PORTSMOUTH, N.H., Nov. 02, 2017
(GLOBE NEWSWIRE) -- Bottomline Technologies (NASDAQ:EPAY), a
leading provider of financial technology which helps businesses pay
and get paid, today reported financial results for the first
quarter ended September 30, 2017.
Subscription and transaction revenues, which are
primarily related to the company's cloud platforms, were $60.7
million for the first quarter, up 16% as compared to the first
quarter of last year. Revenues overall for the first quarter
were $91.3 million, up 10% as compared to the first quarter of last
year.
GAAP net loss for the first quarter was $4.2
million compared to $10.5 million for the first quarter of last
year. GAAP net loss per share was $0.11 in the first quarter
compared to $0.28 in the first quarter of last year.
Adjusted EBITDA for the first quarter was $22.1
million compared to $16.7 million for the first quarter of last
year. Adjusted EBITDA for the first quarter was 24% of
overall revenue compared to 20% of overall revenue for the first
quarter of last year. Adjusted EBITDA is calculated as discussed in
the "Non-GAAP Financial Measures" section that follows.
Core net income for the first quarter was $11.7
million compared to $8.4 million for the first quarter of last year
and core earnings per share was $0.30 for the first quarter
compared to $0.22 for the first quarter of last year. Core net
income and core earnings per share exclude certain items as
discussed in the "Non-GAAP Financial Measures" section that
follows.
"We are executing against our strategic plan and
delivered strong results," said Rob Eberle, President and CEO of
Bottomline Technologies. "Growth and profitability were ahead of
our expectations. We are particularly pleased by the market
reception to our offerings and the new subscription bookings.
We enter the new fiscal year with a high degree of confidence in
our ability to execute against our strategic plan, achieve our
financial targets and drive shareholder value."
First Quarter Customer
Highlights
- 29 institutions selected Paymode-X,
Bottomline's leading payments platform to automate their payments
processes, increase productivity, reduce costs and earn cash
rebates.
- 6 organizations, including Knight
Insurance Group and AmWINS, chose Bottomline's cloud-based legal
spend management solutions to automate, manage and control their
legal spend.
- 4 banks selected Bottomline's
digital banking platforms to help them compete and grow their
corporate and business banking franchises by deploying innovative
digital capabilities.
- Companies such as Banco Santander
and Shop & Finance Limited selected Bottomline's Financial
Messaging solution to improve operating efficiencies and optimize
the effectiveness of their financial transactions.
- Organizations such as The Main
Street America Group and USI Insurance Services chose Bottomline's
corporate payment automation solutions to extend their payments
capabilities and improve efficiencies.
First Quarter Strategic
Corporate Highlights
- Announced expansion of Bottomline's
global footprint with a new financial messaging center in
Singapore. With this new center, Bottomline is well
positioned to extend its secure set of core financial messaging
capabilities into the Asia-Pacific region.
- Announced commitment to becoming a
Third Party Provider (TPP) under the Open Banking initiative, to
allow customers to access information and initiate payments
directly with participating banks through secure Application
Programming Interfaces (APIs), via cloud-based payment
platforms.
- Bottomline's PTX Cloud based
payments platform was recognized as an award winner by the Credit
Control and Risk Association in the new product category for
payments and collections
Non-GAAP Financial
Measures
We have presented supplemental non-GAAP financial
measures as part of this earnings release. The presentation of this
non-GAAP financial information should not be considered in
isolation from, or as a substitute for, our financial results
presented in accordance with GAAP. Core net income, core earnings
per share, constant currency information, adjusted EBITDA and
adjusted EBITDA as a percent of revenue are non-GAAP financial
measures.
Core net income and core earnings per share
exclude certain items, specifically amortization of acquisition
related intangible assets, goodwill impairment charges, stock-based
compensation, acquisition and integration-related expenses,
restructuring related costs, minimum pension liability adjustments,
non-core charges associated with our convertible notes and
revolving credit facility, global enterprise resource planning
(ERP) system implementation costs, and other non-core or
non-recurring gains or losses that arise from time to time.
Non-core charges associated with our convertible
notes and revolving credit facility consist of the amortization of
debt issuance and debt discount costs. Acquisition and
integration-related expenses include legal and professional fees
and other direct transaction costs associated with business and
asset acquisitions, costs associated with integrating acquired
businesses, including costs for transitional employees or services,
integration related professional services costs and other
incremental charges we incur as a direct result of acquisition and
integration efforts. Global ERP system implementation costs relate
to direct and incremental costs incurred in connection with our
implementation of a new, global ERP solution and the related
technology infrastructure.
