Comverse, Inc. ("Comverse") (Nasdaq:CNSI) today announced its
results for the fourth quarter ("Q4") and fiscal year ended January
31, 2015 ("fiscal 2014").
Consolidated Highlights: Below is selected
consolidated financial information for Q4 and fiscal 2014, prepared
in accordance with generally accepted accounting principles
("GAAP"), except as noted.
Comverse, Inc.: |
Three Months
Ended January 31, |
Fiscal Years
Ended January 31, |
(In thousands) |
2015 |
2014 |
2015 |
2014 |
Total revenue |
$ 119,734 |
$ 166,514 |
$ 477,305 |
$ 652,501 |
Costs and expenses |
|
|
|
|
Cost of revenue |
75,694 |
112,140 |
308,642 |
402,476 |
Research and development,
net |
11,049 |
17,036 |
56,334 |
67,512 |
Selling, general and
administrative |
22,604 |
30,689 |
111,832 |
134,031 |
Other operating expenses |
3,632 |
2,924 |
16,333 |
10,783 |
Total costs and expenses |
112,979 |
162,789 |
493,141 |
614,802 |
Income (loss) from operations |
6,755 |
3,725 |
(15,836) |
37,699 |
Expense adjustments |
8,041 |
8,730 |
35,918 |
18,950 |
Comverse performance (1) |
14,796 |
12,455 |
20,082 |
56,649 |
|
|
|
|
|
Income (loss) before income tax (expense)
benefit |
5,040 |
1,514 |
(11,855) |
27,875 |
Income tax (expense) benefit |
4,868 |
14,263 |
(10,284) |
(9,189) |
Net income (loss) |
9,908 |
15,777 |
(22,139) |
18,686 |
Basic earnings (loss) per share |
$ 0.45 |
$ 0.71 |
$ (1.00) |
$ 0.84 |
Diluted earnings (loss) per share |
$ 0.45 |
$ 0.70 |
$ (1.00) |
$ 0.83 |
|
|
|
|
|
Interest expense |
(165) |
(282) |
(641) |
(847) |
Depreciation and amortization |
$ (5,469) |
$ (4,962) |
$ (20,359) |
$ (19,032) |
|
|
|
|
|
Operating margin |
5.6% |
2.2% |
(3.3)% |
5.8% |
Comverse performance margin |
12.4% |
7.5% |
4.2% |
8.7% |
|
|
|
|
|
Net cash (used in) provided by operating
activities (2) |
$ (4,161) |
$ 12,008 |
$ (69,595) |
$ 6,621 |
(1) "Comverse performance" has not been prepared in accordance
with GAAP. See "Presentation of Non-GAAP Financial Measures"
below.
(2) Includes approximately $10.9 million of cash proceeds
related to an Italian VAT refund received during first quarter of
the fiscal year ended January 31, 2014.
Tech Mahindra:
On April 15, 2015, Comverse and Tech Mahindra announced an
agreement in principle on a strategic relationship, whereby
Comverse will accelerate its transformation as a global innovator
in digital services by leveraging Tech Mahindra's expertise and
scale in development and delivery of digital offerings. As part of
this initiative, employees from certain functions within Comverse's
Digital Services business unit are anticipated to join Tech
Mahindra.
"I am pleased with the progress we have made thus far, in terms
of new wins in our business units and our organizational efforts.
Our agreement in principle with Tech Mahindra is an integral step,
and I am eager to continue our efforts in repositioning and
transforming Comverse for a strong and healthy future. We see all
of these steps offering important benefits to our company, our
customers, our employees and our shareholders," said Philippe
Tartavull, President and CEO of Comverse, Inc.
