Exhibit 99.1- PROS Q3 2014 Earnings Release
Exhibit 99.1
PROS HOLDINGS, INC. REPORTS THIRD QUARTER 2014 FINANCIAL RESULTS
| |
• | Record non-GAAP revenue of $48.7 million, exceeding the high end of guidance, an increase of 32% over the third quarter of 2013; GAAP revenue of $46.7 million, an increase of 27% over the third quarter of 2013. |
| |
• | Non-GAAP operating income for the third quarter was $5.5 million, exceeding the high end of guidance; GAAP operating loss was $3.7 million. |
| |
• | Non-GAAP earnings per share for the third quarter was $0.11, exceeding the high end of guidance; GAAP earnings per share was a loss of $0.13. |
HOUSTON – November 6, 2014 — PROS Holdings, Inc. (NYSE: PRO), a big data software company, today announced financial results for the third quarter ended September 30, 2014.
Total non-GAAP revenue for the third quarter of 2014 was $48.7 million and represented an increase of 32% over the third quarter of 2013.
CEO Andres Reiner stated, “We are pleased with our strong third quarter results as we continue to execute on our long-term diversified growth strategy. Through the first nine months of the year, we have added a record number of new customers across a diverse range of industries, indicative of the increased demand for our unique big data applications that help companies outperform. We will continue to invest in increasing awareness and adoption, extending our product leadership position, and expanding our global reach and scale to capitalize on the large market opportunity.”
For the quarter ended September 30, 2014, GAAP operating loss was $3.7 million, compared with operating income of $1.4 million in the third quarter of 2013. GAAP net loss for the third quarter was $3.7 million or $0.13 per share, compared with net income of $1.0 million, or $0.03 per share, in the third quarter of 2013.
For the quarter ended September 30, 2014, non-GAAP operating income was $5.5 million, compared with $6.3 million in the third quarter of 2013. Non-GAAP net income for the third quarter of 2014 was $3.4 million, or $0.11 per share, compared with $4.6 million, or $0.15 per share in the third quarter of 2013.
Recent Business Highlights
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• | Successfully completed the acquisition of over 95% of the outstanding shares and voting rights of Cameleon Software SA, which will result in the full delisting of Cameleon Software SA by the end of 2014. |
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• | Continued to position PROS for long-term growth with leadership changes that will help bring further scale and focus; Tim Girgenti, Chief Marketing Officer since 2010 is now the Company’s Chief Strategy Officer; Patrick Schneidau, a 10-year PROS veteran, is the Company’s new Chief Marketing Officer. |
| |
• | Released PROS Cameleon CPQ Fall ’14, uniting the power of predictive and prescriptive pricing analytics with simple-to-use configure-price-quote (CPQ) capabilities, enabling sales teams to deliver smarter, faster, winning quotes to customers. |
| |
• | Announced Cameleon Parts Quoting, a graphically interactive configuration of PROS Cameleon CPQ solution that supports use cases common to discrete and process manufacturing organizations, including those in the high-tech, industrial equipment and automotive industries. |
| |
• | Introduced PROS Group Sales Optimizer (GSO), a new solution that enables airlines and their customers to book group travel in real-time. PROS GSO includes dynamic pricing integrated with sales effectiveness, revenue management and contract management. |
Executive Vice President and Chief Financial Officer Charles Murphy stated, “We are pleased with our results for the third quarter which came in above our guidance. Our non-GAAP revenue grew 32% period over period, driven by accelerating organic growth and solid contribution from our acquisitions. Our balance sheet also strengthened with cash and cash equivalents increasing to $40.4 million dollars, and we generated $12.2 million in cash flow from operations. We are well positioned to capture the increasing demand for our solutions, and this is reflected in our guidance for the fourth quarter and full year 2014.”
The attached tables provide a reconciliation of GAAP to non-GAAP revenue, gross profit, income from operations, net income as well as earnings per share for the three and nine months ended September 30, 2014.
