8-K

UNITED STATES

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): January 24, 2007

Bottomline Technologies (de), Inc.

(Exact Name of Registrant as Specified in Charter)

Delaware	000-25259	02-0433294
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

325 Corporate Drive, Portsmouth, New Hampshire	03801
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (603) 436-0700

Not Applicable.

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant 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 CFR 240.14a-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 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition

On January 24, 2007, Bottomline Technologies (de), Inc. announced its financial results for the quarter ended December 31, 2006. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

The information in this Form 8-K (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

The following exhibit relating to Item 2.02 shall be deemed to be furnished, and not filed:

99.1 Press Release issued by the company on January 24, 2007.

SIGNATURE

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.

	BOTTOMLINE TECHNOLOGIES (de), INC.
Date: January 24, 2007	By:	/s/ Kevin Donovan
		Kevin Donovan
		Chief Financial Officer and Treasurer

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press release issued by the company on January 24, 2007

EX-99.1

Exhibit 99.1

Contact:	Kevin Donovan
	Bottomline Technologies
	603-501-5240
	kdonovan@bottomline.com

Bottomline Technologies Reports Second Quarter Results

Record Revenues Highlight Quarter

PORTSMOUTH, N.H. – January 24, 2007 – Bottomline Technologies (NASDAQ: EPAY), a leading provider of collaborative payment and invoice automation solutions, today reported financial results for the second quarter ended December 31, 2006.

Revenues for the second quarter were $29.7 million as compared with $26.1 million in the second quarter of last year. The growth in revenue includes a 32% increase in subscription and transaction revenue to $6.7 million for the second quarter of fiscal 2007 as compared to $5.1 million for the same period last year.

Recurring revenues, consisting of subscription and transaction, maintenance and supplies revenue was $18.1 million as compared with $15.1 million in the second quarter of last year. New Annual Recurring Revenue (ARR) was $3.4 million as compared with $2.3 million and $1.7 million in the prior two quarters. ARR represents the expected one-year revenue value from new subscription and transaction sales during the quarter as well as the one-year maintenance value on new software license sales.

Net loss for the second quarter was $2.1 million, or net loss per share of $0.09. During the second quarter, operating expenses of $20.4 million included acquisition-related amortization of intangible assets of $2.4 million and stock-based compensation expense of $2.1 million. Excluding these acquisition-related and stock compensation items, non-GAAP net income for the second quarter was $2.4 million, equating to non-GAAP net income per share of $0.10.

“We are pleased with our second quarter results,” said Rob Eberle, President and CEO of Bottomline Technologies. “We exceeded all of our key financial metrics during the quarter and our order flow and sales pipeline has grown. We have had good market acceptance of our newer offerings resulting in an increase in Annual Recurring Revenue booked in the quarter which we believe will deliver future revenue growth. As a result of our second quarter operating performance and our pipeline, we expect a strong second half of our fiscal year.”

Revenues for the six months ended December 31, 2006 were $54.9 million as compared with $50.8 million in the same period last year. Net loss for the six months ended December 31, 2006 was $3.6 million, or net loss per share of $0.15.

During the six months ended December 31, 2006, the company incurred acquisition-related amortization of intangible assets of approximately $3.9 million and stock compensation expense of $3.9 million. Excluding these items, non-GAAP net income for the six months ended December 31, 2006 was $4.2 million, or non-GAAP net income per share of $0.18.

Customer Highlights:

• Leading organizations, including AstraZeneca, Rogers Corporation and a major online merchant signed multi-year agreements for Bottomline’s accounts payable automation solution.

• New customers such as CVS Corporation, Wis-Pak, Inc., Playtex Products, The Economist Group and Warner Bros. chose Bottomline’s payments and document process automation platforms.

• Organizations such as Land O’Lakes, Wellmark Blue Cross & Blue Shield, Lockheed Martin (UK) and Deutsche Bank AG London expanded existing deployments of Bottomline’s payments and document process automation platforms.

• Property & casualty insurers ACUITY and Capitol Indemnity Corporation each selected Legal eXchange™, Bottomline’s Web-based legal spend management solution, further increasing its adoption within the sector.

Corporate and Product Highlights:

• Named among the top 100 technology providers to the financial services industry for 2006 by American Banker and Financial Insights in their annual FinTech 100 ranking.

