Selectica Announces Earnings for Second Quarter Fiscal 2013

Selectica Announces Earnings for Second Quarter Fiscal 2013 
Company Sees Year-Over-Year 34% Revenue Growth and 76% Growth in
Deferred Revenue 
SAN MATEO, CA -- (Marketwire) -- 10/25/12 --  Selectica, Inc.
(NASDAQ: SLTC), provider of software that accelerates sales cycles
and streamlines contract processes, today announced financial results
for its second quarter of fiscal 2013, ended September 30, 2012. 
"I'm pleased with our accelerated revenue growth; we are now
outpacing the market," said Jason Stern, President and CEO at
Selectica. "And while revenue was up, we were also able to keep
expenses flat for the third successive quarter, leading to a non-GAAP
net loss of less than $250,000." 
The company's net loss on a GAAP basis was $0.9 million in Q2 FY2013,
down 57% compared to Q2 FY2012. 
Financial highlights 
Selectica delivered the following financial results for the second
quarter of fiscal 2013: 


 
--  Recurring revenue: Selectica grew recurring revenue from $2.2 million
    in Q2 FY 2012 to $3.0 million in Q2 FY2013, a year-over-year increase
    of 36%. Recurring revenue in Q1 FY2013 was $2.6 million.
    
    
--  Billings: Billings for Q2 FY2013 were $3.8 million, compared to $3.0
    million in Q2 FY2012, a 27% increase year-over-year. Billings were
    $4.1 million in Q1 FY2013. The company defines billings, a non-GAAP
    financial measure, as revenue recognized during the period plus the
    change in deferred revenue from the beginning to the end of the
    period. Please refer to the financial tables below for a
    reconciliation of this non-GAAP measure to GAAP.
    
    
--  Deferred revenue: In Q2 FY2013, the company had deferred revenue of
    $5.8 million, a 76% year-over-year increase over Q2 FY2012, when
    deferred revenue was $3.3 million. In Q1 FY2013, deferred revenue was
    $6.7 million.

  
Business highlights
 Business highlights from Q2 FY2013 include: 


 
--  Seventh patent issued for Selectica sales configuration technology:
    Selectica announced its newest patent for the declarative constraint
    engine that powers Selectica Guided Selling and enables customers to
    use dynamic, rather than static, components to configure products and
    services with a large number of o
ptions and possible solutions.
--  Recognized as an important participant in cloud computing: In JMP
    Securities' September 24, 2012, report on salesforce.com, titled "CRM:
    JMP Visits 10 Growth Companies at Dreamforce," Selectica was featured
    as one of the growth companies in the salesforce.com partner
    ecosystem.
--  New version of Selectica Contract Lifecycle Management (CLM): In July
    2012, Selectica released the latest version of its flagship contract
    lifecycle management (CLM) product, featuring Contract Blueprints, a
    set of pre-configured, best-practice contract types that enable users
    to get started with contract management quickly. The release also
    offered improvements in the product's Microsoft Word integration,
    eSignature, and audit trail capabilities.
--  Introduction of Selectica Guided Selling for Salesforce on the
    Salesforce AppExchange: Also in July, Selectica announced availability
    of its configure-price-quote (CPQ) offering Selectica Guided Selling
    for Salesforce on the Salesforce AppExchange. The application brings
    the proven benefits of Selectica sales configuration technology to the
    cloud and makes them available to organizations with revenues of $100
    million to several billion dollars.
--  Bronze Stevie award winner: Selectica Guided Selling received a Bronze
    Stevie Award in the "Best New Software Product or Service of the Year,
    Cloud Application or Service" category of the 10th Annual American
    Business Awards.