Financial Outlook
Based on information as of today, PROS anticipates the following:
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• | Total non-GAAP revenue for the fourth quarter of 2014 in the range of $52 million to $55 million and total non-GAAP revenue for the full year 2014 in the range of $190 million to $193 million. |
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• | Non-GAAP operating income of $7 million to $8.5 million and non-GAAP income per share of $0.14 to $0.17 for the fourth quarter of 2014, which excludes estimated non-cash share-based compensation charges of approximately $6.3 million, and estimated intangible amortization and integration-related expenses of approximately $2.0 million. The Company expects non-GAAP operating margin for the full year 2014 to be 9-10%. |
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• | Non-GAAP estimated tax rate of approximately 37% for the fourth quarter and full year 2014. |
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• | Estimated weighted average diluted shares outstanding of 30.5 million and 30.3 million for the fourth quarter and full year 2014, respectively. |
Conference Call
In conjunction with this announcement, PROS Holdings, Inc. will host a conference call on November 6, 2014, at 4:30 p.m. (ET) to discuss the company’s financial results. To access this call, dial 888-262-8720 (domestic) or 913-312-0977 (international). The pass code for the call is 6582158. Additionally, a live webcast of the conference call will be available in the “Investor Relations” section of the Company’s website at www.pros.com.
Following the conference call, a replay will be available at 877-870-5176 (domestic) or (858) 384-5517 (international) through November 13, 2014. The replay pass code is 6582158. An archived webcast of this conference call will also be available in the “Investor Relations” section of the Company’s website at www.pros.com.
About PROS
PROS Holdings, Inc. (NYSE: PRO) is a big data software company that helps customers outperform in their markets by using big data to sell more effectively. We apply over two decades of data science experience to unlock buying patterns and preferences within transaction data to reveal which opportunities are most likely to close, which offers are most likely to sell and which prices are most likely to win. PROS offers big data solutions to optimize sales, pricing, quoting, rebates and revenue management across more than 40 industries. PROS has implemented more than 700 solutions in more than 55 countries. The PROS team comprises more than 900 people around the world. To learn more, visit www.pros.com.
Forward-looking Statements
This press release contains forward-looking statements, including statements about PROS’ momentum and future financial performance; positioning; management's confidence and optimism; customer successes; the success of our acquisitions of Cameleon Software, SA and SignalDemand, Inc.; partner ecosystem growth; big data solutions to optimize sales, pricing, quoting, rebates and revenue management; solutions demand; business predictability, shares outstanding and effective tax rate. The forward-looking statements contained in this press release are based upon PROS’ historical performance and its current plans, estimates and expectations and are not a representation that such plans, estimates or expectations will be achieved. Factors that could cause actual results to differ materially from those described herein include risks related to: (a) the risk that we will face increased competition as part of entering new markets, (b) the risk that the market for PROS’ software does not grow as anticipated, (c) the challenges associated with selling, installing, and delivering PROS' products and services, (d) the impact that a slowdown in the world or any particular economy has on PROS’ business sales cycles, prospects’ and customers’ spending decisions and timing of implementation decisions, (e) the difficulties and risks associated with developing and selling complex new products and enhancements with the technical specifications and functionality desired by customers, (f) the risk that we will be unable to integrate our acquisitions effectively and on the timeline we anticipate, (g) the difficulties of making accurate estimates necessary to complete a project and recognize revenue and risk that PROS’ revenue model will not continue to provide predictability of the PROS business, (h) the risk that PROS will not be able to maintain historical maintenance renewal rates, (i) personnel and other risks associated with growing a business generally, (j) the risk that modification or negotiation of contractual arrangements will be necessary during PROS’ implementations of its solutions, (k) the impact of currency fluctuations on PROS’ results of operations, (l) civil and political unrest in regions in which PROS operates and (m) the risk that reseller and other relationships do not increase sales of PROS’ solutions. Additional information relating to the uncertainty affecting the PROS business are contained in PROS’ filings with the Securities and Exchange Commission. These forward-looking statements represent PROS’ expectations as of the date of this press release. Subsequent events may cause these expectations to change, and PROS disclaims any obligations to update or alter these forward-looking statements in the future, whether as a result of new information, future events or otherwise.
Non-GAAP Financial Measures
PROS has provided in this release certain financial information that has not been prepared in accordance with GAAP. This information includes non-GAAP income (loss) from operations, tax rate, net income and diluted earnings per share. PROS uses these non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, as a supplement to GAAP measures, in evaluating PROS’ ongoing operational performance.
Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measure as detailed above. A reconciliation of GAAP to the non-GAAP financial measures has been
provided in the tables included as part of this press release. PROS' use of non-GAAP financial measures may not be consistent with the presentations by similar companies in PROS' industry. PROS has also provided in this release certain forward-looking non-GAAP financial measures, including non-GAAP revenue, non-GAAP income (loss) from operations, and non-GAAP tax rates (collectively the "non-GAAP financial measures") as follows:
Non-GAAP revenue: Business combination accounting principles under GAAP require us to recognize the fair value of software subscription, maintenance and professional services contracts assumed in our acquisitions of SignalDemand, Inc. and Cameleon Software, SA. A portion of these software subscription and professional services are deferred and typically recognized over the term of the software subscription contract, so our GAAP revenues during the term of the contract after the acquisition do not reflect the full amount of revenues that would have been reported if the acquired deferred software subscription and professional services revenues were not written down to fair value. The revenue for maintenance is deferred and typically recognized over a one-year period, so our GAAP revenues for the one-year period after the acquisition do not reflect the full amount of revenues that would have been reported if the acquired deferred maintenance revenue was not written down to fair value. The non-GAAP revenue adjustments eliminate the effect of the deferred revenue write-down and include the costs associated with the revenue adjustment. We believe these adjustments to the revenue from these contracts and to the associated costs are useful to investors as an additional means to reflect revenue trends of our business.
Non-GAAP income (loss) from operations: Non-GAAP income (loss) from operations includes the non-GAAP revenue discussed above and also excludes the impact of non-recurring acquisition-related expenses, stock-based compensation, amortization of acquisition-related intangibles, impairment of internal-use software, as well as the tax consequences associated with the stock-based compensation costs arising from our acquisitions of Signal Demand and Cameleon Software. The non-GAAP income (loss) from operations excludes the following items from non-GAAP estimates:
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• | Acquisition-Related Expenses: Acquisition-related expenses include transaction fees, due diligence costs and other one-time direct costs associated with our acquisitions. These amounts are unrelated to our core performance during any particular period and are impacted by the timing and size of the acquisitions. We exclude acquisition-related expenses to provide investors a method to compare our operating results to prior periods and to peer companies because such amounts can vary significantly based on the frequency of acquisitions and magnitude of acquisition expenses. |
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• | Share-Based Compensation: Although share-based compensation is an important aspect of compensation for our employees and executives, our share-based compensation expense can vary because of changes in our stock price and market conditions at the time of grant, varying valuation methodologies, and the variety of award types. Since share-based compensation expense can vary for reasons that are generally unrelated to our performance during any particular period, we believe this could make it difficult for investors to compare our current financial results to previous and future periods. Therefore, we believe it is useful to exclude share-based compensation in order to better understand our business performance and allow investors to compare our operating results with peer companies. |
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• | Amortization of Acquisition-Related Intangibles: We view amortization of acquisition-related intangible assets, such as the amortization of the cost associated with an acquired company's research and development efforts, trade names, customer lists and customer relationships, as items arising from pre-acquisition activities determined at the time of an acquisition. While these intangible assets are continually evaluated for impairment, amortization of the cost of purchased intangibles is a static expense, one that is not typically affected by operations during any particular period. |
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• | Impairment of internal-use software: We review the software that has been capitalized for impairment when events or changes in circumstances indicate the software might be impaired. From time to time, we may determine that an impairment is required under GAAP. Since the impairment of internal-use software can vary for reasons that are generally unrelated to our performance during any particular period, we believe this could make it difficult for investors to compare our current financial results to previous and future periods. Therefore, we believe it is useful to exclude any such impairments in order to better understand our business performance and allow investors to compare our operating results with peer companies. |
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• | Tax Consequences: In addition, we exclude the tax consequences associated with stock-based compensation to provide investors with a useful comparison of our operating results to prior periods and to our peer companies because such amounts can vary significantly based on the frequency of acquisitions and the tax rates applicable to stock-based compensation in certain jurisdictions. |
Non-GAAP tax rate: The estimated non-GAAP effective tax rate adjusts the tax effect to quantify the excluded tax consequences of the excluded expense items. These non-GAAP estimates are not measurements of financial performance prepared in accordance with U.S. generally accepted accounting principles.
