ClickSoftware Reports Financial Results for the First Quarter Ended March 31, 2014

ClickSoftware Reports Financial Results for the First Quarter Ended March 31,                                      2014  2014 Annual Revenue Guidance Increased to $126 - $132 million;  Cloud Annual Recurring Revenues (ARR) Expected to Grow to $26 - $30 million at Year-End  PR Newswire  BURLINGTON, Mass., April 30, 2014  BURLINGTON, Mass., April 30, 2014 /PRNewswire/ --ClickSoftware Technologies Ltd. (NasdaqGS: CKSW), the leading provider of automated mobile workforce management and optimization solutions for the service industry, today announced results for the first quarter ended March 31, 2014.  Highlights    oFirst quarter 2014 total revenues reached $28.4 million (16% growth     year-over-year);   oCompleted the acquisition of Xora, Inc. on March 5, 2014 to expand reach     into the SMB market via wireless carriers;   oMajor wins at large enterprises for cloud based solutions in highly     competitive bids, including a Fortune 100 company;   oTotal cash and liquid investments as of March 31, 2014 were $50.3 million     after payment of Xora's purchase price;   oShort-term backlog and deferred revenues increased substantially to $47.3     million (43% growth year-over-year);   o2014 annual revenue guidance increased to $126 - $132 million; Non-GAAP     EPS is expected to be in the range of $0.04 to $0.12;   oAnnual Recurring Revenues (ARR) from cloud expected to grow to $26 - $30     million by end of 2014.  For the first quarter ended March 31, 2014, total revenues were $28.4 million, up 16% from $24.5 million in the first quarter of 2013. Net loss for the first quarter of 2014 was $2.0 million, or $0.06 per fully diluted share, compared to net income of $0.1 million, or $0.00 per fully diluted share, for the same period last year. Non-GAAP net loss for the quarter was $1.0 million, or $0.03 per fully diluted share, compared to Non-GAAP net income of $0.8 million, or $0.02 per fully diluted share, for the same period last year.  Software license revenues for the first quarter of 2014 were $7.0 million, up 4% compared with software license revenues of $6.7 million for the same period last year. Cloud subscriptions revenues for the first quarter of 2014 increased significantly to $2.3 million from $0.3 million for the same period last year. Support revenues were $8.3 million, up 13% compared with support revenues of $7.3 million in the same period last year. Consulting revenues were $10.7 million, up 6% compared with consulting revenues of $10.2 million in the same period last year.  Gross profit in the first quarter of 2014 was $16.5 million, or 58% of revenues, compared to $14.2 million, or 58% of revenues, in the same period last year.  Cash and liquid investments at the end of the first quarter of 2014 were $50.3 million after payment of $12.7 million in cash for the acquisition of Xora (net of Xora cash). This is a decrease of $7.7 million compared to the end of the fourth quarter of 2013. Net cash provided by operating activities was $3.7 million during the first quarter of 2014.  Management Commentary  "We delivered solid financial results in the first quarter and continued to establish a predictable stream of recurring subscription revenues which will grow as we continue to ramp up existing cloud deployments and bring new customers online. In parallel, the number of on premise opportunities in our pipeline remains stable, which gives us confidence that we can achieve our short-term growth targets," said Dr.Moshe BenBassat, ClickSoftware's Founder and CEO.  "The acquisition of Xora, which we closed in March, extends ClickSoftware's market reach into the SMB (Small and Medium Businesses) market and opens an important distribution channel through leading U.S. wireless carriers including AT&T, Sprint, and Verizon. We also intend to build on our existing client-base of more than 50 telecommunication carriers around the world to expand globally our sales into new SMB markets.  "During the quarter we secured several large cloud wins, including a major Fortune 100 company, which were highly competitive and were won after long and in-depth evaluation processes. Not only will these wins contribute substantially to our future recurring revenues, but they also underscore our leadership position as the company with the most powerful cloud-based solutions for mobile workforce management and service optimization. With the new cloud wins we have been reporting over past quarters and the installed base of Xora, we believe we are now the #1 cloud company in our space, both in terms of size of the user-base in the cloud, and the spectrum of our state-of-the-art cloud solutions we offer for companies of all sizes," Dr. BenBassat concluded.  Financial Outlook  Following the strong results of the first quarter and the addition of Xora, the Company is raising its full year revenue guidance to be in the range of $126 - $132 million (previously $111 - $115 million), based on a current backlog of $47.3 million and projections for winning new business. This outlook includes revenues of about $18 to $21 million from cloud subscriptions and about $35 million from support contracts of existing on premise customers.  Evolution of Cloud Subscriptions Revenues: Based on subscriptions from existing users, signed contracts, anticipated roll-out progress with existing customers and projections for signing new business this year, the Company estimates exiting 2014 with an Annual Recurring Revenues (ARR)run rate for cloud subscriptionsin the range of $26 - $30 million.  