Business Segment Highlights:
|
Three Months
Ended January 31, |
Fiscal Years
Ended January 31, |
|
2015 |
2014 |
2015 |
2014 |
|
(Dollars in
thousands) |
SEGMENT RESULTS |
|
|
|
|
BSS |
|
|
|
|
Segment revenue |
$ 65,471 |
$ 78,239 |
$ 250,733 |
$ 299,561 |
Gross margin |
37.3% |
32.6% |
41.5% |
37.0% |
Income from operations |
11,231 |
9,316 |
50,511 |
44,636 |
Operating margin |
17.2% |
11.9% |
20.1% |
14.9% |
Segment performance |
12,033 |
10,017 |
53,410 |
47,557 |
Segment performance margin |
18.4% |
12.8% |
21.3% |
15.9% |
Digital Services |
|
|
|
|
Segment revenue |
$ 54,263 |
$ 88,275 |
$ 226,572 |
$ 352,940 |
Gross margin |
40.9% |
39.6% |
38.4% |
44.7% |
Income from operations |
13,730 |
28,098 |
56,015 |
127,008 |
Operating margin |
25.3% |
31.8% |
24.7% |
36.0% |
Segment performance |
13,825 |
28,134 |
56,213 |
127,224 |
Segment performance margin |
25.5% |
31.9% |
24.8% |
36.0% |
All Other |
|
|
|
|
Loss from operations |
$ (18,206) |
$ (33,689) |
$ (122,362) |
$ (133,945) |
Segment performance |
(11,062) |
(25,696) |
(89,541) |
(118,132) |
Selected Balance Sheet Highlights: Below is
selected balance sheet data:
|
As
of |
(In millions) |
January 31,
2015 |
|
January 31,
2014 |
Cash and cash equivalents |
$ 158.1 |
|
$ 254.6 |
Restricted cash (including long-term
restricted cash) and bank time deposits |
43.7 |
|
68.2 |
Total |
$ 201.8 |
|
$ 322.8 |
Conference Call Details
Comverse will be conducting a conference call today, April 16,
2015 at 8:00 a.m. ET. To listen to the conference call live, please
dial (678) 825-8369. Please dial-in at least ten minutes before the
scheduled start time. A live webcast can be accessed at
www.comverse.com by following links to the events and presentations
page under the Investors section. Following the call, a replay of
the webcast will be archived in the same location.
Segment Performance
We evaluate our business by assessing the performance of each of
our operating segments. Our Chief Executive Officer is our chief
operating decision maker ("CODM"). The CODM uses segment
performance, as defined below, as the primary basis for assessing
the financial results of the operating segments and for the
allocation of resources. Segment performance, as we define it in
accordance with the Financial Accounting Standards Board's guidance
relating to segment reporting, is not necessarily comparable to
other similarly titled captions of other companies.
Segment performance is computed by management as (loss) income
from operations adjusted for the following: (i) stock-based
compensation expense; (ii) amortization of intangible assets; (iii)
compliance-related professional fees; (iv) compliance-related
compensation and other expenses; (v) Italian VAT recovery recorded
within operating expense; (vi) strategic related costs (vii)
write-off of property and equipment; (viii) certain litigation
settlements and related costs; (ix) restructuring expenses; and (x)
certain other gains and expenses. Compliance-related professional
fees relate to fees and expenses recorded in connection with our
efforts to remediate material weaknesses in internal control over
financial reporting. Strategic related costs include business
strategy evaluation and mergers and acquisition efforts.
Presentation of Non-GAAP Financial Measures
We provide Comverse performance, a non-GAAP financial measure,
as additional information for our operating results. This measure
is not in accordance with, or an alternative for, GAAP financial
measures and may be different from, or not comparable to similarly
titled or other non-GAAP financial measures used by other
companies. We believe that the presentation of this non-GAAP
financial measure provides useful information to investors
regarding certain additional financial and business trends relating
to our results of operations as viewed by management in monitoring
our businesses, reviewing financial results and for planning
purposes. See "Consolidated Reconciliation of GAAP to Non-GAAP
Financial Measures" below.
About Comverse, Inc.
At the core of the evolution of how we communicate, exchange
information and monetize the digital world, Comverse enables the
creation and monetization of innovative digital services for
telecom and enterprise service providers through its proven and
innovative product portfolio that includes managed BSS and Policy
(PCRF), Enterprise Billing and Digital Services - all backed by
Managed and Professional Services. Comverse's extensive customer
base spans more than 125 countries with solutions successfully
delivered to over 450 communication service providers serving more
than two billion subscribers. Comverse's solutions are available in
a variety of delivery models, including on-site, cloud, hosted/SaaS
and managed services. For more information, visit
www.comverse.com.