These non-GAAP estimates are not measurements of financial performance prepared in accordance with U.S. generally accepted accounting principles, and we are unable to reconcile these forward-looking non-GAAP financial measures to their directly comparable GAAP financial measures because the information described above which is needed to complete a reconciliation is unavailable at this time without unreasonable effort.
Investor Contact: PROS Investor Relations
Staci Strauss Mortenson
646-277-1200
Staci.Mortenson@icrinc.com
Media Contact: PROS Public Relations
Yvonne Donaldson
713-335-5310
ydonaldson@pros.com
PROS Holdings, Inc.
Condensed Consolidated Balance Sheets
(In thousands, except share amounts)
|
| | | | | | | | |
| | (Unaudited) | | |
| | September 30, 2014 | | December 31, 2013 |
Assets: | | | | |
Current assets: | | | | |
Cash and cash equivalents | | $ | 40,413 |
| | $ | 44,688 |
|
Accounts and unbilled receivables, net of allowance of $770 and $1,060, respectively | | 52,111 |
| | 46,566 |
|
Prepaid and other current assets | | 13,090 |
| | 6,157 |
|
Restricted cash - current | | 2,322 |
| | 39,718 |
|
Total current assets | | 107,936 |
| | 137,129 |
|
Restricted cash - noncurrent | | 100 |
| | 100 |
|
Property and equipment, net | | 17,446 |
| | 15,587 |
|
Intangibles, net | | 21,919 |
| | 8,232 |
|
Goodwill | | 22,097 |
| | 7,024 |
|
Deferred tax assets - noncurrent, net of valuation allowance | | 10,744 |
| | 10,505 |
|
Other long term assets | | 1,710 |
| | 1,251 |
|
Total assets | | $ | 181,952 |
| | $ | 179,828 |
|
Liabilities and Stockholders’ Equity: | | | | |
Current liabilities: | | | | |
Accounts payable and other liabilities | | $ | 10,061 |
| | $ | 7,839 |
|
Accrued liabilities | | 8,928 |
| | 5,210 |
|
Accrued payroll and other employee benefits | | 10,913 |
| | 9,679 |
|
Deferred revenue | | 50,111 |
| | 42,274 |
|
Total current liabilities | | 80,013 |
| | 65,002 |
|
Long-term deferred revenue | | 2,639 |
| | 2,977 |
|
Other long-term liabilities | | 1,445 |
| | 546 |
|
Total liabilities | | 84,097 |
| | 68,525 |
|
PROS Stockholders' equity: | | | | |
Preferred stock, $0.001 par value, 5,000,000 shares authorized none issued | | — |
| | — |
|
Common stock, $0.001 par value, 75,000,000 shares authorized; 33,434,825 and 32,606,228 shares issued, respectively; 29,017,240 and 28,188,643 shares outstanding, respectively | | 34 |
| | 33 |
|
Additional paid-in capital | | 112,332 |
| | 106,880 |
|
Treasury stock, 4,417,585 common shares, at cost | | (13,938 | ) | | (13,938 | ) |
Retained earnings (accumulated deficit) | | (1,076 | ) | | 18,328 |
|
Accumulated other comprehensive loss | | (1,421 | ) | | — |
|
Non-controlling interest | | 1,924 |
| | — |
|
Total stockholders’ equity | | 97,855 |
| | 111,303 |
|
Total liabilities and stockholders’ equity | | $ | 181,952 |
| | $ | 179,828 |
|
PROS Holdings, Inc.
