CHELMSFORD, Mass., July 25, 2013 /PRNewswire/ -- Datawatch
Corporation (NASDAQCM: DWCH), the leading global provider of
information optimization solutions, today announced that total
revenue for its third quarter ended June 30,
2013 was $7.83 million, an
increase of 9% from revenue of $7.17
million in the third quarter a year ago. License
revenue for the third quarter of fiscal 2013 was $5.01 million, an increase of 7% from the
$4.70 million recorded in the
comparable quarter a year ago. Net loss for the third quarter
of fiscal 2013 was $666,000, or
$0.10 per diluted share, compared to
net income of $548,000, or
$0.08 per diluted share, for the year
ago period. Excluding the effects of the non-cash
amortization associated with the purchase of the Monarch
intellectual property in March 2012
as well as non-cash stock compensation costs, the Company's
non–GAAP net income for its third fiscal quarter of 2013 was
$525,000, or $0.08 per diluted share, compared to $1,376,000, or $0.20 per diluted share in the third fiscal
quarter of 2012. Panopticon transaction related costs of
approximately $600,000 were included
in the expenses for the third fiscal quarter of 2013.
(Logo:
http://photos.prnewswire.com/prnh/20121015/NE92833LOGO)
Third quarter 2013 results do not include any contribution from
Datawatch's recently-announced agreement to acquire Panopticon
Software AB, a transaction that is expected to be completed during
Datawatch's fourth fiscal quarter of 2013.
"We continue to vigorously pursue our strategy to drive the
adoption of our Information Optimization solutions throughout the
market and deliver on our growth plans," said Michael A. Morrison, President and Chief
Executive Officer of Datawatch. "Every day, more and more
organizations recognize the value that our Information Optimization
platform delivers by transforming the wide variety of data formats
and sources to augment Big Data and business intelligence
solutions, and more industry analysts are identifying Datawatch as
a thought leader in this rapidly emerging market. While we
clearly have not reached our full potential, we are encouraged by
our building reputation in the market and recent successes in
converting our market message to revenue opportunities, especially
in the growing market for advanced analytics on documents stored in
enterprise content management systems. For these reasons, we
remain confident that our revenue performance will significantly
increase in the coming quarters."
Mr. Morrison added, "The acquisition of Panopticon, which we
announced last month, also presents exciting opportunities for
Datawatch. As we have stated, we believe this acquisition is
a transformative event for our company. Industry analysts
describe the visual discovery market as 'white hot' and the demand
for real-time solutions is growing rapidly. Moreover, media
and industry attention to our planned acquisition of Panopticon has
raised greater awareness of our Information Optimization solutions
and provides us with a larger stage to promote the value of data
variety in Big Data visual discovery solutions. Once we
finalize the Panopticon acquisition as expected in our fiscal
fourth quarter, Datawatch will be the only vendor in the analytics
market able to deliver robust visual discovery solutions, in real
time, against a wide variety of data formats and sources. We
intend to aggressively promote these capabilities across all
industries, including capital markets where Panopticon today is
recognized as the undisputed leader in real-time visual
discovery. We are already well underway with our plans to
quickly and seamlessly integrate Panopticon into Datawatch, so that
together, we can accelerate our revenue growth in the coming
quarters. If the combined organization delivers on the
potential we see in the market, we believe we have a real
opportunity to disrupt the traditional business analytics market,
to the benefit of our customers, partners and shareholders."
Third Quarter Business Highlights
- Datawatch entered into an OEM agreement with one of the world's
largest healthcare information technology providers to embed
Datawatch Report Mining Server with this healthcare provider's
content management solution in order to deliver robust content
analytics to healthcare organizations of all sizes.
- Datawatch expanded its partner channel by adding 15 new
partners globally, including new partnerships with Carahsoft,
LeapPoint and NEWave in the United
States, Infoconnect in Malaysia, Megalegend in Hong Kong, Dawin and Softline in South Korea and RDGS in Poland.
- Datawatch customers The Fauquier Bank and Phelps County
Regional Medical Center received Ventana Research 2013 Business
Technology Leadership Awards in the areas of Governance, Risk &
Compliance and Information Optimization, respectively. The
Ventana Research 2013 Leadership Awards program showcases
technology vendors who have worked with their customers to advance
the potential of their organizations through the use of
applications and technology.
- Datawatch closed a significant six figure transaction with ASG
in connection with a newly established partnership and the
settlement of a prior dispute.