Forward-Looking Statements
This press release includes "forward-looking statements."
Forward-looking statements include financial projections,
statements of plans and objectives for future operations,
statements of future economic performance, and statements of
assumptions relating thereto. In some cases, forward-looking
statements can be identified by the use of terminology such as
"may," "expects," "plans," "anticipates," "estimates," "believes,"
"potential," "projects," "forecasts," "intends," or the negative
thereof or other comparable terminology. By their very nature,
forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause actual
results, performance and the timing of events to differ materially
from those anticipated, expressed or implied by the forward-looking
statements in this press release. Such risks or uncertainties may
give rise to future claims and increase exposure to contingent
liabilities. These risks and uncertainties relate to (among other
factors) the market price of our stock, operating expenses and cash
flows, variability of our tax provision, and the additional risks
described in the sections entitled "Forward-Looking Statements" and
Item 1A, "Risk Factors" and elsewhere in the company's Annual
Report on Form 10-K, or in subsequently filed periodic, current or
other reports. We undertake no commitment to update or revise any
forward-looking statements except as required by law. These risks
and uncertainties discussed above, as well as others, are discussed
in greater detail in our filings with the SEC. The documents and
reports we file with the SEC are available through us, or our
website, www.comverse.com, or through the SEC's Electronic Data
Gathering, Analysis, and Retrieval system (EDGAR) at
www.sec.gov.
COMVERSE, INC. AND
SUBSIDIARIES |
CONSOLIDATED STATEMENTS
OF OPERATIONS |
(In thousands, except
share and per share data) |
|
|
Three Months
Ended January 31, |
Fiscal Years
Ended January 31, |
|
2015 |
2014 |
2015 |
2014 |
Revenue: |
|
|
|
|
Product revenue |
$ 26,000 |
$ 61,359 |
$ 99,768 |
$ 220,167 |
Service revenue |
93,734 |
105,155 |
377,537 |
432,334 |
Total revenue |
119,734 |
166,514 |
477,305 |
652,501 |
Costs and expenses: |
|
|
|
|
Product costs |
16,035 |
36,323 |
55,572 |
116,259 |
Service costs |
59,659 |
75,817 |
253,070 |
286,217 |
Research and development,
net |
11,049 |
17,036 |
56,334 |
67,512 |
Selling, general and
administrative |
22,604 |
30,689 |
111,832 |
134,031 |
Other operating expenses: |
|
|
|
|
Restructuring expenses and
write-off of property and equipment |
3,632 |
2,924 |
16,333 |
10,783 |
Total other operating expenses |
3,632 |
2,924 |
16,333 |
10,783 |
Total costs and expenses |
112,979 |
162,789 |
493,141 |
614,802 |
Income (loss) from operations |
6,755 |
3,725 |
(15,836) |
37,699 |
Interest income |
139 |
178 |
480 |
614 |
Interest expense |
(165) |
(282) |
(641) |
(847) |
Foreign currency transaction
(loss) gain, net |
(1,668) |
(2,529) |
4,659 |
(10,290) |
Other (expense) income,
net |
(21) |
422 |
(517) |
699 |
Income (loss) before income tax benefit
(expense) |
5,040 |
1,514 |
(11,855) |
27,875 |
Income tax benefit (expense) |
4,868 |
14,263 |