Condensed Consolidated Statements of Comprehensive Income
(In thousands, except share and per share data)
(Unaudited)
|
| | | | | | | | | | | | | | | | |
| | For the Three Months Ended September 30, | | For the Nine Months Ended September 30, |
| | 2014 | | 2013 | | 2014 | | 2013 |
Revenue: | | | | | | | | |
License | | $ | 11,844 |
| | $ | 10,930 |
| | $ | 36,039 |
| | $ | 30,044 |
|
Services | | 13,764 |
| | 12,195 |
| | 38,959 |
| | 35,939 |
|
Subscription | | 6,775 |
| | 1,960 |
| | 16,901 |
| | 5,864 |
|
Total license, services and subscription | | 32,383 |
| | 25,085 |
| | 91,899 |
| | 71,847 |
|
Maintenance and support | | 14,336 |
| | 11,728 |
| | 40,101 |
| | 34,119 |
|
Total revenue | | 46,719 |
| | 36,813 |
| | 132,000 |
| | 105,966 |
|
Cost of revenue: | | | | | | | | |
License | | 48 |
| | 37 |
| | 154 |
| | 270 |
|
Services | | 10,556 |
| | 8,696 |
| | 31,604 |
| | 24,857 |
|
Subscription | | 773 |
| | 275 |
| | 2,862 |
| | 1,160 |
|
Total license, services and subscription | | 11,377 |
| | 9,008 |
| | 34,620 |
| | 26,287 |
|
Maintenance and support | | 2,350 |
| | 2,018 |
| | 7,287 |
| | 6,079 |
|
Total cost of revenue | | 13,727 |
| | 11,026 |
| | 41,907 |
| | 32,366 |
|
Gross profit | | 32,992 |
| | 25,787 |
| | 90,093 |
| | 73,600 |
|
Operating expenses: | | | | | | | | |
Selling, marketing, general and administrative | | 24,422 |
| | 15,714 |
| | 71,144 |
| | 45,936 |
|
Research and development | | 11,665 |
| | 8,001 |
| | 34,316 |
| | 24,122 |
|
Acquisition-related | | 625 |
| | 677 |
| | 2,594 |
| | 677 |
|
Impairment charge | | — |
| | — |
| | 2,130 |
| | — |
|
(Loss) income from operations | | (3,720 | ) | | 1,395 |
| | (20,091 | ) | | 2,865 |
|
Other (expense) income, net | | (466 | ) | | 83 |
| | (2,009 | ) | | (150 | ) |
(Loss) income before income tax provision | | (4,186 | ) | | 1,478 |
| | (22,100 | ) | | 2,715 |
|
Income tax (benefit) provision | | (257 | ) | | 485 |
| | (2,057 | ) | | (592 | ) |
Net (loss) income | | $ | (3,929 | ) | | $ | 993 |
| | $ | (20,043 | ) | | $ | 3,307 |
|
Net loss attributable to non-controlling interest | | (195 | ) | | — |
| | (858 | ) | | — |
|
Net (loss) income attributable to PROS Holdings, Inc. | | $ | (3,734 | ) | | $ | 993 |
| | $ | (19,185 | ) | | $ | 3,307 |
|
| | | | | | | | |
Net (loss) earnings per share attributable to PROS Holdings, Inc.: | | | | | | | | |
Basic | | $ | (0.13 | ) | | $ | 0.04 |
| | $ | (0.66 | ) | | $ | 0.12 |
|
Diluted | | $ | (0.13 | ) | | $ | 0.03 |
| | $ | (0.66 | ) | | $ | 0.11 |
|
Weighted average number of shares: | | | | | | | | |
Basic | | 29,000,481 |
| | 28,096,333 |
| | 28,875,499 |
| | 27,953,416 |
|
Diluted | | 29,000,481 |
| | 30,315,499 |
| | 28,875,499 |
| | 29,935,756 |
|
PROS Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
|
| | | | | | | | |
| | For the Nine Months Ended September 30, |
| | 2014 | | 2013 |
Operating activities: | | | | |
Net (loss) income | | $ | (20,043 | ) | | $ | 3,307 |
|
Adjustments to reconcile net income to net cash provided by operating activities: | | | | |
Depreciation and amortization | | 7,967 |
| | 3,080 |
|
Share-based compensation | | 16,530 |
| | 11,822 |
|
Tax shortfall from share-based compensation | | — |
| | (9 | ) |
Deferred income tax, net | | (238 | ) | | 654 |
|
Provision for doubtful accounts | | (290 | ) | | (40 | ) |
Impairment charge | | 2,130 |
| | — |
|
Changes in operating assets and liabilities: | | | | |
Accounts and unbilled receivables | | 5,024 |
| | (5,787 | ) |
Prepaid expenses and other assets | | (6,375 | ) | | (1,413 | ) |
Accounts payable and other liabilities | | (3,222 | ) | | 2,191 |
|
Accrued liabilities | | 448 |
| | 1,371 |
|
Accrued payroll and other employee benefits | | (932 | ) | | (811 | ) |
Deferred revenue | | 2,108 |
| | (3,206 | ) |
Net cash provided by operating activities | | 3,107 |
| | 11,159 |
|
Investing activities: | | | | |
Purchases of property and equipment | | (6,290 | ) | | (2,636 | ) |
Acquisition of Cameleon Software, net of cash acquired | | (22,048 | ) | | — |
|
Capitalized internal-use software development costs | | (2,166 | ) | | (2,265 | ) |
Decrease in restricted cash | | 37,396 |
| | 329 |
|
Net cash provided by (used) in investing activities | | 6,892 |