In addition, the Company is also updating its full year 2014 Non-GAAP earnings per share to be in the range of $0.04 - $0.12 (previously $0.06- $0.12). Non-GAAP earnings exclude share-based compensation costs of approximately $0.11 and amortization of intangible assets of approximately $0.05 per fully diluted share. GAAP fully diluted earnings per share is now expected to be in the range of ($0.12) - ($0.04) (previously ($0.04)- $0.02).  Investors Conference Call  ClickSoftware will host a conference call today at 9:00 a.m. EDT to discuss its financial results and other matters discussed in this press release, as well as answer questions from the investment community. To participate, please call (888) 668-9141 and ask for the ClickSoftware conference call. International participants, please call +972-3-918-0609. The call will be broadcasted by live webcast on the internet (in listen mode only) at http://ir.clicksoftware.com. A replay of this webcast will be available on the ClickSoftware website and on the Investor Relations App. Alternatively, a telephone replay of the call will be available for a week by calling (888) 326-9310 (international callers can dial +972-3-925-5901).  About ClickSoftware  ClickSoftware (NasdaqGS: CKSW) is the leading provider of automated mobile workforce management and service optimization solutions for the enterprise, both for mobile and in-house resources. As pioneers of the "Service chain optimization" concept, our solutions provide organizations with end-to-end visibility and control of the entire service management chain by optimizing forecasting, planning, shift and task scheduling, mobility and real-time management of resource and customer communication.  Available via the cloud or on-premise, our products incorporate best business practices and advanced decision-making algorithms to manage service operations more efficiently, in a scalable, integrated manner. Our solutions have become the backbone for many leading organizations worldwide by addressing the fundamental question of job fulfillment: Who does What, for Whom, With what, Where and When.  ClickSoftware is the premier choice for delivering superb business performance to service sector organizations of all sizes. The company is headquartered in the United States and Israel, with offices across Europe, and Asia Pacific. For more information, please visit http://www.clicksoftware.com. Follow us on Twitter, the content of which is not incorporated herein by reference.  To download ClickSoftware's investor relations app, which offers access to SEC documents, press releases, videos, audiocasts and more, the content of which is not incorporated herein by reference, please visit Apple's App Store to download on your iPhone and iPad, or Google Play for your Android mobile device.  Use of Non-GAAP Financial Results  In addition to disclosing financial results calculated in accordance with U.S. generally accepted accounting principles (GAAP), the Company's earnings release contains Non-GAAP financial measures of net income and net income per share that exclude the effects of share-based compensation, tax benefit related to the update of deferred tax asset, impairment of intangible assets and the amortization of acquired intangible assets. The Company's management believes the Non-GAAP financial information provided in this release is useful to investors' understanding and assessment of the Company's on-going core operations and prospects for the future. Management also uses both GAAP and Non-GAAP information in evaluating and operating business internally and as such deemed it important to provide all this information to investors. The Non-GAAP financial measures disclosed by the Company should not be considered in isolation or as a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements should be carefully evaluated. Reconciliations between GAAP measures and Non-GAAP measures are provided later in this press release.  Safe Harbor for Forward Looking Statements  This press release contains express or implied forward-looking statements within the Private Securities Litigation Reform Act of 1995 and other U.S Federal securities laws. These forward-looking statements include, but are not limited to, those statements regarding future results of operations, including expected growth, prospects, trends and opportunities in SaaS offerings and cloud-based sales, pipeline, demand for our solutions, our outlook for 2014 revenues and GAAP and Non-GAAP earnings per share, and our future expected annual recurring revenues. Such "forward-looking statements" involve known and unknown risks, uncertainties and other factors that may cause actual results or performance to differ materially from those projected. Achievement of these results by ClickSoftware may be affected by many factors, including, but not limited to, risks and uncertainties regarding the general economic outlook, the length of or changes in ClickSoftware's sales cycle, ClickSoftware's ability to close sales to potential customers in a timely manner and maintain or strengthen relationships with strategic partners, the timing of revenue recognition, foreign currency exchange rate fluctuations, the impact of the Cloud model on initial transaction size and gross margins and ClickSoftware's ability to maintain or increase its sales pipeline. The forward-looking statements contained in this press release are subject to other risks and uncertainties, including those discussed in the "Risk Factors" section and elsewhere in ClickSoftware's annual report on Form 20-F for the year ended December 31, 2013 and in subsequent filings with the Securities and Exchange Commission. Except as otherwise required by law, ClickSoftware is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.  