===================================================================================== UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ____________________________________ FORM 8-K CURRENT REPORT Persuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 January 24, 2005 Date of Report (Date of earliest event reported) FILENET CORPORATION (Exact name of registrant as specified in its charter) Delaware 000-15997 95-3757924 (State or other Jurisdiction (Commission File Number) (IRS Employer of Incorporation) Identification Number) 3565 Harbor Boulevard Costa Mesa, California 92626 (Address of principal executive offices including Zip Code) Registrant's telephone number, including area code (714) 327-3400 N/A (Former Name or Former Address, if Changed Since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) =====================================================================================Item 2.02. Disclosure of Results of Operations and Financial Condition. On January 24, 2005, we issued a press release, which sets forth the results of our operations for the quarter ended and the year ended December 31, 2004. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. Item 9.01. Financial Statements and Exhibits. (c) Exhibits Exhibits: Description of Document 99.1 Press Release dated January 24, 2005. 2 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. FILENET CORPORATION Date: January 24, 2005 By: /s/ Sam M. Auriemma Name: Sam M. Auriemma Title: Executive Vice President and Chief Financial Officer 3 EXHIBIT INDEX Exhibits: Description of Document 99.1 Press Release dated January 24, 2005. 4 Exhibit 99.1 [FileNet Corporation logo] FOR IMMEDIATE RELEASE FileNet Reports Fourth Quarter and Year End 2004 Results o Fourth Quarter net income includes a non-cash tax benefit COSTA MESA, Calif.--January 24, 2005--FileNet Corporation (Nasdaq: FILE), the leading provider of Enterprise Content and Business Process Management solutions, today announced financial results for its fourth quarter and year ended December 31, 2004. Total revenues for the fourth quarter of 2004 were $107.5 million compared to total revenues of $101.0 million for the same period in 2003 and $96.5 million for the third quarter of 2004. Software revenues for the fourth quarter of 2004 were $44.8 million compared to $44.8 million for the same period in 2003 and $35.4 million for the third quarter of 2004. Net income was $16.9 million in the fourth quarter of 2004, compared to net income of $5.6 million in the fourth quarter of 2003 and $6.4 million in the third quarter of 2004. Earnings per basic and diluted share were $0.42 and $0.41, respectively for the fourth quarter of 2004, compared to earnings per basic and diluted share of $0.15 and $0.14, respectively, for the fourth quarter of 2003. For the third quarter of 2004, earnings per basic and diluted share were $0.16. As of December 31, 2004, FileNet had cash and investments of $348.7 million, compared to $248.2 million at December 31, 2003. The company has no long-term debt. "Our fourth quarter performance underscores our commitment to growing our company profitably," said Lee Roberts, chairman and CEO of FileNet. "In 2004, we delivered a strong product portfolio, solid balance sheet and leading market share. In 2005, we intend to provide our customers an expanded industry leading content and process management platform that helps address their most critical compliance and business performance demands." For the year ended December 31, 2004, total revenues were $397.6 million, compared to revenues of $364.5 million reported for the year ended December 31, 2003. Software revenues for 2004 were $154.3 million, compared to software revenues of $149.2 million reported for 2003. For 2004, net income was $29.4 million, compared to net income of $10.9 million for 2003. For year 2004, earnings per basic and diluted share were $0.75 and $0.72, respectively, compared to earnings per basic and diluted share of $0.30 and $0.29, respectively, for year 2003. In prior years, the company had established a net deferred tax asset of approximately $26.6 million and a valuation allowance of approximately $24.3 million. As previously disclosed, the company has been assessing its valuation allowance related to its deferred tax assets. Due to continued profitable operating performance, the company released a portion of its valuation allowance, which resulted in a non-cash benefit to its tax expense of $13.5 million during the year. 5 Quarterly Conference Call with Management - January 24, 2005 Lee Roberts, Chairman and Chief Executive Officer, and Sam Auriemma, Chief Financial Officer, will host a conference call for investors at 2:00 p.m. pacific time today. The call and presentation will be broadcast live over the Internet. To listen to the event via the Internet, please follow the instructions that will be available on the investor relations' section of FileNet's Web site at http://www.filenet.com. A replay of the Web cast will be available for an extended period of time. Alternatively, to listen to the call live, dial (800) 599-9795. The conference call ID number for the call is 27774043. A replay of the call will be available from approximately 4:00 p.m. PT on January 24 through midnight PT on January 31. To listen to the replay, dial (888) 286-8010. The conference call ID number for the replay is 53242249. About FileNet FileNet Corporation helps organizations make better decisions by managing the content and processes that drive their business. FileNet's Enterprise Content Management (ECM) solutions allow customers to build and sustain competitive advantage by managing content throughout their organizations, automating and streamlining their business processes, and providing a spectrum of connectivity needed to simplify their critical and everyday decision-making. FileNet ECM solutions deliver a broad set of capabilities that integrate with existing information systems to provide cost-effective solutions that solve real-world business problems. Since the Company's founding in 1982, more than 4,000 organizations, including more than three quarters of the Fortune 100, have taken advantage of FileNet solutions for help in managing their mission-critical content and processes. Headquartered in Costa Mesa, Calif., the Company markets its innovative ECM solutions in more than 90 countries through its own global sales, professional services and support organizations, as well as via its ValueNet(R)Partner network of resellers, system integrators and application developers. Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: This release contains forward-looking statements that are based on our current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by us. Words such as "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates," "may," "will" and variations of these words or similar expressions are intended to identify forward-looking statements. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors. Important factors that may cause such a difference for FileNet include, but are not limited to, the volume of our sales and pricing concessions on volume sales; our ability to specify, develop or acquire, complete, introduce, market, 6 distribute and gain market acceptance for new products and technologies in a timely manner; the mix of products and services sold by us; the timing, rescheduling or cancellation of significant customer orders; the loss of a key customer; our ability to control expenses; announcements of technological innovations, new products or product enhancements by the company or its competitors; the emerging nature of the Enterprise Content Management market; key management changes; changes in joint marketing and development programs; developments relating to patents or other intellectual property rights or disputes; changing relationships with customers, distributors, suppliers and strategic partners; potential contractual or employment issues; our ability to integrate acquired businesses; and general conditions in the worldwide economy and the software/technology sector and other factors. Our Annual Report on Form 10-K, recent Quarterly Reports on Form 10-Q, recent Current Reports on Forms 8-K and other Securities and Exchange Commission filings discuss some of the important risk factors that may affect our business, results of operations and financial condition. We undertake no obligation to revise or update publicly any forward-looking statements for any reason. Note to editors: FileNet and ValueNet are registered trademarks of FileNet Corporation. All other company or product names referenced in this release may be trademarks or registered trademarks of their respective owners. # # # Investor Contact: Greg Witter, Director, Investor Relations FileNet Corporation Phone: 714-327-3405 Email: gwitter@filenet.com Media Contact: Tom Hennessey, Director, Corporate Communications FileNet Corporation Phone: 714-327-5050 Email: thennessey@filenet.com 7 FILENET CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) Quarter Ended Twelve Months Ended December 31, December 31, 2004 2003 2004 2003 (Unaudited) (Unaudited) (Unaudited) (Unaudited) Revenue: Software $ 44,804 $ 44,817 $ 154,279 $ 149,214 Service 62,682 56,133 243,279 215,291 Total revenue 107,486 100,950 397,558 364,505 Costs: Cost of software revenue 4,636 3,384 15,122 13,800 Cost of service revenue 23,422 22,104 86,943 85,131 Total cost of revenue 28,058 25,488 102,065 98,931 Gross profit 79,428 75,462 295,493 265,574 Operating expenses: Sales and Marketing 42,283 41,315 159,716 144,975 Research and development 18,779 19,019 78,248 77,050 General and administrative 8,227 8,073 35,363 32,466 Total operating expenses 69,289 68,407 273,327 254,491 Operating income 10,139 7,055 22,166 11,083 Other income, net 2,721 787 5,959 4,084 Income before income taxes 12,860 7,842 28,125 15,167 Provision (benefit) for income taxes (4,037) 2,196 (1,289) 4,247 Net income $ 16,897 $ 5,646 $ 29,414 $ 10,920 Earnings per share: Basic $ 0.42 $ 0.15 $ 0.75 $ 0.30 Diluted $ 0.41 $ 0.14 $ 0.72 $ 0.29 Weighted average shares outstanding: Basic 39,963 37,426 39,095 36,532 Diluted 41,585 39,944 40,991 38,089 Note: Certain reclassifications have been made to prior-years' balances to conform to the current year's presentation. 8 FILENET CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) December 31, December 31, 2004 2003 (Unaudited) (Unaudited) ASSETS Current assets: Cash and cash equivalents $ 240,442 $ 203,305 Short-term investments 93,971 32,286 Accounts receivable, net 35,878 38,096 Prepaid expenses and other assets 12,179 13,174 Deferred income taxes 3,681 3,551 Total current assets 386,151 290,412 Property, net 21,738 26,922 Long-term investments 14,256 12,672 Goodwill 27,268 26,170 Intangible assets, net 6,188 7,979 Deferred income taxes 36,028 23,001 Other assets 2,037 4,692 Total assets $ 493,666 $ 391,848 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 13,868 $ 11,006 Customer deposits/advances 9,007 5,217 Accrued compensation and benefits 33,674 27,648 Unearned maintenance revenue 47,145 40,691 Other accrued liabilities 19,575 16,524 Total current liabilities 123,269 101,086 Other Liabilities and unearned maintenance revenue 2,533 1,614 Total liabilities 125,802 102,700 Stockholders' equity 367,864 289,148 Total liabilities and stockholders' equity $ 493,666 $ 391,848 9
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Filenet (FILE) Inactive 8-KResults of Operations and Financial Condition
Filed: 24 Jan 05, 12:00am