[July 29, 2014] |
|
Compuware Corporation Reports First Quarter, Fiscal Year 2015 Results
DETROIT --(Business Wire)--
Compuware Corporation (Nasdaq: CPWR), the technology performance
company, today announced financial results for its first quarter, fiscal
year 2015 ended June 30, 2014.
Non-GAAP net income for the quarter was $11.3 million, or $0.05 per
diluted share, compared to $16.5 million, or $0.07 per diluted share in
the year-ago period. GAAP net income for the first quarter was $52,000,
or $0.00 per diluted share, compared to $4.3 million, or $0.02 per
diluted share in the year-ago period. Prior-year amounts relate to our
continuing operations.
(Included in the financial tables is a reconciliation between non-GAAP
and GAAP results.)
"Q1 was essentially in line with expectations. We are experiencing solid
business momentum and are seeing positive metrics across the board for
Q2 and the rest of the fiscal year," said Compuware CEO Bob Paul.
"Additionally, our cost rationalization and business transformation
efforts continue to progress well, and our previously announced
strategic- and shareholder-value initiatives remain on track with the
Board remaining committed to reviewing and evaluating credible
opportunities to create additional value for shareholders."
First Quarter Fiscal Year 2015 Results
During the company's first quarter:
-
Total revenues were approximately $164.5M, down 3.7 percent y/y
-
Software license fees were approximately $26.7M, down 15.9 percent y/y
-
Maintenance fees were approximately $88.5 million, up 1.5 percent y/y
-
Subscription fees were approximately $19.4 million, down 3.8 percent
y/y
-
Professional services revenues were approximately $8.4 million, up 9.7
percent y/y
-
Application services fees were approximately $21.6 million, down 10.4
percent y/y
First Quarter Fiscal Year 2015 Highlights
During the first quarter, Compuware:
-
Announced that CIO Review Magazine named Compuware
APM as one of the Top 100 Most Promising Big Data Companies.
-
Announced that Michael Keddington joined Covisint as its Senior Vice
President of Worldwide Sales.
-
Revealed new mobile capabilities across the Compuware
APMaaS platform that further extends its leadership in mobile
performance and user experience management.
-
Announced that Gartner, Inc. recognized Covisint as a Leader in its
first ever "Magic Quadrant for Identity Access Management as a Service
(IDaaS)."
-
Announced new capabilities to its Data
Center Real-User Monitoring (DCRUM) solution; and partnered with
Emulex Corporation (NYSE:ELX), a leader in network visibility, to
announce the availability of the Endace FusionTM Connector
for Compuware APM's DC
RUM solution.
-
Announced day-one support for two IBM releases-WebSphere MQ for z/OS,
V8.0 (MQ V8) and CICS Transaction Server for z/OS V5.2 (CICS TS
V5.2)-highlighting how Compuware's Mainframe Solutions enhance the
value of IBM's System z platform by optimizing developer productivity,
reducing costs and improving service quality throughout the
application lifecycle.
-
Announced the findings of a global survey of 740 senior IT
professionals' concerns about cloud computing adoption.
-
Announced that Compuware Covisint was named a "major player" by
independent analyst firm IDC in the report: IDC
MarketScape: Worldwide Federated
Identity Management and Single Sign-On 2014 Vendor
Assessment (IDC #247097, March 2014).
Use of Non-GAAP Financial Measures
In an effort to provide investors with additional information regarding
the Company's results as determined by U.S. generally accepted
accounting principles (GAAP), the Company has also disclosed in this
press release and the accompanying tables the following non-GAAP
information: (a) non-GAAP net income and (b) non-GAAP diluted earnings
per share. Each of these financial measures excludes the impact of
certain items and, therefore, has not been calculated in accordance with
GAAP. These non-GAAP financial measures exclude share-based compensation
expense; the amortization of intangible assets; restructuring charges;
advisory fees associated with certain shareholder actions and our
business transformation; and the related tax impacts of these items.
Each of the non-GAAP adjustments is described in more detail below. This
press release also contains a reconciliation of each of these non-GAAP
measures to its most comparable GAAP financial measure.