(10,284) |
(9,189) |
Net income (loss) |
9,908 |
15,777 |
(22,139) |
18,686 |
Weighted average common shares
outstanding: |
|
|
|
|
Basic |
21,853,129 |
22,240,517 |
22,190,630 |
22,164,131 |
Diluted |
21,966,408 |
22,555,426 |
22,190,630 |
22,382,234 |
Earnings (loss) per share
attributable to Comverse, Inc.'s stockholders: |
Basic earnings (loss) per share |
$ 0.45 |
$ 0.71 |
$ (1.00) |
$ 0.84 |
Diluted earnings (loss) per share |
$ 0.45 |
$ 0.70 |
$ (1.00) |
$ 0.83 |
|
COMVERSE, INC. AND
SUBSIDIARIES |
CONSOLIDATED BALANCE
SHEETS |
(In thousands, except
share and per share data) |
|
|
January
31, |
|
2015 |
2014 |
ASSETS |
|
|
Current assets: |
|
|
Cash and cash equivalents |
$158,121 |
$ 254,580 |
Restricted cash and bank
deposits |
35,802 |
34,343 |
Accounts receivable, net of
allowance of $4,403 and $6,945, respectively |
71,670 |
89,361 |
Inventories |
17,817 |
16,166 |
Deferred cost of revenue |
7,059 |
14,500 |
Deferred income taxes |
13,781 |
2,329 |
Prepaid expenses |
15,156 |
17,000 |
Other current assets |
10,570 |
1,680 |
Total current assets |
329,976 |
429,959 |
Property and equipment, net |
49,230 |
41,541 |
Goodwill |
151,217 |
150,346 |
Intangible assets, net |
4,049 |
5,153 |
Deferred cost of revenue |
30,437 |
45,717 |
Deferred income taxes |
3,064 |
1,720 |
Long-term restricted cash |
7,940 |
33,815 |
Other assets |
30,439 |
40,586 |
Total assets |
$ 606,352 |
$ 748,837 |
LIABILITIES AND EQUITY |
|
|
Current liabilities: |
|
|
Accounts payable and accrued
expenses |
$ 121,720 |
$ 168,406 |
Deferred revenue |
185,323 |
239,902 |
Deferred income taxes |
1,491 |
514 |
Income taxes payable |
2,166 |
2,102 |
Total current liabilities |
310,700 |
410,924 |
Deferred revenue |
89,999 |
113,426 |
Deferred income taxes |
56,815 |
43,735 |
Other long-term liabilities |
135,456 |
147,942 |
Total liabilities |
592,970 |
716,027 |
Commitments and contingencies |
|
|
Equity: |
|
|
Common stock, $0.01 par value -
authorized, 100,000,000 shares; issued, 22,591,411 and 22,286,123
shares, respectively; outstanding, 21,830,081 and 22,251,226
shares, respectively |
226 |
223 |
Treasury stock, at cost,
761,330 and 34,897 shares, respectively |
(17,211) |
(1,024) |
Accumulated deficit |
(46,390) |
(24,251) |
Additional paid-in-capital |
45,935 |
34,530 |
Accumulated other comprehensive
income |
30,822 |
23,332 |
Total equity |
13,382 |
32,810 |
Total liabilities and equity |
$ 606,352 |
$ 748,837 |
|
COMVERSE, INC. AND
SUBSIDIARIES |
CONSOLIDATED AND
COMBINED STATEMENTS OF CASH FLOWS |
(In
thousands) |
|
|
Fiscal Years
Ended January 31, |
|
2015 |
2014 |
2013 |
Cash flows from operating activities: |
|
|
|
Net (loss) income |
$ (22,139) |
$ 18,686 |
$ 6,248 |
Net income from discontinued operations |
— |
— |
(26,542) |
Non-cash items |
|
|
|
Depreciation and
amortization |
20,359 |
19,032 |
31,865 |
Impairment of goodwill |
— |
— |
5,605 |
Provision for doubtful
accounts |
1,329 |
1,293 |
518 |
Stock-based compensation
expense |
11,368 |
10,208 |
7,517 |
Deferred income taxes |
928 |
17,345 |
(11,724) |
Inventory write-downs |
2,553 |
4,239 |
6,097 |
Other non-cash items, net |
2,705 |
(765) |
1,244 |
Changes in assets and liabilities: |
