Exhibit 99.1
Interactive Intelligence Reports Record Results
Fourth quarter revenues up 22 percent with improved profitability
INDIANAPOLIS Jan. 30, 2006 - Interactive Intelligence Inc. (Nasdaq: ININ), a global developer of business communications software, today reported results for its quarter and fiscal year ending Dec. 31, 2005.
Total revenues for the company’s 2005 fourth quarter increased 22 percent to $17.5 million compared to $14.4 million for the fourth quarter of 2004. Net income for the fourth quarter of 2005 was $1.8 million, up from $514,000 in the same quarter of the previous year. Diluted earnings per share (EPS) for the fourth quarter of 2005 were $0.10, up from $0.03 in the same period of 2004.
Revenues for the 2005 fiscal year totaled $62.9 million, an increase of 14 percent from $55.1 million in 2004. Net income for 2005 was $2.1 million, up from $1.0 million for 2004, with diluted EPS of $0.13 for 2005, compared to $.06 for 2004.
Cash and short-term investments increased to $15.1 million at year-end, up from $11.6 million, net of borrowings on the line of credit, at the end of 2004.
“The fourth quarter is traditionally our strongest quarter and this year we executed remarkably well,” said Interactive Intelligence president and CEO, Dr. Donald E. Brown. “Our net income numbers improved sharply as a result of increased revenues and effective cost management. Sales performance was particularly good in North America and Europe as we saw continued growth and penetration in the large-sized contact center market and solid demand across all product lines. Additionally, our Vonexus subsidiary continued its strong growth ramp, and during the quarter we successfully launched the latest version of our contact center automation software -- Customer Interaction Center® (CIC). We closed out a record year with a solid fourth quarter finish. These results provide strong momentum for the company and our partners as we move into 2006.”
Fourth quarter highlights included new and follow-on customer contracts signed by DialAmerica Marketing (the largest privately owned telemarketing company in the U.S.), Harrah's Operating Company, Inc., University of California, San Diego, and many others.
The company’s products continue to be applauded in the market. TMCnet, an online industry authority, praised the most recent version of CIC as “a mix of functionality, scalability, and improved ROI.” Communité®, the company’s unified communications and messaging software, received Network Computing magazine’s Editor’s Choice award based on a comparative lab test in which it beat out products from 3COM and Siemens. And Enterprise Interaction Center® (EIC), the flagship product of subsidiary, Vonexus, received INTERNET TELEPHONY magazine’s Excellence Award for its standards-based, all-Microsoft IP PBX solution.
Brown added: “These results reflect the plan that we have been executing on during the past two years. We are encouraged by the increase in orders, which demonstrates that more and more customers see the strong value in our contact center and enterprise IP telephony products. We will continue on the path of driving innovation into all aspects of our products and business processes. Overall, we are pleased with our progress and excited about the growth strategy we have in place for 2006.”
Interactive Intelligence will host an earnings conference call today at 4:30 p.m. Eastern time (EST), featuring Dr. Brown and the company's CFO, Stephen R. Head. There will be a live Q&A session following opening remarks. The teleconference is expected to last approximately 45 minutes.
To access the teleconference, please dial 1 888.313.7413 at least five minutes prior to the start of the call. Ask for the teleconference by the following name: “Interactive Intelligence fourth quarter and year-end earnings call.”
The teleconference will also be broadcast live on the company's investor relations' page at http://www.ININ.com/investors. An archive of the teleconference will be posted following the call.
To receive a copy of the earnings release, please call 317.872.3000 and press "4" for investor relations, or e-mail investorrelations@inin.com.
About Interactive Intelligence
Interactive Intelligence Inc. (Nasdaq: ININ) offers business communications software solutions for contact center automation, enterprise IP telephony, unified communications, and self-service automation. The company was founded in 1994 and has more than 1,500 customers worldwide. Recent awards include Software Magazine’s 2005 Top 500 Global Software and Services Companies, Miercom’s 2005 Best Integrated Multimedia IP Contact Center product award, and Frost & Sullivan’s 2005 Excellence in Technology of the Year Award. Interactive Intelligence employs approximately 350 people and is headquartered in Indianapolis. The company has 12 offices throughout North America, Europe and Asia Pacific. Interactive Intelligence can be reached at +1 317.872.3000 or info@inin.com; on the Net: http://www.inin.com.
This release contains certain forward-looking statements that involve a number of risks and uncertainties. Among the factors that could cause actual results to differ materially are the following: rapid technological changes in the industry; volatility in the market price of the company's common stock; the company's ability to maintain profitability, to manage successfully its growth and increasingly complex third party relationships, to maintain successful relationships with its current and any new resellers, to maintain and improve its current products and to develop new products and to protect its proprietary rights adequately; and other factors described in the company's SEC filings, including the company's latest annual report on Form 10-K and its quarterly reports on Form 10-Q.
Interactive Intelligence Inc. is the owner of the marks INTERACTIVE INTELLIGENCE, its associated LOGO and numerous other marks. All other trademarks mentioned in this document are the property of their respective owners.