We believe that these non-GAAP financial measures provide meaningful
supplemental information regarding our operating results because they
exclude amounts that management and the board of directors do not
consider part of core operating results when assessing the performance
of the organization. We believe that inclusion of these non-GAAP
financial measures provides consistency and comparability with past
reports of financial results and provides consistency in calculations by
outside analysts reviewing our results. Accordingly, we believe these
non-GAAP financial measures are useful to investors in allowing for
greater transparency of supplemental information used by management.
While we believe that these non-GAAP financial measures provide useful
supplemental information, there are limitations associated with the use
of these non-GAAP financial measures. These non-GAAP financial measures
are not prepared in accordance with GAAP, do not reflect a comprehensive
system of accounting and may not be completely comparable to similarly
titled measures of other companies due to potential differences in the
exact method of calculation between companies. Items such as share-based
compensation expense; the amortization of intangible assets;
restructuring charges; advisory fees associated with certain shareholder
actions and our business transformation; and the related tax impacts of
these items that are excluded from our non-GAAP financial measures can
have a material impact on net earnings. As a result, these non-GAAP
financial measures have limitations and should not be considered in
isolation from, or as a substitute for, net earnings, cash flow from
operations or other measures of performance prepared in accordance with
GAAP. We compensate for these limitations by using these non-GAAP
financial measures as supplements to GAAP financial measures and by
reconciling the non-GAAP financial measures to their most comparable
GAAP financial measure. Investors are encouraged to review the
reconciliations of the non-GAAP financial measures to their most
comparable GAAP financial measures that are included elsewhere in this
press release.
The following discusses the reconciling items from our non-GAAP
financial measures to the most comparable GAAP financial measures:
Share-based compensation expense. Our non-GAAP financial measures
exclude the compensation expenses required to be recorded by GAAP for
equity awards to employees and directors. Management and the board of
directors believe it is useful in evaluating corporate performance
during a particular time period to review the supplemental non-GAAP
financial measures, excluding expenses related to share-based
compensation, because these costs are generally fixed at the time an
award is granted, are then expensed over several years and generally
cannot be changed or influenced by management once granted.
Amortization of intangible assets. Our non-GAAP financial measures
exclude costs associated with the amortization of intangible assets.
Management and the board of directors believe it is useful in evaluating
corporate performance during a particular time period to review the
supplemental non-GAAP financial measures, excluding amortization of
intangible assets, because these costs are fixed at the time of an
acquisition, are then amortized over a period of several years after the
acquisition and generally cannot be changed or influenced by management
after the acquisition.
Restructuring charges. Our non-GAAP financial measures exclude
restructuring charges, and any subsequent changes in estimates, as they
relate to our corporate restructuring and exit activities. Management
and the board of directors believe it is useful in evaluating corporate
performance during a particular time period to review the supplemental
non-GAAP financial measures, excluding restructuring charges, in order
to provide comparability and consistency with historical operating
results.
Advisory fees associated with certain shareholder actions and our
business transformation. The Company has incurred costs for consultant
fees related to shareholder actions and business transformation.
Management and the board of directors believe it is useful in evaluating
corporate performance during a particular time period to review the
supplemental non-GAAP financial measures, excluding such costs, in order
to provide comparability and consistency with historical operating
results.
Provision for income taxes on above pre-tax non-GAAP adjustments. Our
non-GAAP financial measures exclude the tax impact of the above pre-tax
non-GAAP adjustments. This amount is calculated using the tax rates of
each country to which these pre-tax non-GAAP adjustments relate.
Management excludes the non-GAAP adjustments on a net-of-tax basis in
evaluating our performance. Therefore, we exclude the tax impact of
these charges when presenting non-GAAP financial measures.
Compuware Corporation
Compuware is the technology performance company, and we exist solely to
help our customers optimize the performance of their most important and
innovative technologies-those that drive their businesses forward.
Today, more than 7,100 companies, including many of the world's largest
organizations, depend on Compuware and our new-generation approach to
performance management to do just that. Learn more at: http://www.compuware.com.