In computing diluted core earnings per share, we
exclude the effect of shares issuable under our convertible notes
to the extent that any such dilution would be offset by our note
hedges; the note hedges would be considered an anti-dilutive
security under GAAP.
Periodically, such as in periods that include
significant foreign currency volatility, we may present certain
metrics on a "constant currency" basis, to show the impact of
period to period results normalized for the impact of foreign
currency rate changes. We calculate constant currency information
by translating prior period financial results using current period
foreign exchange rates.
Adjusted EBITDA and adjusted EBITDA as a percent
of revenue represent our GAAP net income or loss, adjusted for
charges related to interest expense, income taxes, depreciation and
amortization, and other charges, as noted in the reconciliation
that follows.
We believe 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, including more meaningful comparisons of financial
results to historical periods and to the financial results of less
acquisitive peer and competitor companies. Our executive management
team uses these same non-GAAP financial measures internally to
assess the ongoing performance of the company. Additionally, the
same non-GAAP information is used for planning purposes, including
the preparation of operating budgets and in communications with our
board of directors with respect to our core financial performance.
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.
Reconciliation of Core Net Income
A reconciliation of core net income to GAAP net loss for the three
months ended September 30, 2017 and 2016 is as follows:
|
|
|
Three Months Ended September 30, |
|
2017 |
|
2016 |
|
(in thousands) |
GAAP net loss |
$ |
(4,241 |
) |
|
$ |
(10,508 |
) |
Amortization of
acquisition-related intangible assets |
5,188 |
|
|
6,285 |
|
Stock-based compensation
expense |
8,460 |
|
|
8,199 |
|
Acquisition and
integration-related expenses |
992 |
|
|
1,249 |
|
Restructuring benefit |
(9 |
) |
|
- |
|
Global ERP system
implementation costs |
2,076 |
|
|
2,491 |
|
Minimum pension liability
adjustments |
35 |
|
|
277 |
|
Amortization of debt issuance
and debt discount costs |
3,709 |
|
|
3,372 |
|
Tax effects on non-GAAP
income |
(4,542 |
) |
|
(2,978 |
) |
Core net income |
$ |
11,668 |
|
|
$ |
8,387 |
|
|
|
|
|
|
|
|
|
Reconciliation of Diluted Core Earnings per
Share
A reconciliation of our diluted core earnings per share to our GAAP
basic and diluted net loss per share for the three months ended
September 30, 2017 and 2016 is as follows:
|
|
|
Three Months Ended September 30, |
|
2017 |
|
2016 |
|
|
|
|
GAAP basic and diluted net
loss per share |
$ |
(0.11 |
) |
|
$ |
(0.28 |
) |
|
|
|
|
Plus: |
|
|
|
Amortization of
acquisition-related intangible assets |
0.13 |
|
|
0.17 |
|
Stock-based compensation
expense |
0.22 |
|
|
0.22 |
|
Acquisition and
integration-related expenses |
0.03 |
|
|
0.03 |
|
Global ERP system
implementation costs |
0.05 |
|
|
0.06 |
|
Minimum pension liability
adjustments |
- |
|
|
0.01 |
|
Amortization of debt issuance
and debt discount costs |
0.10 |
|
|
0.09 |
|
Tax effects on non-GAAP
income |
(0.12 |
) |
|
(0.08 |
) |
|
|
|
|
Diluted core earnings per
share |
$ |
0.30 |
|
|
$ |
0.22 |
|
|
|
|
|
|
|
|
|
A reconciliation of our non-GAAP weighted average
shares used in computing diluted core earnings per share to our
GAAP weighted average shares used in computing basic and diluted
net loss per share for the three months ended September 30,
2017 and 2016 is as follows:
|
|
|
Three Months Ended September 30, |
|
2017 |
|
2016 |
Numerator: |
|
|
|
|
|
|
|
Core net income |
$ |
11,668 |
|
|
$ |
8,387 |
|
|
|
|
|
Denominator: |
|
|
|
|
|
|
|
Weighted average shares used
in computing basic and diluted net loss per share for GAAP |
37,730 |
|
|
37,940 |
|
|
|
|
|
Impact of dilutive securities
(stock options, restricted stock awards and employee stock purchase
plan) (1) |
581 |
|
|
88 |
|
|
|
|
|
Weighted average shares used
in computing diluted core earnings per share |
