Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Oct. 31, 2016 | Nov. 30, 2016 | |
Common Class A [Member] | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding (in shares) | 15,794,532 | |
Common Class B [Member] | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding (in shares) | 3,207,849 | |
Entity Registrant Name | QAD INC | |
Entity Central Index Key | 1,036,188 | |
Trading Symbol | qada | |
Current Fiscal Year End Date | --01-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Document Type | 10-Q | |
Document Period End Date | Oct. 31, 2016 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Oct. 31, 2016 | Jan. 31, 2016 |
Common Class A [Member] | ||
Stockholders’ equity: | ||
Common stock | $ 16 | $ 16 |
Common Class B [Member] | ||
Stockholders’ equity: | ||
Common stock | 4 | 4 |
Cash and equivalents | 135,689 | 137,731 |
Accounts receivable, net of allowances of $2,298 and $2,642 at October 31, 2016 and January 31, 2016, respectively | 39,100 | 65,512 |
Deferred tax assets, net | 8,543 | 8,203 |
Other current assets | 17,271 | 16,024 |
Total current assets | 200,603 | 227,470 |
Property and equipment, net | 30,995 | 32,080 |
Capitalized software costs, net | 934 | 1,553 |
Goodwill | 10,657 | 10,645 |
Deferred tax assets, net | 12,758 | 12,914 |
Other assets, net | 2,135 | 2,679 |
Total assets | 258,082 | 287,341 |
Current portion of long-term debt | 441 | 422 |
Accounts payable | 7,694 | 10,811 |
Deferred revenue | 73,982 | 97,911 |
Other current liabilities | 29,558 | 31,535 |
Total current liabilities | 111,675 | 140,679 |
Long-term debt | 13,877 | 14,191 |
Other liabilities | 4,650 | 4,465 |
Commitments and contingencies | ||
Additional paid-in capital | 196,382 | 195,808 |
Treasury stock, at cost 1,153,155 shares and 1,365,885 shares at October 31, 2016 and January 31, 2016, respectively) | (15,497) | (18,717) |
Accumulated deficit | (44,637) | (40,376) |
Accumulated other comprehensive loss | (8,388) | (8,729) |
Total stockholders’ equity | 127,880 | 128,006 |
Total liabilities and stockholders’ equity | $ 258,082 | $ 287,341 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) - USD ($) $ in Thousands | Oct. 31, 2016 | Jan. 31, 2016 |
Common Class A [Member] | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 71,000,000 | 71,000,000 |
Common stock, issued (in shares) | 16,605,173 | 16,603,729 |
Common Class B [Member] | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 4,000,000 | 4,000,000 |
Common stock, issued (in shares) | 3,537,380 | 3,537,366 |
Accounts receivable, net of allowances | $ 2,298 | $ 2,642 |
Preferred stock, par value (in dollars per share) | $ 0.001 | |
Preferred stock, authorized (in shares) | 5,000,000 | |
Preferred stock, issued (in shares) | 0 | |
Preferred stock, outstanding (in shares) | 0 | |
Treasury stock (in shares) | 1,153,155 | 1,365,885 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Common Class A [Member] | ||||
Other (income) expense: | ||||
Net (loss) income | $ 1,311 | $ 2,208 | $ (245) | $ 4,067 |
Basic net income (loss) per share | ||||
Basic net (loss) income per share (in dollars per share) | $ 0.08 | $ 0.14 | $ (0.02) | $ 0.26 |
Diluted net income (loss) per share | ||||
Diluted net (loss) income per share (in dollars per share) | $ 0.08 | $ 0.14 | $ (0.02) | $ 0.25 |
Net (loss) income | $ 1,311 | $ 2,208 | $ (245) | $ 4,067 |
Common Class B [Member] | ||||
Other (income) expense: | ||||
Net (loss) income | $ 222 | $ 378 | $ (46) | $ 699 |
Basic net income (loss) per share | ||||
Basic net (loss) income per share (in dollars per share) | $ 0.07 | $ 0.12 | $ (0.01) | $ 0.22 |
Diluted net income (loss) per share | ||||
Diluted net (loss) income per share (in dollars per share) | $ 0.07 | $ 0.12 | $ (0.01) | $ 0.21 |
Net (loss) income | $ 222 | $ 378 | $ (46) | $ 699 |
License fees | 4,323 | 6,350 | 14,686 | 21,761 |
Subscription fees | 13,678 | 9,659 | 37,487 | 28,223 |
Maintenance and other | 32,552 | 33,395 | 98,654 | 100,611 |
Professional services | 18,981 | 18,633 | 53,882 | 57,998 |
Total revenue | 69,534 | 68,037 | 204,709 | 208,593 |
License fees | 582 | 827 | 2,072 | 2,728 |
Subscription fees | 7,145 | 5,134 | 20,085 | 15,360 |
Maintenance and other | 7,480 | 7,924 | 22,991 | 23,608 |
Professional services | 17,850 | 17,120 | 52,851 | 54,035 |
Total cost of revenue | 33,057 | 31,005 | 97,999 | 95,731 |
Gross profit | 36,477 | 37,032 | 106,710 | 112,862 |
Sales and marketing | 15,312 | 15,531 | 49,544 | 49,658 |
Research and development | 10,807 | 10,193 | 33,019 | 31,440 |
General and administrative | 7,934 | 7,676 | 24,423 | 24,719 |
Amortization of intangibles from acquisitions | 165 | 165 | 496 | 495 |
Total operating expenses | 34,218 | 33,565 | 107,482 | 106,312 |
Operating income (loss) | 2,259 | 3,467 | (772) | 6,550 |
Interest income | (184) | (80) | (515) | (224) |
Interest expense | 168 | 171 | 503 | 544 |
Other (income) expense, net | (413) | 61 | 24 | (471) |
Total other (income) expense | (429) | 152 | 12 | (151) |
Income (loss) before income taxes | 2,688 | 3,315 | (784) | 6,701 |
Income tax expense (benefit) | 1,155 | 729 | (493) | 1,935 |
Net (loss) income | 1,533 | 2,586 | (291) | 4,766 |
Net (loss) income | 1,533 | 2,586 | (291) | 4,766 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustment | (20) | (466) | 341 | (1,138) |
Total comprehensive income | $ 1,513 | $ 2,120 | $ 50 | $ 3,628 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Oct. 31, 2016 | Oct. 31, 2015 | |
Cash flows from operating activities: | ||
Net (loss) income | $ (291) | $ 4,766 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation and amortization | 4,530 | 4,324 |
Provision for doubtful accounts and sales adjustments | 157 | 623 |
Stock compensation expense | 5,521 | 5,618 |
Change in fair value of derivative instrument | (31) | (164) |
Other, net | 10 | 10 |
Changes in assets and liabilities: | ||
Accounts receivable | 26,494 | 35,517 |
Other assets | (1,692) | 1,960 |
Accounts payable | (3,098) | (4,113) |
Deferred revenue | (23,743) | (31,587) |
Other liabilities | (2,386) | (6,789) |
Net cash provided by operating activities | 5,471 | 10,165 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (2,166) | (2,641) |
Capitalized software costs | (109) | (70) |
Net cash used in investing activities | (2,275) | (2,711) |
Cash flows from financing activities: | ||
Repayments of debt | (326) | (305) |
Tax payments, net of proceeds, related to stock awards | (1,726) | (2,419) |
Payment of contingent liability associated with acquisitions | (750) | |
Proceeds from issuance of common stock, net of issuance costs | 8,365 | |
Cash dividends paid | (3,970) | (3,922) |
Net cash (used in) provided by financing activities | (6,022) | 969 |
Effect of exchange rates on cash and equivalents | 784 | (2,328) |
Net (decrease) increase in cash and equivalents | (2,042) | 6,095 |
Cash and equivalents at beginning of period | 137,731 | 120,526 |
Cash and equivalents at end of period | $ 135,689 | $ 126,621 |
Note 1 - Basis of Presentation
Note 1 - Basis of Presentation and Recent Accounting Pronouncements | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Basis of Presentation and Significant Accounting Policies [Text Block] | 1. BASIS OF PRESENTATION AND RECENT ACCOUNTING PRONOUNCEMENTS Basis of Presentation In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements fairly present the financial information contained therein. These statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. In management’s opinion, all necessary adjustments, consisting of normal, recurring and non-recurring adjustments, have been included in the accompanying Condensed Consolidated Financial Statements to present fairly the financial position and operating results of QAD Inc. (“QAD” or the “Company”). The Condensed Consolidated Financial Statements do not include all disclosures required by accounting principles generally accepted in the United States of America for annual financial statements and should be read in conjunction with the audited financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended January 31, 2016. The Condensed Consolidated Financial Statements include the results of the Company and its wholly owned subsidiaries. The results of operations for the three and nine months ended October 31, 2016 are not necessarily indicative of the results to be expected for the year ending January 31, 2017. Recent Accounting Pronouncements With the exception of those discussed below, there have been no recent changes in accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”) or adopted by the Company during the nine months ended October 31, 2016, that are of significance, or potential significance, to the Company. Accounting Standards Adopted In March 2016, the FASB issued Accounting Standards Update No. 2016-09 ("ASU 2016-09") regarding ASC Topic 718, “Improvements to Employee Share-Based Payment Accounting.” The new guidance requires excess tax benefits and tax deficiencies to be recorded in the income statement when the awards vest or are settled. In addition, cash flows related to excess tax benefits will no longer be separately classified as a financing activity apart from other income tax cash flows. The standard also increases the amount of shares an employer can withhold for tax purposes without triggering liability accounting, clarifies that all cash payments made on an employee's behalf for withheld shares should be presented as a financing activity in the statements of cash flows, and provides an entity-wide accounting policy election to account for forfeitures as they occur. QAD elected to early adopt the new guidance in the third quarter of fiscal year 2017 which requires us to reflect any adjustments as of February 1, 2016, the beginning of the annual period that includes the interim period of adoption. The primary impact of adoption was the recognition of excess tax benefits in our provision for income taxes rather than paid-in capital for all periods in fiscal year 2017. Additional amendments to the accounting for income taxes resulted in the recognition of prior year unrealized excess tax benefits. This recognition resulted in an increase to our deferred tax assets of $2.2 million, an increase to valuation allowance $1.2 million and an offset to opening accumulated deficit of $1.0 million. QAD elected to account for forfeitures as they occur using a modified retrospective transition method, which resulted in a cumulative-effect adjustment of $0.4 million to