  
Additional results 
Total revenues for Q2 FY2013 were $4.7 million, compared to $3.5
million for Q2 FY2012, a year-over-year increase of 34%. Total
revenues were $4.2 million in Q1 FY2013. 
Net loss for Q2 FY2013 was $0.9 million, or $(0.32) per share,
compared to a net loss of $2.1 million, or $(0.74) per share in Q2
FY2012, and a net loss of $0.7 million, or $(0.25) per share, in Q1
FY2013. 
Complete financial results for Q2 FY2013 can be found in the attached
financial tables.  
About Selectica, Inc.
 Selectica, Inc. (NASDAQ: SLTC) develops
innovative software that the world's most successful companies rely
on to improve the effectiveness of their sales and contracting
processes. Our guided selling, sales configuration, and contract
lifecycle management solutions support the Global 2000 and growing
mid-size firms in closing billions of dollars' worth of business each
year. Our patented technology, delivered through the cloud, makes it
easy for customers in industries like high-tech, telecommunications,
manufacturing, healthcare, financial services, and government
contracting to overcome product and channel complexity, increase deal
value, and accelerate time to revenue. 
For more information: 


 
--  Visit the Selectica website to learn more about the company and its
    products and customers (http://www.selectica.com)
--  Follow @Selectica_Inc on Twitter to stay up to date with industry news
    and updates (http://twitter.com/Selectica_Inc)
--  Visit "Done Deal," the Selectica blog, to read articles, advice, and
    commentary on how to optimize deal processes
    (http://www.selectica.com/blog)
--  Watch Selectica videos on YouTube to see what Selectica and its
    products can do (http://www.youtube.com/user/SelecticaVideos)
--  Browse the Selectica resource center to find guides and resources on
    how to improve sales and contracting processes
    (http://www.selectica.com/resources)

  
Non-GAAP financial measures
 Selectica provides quarterly and annual
financial statements that are prepared in accordance with generally
accepted accounting principles (GAAP). To help understand the
company's past financial performance and future results, the company
is providing non-GAAP financial measures to supplement the financial
results that it provides in accordance with GAAP. The method the
company uses to produce non-GAAP financial results is not computed
according to GAAP and may differ from the methods used by other
companies.  
Forward-looking statements
 Certain statements in this release and
elsewhere by Selectica are forward-looking statements within the
meaning of the federal securities laws and the Private Securities
Litigation Reform Act of 1995. Such statements may include, without
limitation, statements regarding business outlook, assessment of
market conditions, anticipated financial and operating results,
strategies, future plans, contingencies and contemplated transactions
of the company. Such forward-looking statements are not guarantees of
future performance and are subject to known and unknown risks,
uncertainties and other factors which may cause or contribute to
actual results of company operations, or the performance or
achievements of the company or industry results, to differ materially
from those expressed, or implied by the forward-looking statements.
In addition to any such risks, uncertainties and other factors
discussed elsewhere herein, risks, uncertainties and other factors
that could cause or contribute to actual results differing materially
from those expressed or implied for the forward-looking statements
include, but are not limited to the on-going global recession;
fluctuations in demand for Selectica's products and services
;
government policies and regulations, including, but not limited to
those affecting the company's industry; and risks related to the
company's past stock granting policies and related restatement of
financial statements. Selectica undertakes no obligation to publicly
update any forward-looking statements, whether as a result of new
information, future events or otherwise. Additional risk factors
concerning the company can be found in the company's most recent Form
10-K, filed by the company with the Securities and Exchange
Commission. 


 
                                                                            
                                                                            
                                                                            
                              SELECTICA, INC.                               
              Condensed Consolidated Statements of Operations               
                  (In thousands, except per share amounts)                  
                                (Unaudited)                                 
                                                                            
                                                                            
                      Three Months Ended             Six Months Ended       
                 ----------------------------  ---------------------------- 
                 September 30,  September 30,  September 30,  September 30, 
                      2012           2011           2012           2011     
                 -------------  -------------  -------------  ------------- 
                                                                            
Revenues:                                                                   
  Recurring                                                                 
   revenues      $       2,960  $       2,162  $       5,596  $       4,335 
  Non-recurring                                                             
   revenues              1,695          1,370          3,235          2,950 
                 -------------  -------------  -------------  ------------- 
    Total                                                                   
     revenues            4,655          3,532          8,831          7,285 
                 -------------  -------------  -------------  ------------- 
                                                                            
Cost of revenues:                                                           
  Recurring cost                                                            
   of revenues             407            257            738            512 
  Non-recurring                                                             
   cost of                                                                  
   revenues              1,347          1,278          2,574          2,316 
                 -------------  -------------  -------------  ------------- 
    Total cost of                                                           
     revenues            1,754          1,535          3,312          2,828 
                 -------------  -------------  -------------  ------------- 
                                                                            