38,311 |
|
|
38,028 |
|
|
(1) These securities are
anti-dilutive on a GAAP basis as a result of our net loss, but are
considered dilutive on a non-GAAP basis in periods where we report
non-GAAP net income. |
|
Reconciliation of Adjusted EBITDA
A reconciliation of our adjusted EBITDA to GAAP net loss for the
three months ended September 30, 2017 and 2016 is as
follows:
|
|
|
Three Months Ended September 30, |
|
2017 |
|
2016 |
|
|
|
|
GAAP net loss |
$ |
(4,241 |
) |
|
$ |
(10,508 |
) |
|
|
|
|
Adjustments: |
|
|
|
Other expense, net |
4,463 |
|
|
3,935 |
|
Provision for income
taxes |
457 |
|
|
681 |
|
Depreciation and
amortization |
4,668 |
|
|
4,087 |
|
Amortization of
acquisition-related intangible assets |
5,188 |
|
|
6,285 |
|
Stock-based compensation
expense |
8,460 |
|
|
8,199 |
|
Acquisition and
integration-related expenses |
992 |
|
|
1,249 |
|
Restructuring benefit |
(9 |
) |
|
- |
|
Minimum pension liability
adjustments |
35 |
|
|
277 |
|
Global ERP system
implementation costs |
2,076 |
|
|
2,491 |
|
|
|
|
|
Adjusted EBITDA |
$ |
22,089 |
|
|
$ |
16,696 |
|
Reconciliation of Adjusted EBITDA as a percent of
Revenue
A reconciliation of adjusted EBITDA as a percent of revenue to GAAP
net loss as a percent of revenue for the three months ended
September 30, 2017 and 2016 is as follows:
|
|
|
Three Months Ended September 30, |
|
2017 |
|
2016 |
|
|
|
|
GAAP net loss as a percent of
revenue |
(5 |
%) |
|
(13 |
%) |
|
|
|
|
Adjustments: |
|
|
|
Other expense, net |
5 |
% |
|
5 |
% |
Provision for income
taxes |
1 |
% |
|
1 |
% |
Depreciation and
amortization |
5 |
% |
|
5 |
% |
Amortization of
acquisition-related intangible assets |
6 |
% |
|
8 |
% |
Stock-based compensation
expense |
9 |
% |
|
10 |
% |
Acquisition and
integration-related expenses |
1 |
% |
|
1 |
% |
Global ERP system
implementation costs |
2 |
% |
|
3 |
% |
|
|
|
|
Adjusted EBITDA as a percent
of revenue |
24 |
% |
|
20 |
% |
|
|
|
|
|
|
About Bottomline
Technologies
Bottomline Technologies (NASDAQ:EPAY) helps businesses pay and get
paid. We make complex business payments simple, secure and seamless
by providing a trusted and easy-to-use set of cloud-based business
payment, digital banking, fraud prevention and financial document
solutions. Over 10,000 corporations, financial institutions, and
banks benefit from Bottomline solutions. Headquartered in the
United States, Bottomline also maintains offices in Europe and
Asia-Pacific. For more information, visit our website
at www.bottomline.com.
Bottomline Technologies, Paymode-X and the BT logo
are trademarks of Bottomline Technologies (de), Inc. which are
registered in certain jurisdictions. All other brand/product names
are trademarks of their respective holders.
In connection with this earnings release and our
associated conference call, we will be posting additional material
financial information (such as financial results, non-GAAP
financial projections and non-GAAP to GAAP reconciliations) within
the "Investors" section of our website
at www.bottomline.com/us/about/investors.
Cautionary
Language
This press release contains "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995, including statements reflecting our
expectations about our ability to execute on our strategic plans,
achieve future growth and profitability, achieve financial targets
and increase shareholder value. Any statements that are not
statements of historical fact (including but not limited to
statements containing the words "believes," "plans," "anticipates,"
"expects," "look forward", "confident", "estimates" and similar
expressions) should be considered to be forward-looking
statements. Actual results may differ materially from those
indicated by such forward-looking statements as a result of various
important factors including, among others, 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' operational and financial results, refer
to our Form 10-K for the fiscal year ended June 30, 2017 and the
subsequently filed Form 10-Qs and Form 8-Ks or amendments thereto.
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.