reduce the February 1, 2016 opening accumulated deficit. Additional amendments to the accounting for minimum statutory withholding tax requirements had no impact to opening accumulated deficit as of February 1, 2016 as QAD does not withhold more than the minimum statutory requirements. We elected to apply the presentation requirements for cash flows related to excess tax benefits retrospectively to all periods presented which resulted in an increase to net cash provided by operating activities and a decrease to net cash used in financing of $0.3 million for the six months ended July 31, 2016. The presentation requirements for cash flows related to employee taxes paid for withheld shares had no impact to any of the periods presented in our consolidated cash flows statements since such cash flows have historically been presented as a financing activity. With the adoption of the new standard we are required to revise our reported quarterly results for the six months ended July 31, 2016. Accordingly, this table reflects the retrospective adjustments made to beginning accumulated deficit and to the previously reported results for the six months ended July 31, 2016: Condensed Consolidated Balance Sheets ASU 2016-09 Adoption Adjustments (in thousands) As Reported July 31, 20 16 February 1, 2016 For The Six Months Ended July 31, 2016 As Adjusted July 31, 20 16 Other current assets $ 18,369 $ — $ (104 ) $ 18,265 Deferred tax assets, net 12,156 995 — 13,151 Additional paid-in capital 194,943 388 (422 ) 194,909 Accumulated deficit $ (45,767 ) $ 607 $ 318 $ (44,842 ) Condensed Consolidated Statements of Operations (in thousands, except per share data) As Reported Six Months Ended July 31, 2016 ASU 2016-09 Adoption Adjustments As Adjusted Six Months Ended July 31, 2016 Cost of revenue: Subscription fees $ 12,945 $ (5 ) $ 12,940 Maintenance and other 15,532 (21 ) 15,511 Professional services 35,048 (47 ) 35,001 Total cost of revenue 65,015 (73 ) 64,942 Gross profit 70,160 73 70,233 Operating expenses: Sales and marketing 34,322 (90 ) 34,232 Research and development 22,283 (71 ) 22,212 General and administrative 16,526 (37 ) 16,489 Total operating expenses 73,462 (198 ) 73,264 Operating loss (3,302 ) 271 (3,031 ) Loss before income taxes (3,743 ) 271 (3,472 ) Income tax benefit (1,601 ) (47 ) (1,648 ) Net loss $ (2,142 ) $ 318 $ (1,824 ) Basic and diluted weighted average shares outstanding: Class A 15,644 – 15,644 Class B 3,204 – 3,204 Basic and diluted net loss per share: Class A $ (0.12 ) $ 0.02 $ (0.10 ) Class B $ (0.10 ) $ 0.02 $ (0.08 ) In April 2015, the FASB issued ASU 2015-03 - Interest - Imputation of Interest (Subtopic 2015-03): Simplifying the Presentation of Debt Issuance Costs In August 2015, the FASB issued ASU 2015-15, Interest-Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line of Credit Arrangements Accounting Standards Not Yet Adop ted In May 2014, the FASB issued accounting standard update, or ASU, 2014-09, Revenue from Contracts with Customers Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) In October 2016, the FASB issued ASU 2016-16, Income Taxes: Intra-Entity Transfers of Assets Other than Inventory |
Note 2 - Computation of Net Inc
Note 2 - Computation of Net Income (Loss) Per Share | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Earnings Per Share [Text Block] | 2. COMPUTATION OF NET INCOME (LOSS) PER SHARE The following table sets forth the computation of basic and diluted net income (loss) per share: Three Months Ended Nine Months Ended October 31, October 31, 2016 2015 2016 2015 (in thousands, except per share data) (in thousands, except per share data) Net income (loss) $ 1,533 $ 2,586 $ (291 ) $ 4,766 Less: Dividends declared (1,328 ) (1,313 ) (3,970 ) (3,922 ) Undistributed net income (loss) $ 205 $ 1,273 $ (4,261 ) $ 844 Net income (loss) per share – Class A Common Stock Dividends declared $ 1,136 $ 1,121 $ 3,393 $ 3,346 Allocation of undistributed net income (loss) 175 1,087 (3,638 ) 721 Net income (loss) attributable to Class A common stock $ 1,311 $ 2,208 $ (245 ) $ 4,067 Weighted average shares of Class A common stock outstanding— basic 15,773 15,559 15,687 15,431 Weighted average potential shares of Class A common stock 829 749 — 777 Weighted average shares of Class A common stock and potential common shares outstanding— diluted 16,602 16,308 15,687 16,208 Basic net income (loss) per Class A common share $ 0.08 $ 0.14 $ (0.02 ) $ 0.26 Diluted net income (loss) per Class A common share $ 0.08 $ 0.14 $ (0.02 ) $ 0.25 Net income (loss) per share – Class B Common Stock Dividends declared $ 192 $ 192 $ 577 $ 576 Allocation of undistributed net income (loss) 30 186 (623 ) 123 Net income (loss) attributable to Class B common stock $ 222 $ 378 $ (46 ) $ 699 Weighted average shares of Class B common stock outstanding— basic 3,206 3,203 3,205 3,200 Weighted average potential shares of Class B common stock 95 83 — 83 Weighted average shares of Class B common stock and potential common shares outstanding— diluted 3,301 3,286 3,205 3,283 Basic net income (loss) per Class B common share $ 0.07 $ 0.12 $ (0.01 ) $ 0.22 Diluted net income (loss) per Class B common share $ 0.07 $ 0.12 $ (0.01 ) $ 0.21 Potential common shares consist of the shares issuable upon the release of restricted stock units (“RSUs”) and the exercise of stock options and stock appreciation rights (“SARs”). The Company’s unvested RSUs and unexercised SARs are not considered participating securities as they do not have rights to dividends or dividend equivalents prior to release or exercise. The following table sets forth the number of potential common shares not included in the calculation of diluted earnings per share because their effects were anti-dilutive: Three Months Ended Nine Months Ended October 31 , October 31 , 2016 2015 2016 2015 (in thousands) (in thousands) Class A 1,135 640 1,029 490 Class B 180 120 151 92 |
Note 3 - Fair Value Measurement
Note 3 - Fair Value Measurements | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Fair Value, Measurement Inputs, Disclosure [Text Block] | 3. FAIR VALUE MEASUREMENTS When determining fair value, the Company uses a three-tier value hierarchy which prioritizes the inputs used in measuring fair value. Whenever possible, the Company uses observable market data. The Company relies on unobservable inputs only when observable market data is not available. Classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The assessment of the significance of a particular item to the fair value measurement in its entirety requires judgment, including the consideration of inputs specific to the asset or liability. The following table sets forth the financial assets and liabilities, measured at fair value, as of October 31, 2016 and January 31, 2016: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Money market mutual funds as of October 31, 2016 (a) $ 110,735 Money market mutual funds as of January 31, 2016 (a) $ 113,984 Liability related to the interest rate swap as of October 31, 2016 (b) $ (644 ) Liability related to the interest rate swap as of January 31, 2016 (b) $ (675 ) ___________________________ (a) Money market mutual funds are recorded at fair value based upon quoted market prices. (b) The liability related to the interest rate swap is recorded at fair value based upon a valuation model that uses relevant observable market inputs at quoted intervals, such as forward yield curves. Money market mutual funds are classified as part of “Cash and equivalents” in the accompanying Condensed Consolidated Balance Sheets. The amount of cash and equivalents deposited with commercial banks was $25 million and $24 million as of October 31, 2016 and January 31, 2016, respectively. The Company’s line of credit and notes payable both bear a variable market interest rate commensurate with the Company’s credit standing. Therefore, the carrying amounts outstanding under the line of credit and note payable reasonably approximate fair value based on Level 2 inputs. There have been no transfers between fair value measurements levels during the nine months ended October 31, 2016. Derivative Instruments The Company entered into an interest rate swap in May 2012 to mitigate the exposure to the variability of one month LIBOR for its floating rate debt described in Note 6 “Debt” within these Notes to Condensed Consolidated Financial Statements. The fair value of the interest rate swap is reflected as a liability in the Condensed Consolidated Balance Sheets and the change in fair value is reported in “Other (income) expense” in the Condensed Consolidated Statements of Operations and Comprehensive Income. The fair value of the interest rate swap is estimated as the net present value of projected cash flows based upon forward interest rates at the balance sheet date. The fair values of the derivative instrument at October 31, 2016 and January 31, 2016 were as follows (in thousands): (Liability) Derivative Fair Value Balance Sheet Location October 31, 2016 January 31, 2016 Derivative instrument: Interest rate swap Other liabilities $ (644 ) $ (675 ) Total $ (644 ) $ (675 ) The change in fair value of the interest rate swap recognized in the Condensed Consolidated Statements of Operations and Comprehensive Income for the nine months ended October 31, 2016 and 2015 was $31,000 and $164,000 respectively. |
Note 4 - Capitalized Software C
Note 4 - Capitalized Software Costs | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Capitalized Software Costs [Text Block] | 4. CAPITALIZED SOFTWARE COSTS Capitalized software costs and accumulated amortization at October 31, 2016 and January 31, 2016 were as follows: October 31 , 2016 January 31, 2016 (in thousands) Capitalized software costs: Acquired software technology $ 3,458 $ 3,458 Capitalized software development costs 772 1,029 Total capitalized software costs 4,230 4,487 Less accumulated amortization (3,296 ) (2,934 ) Capitalized software costs, net $ 934 $ 1,553 Acquired software technology costs relate to technology purchased as a result of the Company’s fiscal 2013 acquisitions of DynaSys and CEBOS. In addition to the acquired software technology, the Company has capitalized costs related to translations and localizations of QAD Enterprise Applications. It is the Company’s policy to write off capitalized software development costs once fully amortized. Accordingly, during the first nine months of fiscal 2017, approximately $0.4 million of costs and accumulated amortization were removed from the balance sheet. Amortization of capitalized software costs was $0.7 million and $0.8 million for the nine months ended October 31, 2016 and 2015, respectively. Amortization of capitalized software costs is included in “Cost of license fees” in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income. The following table summarizes the estimated amortization expense relating to the Company’s capitalized software costs as of October 31, 2016: Fiscal Years (in thousands) 2017 remaining $ 241 2018 598 2019 74 2020 21 Total $ 934 |
