Lyris Announces First Quarter Fiscal 2014 Financial Results 89% of F1Q14 Revenue Was Recurring; 77% of F1Q14 Revenue From Subscriptions EMERYVILLE, Calif., Nov. 7, 2013 (GLOBE NEWSWIRE) -- Lyris, Inc. (OTCBB:LYRI), a leading global provider of digital marketing solutions, today announced financial results for the first quarter of fiscal 2014 ended September 30, 2013. Highlights *Fiscal first quarter revenues were $8.2 million, down 4.9% from $8.7 million in the prior quarter and down 8.3% from $9.0 million in the same period last year. *Recurring revenue was 89% of total revenue in the fiscal first quarter compared to 90% of total revenues in the same period a year ago and 91% of revenues in the prior quarter. *Lyris HQ Software-as-a-Service (SaaS) revenues were 60% of total revenues in the fiscal first quarter compared to 60% in the same period a year ago and 61% of total revenues in the prior quarter. *Fiscal first quarter gross margin was 63% compared to 58% for the same period last year. *Fiscal first quarter loss from operations was $(0.4) million, compared to loss from operations of $(0.6) million in the same period last year. *Fiscal first quarter net loss was $(0.5) million, or $(0.05) per diluted share, compared to net loss of $0.8 million, or $(0.08) per share, in the same period last year. *Fiscal first quarter non-GAAP net income was $0.1 million, or $0.01 per diluted share, compared to a non-GAAP net loss of $(0.3) million, or $(0.04) per share, in the same period a year ago. *Fiscal first quarter adjusted EBITDA was $0.5 million, compared to adjusted EBITDA of $0.1 million in the same period a year ago. *At September 30, 2013, the Company had $1.9 million in cash. The Company also has $1.5 million available for drawdown on its $5 million loan facility with Silicon Valley Bank. "Since I took the helm as CEO last month, I've instituted new process improvements that focus on customer value and willaccelerate our sales, marketing andservicedelivery efforts," stated John Philpin, president and CEO of Lyris. "We have already drilled into sales execution and implemented a metrics-driven approach to feed a predictable and healthy pipeline of business. It is too earlyto state with confidence thatanuptick in overall sales hastaken hold, but we are doubling down on our efforts to enable our global teams with the tools and domain expertise required to succeed in our space." First Quarter Fiscal 2014 Financial Results Total revenues of the first quarter of fiscal 2014 were $8.2 million, down 4.9% from $8.7 million in the prior quarter and down 8.3% from $9.0 million in the same period last year. Total subscription revenues were $6.3 million, or 77% of total revenues, in the first quarter of fiscal 2014, compared to $7.1 million, or 79% of total revenues, in the same period in fiscal 2013. Lyris HQ SaaS revenues were $5.3 million, or 60% of total revenues, in the first quarter of fiscal 2014, down from $5.4 million, or 60% of total revenues, in the same period a year ago. Gross profit was $5.2 million, or 63% as a percentage of total revenues, in the first quarter of fiscal 2014, compared to $5.2 million, or 58% of total revenue, in the same period in fiscal 2013. Loss from operations was $(0.4) million, compared to loss from operations of $(0.6) million in the same period last year. Net loss was $(0.5) million, or $(0.05) per diluted share, compared to net loss of $0.8 million, or $(0.08) per share, in the same period last year. Conference Call Information Lyris will hold a conference call and webcast to discuss its financial results and operating activities open to all interested parties at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time), November 7, 2013. The teleconference can be accessed by calling 888-438-5525, passcode 5329799. Please dial in 10-15 minutes prior to the beginning of the call. The webcast will be available on the Internet at www.lyris.com. A replay of the call will be available through November 14, 2013, at 877-870-5176, passcode 5329799, and on the company's website at www.lyris.com. About Lyris Lyris, Inc. is a leading global provider of digital marketing solutions that help companies engage with customers in more meaningful ways. Lyris products and services empower marketers to design, automate, and optimize data-driven interactive marketing campaigns that facilitate superior engagement, increase conversions, and deliver measurable business value. Lyris' high-performance, secure and flexible digital marketing platforms improve marketing efficiency by providing automated digital message delivery, robust segmentation, and real-time social, mobile and interaction analytics. The Lyris solutions portfolio is comprised of