Conference Call Information
Compuware will today hold a conference call to discuss these results at
5:30 p.m. Eastern time (21:00 GMT). To join the conference call,
interested parties in the United States should call 800-230-1059. For
international access, the conference call number is +1-612-234-9959. No
password is required. Additionally, investors can listen to the
conference call via webcast by visiting the Compuware
Corporation Investor Relations web site. A conference call presentation
is also available on the site.
A conference call replay will also be available. The United States
replay number will be 800-475-6701, and the international replay number
will be +1-320-365-3844. The replay passcode will be 329744.
Certain statements in this release that are not historical facts,
including those regarding the Company's future plans, objectives and
expected performance, are "forward-looking statements" within the
meaning of the federal securities laws. These forward-looking statements
represent our outlook only as of the date of this release. While we
believe any forward-looking statements we have made are reasonable,
actual results could differ materially since the statements are based on
our current expectations and are subject to risks and uncertainties.
These risks and uncertainties are discussed in the Company's reports
filed with the Securities and Exchange Commission. Readers are cautioned
to consider these factors when relying on such forward-looking
information. The Company does not undertake, and expressly disclaims any
obligation, to update or alter its forward-looking statements whether as
a result of new information, future events or otherwise, except as
required by applicable law.
|
COMPUWARE CORPORATION AND SUBSIDIARIES
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(In Thousands)
|
|
|
|
|
|
|
|
|
|
|
|
AS OF JUNE 30,
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
2013
|
CURRENT ASSETS:
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$
|
275,514
|
|
|
$
|
81,329
|
|
Accounts receivable, net
|
|
|
|
288,031
|
|
|
|
354,404
|
|
Deferred tax asset, net
|
|
|
|
36,770
|
|
|
|
43,062
|
|
Income taxes refundable
|
|
|
|
4,519
|
|
|
|
4,674
|
|
Prepaid expenses and other current assets
|
|
|
|
27,629
|
|
|
|
35,733
|
|
Total current assets
|
|
|
|
632,463
|
|
|
|
519,202
|
|
|
|
|
|
|
|
|
|
PROPERTY AND EQUIPMENT, LESS ACCUMULATED
|
|
|
|
|
|
|
|
DEPRECIATION AND AMORTIZATION
|
|
|
|
283,107
|
|
|
|
297,405
|
|
|
|
|
|
|
|
|
|
CAPITALIZED SOFTWARE AND OTHER
|
|
|
|
|
|
|
|
INTANGIBLE ASSETS, NET
|
|
|
|
96,868
|
|
|
|
113,748
|
|
|
|
|
|
|
|
|
|
ACCOUNTS RECEIVABLE
|
|
|
|
165,010
|
|
|
|
181,343
|
|
DEFERRED TAX ASSET, NET
|
|
|
|
16,582
|
|
|
|
30,587
|
|
GOODWILL
|
|
|
|
647,445
|
|
|
|
724,800
|
|
OTHER ASSETS
|
|
|
|
24,613
|
|
|
|
30,451
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS
|
|
|
$
|
1,866,088
|
|
|
$
|
1,897,536
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
Accounts payable
|
|
|
$
|
14,133
|
|
|
$
|
12,900
|
|
Accrued expenses
|
|
|
|
75,448
|
|
|
|
92,002
|
|
Income taxes payable
|
|
|
|
16,249
|
|
|
|
24,729
|
|
Deferred revenue
|
|
|
|
354,683
|
|
|
|
386,105
|
|
Total current liabilities
|
|
|
|
460,513
|
|
|
|
515,736
|
|
|
|
|
|
|
|
|
|
LONG TERM DEBT
|
|
|
|
-
|
|
|
|
15,000
|
|
|
|
|
|
|
|
|
|
DEFERRED REVENUE
|
|
|
|
274,482
|
|
|
|
294,988
|
|
|
|
|
|
|
|
|
|
ACCRUED EXPENSES
|
|
|
|
19,927
|
|
|
|
17,985
|
|
|
|
|
|
|
|
|
|
DEFERRED TAX LIABILITY, NET
|
|
|
|
33,857
|
|
|
|
54,588
|
|
Total liabilities
|
|
|
|
788,779
|
|
|
|
898,297
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY:
|
|
|
|
|
|
|
|
Common stock
|
|
|
|
2,200
|
|
|
|
2,141
|
|
Additional paid-in capital
|
|
|
|
837,773
|
|
|
|
731,622
|
|
Retained earnings
|
|
|
|
229,037
|
|
|
|
280,780
|
|
Accumulated other comprehensive loss
|
|
|
|
(7,648
|
)
|
|
|
(15,304
|
)
|
Total Compuware shareholders' equity
|
|
|
|
1,061,362
|
|
|
|
999,239
|
|
Non-controlling interest
|
|
|
|
15,947
|
|
|
|
-
|
|
Total shareholders' equity
|
|
|
|
1,077,309
|
|
|
|
999,239
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
$
|
1,866,088
|
|
|
$
|
1,897,536
|
|
|
|
|
|
|
|
|
|
COMPUWARE CORPORATION AND SUBSIDIARIES
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In Thousands, Except Per Share Data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED
|
|
|
|
|
JUNE 30,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
2013
|
REVENUES:
|
|
|
|
|
|
|
|
|
Software license fees
|
|
|
|
$
|
26,687
|
|
|
$
|
31,743
|
|
Maintenance fees
|
|
|
|
|
88,460
|
|
|
|
87,162
|
|
Subscription fees
|
|
|
|
|
19,362
|
|
|
|
20,132
|
|
Services fees
|
|
|
|
|
8,414
|
|
|
|
7,671
|
|
Application services fees
|
|
|
|
|
21,587
|
|
|
|
24,101
|
|
Total revenues
|
|
|
|
|
164,510
|
|
|
|
170,809
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|
Cost of software license fees
|
|
|
|
4,995
|
|
|
|
4,929
|
|
Cost of maintenance fees
|
|
|
|
|
6,922
|
|
|
|
7,339
|
|
Cost of subscription fees
|
|
|
|
|
8,202
|
|
|
|
7,840
|
|
Cost of services
|
|
|
|
|
6,732
|
|
|
|
6,642
|
|
Cost of application services
|
|
|
|
30,902
|
|
|
|
24,261
|
|
Technology development and support
|
|
|
|
19,952
|
|
|
|
23,691
|
|
Sales and marketing
|
|
|
|
|
53,103
|
|
|
|
52,267
|
|
Administrative and general
|
|
|
|
34,013
|
|
|
|
36,048
|
|
Restructuring costs
|
|
|
|
|
2,975
|
|
|
|
4,803
|
|
Total operating expenses
|
|
|
|
167,796
|
|
|
|
167,820
|
|
|
|
|
|
|
|
|
|
|
INCOME (LOSS) FROM CONTINUING OPERATIONS
|
|
|
|
(3,286
|
)
|
|
|
2,989
|
|
|
|
|
|
|
|
|
|
|
OTHER INCOME, NET
|
|
|
|
|
223
|
|
|
|
202
|
|
|
|
|
|
|
|
|
|
|
INCOME (LOSS) FROM CONTINUING OPERATIONS
|
|
|
|
|
|
|
|
BEFORE INCOME TAX PROVISION
|
|
|
|