| | (4,572 | ) |
Financing activities: | | | | |
Exercise of stock options | | 1,055 |
| | 3,079 |
|
Proceeds from employee stock plans | | 335 |
| | — |
|
Tax withholding related to net share settlement of restricted stock units | | (12,462 | ) | | (2,450 | ) |
Increase in Parent's ownership in Cameleon Software | | (3,621 | ) | | — |
|
Net cash (used in) provided by financing activities | | (14,693 | ) | | 629 |
|
Effect of foreign currency rates on cash | | 419 |
| | — |
|
Net change in cash and cash equivalents | | (4,275 | ) | | 7,216 |
|
Cash and cash equivalents: | | | | |
Beginning of period | | 44,688 |
| | 83,558 |
|
End of period | | $ | 40,413 |
| | $ | 90,774 |
|
PROS Holdings, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(Dollars in thousands, except per share data)
(Unaudited)
We use these non-GAAP financial measures to assist in the management of the Company because we believe that this information provides a more consistent and complete understanding of the underlying results and trends of the ongoing business due to the uniqueness of these charges.
|
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | For the Three Months Ended September 30, | | Quarter over Quarter | | For the Nine Months Ended September 30, | | Year over Year |
| | | | | | 2014 | | 2013 | | % change | | 2014 | | 2013 | | % change |
GAAP revenue | | $ | 46,719 |
| | $ | 36,813 |
| | 27% | | $ | 132,000 |
| | $ | 105,966 |
| | 25% |
| Non-GAAP adjustment: | | | | | | | | | | | | |
| Acquisition-related deferred revenue write-down | | 1,994 |
| | $ | — |
| | | | 6,067 |
| | $ | — |
| | |
Non-GAAP revenue | | $ | 48,713 |
| | $ | 36,813 |
| | 32% | | $ | 138,067 |
| | $ | 105,966 |
| | 30% |
| | | | | | | | | | | | | | | | |
GAAP gross profit | | $ | 32,992 |
| | $ | 25,787 |
| | 28% | | $ | 90,093 |
| | $ | 73,600 |
| | 22% |
| Non-GAAP adjustments: | | | | | | | | | | | | |
| Acquisition-related deferred revenue write-down, net of cost of revenue | | 1,177 |
| | — |
| | | | 3,641 |
| | — |
| | |
| Acquisition-related foreign taxes on equity grants | | — |
| | — |
| | | | 68 |
| | — |
| | |
| Amortization of intangibles assets | | 70 |
| | — |
| | | | 209 |
| | — |
| | |
| Share-based compensation | | 864 |
| | 536 |
| | | | 2,546 |
| | 1,531 |
| | |
Non-GAAP gross profit | | $ | 35,103 |
| | $ | 26,323 |
| | 33% | | $ | 96,557 |
| | $ | 75,131 |
| | 29% |
| | | | | | | | | | | | | | | | |
Non-GAAP gross margin | | 72.1 | % | | 71.5 | % | | | | 69.9 | % | | 70.9 | % | | |
| | | | | | | | | | | | | | | | |
GAAP (loss) income from operations | | $ | (3,720 | ) | | $ | 1,395 |
| | (367)% | | $ | (20,091 | ) | | $ | 2,865 |
| | (801)% |
| Non-GAAP adjustments: | | | | | | | | | | | | |
| Acquisition-related deferred revenue write-down, net of cost of revenue | | 1,177 |
| | — |
| | | | 3,641 |
| | | | |
| Acquisition-related expenses | | 625 |
| | 677 |
| | | | 2,594 |
| | 677 |
| | |
| Acquisition-related foreign taxes on equity grants | | — |
| | | | | | 942 |
| | | | |
| Amortization of intangibles assets | | 1,293 |
| | — |
| | | | 4,018 |
| | — |
| | |
| Accretion expense for acquisition-related contingent consideration | | 57 |
| | — |
| | | | 182 |
| | — |
| | |
| Impairment of internal-use software due to acquisition | | — |
| | — |
| | | | 2,130 |
| | — |
| | |
| Share-based compensation | | 6,075 |
| | 4,264 |
| | | | 16,379 |
| | 11,822 |
| | |
| Total Non-GAAP adjustments | | $ | 9,227 |
| | $ | 4,941 |
| | | | $ | 29,886 |
| | $ | 12,499 |
| | |
Non-GAAP income from operations | | $ | 5,507 |
| | $ | 6,336 |
| | (13)% | | $ | 9,795 |
| | $ | 15,364 |
| | (36)% |
| | | | | | | | | | | | | | | | |
Non-GAAP income from operations % of total revenue | | 11.3 | % | | 17.2 | % | | | | 7.1 | % | | 14.5 | % | | |
PROS Holdings, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(Dollars in thousands, except per share data)
(Unaudited)
We use these non-GAAP financial measures to assist in the management of the Company because we believe that this information provides a more consistent and complete understanding of the underlying results and trends of the ongoing business due to the uniqueness of these charges.