• Received a top ranking in Global Finance magazine’s Best Treasury and Cash Management Banks and Providers 2007. Bottomline was awarded the top honor in the Best Accounts Payable Services category for the third consecutive year.

• In an independent vendor evaluation conducted by research firm Celent, Bottomline’s Web-based cash management platform received the highest score for advanced technology, including overall security, scalability and performance.

• Acquired FormScape Group Ltd. to expand Bottomline’s document process automation offerings worldwide, add leading organizations to Bottomline’s customer base, and capitalize on existing channel relationships across North America and Europe.

• Elected Mike Curran to the Board of Directors. Mr. Curran most recently served as executive vice president of Bank of America Global Treasury Services where he was responsible for Global Corporate Banking Sales. His unit had offices across the United States as well as in Canada, Europe, Latin America and Asia, and generated approximately $2 billion in revenue. He was a Corporate Band 1 Executive and a member of the company’s management operating committee.

Bottomline has presented supplemental non-GAAP financial measures as part of this earnings release. The non-GAAP financial measures exclude certain non-cash items, specifically amortization of intangible assets and stock compensation expense. The presentation of this information should not be considered in isolation to, or as a substitute for, the financial results presented in accordance with GAAP. Bottomline believes that these supplemental non-GAAP financial measures are useful to investors because they allow for an evaluation of the company with a focus on the performance of its core operations. Bottomline’s executive management team uses these same non-GAAP measures internally to assess the ongoing performance of the company. Since this information is not a GAAP measurement of financial performance, there are material limitations to its usefulness on a stand-alone basis, including the lack of comparability of this presentation to the GAAP financial results of other companies. A reconciliation of the GAAP results to the non-GAAP results for the three and six month periods ending December 31 is as follows:

	Three Months Ended December 31, (in thousands)					Six Months Ended December 31, (in thousands)
	2006			2005		2006			2005
GAAP Net Income (Loss)	$	(2,116	)	$	1,069	$	(3,596	)	$	1,215
Amortization of Intangible Assets		2,412			774		3,873			1,661
Stock Compensation Expense		2,104			1,743		3,940			3,401
Non-GAAP Net Income	$	2,400		$	3,586	$	4,217		$	6,277

About Bottomline Technologies

Bottomline Technologies (NASDAQ: EPAY) provides collaborative payment and invoice automation solutions to corporations, financial institutions and banks around the world. The company’s solutions are used to streamline, automate and manage processes and transactions involving global payments, invoice approval, purchase-to-pay, collections, cash management and document process automation. Organizations trust these solutions to meet their needs for cost reduction, competitive differentiation and optimization of working capital. Headquartered in the United States, Bottomline also maintains offices in Europe and Asia-Pacific. For more information, visit www.bottomline.com.

Bottomline Technologies, Legal eXchange and the BT logo are registered trademarks of Bottomline Technologies, Inc. which may be registered in certain jurisdictions. All other brand/product names are trademarks of their respective holders.

Cautionary Language

This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are competition, market demand, technological change, strategic relationships, recent acquisitions, international operations and general economic conditions. For additional discussion of factors that could impact Bottomline Technologies’ financial results, refer to the Company’s Quarterly Report or Form 10-Q for the quarter ended September 30, 2006, on file with the SEC. Any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. We do not assume any obligation to update any forward-looking statements.

Bottomline Technologies

Unaudited Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

	Three Months Ended December 31,
	2006			2005
Revenues:
Software licenses	$	4,082		$	3,615
Subscriptions and transactions		6,743			5,121
Service and maintenance		15,492			13,476
Equipment and supplies		3,334			3,906
Total revenues		29,651			26,118
Cost of revenues:
Software licenses		186			375
Subscriptions and transactions		2,633			1,802
Service and maintenance (1)		7,191			6,013
Equipment and supplies		2,470			3,115
Total cost of revenues		12,480			11,305
Gross profit		17,171			14,813
Operating expenses:
Sales and marketing (1)		7,929			6,195
Product development and engineering (1)		4,220			2,803
General and administrative (1)		5,813			4,495
Amortization of intangible assets		2,412			774
Total operating expenses		20,374			14,267
Income (loss) from operations		(3,203	)		546
Other income, net		770			867
Income (loss) before provision for income taxes		(2,433	)		1,413
Provision (benefit) for income taxes		(317	)		344
Net income (loss)	$	(2,116	)	$	1,069
Basic and diluted net income (loss) per share	$	(0.09	)	$	0.05
Shares used in computing net income (loss) per share:
Basic		23,622			22,687
Diluted		23,622			22,988
Non-GAAP (excludes acquisition-related amortization and stock compensation expense):(2)
Net income	$	2,400		$	3,586
Diluted net income per share (3)	$	0.10		$	0.16
(1)      Stock based compensation is allocated as follows:
Cost of revenues: service and maintenance	$	164		$	119
Sales and marketing		705			582
Product development and engineering		198			209
General and administrative		1,037			833
	$	2,104		$	1,743