Note 5 - Goodwill and Intangibl
Note 5 - Goodwill and Intangible Assets | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Goodwill and Intangible Assets Disclosure [Text Block] | 5. GOODWILL AND INTANGIBLE ASSETS Goodwill The changes in the carrying amount of goodwill for the nine months ended October 31, 2016 were as follows: Gross Carrying Amount Accumulated Impairment Goodwill, Net (in thousands) Balance at January 31, 2016 $ 26,253 $ (15,608 ) $ 10,645 Impact of foreign currency translation 12 — 12 Balance at October 31, 2016 $ 26,265 $ (15,608 ) $ 10,657 The Company performed its annual goodwill impairment review during the fourth quarter of fiscal 2016. The analysis compared the Company’s market capitalization to its net assets as of the test date, November 30, 2015. As the market capitalization significantly exceeded the Company’s net assets, there was no indication of goodwill impairment for fiscal 2016. The Company monitors the indicators for goodwill impairment testing between annual tests. No adverse events occurred during the nine months ended October 31, 2016, that would cause the Company to test goodwill for impairment. Intangible Assets October 31 , 2016 January 31, 2016 (in thousands) Amortizable intangible assets Customer relationships (1) $ 2,754 $ 2,749 Trade name 515 515 Total amortizable intangible assets 3,269 3,264 Less: accumulated amortization (2,688 ) (2,191 ) Net amortizable intangible assets $ 581 $ 1,073 ______________________ (1) Customer relationships include the impact of foreign currency translation. The Company’s intangible assets are related to the DynaSys and CEBOS acquisitions completed in fiscal 2013. Intangible assets are included in “Other assets, net” in the accompanying Condensed Consolidated Balance Sheets. As of October 31, 2016, all of the Company’s intangible assets were determined to have finite useful lives, and therefore were subject to amortization. Amortization of intangible assets was $0.5 million for each of the nine months ended October 31, 2016 and 2015. The following table summarizes the estimated amortization expense relating to the Company’s intangible assets as of October 31, 2016: Fiscal Years (in thousands) 2017 remaining $ 164 2018 417 Total $ 581 |
Note 6 - Debt
Note 6 - Debt | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Debt Disclosure [Text Block] | 6. DEBT October 31, 2016 January 31, 2016 (in thousands) Note payable $ 14,377 $ 14,680 Less current maturities (441 ) (422 ) Less loan origination costs, net (59 ) (67 ) Long-term debt $ 13,877 $ 14,191 Note Payable Effective May 30, 2012 QAD Ortega Hill, LLC, wholly owned by the Company, entered into a variable rate credit agreement (the “2012 Mortgage”) with Rabobank, N.A., to refinance a pre-existing mortgage. The 2012 Mortgage has an original principal balance of $16.1 million and bears interest at the one month LIBOR rate plus 2.25%. One month LIBOR was 0.53% at October 31, 2016. The 2012 Mortgage matures in June 2022 and is secured by the Company’s headquarters located in Santa Barbara, California. In conjunction with the 2012 Mortgage, QAD Ortega Hill, LLC entered into an interest rate swap with Rabobank, N.A. The swap agreement has an initial notional amount of $16.1 million and a schedule matching that of the underlying loan that synthetically fixes the interest rate on the debt at 4.31% for the entire term of the 2012 Mortgage. The terms of the 2012 Mortgage provide for QAD Ortega Hill, LLC to make net monthly payments of $88,100 consisting of principal and interest and one final payment of $11.7 million. The unpaid balance as of October 31, 2016 was $14.4 million. Credit Facility The Company has an unsecured credit agreement with Rabobank, N.A. (the “Facility”). The Facility provides a commitment through July 15, 2017 for a $20 million line of credit for working capital or other business needs. The Company pays a commitment fee of 0.25% per annum of the daily average of the unused portion of the $20 million Facility. Borrowings under the Facility bore interest at a rate equal to one month LIBOR plus 0.75%. At October 31, 2016, the effective borrowing rate would have been 1.28%. The Facility provides that the Company maintain certain financial and operating ratios which include, among other provisions, minimum liquidity on a consolidated basis of $25 million in cash and equivalents at all times, a current ratio (calculated using current liabilities excluding deferred revenue) of not less than 1.3 to 1.0 determined at the end of each fiscal quarter, a leverage ratio of not more than 1.5 to 1.0 determined at the end of each fiscal quarter, and a debt service coverage ratio of not less than 1.5 to 1.0 determined at the end of each fiscal year. The Facility also contains customary covenants that could restrict the Company’s ability to incur additional indebtedness. As of October 31, 2016, there were no borrowings under the Facility and the Company was in compliance with all financial covenants. |
Note 7 - Accumulated Other Comp
Note 7 - Accumulated Other Comprehensive Loss | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Accumulated Other Comprehensive Income (Loss) [Text Block] | 7. ACCUMULATED OTHER COMPREHENSIVE LOSS The components of accumulated other comprehensive loss, net of taxes, were as follows: Foreign Currency Translation Adjustments (in thousands) Balance as of January 31, 2016 $ (8,729 ) Other comprehensive income 341 Amounts reclassified from accumulated other comprehensive loss — Net current period other comprehensive income 341 Balance as of October 31, 2016 $ (8,388 ) During the first nine months of fiscal 2017 there were no reclassifications from accumulated other comprehensive loss. |
Note 8 - Income Taxes
Note 8 - Income Taxes | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | 8. INCOME TAXES The Company’s income tax provision for each of the third quarters of fiscal 2017 and fiscal 2016 reflects estimates of the effective tax rates expected to be applicable for the full fiscal years, adjusted for any discrete events which are recorded in the period they occur. The Company recorded income tax (benefit) expense of $(0.5) million and $1.9 million for the first nine months of fiscal 2017 and 2016, respectively. The Company’s effective tax rate increased to 63% from 29% for the same period in the prior year. The increase in the annual effective tax rate is primarily due to substantially lower forecasted and actual book income in fiscal 2017. The Company recorded income tax expense of $1.2 million and $0.7 million in the third quarter of fiscal 2017 and fiscal 2016, respectively. The Company’s effective tax rate increased to 43% during the third quarter of fiscal 2017 compared to 22% for the same period in the prior year. The increase in rates is due to lower forecasted and actual book income in fiscal 2017. The gross amount of unrecognized tax benefits was $1.4 million at October 31, 2016, including interest and penalties. As a result of adoption of ASU 2013-11, the Company reduced its unrecognized tax benefits by $1.0 million with an accompanying reduction of deferred tax assets by $1.0 million. The entire amount of unrecognized tax benefits, if recognized, will impact the Company’s effective tax rate. This liability is classified as long-term unless the liability is expected to conclude within twelve months of the reporting date. In the next twelve months, due to potential settlements with domestic tax authorities related to tax credits and lapse in statute of limitations, an estimated $0.1 million of gross unrecognized tax benefits may be recognized. The Company’s policy is to recognize interest and penalties, if any, related to unrecognized tax benefits as a component of income tax expense. As of October 31, 2016, the Company has accrued approximately $0.2 million of interest and penalty expense relating to unrecognized tax benefits. The Company files U.S. federal, state, and foreign tax returns that are subject to audit by various tax authorities. The Company is currently under audit in: ● India for fiscal years ended March 31, 1998, 1999, 2010, 2013 and 2014 ● France for fiscal year ended January 31, 2013 ● Canada for fiscal year ended January 31, 2014 ● Iowa for fiscal year ended January 31, 2014 During fiscal year 2017, QAD has settled the following audits with immaterial or no adjustments made as a result of the settlements: ● Italy for the fiscal years ended January 31, 2011 and 2012 ● Wisconsin for the fiscal years ended January 31, 2012, 2013 and 2014 ● Thailand for fiscal year ended January 31, 2014 ● India for fiscal year ended March 31, 2009 and 2012 ● Japan for fiscal years ended January 31, 2013, 2014, 2015 and 2016 through July 31, 2016 |
Note 9 - Stockholders' Equity
Note 9 - Stockholders' Equity | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Stockholders' Equity Note Disclosure [Text Block] | 9. STOCKHOLDERS’ EQUITY Issuance of Common Stock On January 22, 2015, the Company closed an offering of 2,000,000 shares of Class A common stock. The net proceeds to the Company from the sale of the stock were $37.0 million after deducting underwriting discounts and commissions and offering expenses. On February 18, 2015 the offering underwriters exercised in full an option to purchase additional shares. As a result, 450,000 shares of Class A common stock were issued generating approximately $8.4 million in additional net proceeds. Dividends The following table sets forth the dividends that were declared by the Company during the first nine months of fiscal 2017: Declaration Date Record Date Payable Dividend Class A Dividend Class B Amount 9/14/2016 9/28/2016 10/5/2016 $ 0.072 $ 0.06 $ 1,328,000 6/14/2016 6/28/2016 7/7/2016 $ 0.072 $ 0.06 $ 1,326,000 4/12/2016 4/26/2016 5/3/2016 $ 0.072 $ 0.06 $ 1,316,000 |
Note 10 - Stock-based Compensat