both in-the-cloud and on-premises offerings, Lyris HQ and Lyris ListManager - combined with customer-focused services and support. More than 5,000 companies worldwide partner with Lyris to manage and execute sophisticated digital marketing campaigns across email, social, Web, and mobile channels. www.lyris.com Forward-Looking Statements This press release includes forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995 (PSLRA), that reflect our current views with respect to future events and financial performance, and that are subject to many risks and uncertainties. These forward-looking statements include material in quotations from management, including our estimate of our addressable market. Statements that include word such as "expects," "intends," "plan," "believe," "project," "estimate," "may," "should," "anticipate," "will" and similar statements identify many of our forward-looking statements. Many factors could cause actual results to differ materially from those indicated in our forward-looking statements. For example, market acceptance of our products, potential delays in product development, product offerings by our competitors, and our ability to finance anticipated growth could affect our future results. Other risk factors that could cause actual results to differ significantly from our expectations are described in our annual and quarterly reports filed with the Securities and Exchange Commission (available at www.sec.gov). Unless otherwise required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise. If one or more of these risks or uncertainties materialize, or if our underlying assumptions otherwise prove to be incorrect, our actual results may vary materially from what we project. Any forward-looking statements you read in this news release reflect our views as of the date of this press release with respect to future events, and are subject to these and other risks, uncertainties and assumptions relating to our operations, financial condition, results of operations, growth strategy and liquidity. All subsequent written and oral forward-looking statements attributable to us or individuals acting on our behalf are expressly qualified in their entirety by this paragraph. Non-GAAP Financial Measures In this release we present certain non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position or cash flow that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with United States generally accepted accounting principles ("GAAP"). A reconciliation between non-GAAP and GAAP measures can be found in the accompanying tables. Non-GAAP financial measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. These non-GAAP financial measures do not reflect a comprehensive system of accounting and may differ from non-GAAP financial measures with the same or similar captions that are used by other companies. We believe the calculation of non-GAAP net income (loss), calculated without giving effect to acquisition-related amortization charges, stock-based compensation expense and certain other amounts that we do not consider to be related to our ongoing core operating performance, provides a basis to compare our operating results across periods and against other companies in our industry. We also believe that adjusted EBITDA, which we calculate as GAAP net income (loss) less interest, taxes, depreciation, amortization, non-cash stock compensation expense and certain other financial measures, is an indicator of our cash flows. This measure is commonly used by our lenders to assess our leverage capacity, debt service ability and liquidity. These non-GAAP measures have been reconciled to the nearest GAAP measure, as required under SEC rules and regulations, in tables attached to this release. Lyris, Inc. Condensed Consolidated Statements of Operations (Unaudited) (In thousands, except for per share data) Three Months Ended September 30, 2013 2012 Revenues: Subscription revenue $6,343 $7,128 Support and maintenance revenue 997 931 Professional services revenue 594 670 Software revenue 297 243 Total revenues 8,231 8,972 Cost of revenues: Subscription, software and other services 2,637 3,574 Amortization of developed technology 439 229 Total cost of revenues 3,076 3,803 Gross profit 5,155 5,169 Operating expenses: Sales & marketing 2,832 2,275 General and administrative 1,673 2,306 Research & development 1,038 1,161 Amortization of customer relationship and trade names 50 50 Total operating expenses 5,593 5,792 Loss from operations (438) (623) Interest expense (38) (125) Interest income -- 2 Other (expense) income, net (7) 29 Loss from operations before income taxes (483) (717) Income tax provision 10 79 Net loss (493) (796) Less: income attributable