⁽²⁾ Non-GAAP presentation excludes charges for amortization of intangible assets of $2,412 and $774 and stock compensation expense of $2,104 and $1,743 for the three months ended December 31, 2006 and 2005, respectively.

⁽³⁾ Shares used in computing non-GAAP diluted net income per share were 23,807 and 22,988 for the three months ended December 31, 2006 and 2005, respectively.

Bottomline Technologies

Unaudited Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

	Six Months Ended December 31,
	2006			2005
Revenues:
Software licenses	$	5,933		$	6,872
Subscriptions and transactions		13,227			10,001
Service and maintenance		28,998			26,132
Equipment and supplies		6,714			7,792
Total revenues		54,872			50,797
Cost of revenues:
Software licenses		383			680
Subscriptions and transactions		5,085			3,217
Service and maintenance (1)		13,367			12,135
Equipment and supplies		4,997			6,175
Total cost of revenues		23,832			22,207
Gross profit		31,040			28,590
Operating expenses:
Sales and marketing (1)		14,236			12,540
Product development and engineering (1)		7,972			5,317
General and administrative (1)		10,611			8,708
Amortization of intangible assets		3,873			1,661
Total operating expenses		36,692			28,226
Income (loss) from operations		(5,652	)		364
Other income, net		1,739			1,505
Income (loss) before provision for income taxes		(3,913	)		1,869
Provision (benefit) for income taxes		(317	)		654
Net income (loss)	$	(3,596	)	$	1,215
Basic and diluted net income (loss) per share	$	(0.15	)	$	0.05
Shares used in computing net income (loss) per share:
Basic		23,526			22,424
Diluted		23,526			23,115
Non-GAAP (excludes acquisition-related amortization and stock compensation expense):(2)
Net income	$	4,217		$	6,277
Diluted net income per share (3)	$	0.18		$	0.27
(1)      Stock based compensation is allocated as follows:
Cost of revenues: service and maintenance	$	272		$	246
Sales and marketing		1,368			1,160
Product development and engineering		397			438
General and administrative		1,903			1,557
	$	3,940		$	3,401

⁽²⁾ Non-GAAP presentation excludes charges for amortization of intangible assets of $3,873 and $1,661 and stock compensation expense of $3,940 and $3,401 for the six months ended December 31, 2006 and 2005, respectively.

⁽³⁾ Shares used in computing non-GAAP diluted net income per share were 23,728 and 23,115 for the six months ended December 31, 2006 and 2005, respectively.

Bottomline Technologies

Unaudited Condensed Consolidated Balance Sheets

(in thousands)

	December 31, 2006			June 30, 2006
Assets
Current assets:
Cash, cash equivalents and short-term investments	$	64,408		$	80,497
Accounts receivable		23,474			21,043
Other current assets		4,955			4,864
Total current assets		92,837			106,404
Property and equipment		7,755			7,106
Intangible assets		89,263			61,077
Other assets		1,838			1,247
Total assets	$	191,693		$	175,834
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	5,446		$	5,990
Accrued expenses		11,077			8,660
Deferred revenue and deposits		22,961			19,880
Total current liabilities		39,484			34,530
Deferred revenue and deposits, non current		2,140			1,249
Deferred income taxes		6,987			2,985
Other liabilities		538			462
Total liabilities		49,149			39,226
Stockholders’ equity
Common stock		24			23
Additional paid-in-capital		256,674			246,543
Accumulated other comprehensive income		6,889			3,585
Treasury stock		(4,652	)		(748	)
Retained deficit		(116,391	)		(112,795	)
Total stockholders’ equity		142,544			136,608
Total liabilities and stockholders’ equity	$	191,693		$	175,834