Note 10 - Stock-based Compensation | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | 10. STOCK-BASED COMPENSATION The Company’s equity awards consist of SARs and RSUs. For a description of the Company’s stock-based compensation plans, see Note 5 “Stock-Based Compensation” in Notes to Consolidated Financial Statements included in the Annual Report on Form 10-K for the year ended January 31, 2016. Stock-Based Compensation The following table sets forth reported stock-based compensation expense for the three and nine months ended October 31, 2016: Three Months Ended October 31, Nine Months Ended October 31, 2016 2015 2016 2015 (in thousands) (in thousands) Cost of subscription $ 32 $ 21 $ 81 $ 55 Cost of maintenance and other revenue 80 69 219 202 Cost of professional services 232 189 618 542 Sales and marketing 306 350 904 1,040 Research and development 262 227 748 665 General and administrative 908 1,025 2,951 3,114 Total stock-based compensation expense $ 1,820 $ 1,881 $ 5,521 $ 5,618 SAR Information The weighted average assumptions used to value SARs granted in the nine months ended October 31, 2016 and 2015 are shown in the following table: Nine Months Ended October 31, 2016 2015 Expected life in years (1) 5.25 5.00 Risk free interest rate (2) 1.16 % 1.64 % Volatility (3) 36 % 41 % Dividend rate (4) 1.51 % 1.10 % ____________________________ (1) The expected life of SARs granted under the stock-based compensation plans is based on historical vested SAR exercise and post-vest forfeiture patterns and includes an estimate of the expected term for SARs that were fully vested and outstanding. (2) The risk-free interest rate is based on the U.S. Treasury yield for a term consistent with the expected life of SARs in effect at the time of grant. (3) The Company estimates the volatility of its common stock at the date of grant based on the historical volatility of the Company’s common stock for a period equivalent to the expected life of the SARs, which it believes is representative of the expected volatility over the expected life of the SARs. (4) The Company expects to continue paying quarterly dividends at the same rate as the nine months ending on October 31, 2016. The following table summarizes the activity for outstanding SARs for the nine months ended October 31, 2016: SARs (in thousands) Weighted Average Exercise Price per Share Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at January 31, 2016 2,596 $ 14.74 Granted 380 18.64 Exercised (97 ) 10.94 Expired (17 ) 12.56 Forfeited (6 ) 12.16 Outstanding at October 31, 2016 2,856 15.41 4.6 $ 24,198 Vested and exercisable at October 31, 2016 1,863 12.86 3.6 $ 20,304 The aggregate intrinsic value in the table above represents the total pretax intrinsic value (the aggregate difference between the closing stock price of the Company’s common stock based on the last trading day as of October 31, 2016, and the exercise price for in-the-money SARs) that would have been received by the holders if all SARs had been exercised on October 31, 2016. The total intrinsic value of SARs exercised in the nine months ended October 31, 2016 was $0.9 million. The number of SARs exercised includes shares withheld on behalf of employees to satisfy minimum statutory tax withholding requirements. During the three months ended October 31, 2016, the Company withheld 4,200 shares for payment of these taxes at a value of $96,000. During the nine months ended October 31, 2016, the Company withheld 13,000 shares for payment of these taxes at a value of $266,000. At October 31, 2016, there was approximately $5.6 million of total unrecognized compensation cost related to unvested SARs. This cost is expected to be recognized over a weighted-average period of approximately 2.6 years. RSU Information The estimated fair value of RSUs was calculated based on the closing price of the Company’s common stock on the date of grant, reduced by the present value of dividends foregone during the vesting period. The following table summarizes the activity for RSUs for the nine months ended October 31, 2016: RSUs Weighted Average Grant Date Fair Value (in thousands) Restricted stock at January 31, 2016 617 $ 20.91 Granted 307 18.54 Released (1) (258 ) 18.95 Forfeited (35 ) 20.79 Restricted stock at October 31, 2016 631 $ 20.56 _________________________ (1) The number of RSUs released includes shares withheld on behalf of employees to satisfy the minimum statutory tax withholding requirements. The Company withholds, at the employee’s election, a portion of the released shares as consideration for the Company’s payment of applicable employee income taxes. During the three months ended October 31, 2016, the Company withheld 2,200 shares for payment of these taxes at a value of $46,000. During the nine months ended October 31, 2016, the Company withheld 74,700 shares for payment of these taxes at a value of $1.5 million. Total unrecognized compensation cost related to RSUs was approximately $11.2 million as of October 31, 2016. This cost is expected to be recognized over a weighted-average period of approximately 2.8 years. |
Note 11 - Deferred Revenues
Note 11 - Deferred Revenues | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Deferred Revenue Disclosure [Text Block] | 11. DEFERRED REVENUES Deferred revenues consisted of the following: October 31 , 2016 January 31, 2016 (in thousands) Deferred maintenance revenue $ 52,817 $ 79,533 Deferred subscription revenue 17,873 14,194 Deferred services revenue 2,331 2,332 Deferred license revenue 854 1,549 Deferred other revenue 107 303 Deferred revenues, current 73,982 97,911 Deferred revenues, non-current (in Other liabilities) 2,039 1,690 Total deferred revenues $ 76,021 $ 99,601 Deferred maintenance and subscription revenues represent customer payments made in advance for support and subscription contracts. Support and subscription are billed in advance with corresponding revenues being recognized ratably over the support and subscription periods. Support is typically billed annually while subscription is billed quarterly or annually. Deferred services revenues represent both prepayments for our professional services where revenues for these services are generally recognized as the Company completes the performance obligations for the prepaid services; and services already provided but deferred due to software revenue recognition rules. Deferred license revenues result from undelivered products or specified enhancements, customer specific acceptance provisions and software license transactions that cannot be segmented from undelivered consulting or other services. |
Note 12 - Commitments and Conti
Note 12 - Commitments and Contingencies | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Commitments and Contingencies Disclosure [Text Block] | 12. COMMITMENTS AND CONTINGENCIES Indemnifications The Company sells software licenses and services to its customers under written agreements. Each agreement contains the relevant terms of the contractual arrangement with the customer and generally includes certain provisions for indemnifying the customer against losses, expenses and liabilities from damages that may be awarded against the customer in the event the Company’s software is found to infringe upon certain intellectual property rights of a third party. The agreements generally limit the scope of and remedies for such indemnification obligations in a variety of industry-standard respects. The Company believes its internal development processes and other policies and practices limit its exposure related to the indemnification provisions of the agreements. For several reasons, including the lack of prior indemnification claims and the lack of a monetary liability limit for certain infringement cases under the agreements, the Company cannot determine the maximum amount of potential future payments, if any, related to such indemnification provisions. Legal Actions The Company is subject to various legal proceedings and claims, either asserted or unasserted, which arise in the ordinary course of business. While the outcome of these claims cannot be predicted with certainty, management does not believe that the outcome of any of these legal matters will have a material adverse effect on the Company’s consolidated results of operations, financial position or liquidity. |
Note 13 - Business Segment Info
Note 13 - Business Segment Information | 9 Months Ended |
Oct. 31, 2016 | |
Notes to Financial Statements | |
Segment Reporting Disclosure [Text Block] | 13. BUSINESS SEGMENT INFORMATION The Company markets its products and services worldwide, primarily to companies in the manufacturing industry, including automotive, consumer products, food and beverage, high technology, industrial products and life sciences industries. The Company sells and licenses its products through its direct sales force in four geographic regions: North America; Europe, the Middle East and Africa (“EMEA”); Asia Pacific; and Latin America and through distributors where third parties can extend sales reach more effectively or efficiently. The North America region includes the United States and Canada. The EMEA region includes Europe, the Middle East and Africa. The Asia Pacific region includes Asia and Australia. The Latin America region includes South America, Central America and Mexico. The Company’s Chief Operating Decision Maker, the Chief Executive Officer, reviews the consolidated results within one operating segment. License revenue is assigned to the geographic regions based on the estimated proportion of users in each region at the time of sale. Maintenance and subscription revenues are allocated to the region where the end user customer is located. Services revenue is assigned based on the region where the services are performed. Three Months Ended October 31 , Nine Months Ended October 31 , 2016 2015 2016 2015 (in thousands) (in thousands) Revenue: North America (1) $ 33,413 $ 32,417 $ 95,747 $ 96,168 EMEA 19,334 19,376 58,961 62,730 Asia Pacific 11,932 11,813 35,749 35,135 Latin America 4,855 4,431 14,252 14,560 $ 69,534 $ 68,037 $ 204,709 $ 208,593 ____________________________ (1) Sales into Canada accounted for 2% of North America total revenue in each of the three and nine months ended October 31, 2016 and 2015. |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 9 Months Ended |