Contacts:
Stephen R. Head
Chief Financial Officer
Interactive Intelligence Inc.
+1 317.715.8412
steve.head@inin.com
Christine Holley
Director, Market Communications
Interactive Intelligence Inc.
+1 317.715.8220
christine.holley@inin.com
Interactive Intelligence, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
| | | December 31, 2005 | | December 31, 2004 | |
| | | | | | |
Assets | | | | | |
| Current assets: | | | | | | | |
| Cash and cash equivalents | | $ | 11,551 | | $ | 14,603 | |
| Short-term investments | | | 3,576 | | | -- | |
| Accounts receivable, net | | | 14,927 | | | 10,251 | |
| Prepaid expenses | | | 2,939 | | | 2,119 | |
| Other current assets | | | 789 | | | 836 | |
| Total current assets | | | 33,782 | | | 27,809 | |
| Property and equipment, net | | | 4,013 | | | 4,071 | |
| Other assets, net | | | 603 | | | 618 | |
| Total assets | | $ | 38,398 | | $ | 32,498 | |
| | | | | | | | |
Liabilities and Shareholders’ Equity | | | | | | | |
| Current liabilities: | | | | | | | |
| Line of credit | | $ | -- | | $ | 3,000 | |
| Accounts payable and accrued liabilities | | | 6,676 | | | 5,894 | |
| Accrued compensation and related expenses | | | 1,906 | | | 1,200 | |
| Deferred product revenues | | | 5,195 | | | 4,484 | |
| Deferred services revenues | | | 16,828 | | | 12,884 | |
| Total current liabilities | | | 30,605 | | | 27,462 | |
| Shareholders’ equity: | | | | | | | |
| Preferred stock | | | -- | | | -- | |
| Common stock | | | 161 | | | 159 | |
| Additional paid-in capital | | | 65,826 | | | 65,179 | |
| Accumulated deficit | | | (58,194 | ) | | (60,302 | ) |
| Total shareholders’ equity | | | 7,793 | | | 5,036 | |
| Total liabilities and shareholders’ equity | | $ | 38,398 | | $ | 32,498 | |
| | | | | | | | |
Interactive Intelligence, Inc.
Condensed Consolidated Statement of Operations
(in thousands, except per share amounts)
| | | Three Months Ended December 31, | | Twelve Months Ended December 31, | |
| | | 2005 | | 2004 | | 2005 | | 2004 | |
| Revenues: | | | | | | | | | | | | | |
| Product | | $ | 9,031 | | $ | 7,240 | | $ | 33,296 | | $ | 28,187 | |
| Services | | | 8,503 | | | 7,118 | | | 29,641 | | | 26,932 | |
| Total revenues | | | 17,534 | | | 14,358 | | | 62,937 | | | 55,119 | |
| Cost of revenues: | | | | | | | | | | | | | |
| Product | | | 1,824 | | | 948 | | | 4,661 | | | 2,399 | |
| Services | | | 2,872 | | | 2,668 | | | 11,025 | | | 10,756 | |
| Total cost of revenues | | | 4,696 | | | 3,616 | | | 15,686 | | | 13,155 | |
| Gross profit | | | 12,838 | | | 10,742 | | | 47,251 | | | 41,964 | |
| Operating expenses: | | | | | | | | | | | | | |
| Sales and marketing | | | 5,961 | | | 5,200 | | | 24,149 | | | 20,492 | |
| Research and development | | | 2,915 | | | 3,114 | | | 12,383 | | | 12,858 | |
| General and administrative | | | 2,118 | | | 1,965 | | | 8,327 | | | 7,631 | |
| Total operating expenses | | | 10,994 | | | 10,279 | | | 44,859 | | | 40,981 | |
| Operating income | | | 1,844 | | | 463 | | | 2,392 | | | 983 | |
| Other income (expense): | | | | | | | | | | | | | |
| Interest income, net | | | 87 | | | 65 | | | 269 | | | 125 | |
| Other income (expense) | | | (32 | ) | | (12 | ) | | (288 | ) | | 70 | |
| Total other income (expense) | | | 55 | | | 53 | | | (19 | ) | | 195 | |
| Income before income taxes | | | 1,899 | | | 516 | | | 2,373 | | | 1,178 | |
| Income taxes | | | 134 | | | 2 | | | 265 | | | 138 | |
| Net income | | $ | 1,765 | | $ | 514 | | $ | 2,108 | | $ | 1,040 | |
| | | | | | | | | | | | | | |
| Net income per share: | | | | | | | | | | | | | |
| Basic | | $ | 0.11 | | $ | 0.03 | | $ | 0.13 | | $ | 0.07 | |
| Diluted | | | 0.10 | | | 0.03 | | | 0.13 | | | 0.06 | |
| | | | | | | | | | | | | | |
| Shares used to compute net income per share: | | | | | | | | | | | | | |
| Basic | | | 16,085 | | | 15,806 | | | 16,020 | | | 15,857 | |
| Diluted | | | 16,860 | | | 16,700 | | | 16,754 | | | 16,605 | |