(3,063
|
)
|
|
|
3,191
|
|
|
|
|
|
|
|
|
|
|
INCOME TAX PROVISION (BENEFIT)
|
|
|
|
(1,707
|
)
|
|
|
(1,071
|
)
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS) FROM CONTINUING OPERATIONS
|
|
|
|
|
|
|
|
INCLUDING NON-CONTROLLING INTEREST
|
|
|
|
(1,356
|
)
|
|
|
4,262
|
|
|
|
|
|
|
|
|
|
|
INCOME FROM DISCONTINUED OPERATIONS, NET OF TAX
|
|
|
-
|
|
|
|
5,705
|
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS) INCLUDING NON-CONTROLLING INTEREST
|
|
|
(1,356
|
)
|
|
|
9,967
|
|
|
|
|
|
|
|
|
|
|
Less: Net loss attributable to the
|
|
|
|
|
|
|
|
non-controlling interest in Covisint Corporation
|
|
|
|
(1,408
|
)
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
NET INCOME ATTRIBUTABLE TO COMPUWARE CORP
|
|
|
$
|
52
|
|
|
$
|
9,967
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to Compuware common shareholders
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
|
(1,356
|
)
|
|
|
4,262
|
|
Loss attributable to non-controlling interest
|
|
|
|
(1,408
|
)
|
|
|
-
|
|
Income from continuing operations, net of tax
|
|
|
|
52
|
|
|
|
4,262
|
|
Income from discontinued operations, net of tax
|
|
|
|
-
|
|
|
|
5,705
|
|
Net income attributable to Compuware common shareholders
|
|
$
|
52
|
|
|
$
|
9,967
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share:
|
|
|
|
|
|
|
|
Continuing operations
|
|
|
|
|
0.00
|
|
|
|
0.02
|
|
Discontinued operations
|
|
|
|
|
0.00
|
|
|
|
0.03
|
|
Diluted earnings per share
|
|
|
$
|
0.00
|
|
|
$
|
0.05
|
|
|
|
|
|
|
|
|
|
|
Weighted-average common shares outstanding
|
|
|
|
219,667
|
|
|
|
213,640
|
|
Dilutive effect of stock awards
|
|
|
|
3,680
|
|
|
|
6,054
|
|
Total shares
|
|
|
|
|
223,347
|
|
|
|
219,694
|
|
|
|
|
|
|
|
|
|
|
COMPUWARE CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In Thousands)
|
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED
|
|
|
JUNE 30,
|
|
|
2014
|
|
2013
|
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:
|
|
|
|
|
|
|
Net income (loss) including non-controlling interest
|
|
$
|
(1,356
|
)
|
|
$
|
9,967
|
|
Adjustments to reconcile net income (loss) to cash provided
|
|
|
|
|
|
|
by operations:
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
14,980
|
|
|
|
16,452
|
|
Stock award compensation
|
|
|
8,800
|
|
|
|
10,437
|
|
Deferred income taxes
|
|
|
(3,237
|
)
|
|
|
(14,148
|
)
|
Other
|
|
|
570
|
|
|
|
13
|
|
Net change in assets and liabilities, net of effects from
|
|
|
|
|
|
|
currency fluctuations:
|
|
|
|
|
|
|
Accounts receivable
|
|
|
102,475
|
|
|
|
60,935
|
|
Prepaid expenses and other assets
|
|
|
(48
|
)
|
|
|
1,871
|
|
Accounts payable and accrued expenses
|
|
|
(24,695
|
)
|
|
|
(25,892
|
)
|
Deferred revenue
|
|
|
(58,194
|
)
|
|
|
(41,987
|
)
|
Income taxes
|
|
|
(17,231
|
)
|
|
|
11,002
|
|
Net cash provided by operating activities
|
|
|
22,064
|
|
|
|
28,650
|
|
|
|
|
|
|
|
|
CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES:
|
|
|
|
|
|
|
Purchase of:
|
|
|
|
|
|
|
Property and equipment
|
|
|
(2,189
|
)
|
|
|
(1,667
|
)
|
Capitalized software
|
|
|
(6,988
|
)
|
|
|
(5,745
|
)
|
Divestiture of business units
|
|
|
(8,046
|
)
|
|
|
-
|
|
Other
|
|
|
-
|
|
|
|
(275
|
)
|
Net cash provided by (used in) investing activities
|
|
|
(17,223
|
)
|
|
|
(7,687
|
)
|
|
|
|
|
|
|
|
CASH FLOWS USED IN FINANCING ACTIVITIES:
|
|
|
|
|
|
|
Proceeds from borrowings
|
|
|
-
|
|
|
|
26,500
|
|
Payments on borrowings
|
|
|
-
|
|
|
|
(29,500
|
)
|
Net proceeds from exercise of stock awards including excess tax
benefits
|
|
|
3,386
|
|
|
|
7,105
|
|
Employee contribution to common stock purchase plans
|
|
|
397
|
|
|
|
651
|
|
Repurchase of common stock
|
|
|
(6,423
|
)
|
|
|
(4,962
|
)
|
Dividends
|
|
|
(27,474
|
)
|
|
|
(26,741
|
)
|
Other
|
|
|
-
|
|
|
|
(299
|
)
|
Net cash used in financing activities
|
|
|
(30,114
|
)
|
|
|
(27,246
|
)
|
|
|
|
|
|
|
|
EFFECT OF EXCHANGE RATE CHANGES ON CASH
|
|
|
728
|
|
|
|
(2,261
|
)
|
|
|
|
|
|
|
|
NET CHANGE IN CASH AND CASH EQUIVALENTS
|
|
|
(24,545
|
)
|
|
|
(8,544
|
)
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
|
|
|
300,059
|
|
|
|
89,873
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
|
$
|
275,514
|
|
|
$
|
81,329
|
|
|
|
|
|
|
|
|
COMPUWARE CORPORATION AND SUBSIDIARIES
|
OPERATIONAL HIGHLIGHTS
|
(Dollar Amounts In Thousands)
|
|
|
|
|
|
|
|
|
|
QUARTER
|
|
|
|
|
ENDED
|
|
|
|
|
JUNE 30,
|
|
YR - YR
|
|
|
2014
|
|
2013
|
|
% Chg
|
Total Product Software Revenue by Geography
|
|
|
|
|
|
|
North America
|
|
$
|
76,675
|
|
$
|
80,643
|
|
(4.9
|
%)
|
International
|
|
|
57,834
|
|
|
58,394
|
|
(1.0
|
%)
|
|
|
|
|
|
|
|
Deferred License Fees
|
|
|
|
|
|
|
Current
|
|
$
|
15,133
|
|
$
|
14,849
|
|
1.9
|
%
|
Long-term
|
|
|
7,536
|
|
|
8,926
|
|
(15.6
|
%)
|
|
|
|
|
|
|
|
Deferred Maintenance
|
|
|
|
|
|
|
Current
|
|
$
|
263,358
|
|
$
|
290,453
|
|
(9.3
|
%)
|
Long-Term
|
|
|
249,141
|
|
|
260,188
|
|
(4.2
|
%)
|
|
|
|
|
|
|
|
Deferred Subscription
|
|
|
|
|
|
|
Current
|
|
$
|
41,830
|
|
$
|
43,017
|
|
(2.8
|
%)
|
Long-Term
|
|
|
8,455
|
|
|
6,775
|
|
24.8
|
%
|
|
|
|
|
|
|
|
Deferred Services
|
|
$
|
19,786
|
|
$
|
21,962
|
|
(9.9
|
%)
|
|
|
|
|
|
|
|
Deferred Application Services
|
|
$
|
23,926
|
|
$
|
34,923
|
|
(31.5
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other:
|
|
|
|
|
|
|
Total Company Headcount
|
|
|
2,957
|
|
|
4,363
|
|
(32.2
|
%)
|
|
|
|
|
|
|
|
Total DSO (Billed)
|
|
|
59.3
|
|
|
59.5
|
|
|
Total DSO
|
|
|
158.4
|
|
|
140.0
|
|
|
|
|
|
|
|
|
|
Stock-based compensation expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of license fees
|
|
$
|
-
|
|
$
|
-
|
|
N/A
|
|
Cost of maintenance fees
|
|
|
93
|
|
|
178
|
|
(47.8
|
%)
|
Cost of subscription fees
|
|
|
28
|
|
|
29
|
|
(3.4
|
%)
|
Cost of services
|
|
|