Oct. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements fairly present the financial information contained therein. These statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. In management’s opinion, all necessary adjustments, consisting of normal, recurring and non-recurring adjustments, have been included in the accompanying Condensed Consolidated Financial Statements to present fairly the financial position and operating results of QAD Inc. (“QAD” or the “Company”). The Condensed Consolidated Financial Statements do not include all disclosures required by accounting principles generally accepted in the United States of America for annual financial statements and should be read in conjunction with the audited financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended January 31, 2016. The Condensed Consolidated Financial Statements include the results of the Company and its wholly owned subsidiaries. The results of operations for the three and nine months ended October 31, 2016 are not necessarily indicative of the results to be expected for the year ending January 31, 2017. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements With the exception of those discussed below, there have been no recent changes in accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”) or adopted by the Company during the nine months ended October 31, 2016, that are of significance, or potential significance, to the Company. Accounting Standards Adopted In March 2016, the FASB issued Accounting Standards Update No. 2016-09 ("ASU 2016-09") regarding ASC Topic 718, “Improvements to Employee Share-Based Payment Accounting.” The new guidance requires excess tax benefits and tax deficiencies to be recorded in the income statement when the awards vest or are settled. In addition, cash flows related to excess tax benefits will no longer be separately classified as a financing activity apart from other income tax cash flows. The standard also increases the amount of shares an employer can withhold for tax purposes without triggering liability accounting, clarifies that all cash payments made on an employee's behalf for withheld shares should be presented as a financing activity in the statements of cash flows, and provides an entity-wide accounting policy election to account for forfeitures as they occur. QAD elected to early adopt the new guidance in the third quarter of fiscal year 2017 which requires us to reflect any adjustments as of February 1, 2016, the beginning of the annual period that includes the interim period of adoption. The primary impact of adoption was the recognition of excess tax benefits in our provision for income taxes rather than paid-in capital for all periods in fiscal year 2017. Additional amendments to the accounting for income taxes resulted in the recognition of prior year unrealized excess tax benefits. This recognition resulted in an increase to our deferred tax assets of $2.2 million, an increase to valuation allowance $1.2 million and an offset to opening accumulated deficit of $1.0 million. QAD elected to account for forfeitures as they occur using a modified retrospective transition method, which resulted in a cumulative-effect adjustment of $0.4 million to reduce the February 1, 2016 opening accumulated deficit. Additional amendments to the accounting for minimum statutory withholding tax requirements had no impact to opening accumulated deficit as of February 1, 2016 as QAD does not withhold more than the minimum statutory requirements. We elected to apply the presentation requirements for cash flows related to excess tax benefits retrospectively to all periods presented which resulted in an increase to net cash provided by operating activities and a decrease to net cash used in financing of $0.3 million for the six months ended July 31, 2016. The presentation requirements for cash flows related to employee taxes paid for withheld shares had no impact to any of the periods presented in our consolidated cash flows statements since such cash flows have historically been presented as a financing activity. With the adoption of the new standard we are required to revise our reported quarterly results for the six months ended July 31, 2016. Accordingly, this table reflects the retrospective adjustments made to beginning accumulated deficit and to the previously reported results for the six months ended July 31, 2016: Condensed Consolidated Balance Sheets ASU 2016-09 Adoption Adjustments (in thousands) As Reported July 31, 20 16 February 1, 2016 For The Six Months Ended July 31, 2016 As Adjusted July 31, 20 16 Other current assets $ 18,369 $ — $ (104 ) $ 18,265 Deferred tax assets, net 12,156 995 — 13,151 Additional paid-in capital 194,943 388 (422 ) 194,909 Accumulated deficit $ (45,767 ) $ 607 $ 318 $ (44,842 ) Condensed Consolidated Statements of Operations (in thousands, except per share data) As Reported Six Months Ended July 31, 2016 ASU 2016-09 Adoption Adjustments As Adjusted Six Months Ended July 31, 2016 Cost of revenue: Subscription fees $ 12,945 $ (5 ) $ 12,940 Maintenance and other 15,532 (21 ) 15,511 Professional services 35,048 (47 ) 35,001 Total cost of revenue 65,015 (73 ) 64,942 Gross profit 70,160 73 70,233 Operating expenses: Sales and marketing 34,322 (90 ) 34,232 Research and development 22,283 (71 ) 22,212 General and administrative 16,526 (37 ) 16,489 Total operating expenses 73,462 (198 ) 73,264 Operating loss (3,302 ) 271 (3,031 ) Loss before income taxes (3,743 ) 271 (3,472 ) Income tax benefit (1,601 ) (47 ) (1,648 ) Net loss $ (2,142 ) $ 318 $ (1,824 ) Basic and diluted weighted average shares outstanding: Class A 15,644 – 15,644 Class B 3,204 – 3,204 Basic and diluted net loss per share: Class A $ (0.12 ) $ 0.02 $ (0.10 ) Class B $ (0.10 ) $ 0.02 $ (0.08 ) In April 2015, the FASB issued ASU 2015-03 - Interest - Imputation of Interest (Subtopic 2015-03): Simplifying the Presentation of Debt Issuance Costs In August 2015, the FASB issued ASU 2015-15, Interest-Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line of Credit Arrangements Accounting Standards Not Yet Adop ted In May 2014, the FASB issued accounting standard update, or ASU, 2014-09, Revenue from Contracts with Customers Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) In October 2016, the FASB issued ASU 2016-16, Income Taxes: Intra-Entity Transfers of Assets Other than Inventory |
Note 1 - Basis of Presentatio20
Note 1 - Basis of Presentation and Recent Accounting Pronouncements (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Notes Tables | |
New Accounting Pronouncement, Early Adoption [Table Text Block] | Condensed Consolidated Balance Sheets ASU 2016-09 Adoption Adjustments (in thousands) As Reported July 31, 20 16 February 1, 2016 For The Six Months Ended July 31, 2016 As Adjusted July 31, 20 16 Other current assets $ 18,369 $ — $ (104 ) $ 18,265 Deferred tax assets, net 12,156 995 — 13,151 Additional paid-in capital 194,943 388 (422 ) 194,909 Accumulated deficit $ (45,767 ) $ 607 $ 318 $ (44,842 ) (in thousands, except per share data) As Reported Six Months Ended July 31, 2016 ASU 2016-09 Adoption Adjustments As Adjusted Six Months Ended July 31, 2016 Cost of revenue: Subscription fees $ 12,945 $ (5 ) $ 12,940 Maintenance and other 15,532 (21 ) 15,511 Professional services 35,048 (47 ) 35,001 Total cost of revenue 65,015 (73 ) 64,942 Gross profit 70,160 73 70,233 Operating expenses: Sales and marketing 34,322 (90 ) 34,232 Research and development 22,283 (71 ) 22,212 General and administrative 16,526 (37 ) 16,489 Total operating expenses 73,462 (198 ) 73,264 Operating loss (3,302 ) 271 (3,031 ) Loss before income taxes (3,743 ) 271 (3,472 ) Income tax benefit (1,601 ) (47 ) (1,648 ) Net loss $ (2,142 ) $ 318 $ (1,824 ) Basic and diluted weighted average shares outstanding: Class A 15,644 – 15,644 Class B 3,204 – 3,204 Basic and diluted net loss per share: Class A $ (0.12 ) $ 0.02 $ (0.10 ) Class B $ (0.10 ) $ 0.02 $ (0.08 ) |
Note 2 - Computation of Net I21
Note 2 - Computation of Net Income (Loss) Per Share (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Notes Tables | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Three Months Ended Nine Months Ended October 31, October 31, 2016 2015 2016 2015 (in thousands, except per share data) (in thousands, except per share data) Net income (loss) $ 1,533 $ 2,586 $ (291 ) $ 4,766 Less: Dividends declared (1,328 ) (1,313 ) (3,970 ) (3,922 ) Undistributed net income (loss) $ 205 $ 1,273 $ (4,261 ) $ 844 Net income (loss) per share – Class A Common Stock Dividends declared $ 1,136 $ 1,121 $ 3,393 $ 3,346 Allocation of undistributed net income (loss) 175 1,087 (3,638 ) 721 Net income (loss) attributable to Class A common stock $ 1,311 $ 2,208 $ (245 ) $ 4,067 Weighted average shares of Class A common stock outstanding— basic 15,773 15,559 15,687 15,431 Weighted average potential shares of Class A common stock 829 749 — 777 Weighted average shares of Class A common stock and potential common shares outstanding— diluted 16,602 16,308 15,687 16,208 Basic net income (loss) per Class A common share $ 0.08 $ 0.14 $ (0.02 ) $ 0.26 Diluted net income (loss) per Class A common share $ 0.08 $ 0.14 $ (0.02 ) $ 0.25 Net income (loss) per share – Class B Common Stock Dividends declared $ 192 $ 192 $ 577 $ 576 Allocation of undistributed net income (loss) 30 186 (623 ) 123 Net income (loss) attributable to Class B common stock $ 222 $ 378 $ (46 ) $ 699 Weighted average shares of Class B common stock outstanding— basic 3,206 3,203 3,205 3,200 Weighted average potential shares of Class B common stock 95 83 — 83 Weighted average shares of Class B common stock and potential common shares outstanding— diluted 3,301 3,286 3,205 3,283 Basic net income (loss) per Class B common share $ 0.07 $ 0.12 $ (0.01 ) $ 0.22 Diluted net income (loss) per Class B common share $ 0.07 $ 0.12 $ (0.01 ) $ 0.21 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | Three Months Ended Nine Months Ended October 31 , October 31 , 2016 2015 2016 2015 (in thousands) (in thousands) Class A 1,135 640 1,029 490 Class B 180 120 151 92 |
Note 3 - Fair Value Measureme22
Note 3 - Fair Value Measurements (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Notes Tables | |
Fair Value Measurements, Recurring and Nonrecurring [Table Text Block] | Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Money market mutual funds as of October 31, 2016 (a) $ 110,735 Money market mutual funds as of January 31, 2016 (a) $ 113,984 Liability related to the interest rate swap as of October 31, 2016 (b) $ (644 ) Liability related to the interest rate swap as of January 31, 2016 (b) $ (675 ) |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block] | (Liability) Derivative Fair Value Balance Sheet Location October 31, 2016 January 31, 2016 Derivative instrument: Interest rate swap Other liabilities $ (644 ) $ (675 ) Total $ (644 ) $ (675 ) |