- Datawatch continued its success in content management analytics
and transformation with significant Datawatch Report Mining Server
wins with two major financial institutions. Datawatch Report
Mining Server will be deployed to access and leverage terabytes of
valuable information trapped in business documents stored in IBM
and Saperion enterprise content management systems.
Third Quarter Financial Highlights
- Cash and short-term investments were $10.42 million at June 30,
2013, up 8% from $9.68 million
at March 31, 2013 and up 33% from
$7.84 million at June 30, 2012.
- Gross margin for the third fiscal quarter of 2013 was 85.3%,
compared to 84.0% for the second fiscal quarter of 2013 and 83.8%
for the third fiscal quarter of 2012.
- Days sales outstanding were 60 days at June 30, 2013, compared to 57 days at
March 31, 2013 and 65 days at
June 30, 2012.
- There were 3 six-figure deals in the third fiscal quarter, as
compared to 5 six-figure deals in the third fiscal quarter of
2012.
- The average deal size in the third fiscal quarter was
$60,000, as compared to $60,000 in the third fiscal quarter of 2012.
"We continue to improve our balance sheet, as we added more than
$700,000 to Datawatch's cash balances
in the third quarter, closing the quarter with more than
$10 million," said James Eliason, Chief Financial Officer of
Datawatch. "As a result, we are in a strong financial
position to better execute on our recently announced acquisition of
Panopticon, and aggressively roll out sales and marketing
initiatives to take advantage of the large opportunity we see in
the market. Our financial performance has also enabled us to
reach a preliminary understanding with our lenders to refinance our
existing debt in light of changes in the commercial credit market
to reduce our interest costs substantially."
Investor Conference Call and Webcast
The senior management of Datawatch will host a conference call and
webcast to discuss the third quarter results this afternoon,
Thursday, July 25, 2013 at
4:30 pm ET. To access the call,
please dial 1-877-407-0782. Internationally, the call may be
accessed by dialing 1-201-689-8567. The conference call will be
broadcast live on the Internet at:
http://www.investorcalendar.com/IC/CEPage.asp?ID=171188. It
is recommended that listeners register to participate and download
any necessary audio software from the website 15 minutes prior to
the scheduled call. The webcast will be available as a replay
starting one hour after the call is completed at the same
location.
ABOUT DATAWATCH CORPORATION
Datawatch Corporation
(NASDAQCM: DWCH) is a leader in providing information optimization
products and solutions that allow organizations to deliver the
greatest data variety possible into their big data and analytic
applications. Datawatch provides organizations the ability to
integrate structured, unstructured, and semi-structured sources
like reports, PDF files, and EDI streams into these applications to
provide a 360 degree perspective of the issues and opportunities
that exist in their businesses. More than 40,000 organizations
worldwide use Datawatch's products and services, including 99 of
the Fortune 100, and businesses of every type can benefit from the
power and flexibility of Datawatch's industry leading solutions.
Datawatch is headquartered in Chelmsford,
Massachusetts with offices in London, Munich, Singapore, Sydney and Manila, and with partners and customers in
more than 100 countries worldwide. For more information, visit
www.datawatch.com.
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995
Any statements contained in this press
release that do not describe historical facts may constitute
forward-looking statements as that term is defined in the Private
Securities Litigation Reform Act of 1995. Any such statements,
including but not limited to those relating to results of
operations, contained herein are based on current expectations, but
are subject to a number of risks and uncertainties that may cause
actual results to differ materially from expectations. The factors
that could cause actual future results to differ materially from
current expectations include the following: risks associated with
the continuing weak global economy; risks associated with
fluctuations in quarterly operating results due, among other
factors, to the size and timing of large customer orders; risks
associated with acquisitions, including the recent acquisition of
intellectual property from Math Strategies and the acquisition of
Panopticon; the volatility of Datawatch's stock price; limitations
on the effectiveness of internal controls; rapid technological
change; Datawatch's dependence on the introduction of new products
and possible delays in those introductions; competition in the
software industry generally, and in the markets for information
optimization in particular; Datawatch's dependence on its principal
products, proprietary software technology and software licensed
from third parties; risks associated with international sales and
operations; risks associated with indirect distribution channels;
the adequacy of Datawatch's sales returns reserve; risks associated
with a subscription sales model; Datawatch's dependence on its
ability to hire and retain skilled personnel; disruption or failure
of Datawatch's technology systems that may result from a natural
disaster, cyber-attack or other catastrophic event; and uncertainty
and additional costs that may result from evolving regulation of
corporate governance and public disclosure. Further information on
factors that could cause actual results to differ from those
anticipated is detailed in various publicly-available documents,
which include, but are not limited to, filings made by Datawatch
from time to time with the Securities and Exchange Commission,
including but not limited to, those appearing in the Company's
Annual Report on Form 10-K for the year ended September 30, 2012 and Form 10-Q for the quarters
ended December 31, 2012 and
March 31, 2013. Any
forward-looking statements should be considered in light of those
factors.