Gross profit:                                                               
  Recurring gross                                                           
   profit                2,553          1,905          4,858          3,823 
  Non-recurring                                                             
   gross profit            348             92            661            634 
                 -------------  -------------  -------------  ------------- 
    Total gross                                                             
     profit              2,901          1,997          5,519          4,457 
                 -------------  -------------  -------------  ------------- 
                                                                            
Operating                                                                   
 expenses:                                                                  
  Research and                                                              
   development             861            810          1,792          1,706 
  Sales and                                                                 
   marketing             1,726          1,415          3,245          2,594 
  General and                                                               
   administrative          698            843          1,568          1,774 
  Fees related to                                                           
   comprehensive                                                            
   settlement                                                               
   agreement               500            500            500            500 
                 -------------  -------------  -------------  ------------- 
    Total                                                                   
     operating                                                              
     expenses            3,785          3,568          7,105          6,574 
                 -------------  -------------  -------------  ------------- 
                                                                            
Loss from                                                                   
 operations               (884)        (1,571)        (1,586)        (2,117)
                                                                            
Loss on early                                                               
 extinguishment                                                             
 of note payable             -            470              -            470 
Interest and                                                                
 other income                                                               
 (expense), net             (5)           (38)           (12)           (88)
                 -------------  -------------  -------------  ------------- 
                                                                            
Net loss         $        (889) $      (2,079) $      (1,598) $      (2,675)
                 =============  =============  =============  ============= 
                                                                            
Basic and diluted                                                           
 net loss per                                                               
 share           $       (0.32) $       (0.74) $       (0.57) $       (0.95)
                 =============  =============  =============  ============= 
                                                                            
Reconciliation to                                                           
 non-GAAP net                                                               
 loss:                                                                      
Net loss         $        (889) $      (2,079) $      (1,598) $      (2,675)
Stock-based                                                                 
 compensation                                                               
 expense         $
         153  $         179  $         361  $         288 
Loss on early                                                               
 extinguishment                                                             
 of note payable             -            470              -            470 
Fees related to                                                             
 comprehensive                                                              
 settlement                                                                 
 agreement                 500            500            500            500 
                 -------------  -------------  -------------  ------------- 
Non-GAAP net                                                                
loss             $        (236) $        (930) $        (737) $      (1,417)
                 =============  =============  =============  ============= 
                                                                            
                 -------------  -------------  -------------  ------------- 
Non-GAAP basic                                                              
 and diluted net                                                            
 loss per share  $       (0.08) $       (0.33) $       (0.26) $       (0.50)
                 =============  =============  =============  ============= 
                                                                            
                                                                            
Weighted average                                                            
 shares                                                                     
 outstanding for                                                            
 basic and                                                                  
 diluted net loss                                                           
 per share               2,818          2,820          2,815          2,826 
                 =============  =============  =============  ============= 
                                                                            
                                                                            
                                                                            
                               SELECTICA, INC.                              
                    Condensed Consolidated Balance Sheets                   
                               (In thousands)                               
                                 (Unaudited)                                
                                                                            
                                                                            
                                                September 30,    March 31,  
                                                    2012           2012     
                                               -------------- --------------
                                                                            
ASSETS                                                                      
Current assets                                                              
  Cash and cash equivalents                    $       12,052 $       15,877
  Short-term investments                                    -            199
  Accounts receivable                                   3,682          2,446
  Prepaid expenses and other current assets               512            531
                                               -------------- --------------
    Total current assets                               16,246         19,053
                                                                            
Property and equipment, net                               368            362
Other assets                                               39             39
                                               -------------- --------------
    Total assets                               $       16,653 $       19,454
                                               ============== ==============
                                                                            
                                                                            
LIABILITIES AND STOCKHOLDERS' EQUITY                                        
Current liabilities                                                         
  Credit facility                              $        6,000 $        6,000
  Accounts payable                                        876            395
  Accrued payroll and related liabilities                 739          1,771
  Other accrued liabilities                                87             88
  Deferred revenue                                      4,811          5,394
                                               -------------- --------------
    Total current liabilities                          12,513         13,648
                                               -------------- --------------
  Long-term deferred revenue                              964          1,327
  Other long-term liabilities                              33             41
                                               -------------- --------------
    Total liabilities                                  13,510         15,016
                                               -------------- --------------
                                                                            