Note 4 - Capitalized Software23
Note 4 - Capitalized Software Costs (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Notes Tables | |
Schedule of Capitalized Software Costs [Table Text Block] | October 31 , 2016 January 31, 2016 (in thousands) Capitalized software costs: Acquired software technology $ 3,458 $ 3,458 Capitalized software development costs 772 1,029 Total capitalized software costs 4,230 4,487 Less accumulated amortization (3,296 ) (2,934 ) Capitalized software costs, net $ 934 $ 1,553 |
Schedule of Capitalized Software Costs Amortization Expense [Table Text Block] | Fiscal Years (in thousands) 2017 remaining $ 241 2018 598 2019 74 2020 21 Total $ 934 |
Note 5 - Goodwill and Intangi24
Note 5 - Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Notes Tables | |
Schedule of Goodwill [Table Text Block] | Gross Carrying Amount Accumulated Impairment Goodwill, Net (in thousands) Balance at January 31, 2016 $ 26,253 $ (15,608 ) $ 10,645 Impact of foreign currency translation 12 — 12 Balance at October 31, 2016 $ 26,265 $ (15,608 ) $ 10,657 |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | October 31 , 2016 January 31, 2016 (in thousands) Amortizable intangible assets Customer relationships (1) $ 2,754 $ 2,749 Trade name 515 515 Total amortizable intangible assets 3,269 3,264 Less: accumulated amortization (2,688 ) (2,191 ) Net amortizable intangible assets $ 581 $ 1,073 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | Fiscal Years (in thousands) 2017 remaining $ 164 2018 417 Total $ 581 |
Note 6 - Debt (Tables)
Note 6 - Debt (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Notes Tables | |
Schedule of Debt [Table Text Block] | October 31, 2016 January 31, 2016 (in thousands) Note payable $ 14,377 $ 14,680 Less current maturities (441 ) (422 ) Less loan origination costs, net (59 ) (67 ) Long-term debt $ 13,877 $ 14,191 |
Note 7 - Accumulated Other Co26
Note 7 - Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Notes Tables | |
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | Foreign Currency Translation Adjustments (in thousands) Balance as of January 31, 2016 $ (8,729 ) Other comprehensive income 341 Amounts reclassified from accumulated other comprehensive loss — Net current period other comprehensive income 341 Balance as of October 31, 2016 $ (8,388 ) |
Note 9 - Stockholders' Equity (
Note 9 - Stockholders' Equity (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Notes Tables | |
Dividends Declared [Table Text Block] | Declaration Date Record Date Payable Dividend Class A Dividend Class B Amount 9/14/2016 9/28/2016 10/5/2016 $ 0.072 $ 0.06 $ 1,328,000 6/14/2016 6/28/2016 7/7/2016 $ 0.072 $ 0.06 $ 1,326,000 4/12/2016 4/26/2016 5/3/2016 $ 0.072 $ 0.06 $ 1,316,000 |
Note 10 - Stock-based Compens28
Note 10 - Stock-based Compensation (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Notes Tables | |
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block] | Three Months Ended October 31, Nine Months Ended October 31, 2016 2015 2016 2015 (in thousands) (in thousands) Cost of subscription $ 32 $ 21 $ 81 $ 55 Cost of maintenance and other revenue 80 69 219 202 Cost of professional services 232 189 618 542 Sales and marketing 306 350 904 1,040 Research and development 262 227 748 665 General and administrative 908 1,025 2,951 3,114 Total stock-based compensation expense $ 1,820 $ 1,881 $ 5,521 $ 5,618 |
Schedule of Share-based Compensation, Stock Appreciation Rights, Valuation Assumption [Table Text block] | Nine Months Ended October 31, 2016 2015 Expected life in years (1) 5.25 5.00 Risk free interest rate (2) 1.16 % 1.64 % Volatility (3) 36 % 41 % Dividend rate (4) 1.51 % 1.10 % |
Schedule of Share-based Compensation, Stock Options and Stock Appreciation Rights Award Activity [Table Text Block] | SARs (in thousands) Weighted Average Exercise Price per Share Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at January 31, 2016 2,596 $ 14.74 Granted 380 18.64 Exercised (97 ) 10.94 Expired (17 ) 12.56 Forfeited (6 ) 12.16 Outstanding at October 31, 2016 2,856 15.41 4.6 $ 24,198 Vested and exercisable at October 31, 2016 1,863 12.86 3.6 $ 20,304 |
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity [Table Text Block] | RSUs Weighted Average Grant Date Fair Value (in thousands) Restricted stock at January 31, 2016 617 $ 20.91 Granted 307 18.54 Released (1) (258 ) 18.95 Forfeited (35 ) 20.79 Restricted stock at October 31, 2016 631 $ 20.56 |
Note 11 - Deferred Revenues (Ta
Note 11 - Deferred Revenues (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Notes Tables | |
Deferred Revenue, by Arrangement, Disclosure [Table Text Block] | October 31 , 2016 January 31, 2016 (in thousands) Deferred maintenance revenue $ 52,817 $ 79,533 Deferred subscription revenue 17,873 14,194 Deferred services revenue 2,331 2,332 Deferred license revenue 854 1,549 Deferred other revenue 107 303 Deferred revenues, current 73,982 97,911 Deferred revenues, non-current (in Other liabilities) 2,039 1,690 Total deferred revenues $ 76,021 $ 99,601 |
Note 13 - Business Segment In30
Note 13 - Business Segment Information (Tables) | 9 Months Ended |
Oct. 31, 2016 | |
Notes Tables | |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block] | Three Months Ended October 31 , Nine Months Ended October 31 , 2016 2015 2016 2015 (in thousands) (in thousands) Revenue: North America (1) $ 33,413 $ 32,417 $ 95,747 $ 96,168 EMEA 19,334 19,376 58,961 62,730 Asia Pacific 11,932 11,813 35,749 35,135 Latin America 4,855 4,431 14,252 14,560 $ 69,534 $ 68,037 $ 204,709 $ 208,593 |
Note 1 - Basis of Presentatio31
Note 1 - Basis of Presentation and Recent Accounting Pronouncements (Details Textual) - USD ($) $ in Thousands | 9 Months Ended | ||
Oct. 31, 2016 | Feb. 01, 2016 | Jan. 31, 2016 | |
Effect of Recognition of Excess Tax Benenfits in Income Taxes Rather Than Additional Paid-in Capital [Member] | |||
Deferred Tax Assets, Gross | $ 2,200 | ||
Deferred Tax Assets, Valuation Allowance | 1,200 | ||
Retained Earnings (Accumulated Deficit) | 1,000 | ||
Effect of Accounting Forfeitures as Occur [Member] | |||
Retained Earnings (Accumulated Deficit) | $ 400 | ||
Increase in Cash Provided By Operating Activities, and a Decrease in Cash Used in Financing Activities [Member] | July 31, 2016 [Member] | |||
Prior Period Reclassification Adjustment | $ 300 | ||
Retained Earnings (Accumulated Deficit) | $ (44,637) | $ (40,376) |
Note 1 - Basis of Presentatio32
Note 1 - Basis of Presentation and Recent Accounting Pronouncements - Adjustment to Financial Statements (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||||
Oct. 31, 2016 | Oct. 31, 2015 | Jul. 31, 2016 | Oct. 31, 2016 | Oct. 31, 2015 | Feb. 01, 2016 | Jan. 31, 2016 | |
New Accounting Pronouncement, Early Adoption, Effect [Member] | Scenario, Previously Reported [Member] | Common Class A [Member] | |||||||
Basic and diluted weighted average shares outstanding (in shares) | 15,644 | ||||||
Basic and diluted net loss per share (in dollars per share) | $ (0.12) | ||||||
New Accounting Pronouncement, Early Adoption, Effect [Member] | Scenario, Previously Reported [Member] | Common Class B [Member] | |||||||
Basic and diluted weighted average shares outstanding (in shares) | 3,204 | ||||||
Basic and diluted net loss per share (in dollars per share) | $ (0.10) | ||||||
New Accounting Pronouncement, Early Adoption, Effect [Member] | Scenario, Previously Reported [Member] | |||||||
Other current assets | $ 18,369 | ||||||
Deferred tax assets, net | 12,156 | ||||||
Additional paid-in capital | 194,943 | ||||||
Accumulated deficit | (45,767) | ||||||
Subscription fees | 12,945 | ||||||
Maintenance and other | 15,532 | ||||||
Professional services | 35,048 | ||||||
Total cost of revenue | 65,015 | ||||||
Gross profit | 70,160 | ||||||
Sales and marketing | 34,322 | ||||||
Research and development | 22,283 | ||||||
General and administrative | 16,526 | ||||||
Total operating expenses | 73,462 | ||||||
Operating loss | (3,302) | ||||||
Loss before income taxes | (3,743) | ||||||
Income Tax Expense (Benefit) | (1,601) | ||||||
Net loss | $ (2,142) | ||||||
New Accounting Pronouncement, Early Adoption, Effect [Member] | Restatement Adjustment [Member] | Common Class A [Member] | |||||||
Basic and diluted weighted average shares outstanding (in shares) | |||||||
Basic and diluted net loss per share (in dollars per share) | $ 0.02 | ||||||
New Accounting Pronouncement, Early Adoption, Effect [Member] | Restatement Adjustment [Member] | Common Class B [Member] | |||||||
Basic and diluted weighted average shares outstanding (in shares) | |||||||
Basic and diluted net loss per share (in dollars per share) | $ 0.02 | ||||||
New Accounting Pronouncement, Early Adoption, Effect [Member] | Restatement Adjustment [Member] | |||||||
Other current assets | $ (104) | ||||||
Deferred tax assets, net | 995 | ||||||
Additional paid-in capital | (422) | 388 | |||||
Accumulated deficit | 318 | $ 607 | |||||
Subscription fees | (5) | ||||||
Maintenance and other | (21) | ||||||
Professional services | (47) | ||||||
Total cost of revenue | (73) | ||||||
Gross profit | 73 | ||||||
Sales and marketing | (90) | ||||||
Research and development | (71) | ||||||
General and administrative | (37) | ||||||
Total operating expenses | (198) | ||||||
Operating loss | 271 | ||||||
Loss before income taxes | 271 | ||||||
Income Tax Expense (Benefit) | (47) | ||||||
Net loss | $ 318 | ||||||
New Accounting Pronouncement, Early Adoption, Effect [Member] | Common Class A [Member] | |||||||
Basic and diluted weighted average shares outstanding (in shares) | 15,644 | ||||||
Basic and diluted net loss per share (in dollars per share) | $ (0.10) | ||||||
New Accounting Pronouncement, Early Adoption, Effect [Member] | Common Class B [Member] | |||||||
Basic and diluted weighted average shares outstanding (in shares) | 3,204 | ||||||
Basic and diluted net loss per share (in dollars per share) | $ (0.08) | ||||||
New Accounting Pronouncement, Early Adoption, Effect [Member] | |||||||
Other current assets | $ 18,265 | ||||||
Deferred tax assets, net | 13,151 | ||||||
Additional paid-in capital | 194,909 | ||||||
Accumulated deficit | (44,842) | ||||||
Subscription fees | 12,940 | ||||||
Maintenance and other | 15,511 | ||||||
Professional services | 35,001 | ||||||