Additional Information Regarding Panopticon
Acquisition:
In connection with the proposed acquisition of
Panopticon and solicitation of stockholder approval of the issuance
of Datawatch stock in connection with the proposed acquisition,
Datawatch will file with the Securities and Exchange Commission
(the "SEC") a definitive Proxy Statement as well as other relevant
documents. Shareholders are urged to read the Proxy Statement
regarding the proposed transaction when it becomes available and
any other relevant documents filed with the SEC, as well as any
amendments or supplements to those documents, because they will
contain important information about the proposed transaction. You
will be able to obtain a free copy of the Proxy Statement, as well
as other filings containing information about Datawatch and
Panopticon, at the SEC's Internet site (http://www.sec.gov). You
will also be able to obtain these documents for Datawatch, free of
charge, at www.datawatch.com under the tab "Investor Relations" and
then under the heading "SEC Filings." Copies of the Proxy Statement
and any SEC filings incorporated by reference in the Proxy
Statement can also be obtained, free of charge, by directing a
request to Datawatch Investor Relations, Datawatch Corporation, 271
Mill Road, Quorum Office Park, Chelmsford, Massachusetts 01824, (978)
441-2200.
Datawatch and its directors and executive officers may be deemed
to be participants in the solicitation of proxies from Datawatch
stockholders in connection with the proposed acquisition.
Information about Datawatch's directors and executive officers is
set forth in the proxy statement for its 2013 annual meeting of
shareholders, as filed with the SEC on Schedule 14A on January 28, 2013. Additional information
regarding the interests of those participants and other persons who
may be deemed participants in the transaction may be obtained by
reading the Proxy Statement regarding the proposed acquisition when
it becomes available. You may obtain free copies of this
document as described in the preceding paragraph.
Investor Contact:
Datawatch Investor Relations
investor@datawatch.com
Phone: (978) 441-2200 ext. 8323
Media Contact:
Sarah
Bernardi
Datawatch Corporation
Sarah_Bernardi@datawatch.com
Phone: (978) 441-2200 ext. 8387
Twitter: @datawatch
© 2013 Datawatch Corporation. Datawatch, Monarch and their
respective logos are trademarks or registered trademarks of
Datawatch Corporation in the United
States and/or other countries. All other names are
trademarks or registered trademarks of their respective
companies.
DATAWATCH
CORPORATION
|
Condensed
Consolidated Statements of Operations
|
Amounts in
Thousands (except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
June
30,
|
|
June
30,
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
REVENUE:
|
|
|
|
|
|
|
|
|
|
Software
licenses
|
|
$
5,007
|
|
$
4,699
|
|
$
13,634
|
|
$
13,182
|
|
Maintenance
|
|
2,409
|
|
2,106
|
|
7,042
|
|
5,683
|
|
Professional
services
|
|
411
|
|
368
|
|
803
|
|
1,126
|
|
Total revenue
|
|
7,827
|
|
7,173
|
|
21,479
|
|
19,991
|
|
|
|
|
|
|
|
|
|
|
COSTS AND
EXPENSES:
|
|
|
|
|
|
|
|
|
|
Cost of
software licenses
|
|
549
|
|
509
|
|
1,602
|
|
1,743
|
|
Cost of
maintenance and services
|
|
602
|
|