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| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | For the Three Months Ended September 30, | | Quarter over Quarter | | For the Nine Months Ended September 30, | | Year over Year |
| | | | | | 2014 | | 2013 | | % change | | 2014 | | 2013 | | % change |
GAAP net (loss) income | | $ | (3,929 | ) | | $ | 993 |
| | (496)% | | $ | (20,043 | ) | | $ | 3,307 |
| | (706)% |
| Non-GAAP adjustments: | | | | | | | | | | | | |
| Total Non-GAAP adjustments affecting income (loss) from operations | | 9,227 |
| | 4,941 |
| | | | 29,886 |
| | 12,499 |
| | |
| Acquisition-related foreign currency loss | | — |
| | — |
| | | | 593 |
| | — |
| | |
| Tax impact related to non-GAAP adjustments | | (1,961 | ) | | (1,296 | ) | | | | (5,157 | ) | | (3,346 | ) | | |
Non-GAAP net income | | $ | 3,337 |
| | $ | 4,638 |
| | (28)% | | $ | 5,279 |
| | $ | 12,460 |
| | (58)% |
Non-GAAP loss attributable to non-controlling interest | | (38 | ) | | — |
| | | | (106 | ) | | — |
| | |
Non-GAAP income attributable to PROS Holdings, Inc. | | 3,375 |
| | 4,638 |
| | | | 5,385 |
| | 12,460 |
| | |
| | | | | | | | | | | | | | | | |
Non-GAAP diluted earnings per share attributable to PROS Holdings, Inc. | | $ | 0.11 |
| | $ | 0.15 |
| | | | $ | 0.18 |
| | $ | 0.42 |
| | |
| | | | | | | | | | | | | | | | |
Shares used in computing non-GAAP earnings per share | | 30,349 |
| | 30,315 |
| | | | 30,319 |
| | 29,936 |
| | |
| | | | | | | | | | | | | | | | |
Detail of share-based compensation expense: | | | | | | | | | | | | |
| Cost of revenue | | $ | 864 |
| | $ | 536 |
| | | | $ | 2,546 |
| | $ | 1,531 |
| | |
| Selling, marketing, general and administrative | | 3,967 |
| | 2,940 |
| | | | 10,408 |
| | 8,000 |
| | |
| Research and development | | 1,244 |
| | 788 |
| | | | 3,425 |
| | 2,291 |
| | |
Total share-based compensation expense | | $ | 6,075 |
| | $ | 4,264 |
| | | | $ | 16,379 |
| | $ | 11,822 |
| | |
| | | | | | | | | | | | | | | | |
Detail of amortization of intangible assets: | | | | | | | | | | | | |
| Cost of revenue | | $ | 70 |
| | $ | — |
| | | | $ | 209 |
| | $ | — |
| | |
| Selling, marketing, general and administrative | | 553 |
| | — |
| | | | 1,654 |
| | — |
| | |
| Research and development | | 670 |
| | — |
| | | | 2,155 |
| | — |
| | |
Total amortization of intangible assets | | $ | 1,293 |
| | $ | — |
| | | | $ | 4,018 |
| | $ | — |
| | |
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