|
|
|
Accounts receivable |
12,419 |
32,498 |
9,538 |
Inventories |
(6,750) |
374 |
(7,085) |
Deferred cost of revenue |
22,723 |
45,882 |
36,124 |
Prepaid expense and other
current assets |
(9,108) |
12,845 |
14,881 |
Accounts payable and accrued
expenses |
(38,005) |
(12,926) |
(19,806) |
Income tax payable |
993 |
(7,237) |
37,828 |
Deferred revenue |
(69,277) |
(110,828) |
(85,036) |
Tax contingencies |
(655) |
(24,036) |
17,889 |
Other assets and
liabilities |
962 |
11 |
3,029 |
Net cash (used in) provided by operating
activities - continuing operations |
(69,595) |
6,621 |
28,190 |
Net cash used in operating activities -
discontinued operations |
— |
— |
(1,277) |
Net cash (used in) provided by operating
activities |
(69,595) |
6,621 |
26,913 |
Cash flows from investing activities: |
|
|
|
Purchase of other assets |
— |
— |
(1,131) |
Proceeds from sale of Starhome
B.V., net of cash sold of $30.9 million |
— |
— |
6,340 |
Purchase of property and
equipment |
(23,377) |
(12,341) |
(5,402) |
Acquisition of Solaiemes, net
of cash acquired |
(2,673) |
— |
— |
Net change in restricted cash
and bank deposits |
23,791 |
(26,918) |
(4,678) |
Other, net |
106 |
962 |
389 |
Net cash used in investing activities |
(2,153) |
(38,297) |
(4,482) |
Cash flows from financing activities: |
|
|
|
Decrease in net investment by
CTI |
— |
— |
1,052 |
Borrowings under note payable
to CTI |
— |
— |
9,500 |
CTI capital contribution |
— |
25,000 |
38,500 |
Payment for repurchase of
common stock in connection with tax liabilities upon settlement of
awards |
(1,053) |
(991) |
(33) |
Payment for repurchase of
common stock under repurchase program |
(15,134) |
— |
— |
Proceeds from stock options
exercises and issuance of subsidiary common stock |
40 |
1,109 |
233 |
Borrowings |
87 |
— |
— |
Repayments |
(100) |
— |
— |
Net cash (used in) provided by financing
activities |
(16,160) |
25,118 |
49,252 |
Effects of exchange rates on cash and cash
equivalents |
(8,551) |
(1,783) |
(1,954) |
Net (decrease) increase in cash and cash
equivalents |
(96,459) |
(8,341) |
69,729 |
Cash and cash equivalents, beginning of year
including cash from discontinued operations |
254,580 |
262,921 |
193,192 |
Cash and cash equivalents, end of year |
$ 158,121 |
$ 254,580 |
$ 262,921 |
|
COMVERSE, INC. AND
SUBSIDIARIES |
CONSOLIDATED
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES |
(UNAUDITED) |
|
|
Three Months
Ended January 31, |
Fiscal Years
Ended January 31, |
|
2015 |
2014 |
2015 |
2014 |
|
(In
thousands) |
Income (loss) from operations |
$ 6,755 |
$ 3,725 |
$ (15,836) |
$ 37,699 |
Expense Adjustments: |
|
|
|
|
Stock-based compensation
expense |
2,762 |
2,197 |
11,368 |
10,208 |
Amortization of intangible
assets |
793 |
695 |
2,984 |
2,765 |
Compliance-related professional
fees |
265 |
594 |
1,024 |
2,144 |
Compliance-related compensation
and other expenses |
— |
36 |
(70) |
199 |
Italian VAT recovery recorded
within operating expense |
— |
— |
— |
(10,861) |
Strategic related costs |
— |
— |
2,576 |
— |
Write-off of property and
equipment |
322 |
231 |
1,970 |
482 |
Certain litigation settlements
and related costs |
41 |
(1) |
87 |
(16) |