668
|
|
1,697
|
|
2,019
|
|
Sales and
marketing
|
|
4,398
|
|
3,244
|
|
12,391
|
|
9,041
|
|
Engineering and
product development
|
|
759
|
|
730
|
|
2,361
|
|
2,048
|
|
General and
administrative
|
|
2,038
|
|
1,289
|
|
4,475
|
|
3,469
|
|
Total costs and expenses
|
|
8,346
|
|
6,440
|
|
22,526
|
|
18,320
|
|
|
|
|
|
|
|
|
|
|
(LOSS) INCOME
FROM OPERATIONS
|
|
(519)
|
|
733
|
|
(1,047)
|
|
1,671
|
Other
expense
|
|
(148)
|
|
(175)
|
|
(466)
|
|
(285)
|
|
|
|
|
|
|
|
|
|
|
(LOSS) INCOME
BEFORE INCOME TAXES
|
|
(667)
|
|
558
|
|
(1,513)
|
|
1,386
|
Income tax
(benefit) provision
|
|
(1)
|
|
10
|
|
1
|
|
75
|
|
|
|
|
|
|
|
|
|
|
NET (LOSS)
INCOME
|
|
$
(666)
|
|
$
548
|
|
$
(1,514)
|
|
$
1,311
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss)
income per share - Basic
|
|
$
(0.10)
|
|
$
0.09
|
|
$
(0.24)
|
|
$
0.21
|
|
|
|
|
|
|
|
|
|
|
Net (loss)
income per share - Diluted
|
|
$
(0.10)
|
|
$
0.08
|
|
$
(0.24)
|
|
$
0.20
|
|
|
|
|
|
|
|
|
|
|
Weighted
Average Shares Outstanding - Basic
|
|
6,495
|
|
6,288
|
|
6,434
|
|
6,224
|
|
|
|
|
|
|
|
|
|
|
Weighted
Average Shares Outstanding - Diluted
|
|
6,495
|
|
6,775
|
|
6,434
|
|
6,653
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP
Disclosure - Reconciliation of Net (Loss) Income to Net Income
Excluding the Effects of Certain Items:
|
|
|
|
|
|
|
|
|
|
|
GAAP Net
(Loss) Income
|
|
$
(666)
|
|
$
548
|
|
$
(1,514)
|
|
$
1,311
|
Add-back Amortization of Monarch IP
|
|
431
|
|
431
|
|
1,292
|
|
440
|
Add-back Share-Based Compensation
|
|
760
|
|
227
|
|
1,922
|
|
560
|
Add-back Restructuring Severance Charges
|
|
-
|
|
170
|
|
-
|
|
183
|
|
|
|
|
|
|
|
|
|
|
Net income
(non-GAAP)
|
|
$
525
|
|
$
1,376
|
|
$
1,700
|
|
$
2,494
|
|
|
|
|
|
|
|
|
|
|
Net income
per share - Basic
|
|
$
0.08
|
|
$
0.22
|
|
$
0.26
|
|
$
0.40
|
|
|
|
|
|
|
|
|
|
|
Net income
per share - Diluted
|
|
$
0.08
|
|
$
0.20
|
|
$
0.25
|
|
$
0.37
|
|
|
|
|
|
|
|
|
|
|
Weighted
Average Shares Outstanding - Basic
|
|
6,495
|
|
6,288
|
|
6,434
|
|
6,224
|
|
|
|
|
|
|
|
|
|
|
Weighted
Average Shares Outstanding - Diluted
|
|
6,915
|
|
6,775
|
|
6,895
|
|
6,653
|
|
|
|
|
|
|
|
|
|
|
DATAWATCH
CORPORATION
|
Condensed
Consolidated Balance Sheets
|
Amounts in
Thousands
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
September
30,
|
|
|
2013
|
|
2012
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
10,424
|
|
$
8,722
|
Accounts
receivable, net
|
|
5,085
|
|
4,391
|
Prepaid
expenses and other current assets
|
|
858
|
|
591
|
Total current assets
|
|
16,367
|
|
13,704
|
|
|
|
|
|
Property and
equipment, net
|
|
286
|
|
281
|
Intangible and
other assets, net
|
|
7,533
|
|
8,820
|
|
|
|
|
|
|
|
$
24,186
|
|
$
22,805
|
|
|
|
|
|
|
|
|
|
|
Current portion
of long-term debt
|
|
$
900
|
|
$
900
|
Current portion
of note payable
|
|
267
|
|
-
|
Accounts
payable and accrued expenses
|
|
3,290
|
|
2,468
|
Deferred
revenue - current portion
|
|
6,283
|
|
6,295
|
Total current liabilities
|
|
10,740
|
|
9,663
|
|
|
|
|
|
Note
payable
|
|
2,834
|
|
2,983
|
Other long-term
liabilities
|
|
416
|
|
465
|
Total long-term liabilities
|
|
3,250
|
|
3,448
|
|
|
|
|
|
Total shareholders' equity
|
|
10,196
|
|
9,694
|
|
|
|
|
|
|
|
$
24,186
|
|
$
22,805
|
|
|
|
|
|
|
|
|
|
|
SOURCE Datawatch Corporation