Stockholders' equity                                    3,143          4,438
                                               -------------- --------------
    Total liabilities and stockholders' equity $       16,653 $       19,454
                                               ============== ==============
                                                                            
                                                                            
                                                                            
                              SELECTICA, INC.                               
              Condensed Consolidated Statements of Cash Flows               
                               (In thousands)                               
                                (Unaudited)                                 
                                                                            
                                                                            
                                                    Six Months Ended        
                                             ------------------------------ 
                                              September 30,   September 30, 
                                                  2012            2011      
                                             --------------  -------------- 
                                                                            
Operating activities                                                        
Net loss                                     $       (1,598) $       (2,675)
Adjustments to reconcile net loss to net                                    
 cash used in operating activities:                                         
Depreciation                                            101             139 
Loss on disposition of property and                                         
 equipment                                                -               1 
Stock-based compensation expense                        361             288 
Changes in assets and liabilities:                                          
  Accounts receivable (net)                          (1,236)            987 
  Prepaid expenses and other current assets              19              50 
  Other assets                                            -             (39)
  Accounts payable                                      481            (315)
  Accrued payroll and related liabilities            (1,031)            321 
  Other accrued liab
ilities and long term                                   
   liabilities                                           (9)           (243)
  Deferred revenues                                    (946)           (793)
                                             --------------  -------------- 
Net cash used in operating activities        $       (3,858) $       (2,279)
                                                                            
Investing activities                                                        
  Purchase of capital assets                           (107)            (98)
  Proceeds from maturities of short-term                                    
   investments                                          199          (1,398)
                                             --------------  -------------- 
Net cash provided by (used in) investing                                    
 activities                                  $           92  $       (1,496)
                                                                            
Financing activities                                                        
  Payments on note payable to Versata                     -          (4,268)
  Purchase of treasury shares                             -            (472)
  Borrowings under credit facility                        -           4,713 
  Repurchases of common stock, net of                                       
   issuance                                             (59)             (7)
                                             --------------  -------------- 
Net cash used in financing activities        $          (59) $          (34)
                                                                            
Net decrease in cash and cash equivalents            (3,825)         (3,809)
Cash and cash equivalents at beginning of                                   
 the period                                          15,877          16,822 
                                             --------------  -------------- 
Cash and cash equivalents at end of the                                     
 period                                      $       12,052  $       13,013 
                                             ==============  ============== 
                                                                            
                                                                            
                                                                            
                              SELECTICA, INC.                               
                          Billings Reconciliation                           
                               (In thousands)                               
                                (Unaudited)                                 
                                                                            
                                                                            
                      Three Months Ended             Six Months Ended       
                 ----------------------------  ---------------------------- 
                 September 30,  September 30,  September 30,  September 30, 
                      2012           2011           2012           2011     
                 -------------  -------------  -------------  ------------- 
                                                                            
Total revenues   $       4,655  $       3,532  $       8,831  $       7,285 
Deferred                                                                    
 revenue:                                                                   
End of period            5,775          3,337          5,775          3,337 
Beginning of                                                                
 period                  6,664          3,857          6,721          4,320 
                 -------------  -------------  -------------  ------------- 
Change in                                                                   
 deferred                                                                   
 revenue                  (889)          (520)          (946)          (983)
                 -------------  -------------  -------------  ------------- 
Total billings                                                              
 (total revenues                                                            
 plus the change                                                            
 in deferred                                                                
 revenue)        $       3,766  $       3,012  $       7,885  $       6,302 
                 =============  =============  =============  ============= 

  
Media contacts
Kimberly Canedo
Tanis Communications
(408) 295-4309 x104
kimberly.canedo@taniscomm.com 
Jordan McMahon
Selectica
(650) 532-1520
pr@selectica.com 
Investor contact
Todd Spartz
Selectica
(650) 532-1540
ir@selectica.com 
 
 
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