Total cost of revenue | 64,942 | ||||||
Gross profit | 70,233 | ||||||
Sales and marketing | 34,232 | ||||||
Research and development | 22,212 | ||||||
General and administrative | 16,489 | ||||||
Total operating expenses | 73,264 | ||||||
Operating loss | (3,031) | ||||||
Loss before income taxes | (3,472) | ||||||
Income Tax Expense (Benefit) | (1,648) | ||||||
Net loss | $ (1,824) | ||||||
Common Class A [Member] | |||||||
Net loss | $ 1,311 | $ 2,208 | $ (245) | $ 4,067 | |||
Common Class B [Member] | |||||||
Net loss | 222 | 378 | (46) | 699 | |||
Other current assets | 17,271 | 17,271 | $ 16,024 | ||||
Deferred tax assets, net | 12,758 | 12,758 | 12,914 | ||||
Additional paid-in capital | 196,382 | 196,382 | 195,808 | ||||
Accumulated deficit | (44,637) | (44,637) | $ (40,376) | ||||
Subscription fees | 7,145 | 5,134 | 20,085 | 15,360 | |||
Maintenance and other | 7,480 | 7,924 | 22,991 | 23,608 | |||
Professional services | 17,850 | 17,120 | 52,851 | 54,035 | |||
Total cost of revenue | 33,057 | 31,005 | 97,999 | 95,731 | |||
Gross profit | 36,477 | 37,032 | 106,710 | 112,862 | |||
Sales and marketing | 15,312 | 15,531 | 49,544 | 49,658 | |||
Research and development | 10,807 | 10,193 | 33,019 | 31,440 | |||
General and administrative | 7,934 | 7,676 | 24,423 | 24,719 | |||
Total operating expenses | 34,218 | 33,565 | 107,482 | 106,312 | |||
Operating loss | 2,259 | 3,467 | (772) | 6,550 | |||
Loss before income taxes | 2,688 | 3,315 | (784) | 6,701 | |||
Income Tax Expense (Benefit) | 1,155 | 729 | (493) | 1,935 | |||
Net loss | $ 1,533 | $ 2,586 | $ (291) | $ 4,766 |
Note 2 - Computation of Net I33
Note 2 - Computation of Net Income (Loss) Per Share - Computation of Basic and Diluted Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Common Class A [Member] | ||||
Net (loss) income | $ 1,311 | $ 2,208 | $ (245) | $ 4,067 |
Less: Dividends declared | (1,136) | (1,121) | (3,393) | (3,346) |
Undistributed net income (loss) | 175 | 1,087 | (3,638) | 721 |
Net (loss) income per share – Common Stock | ||||
Dividends declared | 1,136 | 1,121 | 3,393 | 3,346 |
Allocation of undistributed net income (loss) | 175 | 1,087 | (3,638) | 721 |
Net (loss) income | $ 1,311 | $ 2,208 | $ (245) | $ 4,067 |
Weighted average shares of common stock outstanding—basic (in shares) | 15,773 | 15,559 | 15,687 | 15,431 |
Weighted average potential shares of common stock (in shares) | 829 | 749 | 777 | |
Weighted average shares of common stock and potential common shares outstanding—diluted (in shares) | 16,602 | 16,308 | 15,687 | 16,208 |
Basic net (loss) income per share (in dollars per share) | $ 0.08 | $ 0.14 | $ (0.02) | $ 0.26 |
Diluted net (loss) income per share (in dollars per share) | $ 0.08 | $ 0.14 | $ (0.02) | $ 0.25 |
Common Class B [Member] | ||||
Net (loss) income | $ 222 | $ 378 | $ (46) | $ 699 |
Less: Dividends declared | (192) | (192) | (577) | (576) |
Undistributed net income (loss) | 30 | 186 | (623) | 123 |
Net (loss) income per share – Common Stock | ||||
Dividends declared | 192 | 192 | 577 | 576 |
Allocation of undistributed net income (loss) | 30 | 186 | (623) | 123 |
Net (loss) income | $ 222 | $ 378 | $ (46) | $ 699 |
Weighted average shares of common stock outstanding—basic (in shares) | 3,206 | 3,203 | 3,205 | 3,200 |
Weighted average potential shares of common stock (in shares) | 95 | 83 | 83 | |
Weighted average shares of common stock and potential common shares outstanding—diluted (in shares) | 3,301 | 3,286 | 3,205 | 3,283 |
Basic net (loss) income per share (in dollars per share) | $ 0.07 | $ 0.12 | $ (0.01) | $ 0.22 |
Diluted net (loss) income per share (in dollars per share) | $ 0.07 | $ 0.12 | $ (0.01) | $ 0.21 |
Net (loss) income | $ 1,533 | $ 2,586 | $ (291) | $ 4,766 |
Less: Dividends declared | (1,328) | (1,313) | (3,970) | (3,922) |
Undistributed net income (loss) | 205 | 1,273 | (4,261) | 844 |
Dividends declared | 1,328 | 1,313 | 3,970 | 3,922 |
Allocation of undistributed net income (loss) | 205 | 1,273 | (4,261) | 844 |
Net (loss) income | $ 1,533 | $ 2,586 | $ (291) | $ 4,766 |
Note 2 - Computation of Net I34
Note 2 - Computation of Net Income (Loss) Per Share - Anti-dilutive Shares (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Common Class A [Member] | ||||
Antidilutive securities excluded from computation of net income per share (in shares) | 1,135 | 640 | 1,029 | 490 |
Common Class B [Member] | ||||
Antidilutive securities excluded from computation of net income per share (in shares) | 180 | 120 | 151 | 92 |
Note 3 - Fair Value Measureme35
Note 3 - Fair Value Measurements (Details Textual) - USD ($) | 9 Months Ended | |||
Oct. 31, 2016 | Oct. 31, 2015 | Jan. 31, 2016 | Jan. 31, 2015 | |
Reported Value Measurement [Member] | ||||
Cash and Cash Equivalents, at Carrying Value | $ 25,000,000 | $ 24,000,000 | ||
Interest Rate Swap [Member] | ||||
Derivative, Gain (Loss) on Derivative, Net | 31,000 | $ 164,000 | ||
Cash and Cash Equivalents, at Carrying Value | $ 135,689,000 | $ 126,621,000 | $ 137,731,000 | $ 120,526,000 |
Note 3 - Fair Value Measureme36
Note 3 - Fair Value Measurements - Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Oct. 31, 2016 | Jan. 31, 2016 | |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Money market mutual funds | [1] | $ 110,735 | $ 113,984 |
Liability related to the interest rate swap | [2] | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Money market mutual funds | [1] | ||
Liability related to the interest rate swap | [2] | (644) | (675) |
Liability related to the interest rate swap | $ (644) | $ (675) | |
[1] | Money market mutual funds are recorded at fair value based upon quoted market prices. | ||
[2] | The liability related to the interest rate swap is recorded at fair value based upon a valuation model that uses relevant observable market inputs at quoted intervals, such as forward yield curves. |
Note 3 - Fair Value Measureme37
Note 3 - Fair Value Measurements - Fair Values of the Derivative Instrument (Details) - USD ($) $ in Thousands | Oct. 31, 2016 | Jan. 31, 2016 |
Interest Rate Swap [Member] | Other Liabilities [Member] | ||
Derivative instrument: | ||
Fair value of derivative instrument | $ (644) | $ (675) |
Fair value of derivative instrument | $ (644) | $ (675) |
Note 4 - Capitalized Software38
Note 4 - Capitalized Software Costs (Details Textual) - USD ($) $ in Millions | 9 Months Ended | |
Oct. 31, 2016 | Oct. 31, 2015 | |
Capitalized Computer Software Write-Downs | $ 0.4 | |
Capitalized Computer Software, Amortization | $ 0.7 | $ 0.8 |
Note 4 - Capitalized Software39
Note 4 - Capitalized Software Costs - Capitalized Software Costs and Accumulated Amortization (Details) - USD ($) $ in Thousands | Oct. 31, 2016 | Jan. 31, 2016 |
Capitalized software costs: | ||
Acquired software technology | $ 3,458 | $ 3,458 |
Capitalized software development costs | 772 | 1,029 |
Total capitalized software costs | 4,230 | 4,487 |
Less accumulated amortization | (3,296) | (2,934) |
Capitalized software costs, net | $ 934 | $ 1,553 |
Note 4 - Capitalized Software40
Note 4 - Capitalized Software Costs - Estimated Amortization Expense (Details) - USD ($) $ in Thousands | Oct. 31, 2016 | Jan. 31, 2016 |
Computer Software, Intangible Asset [Member] | ||
2017 remaining | $ 241 | |
2,018 | 598 | |
2,019 | 74 | |
2,020 | 21 | |
Total | 934 | |
2017 remaining | 164 | |
2,018 | 417 | |
Total | $ 581 | $ 1,073 |
Note 5 - Goodwill and Intangi41
Note 5 - Goodwill and Intangible Assets (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Goodwill, Impairment Loss | $ 0 | |||
Amortization of Intangible Assets | $ 165,000 | $ 165,000 | $ 496,000 | $ 495,000 |
Note 5 - Goodwill and Intangi42
Note 5 - Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Oct. 31, 2016 | Jan. 31, 2016 | |
Beginning balance, gross | $ 26,253 | |
Accumulated impairment | (15,608) | $ (15,608) |
Beginning balance, net | 10,645 | |
Impact of foreign currency translation, gross | 12 | |
Impact of foreign currency translation, accumulated impairment | ||
Impact of foreign currency translation, net | 12 | |
Ending balance, gross | 26,265 | |
Ending balance, net | $ 10,657 |
Note 5 - Goodwill and Intangi43
Note 5 - Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | Oct. 31, 2016 | Jan. 31, 2016 | |
Customer Relationships [Member] | |||
Amortizable intangible assets | |||
Amortizable intangible assets, gross | [1] | $ 2,754 | $ 2,749 |
Trade Names [Member] | |||
Amortizable intangible assets | |||
Amortizable intangible assets, gross | 515 | 515 | |
Amortizable intangible assets, gross | 3,269 | 3,264 | |
Less: accumulated amortization | (2,688) | (2,191) | |
Net amortizable intangible assets | $ 581 | $ 1,073 | |
[1] | Customer relationships include the impact of foreign currency translation. |
Note 5 - Goodwill and Intangi44
Note 5 - Goodwill and Intangible Assets - Estimated Amortization Expense Relating to Intangible Assets (Details) - USD ($) $ in Thousands | Oct. 31, 2016 | Jan. 31, 2016 |
Fiscal Years | ||
2017 remaining | $ 164 | |
2,018 | 417 | |
Total | $ 581 | $ 1,073 |
Note 6 - Debt (Details Textual)
Note 6 - Debt (Details Textual) | Oct. 31, 2016USD ($) | May 30, 2012USD ($) | Oct. 31, 2016USD ($) |
Unsecured Credit Agreement [Member] | Rabobank N.A [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Debt Instrument, Basis Spread on Variable Rate | 0.75% | ||
Unsecured Credit Agreement [Member] | Rabobank N.A [Member] | |||
Long-term Line of Credit | $ 0 | $ 0 | |
Line of Credit Facility, Maximum Borrowing Capacity | $ 20,000,000 | $ 20,000,000 | |
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.25% | ||
Debt Instrument, Interest Rate, Effective Percentage | 1.28% | 1.28% | |
Liquidity on Consolidated Basis Minimum | $ 25,000,000 | $ 25,000,000 | |
Current Ratio Minimum | 1.3 | 1.3 | |
Leverage Ratio Maximum | 1.5 | 1.5 | |
Debt Service Coverage Ratio, Minimum | 1.5 | 1.5 | |
2012 Mortgage [Member] | Rabobank N.A [Member] | Quad Ortega Hill LLC [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Debt Instrument, Basis Spread on Variable Rate | 2.25% | ||
2012 Mortgage [Member] | Rabobank N.A [Member] | Quad Ortega Hill LLC [Member] | Swap [Member] | |||
Derivative Liability, Notional Amount | $ 16,100,000 | ||
Derivative, Fixed Interest Rate | 4.31% | ||
2012 Mortgage [Member] | Rabobank N.A [Member] | Quad Ortega Hill LLC [Member] | |||
Debt Instrument, Face Amount | $ 16,100,000 | ||
Debt Instrument, Periodic Payment | 88,100 | ||
Final Principal Payment | $ 11,700,000 | ||