9
|
|
|
20
|
|
(55.0
|
%)
|
Cost of application services
|
|
|
2,619
|
|
|
486
|
|
438.9
|
%
|
Technology development and support
|
|
|
267
|
|
|
574
|
|
(53.5
|
%)
|
Sales and marketing
|
|
|
1,894
|
|
|
2,770
|
|
(31.6
|
%)
|
Administrative and general
|
|
|
3,890
|
|
|
4,517
|
|
(13.9
|
%)
|
Restructuring costs
|
|
|
-
|
|
|
1,791
|
|
(100.0
|
%)
|
Discontinued operations
|
|
|
-
|
|
|
72
|
|
(100.0
|
%)
|
|
|
|
|
|
|
Total stock-based compensation expense before income taxes
|
|
$
|
8,800
|
|
$
|
10,437
|
|
(15.7
|
%)
|
|
|
|
|
|
|
|
|
|
|
COMPUWARE CORPORATION AND SUBSIDIARIES
|
BUSINESS UNIT RESULTS OF OPERATIONS
|
(In Thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Covisint
|
|
|
|
|
|
|
|
|
|
|
|
|
Application
|
|
Unallocated
|
|
|
Quarter Ended:
|
|
APM
|
|
|
Mainframe
|
|
Services
|
|
Expenses
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Software license fees
|
|
$
|
21,387
|
|
|
|
$
|
5,300
|
|
|
|
-
|
|
|
|
-
|
|
|
$
|
26,687
|
|
|
Maintenance fees
|
|
|
28,295
|
|
|
|
|
60,165
|
|
|
|
-
|
|
|
|
-
|
|
|
|
88,460
|
|
|
Subscription fees
|
|
|
19,362
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
19,362
|
|
|
Services fees
|
|
|
8,332
|
|
|
|
|
82
|
|
|
|
-
|
|
|
|
-
|
|
|
|
8,414
|
|
|
Application services fees
|
|
|
-
|
|
|
|
|
-
|
|
|
$
|
21,587
|
|
|
|
-
|
|
|
|
21,587
|
|
|
Total revenues
|
|
|
77,376
|
|
|
|
|
65,547
|
|
|
|
21,587
|
|
|
|
-
|
|
|
|
164,510
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses
|
|
|
75,633
|
|
|
|
|
17,116
|
|
|
|
33,392
|
|
|
|
41,655
|
|
|
|
167,796
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from operations
|
|
$
|
1,743
|
|
|
|
$
|
48,431
|
|
|
$
|
(11,805
|
)
|
|
$
|
(41,655
|
)
|
|
$
|
(3,286
|
)
|
|
Contribution margin %
|
|
|
2.3
|
%
|
|
|
|
73.9
|
%
|
|
|
(54.7
|
%)
|
|
|
|
|
(2.0
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses include:
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock awards compensation
|
|
$
|
1,912
|
|
|
|
$
|
247
|
|
|
$
|
2,619
|
|
|
$
|
4,022
|
|
|
$
|
8,800
|
|
|
Amortization of purchased software
|
|
$
|
1,620
|
|
|
|
$
|
-
|
|
|
$
|
94
|
|
|
$
|
-
|
|
|
$
|
1,714
|
|
|
Amortization of other acquired intangible assets
|
|
$
|
1,738
|
|
|
|
$
|
-
|
|
|
$
|
77
|
|
|
$
|
-
|
|
|
$
|
1,815
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Software license fees
|
|
$
|
23,530
|
|
|
|
$
|
8,213
|
|
|
|
-
|
|
|
|
-
|
|
|
$
|
31,743
|
|
|
Maintenance fees
|
|
|
23,801
|
|
|
|
|
63,361
|
|
|
|
-
|
|
|
|
-
|
|
|
|
87,162
|
|
|
Subscription fees
|
|
|
20,132
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
20,132
|
|
|
Services fees
|
|
|
7,602
|
|
|
|
|
69
|
|
|
|
-
|
|
|
|
-
|
|
|
|
7,671
|
|
|
Application services fees
|
|
|
-
|
|
|
|
|
-
|
|
|
$
|
24,101
|
|
|
|
-
|
|
|
|
24,101
|
|
|
Total revenues
|
|
|
75,065
|
|
|
|
|
71,643
|
|
|
|
24,101
|
|
|
|
-
|
|
|
|
170,809