Restructuring expenses |
3,632 |
2,924 |
14,869 |
10,783 |
Gain on sale of fixed
assets |
(10) |
(9) |
(31) |
(41) |
Other |
236 |
2,063 |
1,141 |
3,287 |
Total expense adjustments |
8,041 |
8,730 |
35,918 |
18,950 |
Comverse performance |
$ 14,796 |
$ 12,455 |
$ 20,082 |
$ 56,649 |
|
COMVERSE, INC. AND
SUBSIDIARIES |
BUSINESS SEGMENT
INFORMATION |
(UNAUDITED) |
|
|
BSS |
Digital
Services |
All Other |
Combined |
|
(In
thousands) |
Three Months Ended January 31,
2015 |
|
|
|
|
Maintenance revenue |
$ 30,085 |
$ 24,878 |
$ — |
$ 54,963 |
Customer solutions revenue |
35,386 |
29,385 |
— |
64,771 |
Total revenue |
$ 65,471 |
$ 54,263 |
$ — |
$ 119,734 |
Total costs and expenses |
$ 54,240 |
$ 40,533 |
$ 18,206 |
$ 112,979 |
Income (loss) from operations |
$ 11,231 |
$ 13,730 |
$ (18,206) |
$6,755 |
Computation of segment performance: |
|
|
|
|
Segment revenue |
$ 65,471 |
$ 54,263 |
$ — |
|
Total costs and expenses |
$ 54,240 |
$ 40,533 |
$ 18,206 |
|
Segment expense adjustments: |
|
|
|
|
Stock-based compensation
expense |
— |
— |
2,762 |
|
Amortization of intangible
assets |
698 |
95 |
— |
|
Compliance-related professional
fees |
— |
— |
265 |
|
Write-off of property and
equipment |
43 |
— |
279 |
|
Certain litigation settlements
and related cost |
— |
— |
41 |
|
Restructuring expenses |
— |
— |
3,632 |
|
Gain on sale of fixed
assets |
61 |
— |
(71) |
|
Other |
— |
— |
236 |
|
Segment expense
adjustments |
802 |
95 |
7,144 |
|
Segment expenses |
53,438 |
40,438 |
11,062 |
|
Segment performance |
$ 12,033 |
$ 13,825 |
$ (11,062) |
|
Interest expense |
$ — |
$ — |
$ (165) |
$ (165) |
Depreciation |
$ (890) |
$ (1,264) |
$ (2,522) |
$ (4,676) |
|
COMVERSE, INC. AND
SUBSIDIARIES |
BUSINESS SEGMENT
INFORMATION |
(UNAUDITED) |
|
|
BSS |
Digital
Services |
All Other |
Combined |
|
(In
thousands) |
Three Months Ended January 31,
2014 |
|
|
|
|
Maintenance revenue |
$ 35,019 |
$ 33,924 |
$ — |
$ 68,943 |
Customer solutions revenue |
43,228 |
54,343 |
— |
97,571 |
Total revenue |
$ 78,247 |
$ 88,267 |
$ — |
$ 166,514 |
Total costs and expenses |
$ 68,923 |
$ 60,177 |
$ 33,689 |
$ 162,789 |
Income (loss) from operations |
$ 9,324 |
$ 28,090 |
$ (33,689) |
$ 3,725 |
Computation of segment performance: |
|
|
|
|
Segment revenue |
$ 78,247 |
$ 88,267 |
$ — |
|
Total costs and expenses |
$ 68,923 |
$ 60,177 |
$ 33,689 |
|
Segment expense adjustments: |
|
|
|
|
Stock-based compensation
expense |
— |
— |
2,197 |
|
Amortization of intangible
assets |
695 |
— |
— |
|
Compliance-related professional
fees |
— |
— |
594 |
|
Compliance-related compensation
and other expenses |
— |
36 |
— |
|
Write-off of property and
equipment |
— |
— |
231 |
|
Certain litigation settlements
and related costs |
— |
— |
(1) |
|
Restructuring expenses |
— |
— |
2,924 |
|
Gain on sale of fixed
assets |
— |
— |
(9) |
|
Other |
6 |
— |
2,057 |
|
Segment expense
adjustments |
701 |
36 |
7,993 |
|
Segment expenses |
68,222 |
60,141 |
25,696 |
|
Segment performance |
$ 10,025 |
$ 28,126 |
$ (25,696) |
|
Interest expense |
$ — |
$ — |
$ (282) |
$ (282) |
Depreciation |
$ (1,259) |
$ (1,328) |
$ (1,680) |
$ (4,267) |
|
COMVERSE, INC. AND
SUBSIDIARIES |
BUSINESS SEGMENT
INFORMATION |