2012 Mortgage [Member] | Quad Ortega Hill LLC [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Debt Instrument, Basis Spread on Variable Rate | 0.53% | ||
2012 Mortgage [Member] | Quad Ortega Hill LLC [Member] | |||
Loans Payable to Bank | $ 14,400,000 | $ 14,400,000 |
Note 6 - Debt - Summary of Debt
Note 6 - Debt - Summary of Debt (Details) - USD ($) $ in Thousands | Oct. 31, 2016 | Jan. 31, 2016 |
Note payable | $ 14,377 | $ 14,680 |
Less current maturities | (441) | (422) |
Less loan origination costs, net | (59) | (67) |
Long-term debt | $ 13,877 | $ 14,191 |
Note 7 - Accumulated Other Co47
Note 7 - Accumulated Other Comprehensive Loss (Details Textual) | 9 Months Ended |
Oct. 31, 2016USD ($) | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | $ 0 |
Note 7 - Accumulated Other Co48
Note 7 - Accumulated Other Comprehensive Loss - Components of Accumulated Other Comprehensive Loss (Details) | 9 Months Ended |
Oct. 31, 2016USD ($) | |
Accumulated Foreign Currency Adjustment Attributable to Parent [Member] | |
Balance | $ (8,729,000) |
Other comprehensive income | 341,000 |
Amounts reclassified from accumulated other comprehensive loss | |
Net current period other comprehensive income | 341,000 |
Balance | (8,729,000) |
Amounts reclassified from accumulated other comprehensive loss | 0 |
Balance | $ (8,388,000) |
Note 8 - Income Taxes (Details
Note 8 - Income Taxes (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Income Tax Expense (Benefit) | $ 1,155 | $ 729 | $ (493) | $ 1,935 |
Effective Income Tax Rate Reconciliation, Percent | 43.00% | 22.00% | 63.00% | 29.00% |
Unrecognized Tax Benefits | $ 1,400 | $ 1,400 | ||
Unrecognized Tax Benefits, Period Increase (Decrease) | (1,000) | |||
Increase (Decrease) in Deferred Tax Asset | (1,000) | |||
Unrecognized Tax Benefits Recognized in Next Twelve Months | 100 | 100 | ||
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued | $ 200 | $ 200 |
Note 9 - Stockholders' Equity50
Note 9 - Stockholders' Equity (Details Textual) - USD ($) $ in Thousands | Feb. 18, 2015 | Jan. 22, 2015 | Oct. 31, 2016 | Oct. 31, 2015 |
Common Class A [Member] | ||||
Stock Issued During Period, Shares, New Issues | 450,000 | 2,000,000 | ||
Proceeds from Issuance of Common Stock | $ 8,400 | $ 37,000 | ||
Proceeds from Issuance of Common Stock | $ 8,365 |
Note 9 - Stockholders' Equity -
Note 9 - Stockholders' Equity - Dividends (Details) | 9 Months Ended |
Oct. 31, 2016USD ($)$ / shares | |
Dividends Declaration Date One [Member] | Common Class A [Member] | |
Dividend (in dollars per share) | $ 0.072 |
Dividends Declaration Date One [Member] | Common Class B [Member] | |
Dividend (in dollars per share) | $ 0.06 |
Dividends Declaration Date One [Member] | |
Record date | Sep. 28, 2016 |
Payable | Oct. 5, 2016 |
Amount | $ | $ 1,328,000 |
Dividends Declaration Date Two [Member] | Common Class A [Member] | |
Dividend (in dollars per share) | $ 0.072 |
Dividends Declaration Date Two [Member] | Common Class B [Member] | |
Dividend (in dollars per share) | $ 0.06 |
Dividends Declaration Date Two [Member] | |
Record date | Jun. 28, 2016 |
Payable | Jul. 7, 2016 |
Amount | $ | $ 1,326,000 |
Dividend Declaration Date Three [Member] | Common Class A [Member] | |
Dividend (in dollars per share) | $ 0.072 |
Dividend Declaration Date Three [Member] | Common Class B [Member] | |
Dividend (in dollars per share) | $ 0.06 |
Dividend Declaration Date Three [Member] | |
Record date | Apr. 26, 2016 |
Payable | May 3, 2016 |
Amount | $ | $ 1,316,000 |
Note 10 - Stock-based Compens52
Note 10 - Stock-based Compensation (Details Textual) - USD ($) | 9 Months Ended | |
Oct. 31, 2016 | Oct. 31, 2015 | |
Stock Appreciation Rights (SARs) [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $ 900,000 | |
Shares Paid for Tax Withholding for Share Based Compensation | 4,200 | 13,000 |
Adjustments Related to Tax Withholding for Share-based Compensation | $ 96,000 | $ 266,000 |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ 5,600,000 | |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 2 years 219 days | |
Restricted Stock Units (RSUs) [Member] | ||
Shares Paid for Tax Withholding for Share Based Compensation | 2,200 | 74,700 |
Adjustments Related to Tax Withholding for Share-based Compensation | $ 46,000 | $ 1,500,000 |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ 11,200,000 | |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 2 years 292 days |
Note 10 - Stock-based Compens53
Note 10 - Stock-based Compensation - Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Cost of Subscription [Member] | ||||
Stock-based compensation expense | $ 32 | $ 21 | $ 81 | $ 55 |
Cost of Maintenance and Other Revenue [Member] | ||||
Stock-based compensation expense | 80 | 69 | 219 | 202 |
Cost of Professional Services [Member] | ||||
Stock-based compensation expense | 232 | 189 | 618 | 542 |
Selling and Marketing Expense [Member] | ||||
Stock-based compensation expense | 306 | 350 | 904 | 1,040 |
Research and Development Expense [Member] | ||||
Stock-based compensation expense | 262 | 227 | 748 | 665 |
General and Administrative Expense [Member] | ||||
Stock-based compensation expense | 908 | 1,025 | 2,951 | 3,114 |
Stock-based compensation expense | $ 1,820 | $ 1,881 | $ 5,521 | $ 5,618 |
Note 10 - Stock-based Compens54
Note 10 - Stock-based Compensation - Weighted Average Assumptions to Value SARs (Details) - Stock Appreciation Rights (SARs) [Member] | 9 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | ||
Expected life in years | [1] | 5 years 91 days | 5 years |
Risk free interest rate | [2] | 1.16% | 1.64% |
Volatility | [3] | 36.00% | 41.00% |
Dividend rate | [4] | 1.51% | 1.10% |
[1] | The expected life of SARs granted under the stock-based compensation plans is based on historical vested SAR exercise and post-vest forfeiture patterns and includes an estimate of the expected term for SARs that were fully vested and outstanding. | ||
[2] | The risk-free interest rate is based on the U.S. Treasury yield for a term consistent with the expected life of SARs in effect at the time of grant. | ||
[3] | The Company estimates the volatility of its common stock at the date of grant based on the historical volatility of the Company's common stock for a period equivalent to the expected life of the SARs, which it believes is representative of the expected volatility over the expected life of the SARs. | ||
[4] | The Company expects to continue paying quarterly dividends at the same rate as the nine months ending on October 31, 2016. |
Note 10 - Stock-based Compens55
Note 10 - Stock-based Compensation - SARs Activity (Details) $ / shares in Units, $ in Thousands | 9 Months Ended |
Oct. 31, 2016USD ($)$ / sharesshares | |
Stock Appreciation Rights (SARs) [Member] | |
Outstanding (in shares) | shares | 2,596 |
Outstanding (in dollars per share) | $ / shares | $ 14.74 |
Granted (in shares) | shares | 380 |
Granted (in dollars per share) | $ / shares | $ 18.64 |
Exercised (in shares) | shares | (97) |
Exercised (in dollars per share) | $ / shares | $ 10.94 |
Expired (in shares) | shares | (17) |
Expired (in dollars per share) | $ / shares | $ 12.56 |
Forfeited (in shares) | shares | (6) |
Forfeited (in dollars per share) | $ / shares | $ 12.16 |
Outstanding (in shares) | shares | 2,856 |
Outstanding (in dollars per share) | $ / shares | $ 15.41 |
Outstanding | 4 years 219 days |
Outstanding | $ | $ 24,198 |
Vested and exercisable (in shares) | shares | 1,863 |
Vested and exercisable (in dollars per share) | $ / shares | $ 12.86 |
Vested and exercisable | 3 years 219 days |
Vested and exercisable | $ | $ 20,304 |
Note 10 - Stock-base Compensati
Note 10 - Stock-base Compensation - RSUs Activity (Details) shares in Thousands | 9 Months Ended | |
Oct. 31, 2016$ / sharesshares | ||
Restricted Stock Units (RSUs) [Member] | ||
Restricted stock (in shares) | shares | 617 | |
Restricted stock (in dollars per share) | $ / shares | $ 20.91 | |
Granted (in shares) | shares | 307 | |
Granted (in dollars per share) | $ / shares | $ 18.54 | |
Released (1) (in shares) | shares | (258) | [1] |
Released (1) (in dollars per share) | $ / shares | $ 18.95 | [1] |
Forfeited (in shares) | shares | (35) | |
Forfeited (in dollars per share) | $ / shares | $ 20.79 | |
Restricted stock (in shares) | shares | 631 | |
Restricted stock (in dollars per share) | $ / shares | $ 20.56 | |
[1] | The number of RSUs released includes shares withheld on behalf of employees to satisfy statutory tax withholding requirements. |
Note 11 - Deferred Revenues - S
Note 11 - Deferred Revenues - Summary of Deferred Revenues (Details) - USD ($) $ in Thousands | Oct. 31, 2016 | Jan. 31, 2016 |
Software Service, Support and Maintenance Arrangement [Member] | ||
Deferred revenue | $ 52,817 | $ 79,533 |
Subscription Arrangement [Member] | ||
Deferred revenue | 17,873 | 14,194 |
Nonsoftware Service, Support and Maintenance Arrangement [Member] | ||
Deferred revenue | 2,331 | 2,332 |
Software License Arrangement [Member] | ||
Deferred revenue | 854 | 1,549 |
Deferred Other Revenue [Member] | ||
Deferred revenue | 107 | 303 |
Deferred revenue | 73,982 | 97,911 |
Deferred revenues, non-current (in Other liabilities) | 2,039 | 1,690 |
Total deferred revenues | $ 76,021 | $ 99,601 |
Note 13 - Business Segment In58
Note 13 - Business Segment Information (Details Textual) | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Percentage of Sales Into Canada to North America Total Revenue | 2.00% | 2.00% | 2.00% | 2.00% |
Number of Geographic Locations | 4 | |||
Number of Operating Segments | 1 |
Note 13 - Business Segment In59
Note 13 - Business Segment Information - Revenue by Region (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | ||
Reportable Geographical Components [Member] | North America [Member] | |||||
Revenue | [1] | $ 33,413 | $ 32,417 | $ 95,747 | $ 96,168 |
Reportable Geographical Components [Member] | EMEA [Member] | |||||
Revenue | 19,334 | 19,376 | 58,961 | 62,730 | |
Reportable Geographical Components [Member] | Asia Pacific [Member] | |||||
Revenue | 11,932 | 11,813 | 35,749 | 35,135 | |
Reportable Geographical Components [Member] | Latin America [Member] | |||||
Revenue | 4,855 | 4,431 | 14,252 | 14,560 | |
Reportable Geographical Components [Member] | |||||
Revenue | 69,534 | 68,037 | 204,709 | 208,593 | |
Revenue | $ 69,534 | $ 68,037 | $ 204,709 | $ 208,593 | |
[1] | Sales into Canada accounted for 2% of North America total revenue in each of the three and nine months ended October 31, 2016 and 2015. |