 136 Interest expense on convertible notes 703 874 2,110 1,265 Amortization of convertible note issuance cost 134 157 402 216 Tax benefit from release of valuation allowance - (572) (224) (572) Gain on extinguishment of convertible note - (904) - (904) Impairment of asset - 375 - 375 -------- -------- -------- -------- Non-GAAP Net income (loss) $ (946) $ (130) $ (2,703) $ 672 -------- -------- -------- -------- Non-GAAP Net income (loss), as a % of total revenues -4% -1% -4% 1% Non-GAAP net income (loss) per share reconciliation: Net loss per basic and diluted share $ (0.18) $ (0.14) $ (0.53) $ (0.36) Add back: Non-cash stock-based compensation 0.10 0.09 0.31 0.27 Non-cash amortization of acquired intangible assets 0.02 0.01 0.07 0.03 Acquisition related expenses 0.01 0.02 0.02 0.03 Patent litigation costs - 0.02 0.02 0.03 Acquisition-related adjustment - - (0.05) - Restructuring - - 0.02 - Interest expense on convertible notes 0.02 0.03 0.06 0.04 Amortization of convertible note issuance cost - - 0.01 0.01 Tax benefit from release of valuation allowance - (0.02) (0.01) (0.02) Gain on extinguishment of convertible note - (0.03) - (0.03) Impairment of asset - 0.01 - 0.01 -------- -------- -------- -------- Non-GAAP net income (loss) per basic share $ (0.03) $ (0.01) $ (0.08) $ 0.01 -------- -------- -------- -------- Non-GAAP net income (loss) per diluted share $ (0.03) - $ $ (0.08) $ 0.02 -------- -------- -------- -------- Basic and fully diluted shares reconciliation: Basic shares 35,853 32,327 35,070 32,826 -------- -------- -------- -------- Add back: Weighted average effect of dilutive securities - 10,740 - 6,877 -------- -------- -------- -------- Diluted shares 35,853 43,067 35,070 39,703 -------- -------- -------- --------
Investor Relations Contact Carolyn Bass Market Street Partners (415) 445-3232 carolyn@marketstreetpartners.com Press Contact: Giles House CallidusCloud 925-251-2200 pr@calliduscloud.com