to noncontrolling interest -- 20 Net loss attributable to Lyris, Inc. $(493) $(816) Net loss per share Basic and diluted $(0.05) $(0.08) Weighted average shares outstanding used in calculating net income per share: Basic and diluted 9,568 9,441 Lyris, Inc. Reconciliation of Net Income to Non-GAAP Net Income (Unaudited) (in thousands, except for per share data) Three Months Ended September 30, 2013 2012 Net loss $(493) $(796) Stock-based compensation expense 115 206 Amortization of intangible assets 489 279 Other (income) expense, net 7 (29) Non-GAAP net income (loss) $118 $(340) Net income (loss) per share Basic and diluted $0.01 $(0.04) Shares used to compute net income per share: Basic and diluted 9,568 9,441 Non-GAAP net income excludes stock-based compensation expense, amortization of intangiblesand certain other financial measures. Management believes that non-GAAP net income providesuseful, supplemental information to management and investors regarding the performance of thecompany's business operations. Non-GAAP net income is not a measure determined in accordancewith United States Generally Accepted Accounting Principles ("GAAP") and is thus susceptible tovarying calculations. As presented, this measure may not be comparable to similarly titled measuresthat other companies may disclose. Non-GAAP net income should not be considered in isolation orconstrued as a substitute for other measures of profitability prepared in accordance with GAAP forpurposes of analyzing our financial performance or profitability. Non-GAAP net income should beconsidered in addition to, and not as a substitute or as superior measure to, net income, earningsper share or other measures of financial performance prepared in accordance with GAAP. Lyris, Inc. Reconciliation of Net Income to Adjusted EBITDA (Unaudited, in thousands) Three Months Ended September 30, 2013 2012 Net loss $(493) $(796) Interest (income) / expense, net 38 123 Income tax (benefit) / provision 10 79 Depreciation 369 251 Amortization 489 279 Total EBITDA 413 (64) Stock-based compensation expense 115 206 Other (income) expense, net 7 (29) Total Adjusted EBITDA $535 $113 Adjusted EBITDA is calculated as earnings before net interest expense, taxes, depreciation and amortization expense, stock-based compensation expense and certain other financial measures. Adjusted EBITDA is commonly used by our lenders to assess leverage capacity, debt service ability and liquidity, and the company uses adjusted EBITDA to evaluate financial performance and to award incentive compensation for certain employees, including our chief executive officer. We believe that adjusted EBITDA also provides useful measurements of liquidity and financial performance for our investors. Lyris, Inc. Condensed Consolidated Balance Sheets (Unaudited) (In thousands, except for per share data) September 30, June 30, 2013 2013 ASSETS Current assets: Cash and cash equivalents $1,898 $2,318 Accounts receivable, less allowances of $436 and 3,848 4,103 $510, respectively Prepaid expenses and other current assets 788 722 Deferred income taxes 954 942 Total current assets 7,488 8,085 Property and equipment, net 9,499 9,354 Intangible assets, net 4,967 5,014 Goodwill 9,791 9,791 Other long-term assets 667 663 TOTAL ASSETS $32,412 $32,907 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued expenses $3,356 $3,458 Revolving line of credit 2,265 2,260 Capital lease obligations - short-term 835 827 Income taxes payable 187 203 Deferred revenue 3,267 3,220 Total current liabilities 9,910 9,968 Other long-term liabilities 516 436 Capital lease obligations - long-term 318 504 TOTAL LIABILITIES 10,744 10,908 Commitments and contingencies Stockholders' equity: Redeemable convertible Series A preferred stock; $0.01 par value per share, 2,000 shares authorized, 5,000 5,000 issued and outstanding, liquidation preferrence $5,000 , as of September 30, 2013 and June 30, 2013 Common stock, $0.01 par value; 40,000 shares authorized; 9,579 shares issued and outstanding 1,415 1,415 shares as of September 30, 2013 and June 30, 2013 Additional paid-in capital 268,323 268,209 Accumulated deficit (253,102) (252,608) Treasury stock, at cost 11 shares held as of (56) (56) September 30, 2012 and June 30, 2013 Accumulated other comprehensive income 88 39 Total stockholders' equity 16,668 16,999 Noncontrolling interest -- -- Total stockholders' equity 16,668 16,999 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $32,412 $32,907 CONTACT: Investor Relations Contact: Rich McDonald Director, Investor Relations (610) 688-3305 firstname.lastname@example.org
Lyris Announces First Quarter Fiscal 2014 Financial Results
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