|
|
BSS |
Digital
Services |
All Other |
Consolidated |
|
(In
thousands) |
Fiscal Year Ended January 31,
2015 |
|
|
|
|
Maintenance revenue |
$ 118,086 |
$ 109,559 |
$ — |
$ 227,645 |
Customer solutions revenue |
132,647 |
117,013 |
— |
249,660 |
Total revenue |
$ 250,733 |
$ 226,572 |
$ — |
$ 477,305 |
Total costs and expenses |
$ 200,222 |
$ 170,557 |
$ 122,362 |
$ 493,141 |
Income (loss) from operations |
$ 50,511 |
$ 56,015 |
$ (122,362) |
$ (15,836) |
Computation of segment performance: |
|
|
|
|
Segment revenue |
$ 250,733 |
$ 226,572 |
$ — |
|
Total costs and expenses |
$ 200,222 |
$ 170,557 |
$ 122,362 |
|
Segment expense adjustments: |
|
|
|
|
Stock-based compensation
expense |
— |
— |
11,368 |
|
Amortization of intangible
assets |
2,791 |
193 |
— |
|
Compliance-related professional
fees |
— |
— |
1,024 |
|
Compliance-related compensation
and other expenses |
— |
1 |
(71) |
|
Strategic-related cost |
— |
— |
2,576 |
|
Write-off of property and
equipment |
45 |
3 |
1,922 |
|
Certain litigation settlements
and related cost |
— |
— |
87 |
|
Restructuring expenses |
— |
— |
14,869 |
|
Gain on sale of fixed
assets |
63 |
1 |
(95) |
|
Other |
— |
— |
1,141 |
|
Segment expense
adjustments |
2,899 |
198 |
32,821 |
|
Segment expenses |
197,323 |
170,359 |
89,541 |
|
Segment performance |
$ 53,410 |
$ 56,213 |
$ (89,541) |
|
Interest expense |
$ — |
$ — |
$ (641) |
$ (641) |
Depreciation |
$ (3,522) |
$ (5,092) |
$ (8,761) |
$ (17,375) |
|
COMVERSE, INC. AND
SUBSIDIARIES |
BUSINESS SEGMENT
INFORMATION |
|
|
BSS |
Digital
Services |
All Other |
Combined |
|
(In
thousands) |
Fiscal Year Ended January 31,
2014 |
|
|
|
|
Maintenance revenue |
$ 128,024 |
$ 135,242 |
$ — |
$ 263,266 |
Customer solutions revenue |
171,537 |
217,698 |
— |
389,235 |
Total revenue |
$ 299,561 |
$ 352,940 |
$ — |
$ 652,501 |
Total costs and expenses |
$ 254,925 |
$ 225,932 |
$ 133,945 |
$ 614,802 |
Income (loss) from operations |
$ 44,636 |
$ 127,008 |
$ (133,945) |
$ 37,699 |
Computation of segment performance: |
|
|
|
|
Segment revenue |
$ 299,561 |
$ 352,940 |
$ — |
|
Total costs and expenses |
$ 254,925 |
$ 225,932 |
$ 133,945 |
|
Segment expense adjustments: |
|
|
|
|
Stock-based compensation
expense |
— |
— |
10,208 |
|
Amortization of intangible
assets |
2,765 |
— |
— |
|
Compliance-related professional
fees |
— |
— |
2,144 |
|
Compliance-related compensation
and other expenses |
122 |
216 |
(139) |
|
Italian VAT recovery recorded
within operating expense |
— |
— |
(10,861) |
|
Write-off of property and
equipment |
28 |
— |
454 |
|
Certain litigation settlements
and related costs |
— |
— |
(16) |
|
Restructuring expenses |
— |
— |
10,783 |
|
Gain on sale of fixed
assets |
— |
— |
(41) |
|
Other |
6 |
— |
3,281 |
|
Segment expense
adjustments |
2,921 |
216 |
15,813 |
|
Segment expenses |
252,004 |
225,716 |
118,132 |
|
Segment performance |
$ 47,557 |
$ 127,224 |
$ (118,132) |
|
Interest expense |
$ — |
$ — |
$ (847) |
$ (847) |
Depreciation |
$ (3,738) |
$ (5,040) |
$ (7,489) |
$ (16,267) |
CONTACT: Mary T. Conway
Conway Communications
for Comverse, Inc.
(781) 772-1679
ir@comverse.com
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