Note: Financial Schedules Attached    ClickSoftware Technologies Ltd. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited. In thousands, except share and per share amounts)                                 Three Months Ended                                 March 31, 2014          March 31, 2013                                 $             % of      $             % of                                               Revenues                Revenues Revenues:  Software license               $    7,014 25%       $   6,738  27%   Cloud Subscriptions      2,290         8%        301           1%   Support                  8,336         29%       7,349         30%  Cloud subscriptions and        10,626        37%       7,650         31%  Support  Consulting                     10,740        38%       10,152        41%       Total revenues            28,380        100%      24,540        100% Cost of revenues:  Software license               729           3%        707           3%  Cloud subscriptions and        2,389         8%        1,310         5%  Support  Consulting                     8,749         31%       8,310         34%       Total cost of revenues    11,867        42%       10,327        42% Gross Profit                    16,513        58%       14,213        58% Operating expenses:  Research and development       4,463         16%       3,705         15%  costs, net  Selling and marketing expenses 11,146        39%       8,456         34%  General and administrative     2,751         10%       2,053         8%  expenses       Total operating expenses  18,360        65%       14,214        58% Operating loss                  (1,847)       (7%)      (1)           0% Interest income, net            201           1%        273           1% Net (loss) income before taxes  $ (1,646)    (6%)      $         1%                                                         272 Tax income, net                 308           1%        187           1% Net (loss) income               $ (1,954)    (7%)      $        0%                                                         85 Net (loss) earnings per ordinary share:  Basic                          $                    $    0.00                                 (0.06)  Diluted                        $                    $    0.00                                 (0.06) Shares used in computing basic                                 32,568,790              31,688,726 net (loss) earnings per share Shares used in computing diluted                         33,568,790              32,899,269  net (loss) earnings per share    ClickSoftware Technologies Ltd. CONSOLIDATED BALANCE SHEETS (In thousands, except share data)                                    March 31, 2014        December 31, 2013                                    (Unaudited)           (Audited)    ASSETS CURRENT ASSETS  Cash and cash equivalents         $      27,818    $     25,346  Deposits                          2,955                 9,001  Marketable securities             17,091                22,586  Trade receivables, net            23,325                22,490  Deferred taxes                    1,600                 1,740  Other receivables and prepaid     5,738                 4,408  expenses   Total current assets             78,527                85,571 LONG TERM ASSETS  Property and equipment, net       4,984                 5,023  Deposits                          2,394                 1,072  Other receivables and prepaid     314                   218  expenses  Deferred taxes                    2,150                 2,060  Intangible assets and Goodwill,   13,446                1,572  net  Severance pay funds               2,086                 2,052   Total long term assets           25,374                11,997    Total Assets                    $    103,901      $     97,568    LIABILITIES AND SHAREHOLDERS'    EQUITY CURRENT LIABILITIES  Current maturities of debt        $        363  $                                                                    -  Accounts payable and accrued      18,743                17,707  expenses  Deferred revenues                 17,773                13,420   Total current liabilities        36,879                31,127 LONG TERM LIABILITIES  Debt, less current maturities     319                   -  Accrued severance pay             4,809                 4,840  Deferred taxes                    40                    40  Deferred revenues                 4,919                 4,642   Total long term liabilities      10,087                9,522   Total liabilities                46,966                40,649 SHAREHOLDERS' EQUITY  Ordinary shares of NIS 0.02 par   139                   137  value  Additional paid-in capital        94,188                92,301  Accumulated deficit               (38,133)              (36,179)  Accumulated other comprehensive   784                   703  income  Treasury stock, at cost: 39,000   (43)                  (43)  shares   Total shareholders' equity       56,935                56,919    Total Liabilities and           $    103,901       $    97,568    shareholders' equity    ClickSoftware Technologies Ltd. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands)                                          Three Months Ended                                          March 31, 2014      March 31, 2013                                           (Unaudited)         (Unaudited) CASH FLOWS FROM OPERATING ACTIVITIES   Net (loss) income                      $              $                                                  (1,954)            85   Adjustments to reconcile net (loss)   income to net cash provided by   operating activities:      Income and expense items not      involving cash flows:             Depreciation                 661                 582             Amortization of deferred     736                 569             compensation             Amortization of acquired     145                 130             intangible assets             Severance pay, net           (65)                26             Gain on marketable           (441)               (152)             securities             Other                        (1)                 46      Changes in operating assets and      liabilities:             Trade receivables            1,668               2,468             Deferred taxes               50                  (720)             Other receivables            310                 (284)             Accounts payable and accrued (1,556)             (3,975)             expenses             Deferred revenues            4,177               4,975   Net cash provided by operating         $      3,730  $         activities                                                 3,750 CASH FLOWS FROM INVESTING ACTIVITIES      Purchase of equipment               (176)               (791)      Acquisition of subsidiary (*)       (12,737)            -      Decrease in deposits                4,724               6,472      Investments in marketable           (2,920)             (3,752)      securities      Proceedsfrom sale of marketable    8,856               1,802      securities   Net cash (used in) provided by         $     (2,253)   $         investment activities                                      3,731 CASH FLOWS FROM FINANCING ACTIVITIES      Prepayments of long-term debts      (158)               -      Dividend paid                       -                   (2,539)      Employee options exercised          1,153               357   Net cash provided by (used in)         $       995  $        financing activities                                       (2,182) INCREASE IN CASH AND CASH EQUIVALENTS    2,472               5,299 CASH AND CASH EQUIVALENTS AT BEGINNING   25,346              12,793 OF PERIOD CASH AND CASH EQUIVALENTS AT END OF      $     27,818   $      PERIOD                                                       18,092 (*)Acquisition of subsidiary      Working capital (excluding cash and 1,113      cash equivalents)      Property and Equipment              445      Intangible assets                   12,019      Long-term liabilities               (840)   Cash paid for the acquisition of a     $     12,737   subsidiary, net    ClickSoftware Technologies Ltd. SUPPLEMENTAL RECONCILIATIONS OF GAAP TO NON-GAAP RESULTS (Unaudited. In thousands, except per share amounts)                                     Three Months Ended                                     March 31, 2014          March 31, 2013                                     $             % of      $         % of                                                   Revenues            Revenues GAAP Net (loss) income              $         (7%)      $     0%                                     (1,954)                  85 Share-based compensation (1)        736                     569 Amortization of intangible assets   145                     130 (2) Tax payment for previous years      -                       744 retained earnings* Deferred taxes                      50                      (720) Non-GAAP Net (loss) income          $         (4%)      $     3%                                     (1,023)                 808 GAAP Earnings per share (diluted)   $                  $                                         (0.06)                  0.00 Share-based compensation            0.02                    0.02 Amortization of intangible assets   0.01                    0.00 Tax payment for previous years      0.00                    0.02 retained earnings* Deferred taxes                      0.00                    (0.02) Non-GAAP (loss) earnings per share  $                 $     (diluted)                           (0.03)                   0.02 (1) Share-based compensation:     Cost of revenues                $                 $                                           102                    79     Research and development costs, 84                      61     net     Selling and marketing expenses  234                     152     General and administrative      316                     277     expenses                                     $                 $                                         736                      569 (2) Amortization of intangible assets:     Cost of revenues                $                 $                                          145                    101     Research and development costs, -                       29     net                                     $                 $                                          145                    130   * See Note 14.A to our consolidated financial statements for the year ended December 31, 2012 included in our Annual Report on Form 20-F, regarding November 2012 law    ClickSoftware Contact:        Investor Relations Contact: Noa Schuman                   Rob Fink Investor Relations            KCSA Strategic Communications +972-3-7659-467               212-896-1206 Noa.Schuman@clicksoftware.com rfink@kcsa.com   SOURCE ClickSoftware  Website: http://www.clicksoftware.com  
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