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
|
74,411
|
|
|
|
|
18,811
|
|
|
|
25,423
|
|
|
$
|
49,175
|
|
|
|
167,820
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from operations
|
|
$
|
654
|
|
|
|
$
|
52,832
|
|
|
$
|
(1,322
|
)
|
|
$
|
(49,175
|
)
|
|
$
|
2,989
|
|
|
Contribution margin %
|
|
|
0.9
|
%
|
|
|
|
73.7
|
%
|
|
|
(5.5
|
%)
|
|
|
|
|
1.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses include:
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock awards compensation
|
|
$
|
2,823
|
|
|
|
$
|
534
|
|
|
$
|
486
|
|
|
$
|
6,522
|
|
|
$
|
10,365
|
|
|
Amortization of purchased software
|
|
$
|
2,276
|
|
|
|
$
|
-
|
|
|
$
|
94
|
|
|
$
|
-
|
|
|
$
|
2,370
|
|
|
Amortization of other acquired intangible assets
|
|
$
|
1,694
|
|
|
|
$
|
-
|
|
|
$
|
99
|
|
|
$
|
-
|
|
|
$
|
1,793
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prior year amounts have been reclassified to reflect the transition
of APM for Mainframe from the Mainframe segment to the APM segment.
|
|
|
COMPUWARE CORPORATION
|
RECONCILIATION OF GAAP TO NON-GAAP
|
(In Thousands, Except Per Share Data)
|
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED JUNE 30,
|
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
NET INCOME FROM CONTINUING OPERATIONS ATTRIBUTABLE TO COMPUWARE
CORPORATION
|
|
$
|
52
|
|
|
$
|
4,262
|
|
ADJUSTMENTS EXCLUDING IMPACT OF NON-CONTROLLING INTEREST
|
|
|
|
|
|
|
Stock compensation (excl. restructuring)
|
|
|
8,304
|
|
|
|
8,574
|
|
Amortization of purchased software
|
|
|
1,696
|
|
|
|
2,370
|
|
Amortization of acquired intangibles
|
|
|
1,800
|
|
|
|
1,793
|
|
Restructuring expense
|
|
|
2,975
|
|
|
|
4,803
|
|
Advisory fees
|
|
|
2,744
|
|
|
|
1,156
|
|
Income tax effect of above adjustments
|
|
|
(6,270
|
)
|
|
|
(6,493
|
)
|
|
|
|
|
|
|
|
Total adjustments
|
|
|
11,249
|
|
|
|
12,203
|
|
|
|
|
|
|
|
|
NON-GAAP NET INCOME FROM CONTINUING OPERATIONS
|
|
$
|
11,301
|
|
|
$
|
16,465
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS - GAAP
|
|
$
|
0.00
|
|
|
$
|
0.02
|
|
|
|
|
|
|
|
|
ADJUSTMENTS EXCLUDING IMPACT OF NON-CONTROLLING INTEREST
|
|
|
|
|
|
|
Stock compensation (excl. restructuring)
|
|
|
0.04
|
|
|
|
0.04
|
|
Amortization of purchased software
|
|
|
0.01
|
|
|
|
0.01
|
|
Amortization of acquired intangibles
|
|
|
0.01
|
|
|
|
0.01
|
|
Restructuring expense
|
|
|
0.01
|
|
|
|
0.02
|
|
Advisory fees
|
|
|
0.01
|
|
|
|
0.01
|
|
Income tax effect of above adjustments
|
|
|
(0.03
|
)
|
|
|
(0.03
|
)
|
|
|
|
|
|
|
|
Total adjustments
|
|
|
0.05
|
|
|
|
0.06
|
|
|
|
|
|
|
|
|
NON-GAAP EPS FROM CONTINUING OPERATIONS
|
|
$
|
0.05
|
|
|
$
|
0.07
|
|
|
|
|
|
|
|
|
Diluted shares outstanding
|
|
|
223,347
|
|
|
|
219,694
|
|
|
|
|
|
|
|
|
EPS amounts may not add to the total due to rounding
|
|
|
|
|
|
|
|
Source:Compuware
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|