Media
Contact:
Rick Booth
Bottomline Technologies
603-501-6270
rbooth@bottomline.com
|
Bottomline Technologies |
Unaudited Condensed Consolidated Statement of
Operations |
(in thousands, except per share amounts) |
|
|
|
|
|
Three Months Ended September 30, |
|
2017 |
|
2016 |
Revenues: |
|
|
|
Subscriptions and
transactions |
$ |
60,714 |
|
|
$ |
52,132 |
|
Software licenses |
2,365 |
|
|
2,121 |
|
Service and maintenance |
27,342 |
|
|
27,673 |
|
Other |
875 |
|
|
1,158 |
|
|
|
|
|
Total revenues |
91,296 |
|
|
83,084 |
|
|
|
|
|
Cost of revenues: |
|
|
|
Subscriptions and
transactions |
27,411 |
|
|
23,886 |
|
Software licenses |
170 |
|
|
128 |
|
Service and maintenance |
12,232 |
|
|
13,285 |
|
Other |
667 |
|
|
878 |
|
Total cost of revenues |
40,480 |
|
|
38,177 |
|
|
|
|
|
Gross profit |
50,816 |
|
|
44,907 |
|
|
|
|
|
Operating expenses: |
|
|
|
Sales and marketing |
19,305 |
|
|
18,875 |
|
Product development and
engineering |
13,815 |
|
|
12,935 |
|
General and
administrative |
11,829 |
|
|
12,704 |
|
Amortization of
acquisition-related intangible assets |
5,188 |
|
|
6,285 |
|
Total operating expenses |
50,137 |
|
|
50,799 |
|
|
|
|
|
Income (loss) from
operations |
679 |
|
|
(5,892 |
) |
|
|
|
|
Other expense, net |
(4,463 |
) |
|
(3,935 |
) |
|
|
|
|
Loss before income taxes |
(3,784 |
) |
|
(9,827 |
) |
Income tax provision |
457 |
|
|
681 |
|
|
|
|
|
Net loss |
$ |
(4,241 |
) |
|
$ |
(10,508 |
) |
|
|
|
|
Basic and diluted net loss per
share: |
$ |
(0.11 |
) |
|
$ |
(0.28 |
) |
|
|
|
|
Shares used in computing basic
and diluted net loss per share: |
37,730 |
|
|
37,940 |
|
|
|
|
|
|
|
|
|
|
Bottomline Technologies |
Unaudited Condensed Consolidated Balance
Sheets |
(in thousands) |
|
September 30, |
|
June 30, |
|
2017 |
|
2017 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash, cash equivalents and
marketable securities |
$ |
128,331 |
|
|
$ |
126,542 |
|
Accounts receivable |
61,505 |
|
|
64,244 |
|
Other current assets |
19,362 |
|
|
16,807 |
|
|
|
|
|
Total current assets |
209,198 |
|
|
207,593 |
|
|
|
|
|
Property and equipment,
net |
26,138 |
|
|
26,195 |
|
Goodwill and intangible
assets, net |
365,048 |
|
|
365,980 |
|
Other assets |
17,174 |
|
|
17,671 |
|
|
|
|
|
Total assets |
$ |
617,558 |
|
|
$ |
617,439 |
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
11,235 |
|
|
$ |
9,013 |
|
Accrued expenses and other
current liabilities |
27,236 |
|
|
29,179 |
|
Deferred revenue |
62,123 |
|
|
74,113 |
|
Convertible senior notes |
187,281 |
|
|
183,682 |
|
|
|
|
|
Total current liabilities |
287,875 |
|
|
295,987 |
|
|
|
|
|
Deferred revenue, non
current |
22,122 |
|
|
22,047 |
|
Deferred income taxes |
15,838 |
|
|
15,433 |
|
Other liabilities |
22,522 |
|
|
22,016 |
|
|
|
|
|
Total liabilities |
348,357 |
|
|
355,483 |
|
|
|
|
|
Stockholders' equity |
|
|
|
Common stock |
43 |
|
|
43 |
|
Additional
paid-in-capital |
632,490 |
|
|
624,001 |
|
Accumulated other
comprehensive loss |
(31,083 |
) |
|
(32,325 |
) |
Treasury stock |
(111,565 |
) |
|
(113,071 |
) |
Accumulated deficit |
(220,684 |
) |
|
(216,692 |
) |
|
|
|
|
Total stockholders'
equity |
269,201 |
|
|
261,956 |
|
|
|
|
|
Total liabilities and
stockholders' equity |
$ |
617,558 |
|
|
$ |
617,439 |
|
|
|
|
|
|
|
|
|