Exhibit 99.1
FICO Announces Earnings of $0.38 per Share for Fiscal Fourth Quarter 2010
Revenue of $155 million and bookings of $106 million
MINNEAPOLIS--(BUSINESS WIRE)--November 3, 2010--FICO (NYSE:FICO), the leading provider of analytics and decision management technology, today announced financial results for its fourth fiscal quarter ended September 30, 2010.
Fourth Quarter Fiscal 2010 Results
Net income for the quarter totaled $15.8 million, or $0.38 per share, which includes $0.03 per share of restructuring charges. This compares with prior-year period net income of $17.1 million, or $0.35 per share.
Fourth Quarter Fiscal 2010 Revenue
The company reported quarter revenues of $155.1 million versus $151.9 million reported in the prior year period.
“Our results demonstrate growth in both top-line revenue and new bookings, and general stabilization of our business despite continued macroeconomic challenges,” said Mark Greene, chief executive officer. “As we enter fiscal 2011, I believe we’re well-positioned to realize growth by capitalizing on improving market conditions, our robust and relevant product portfolio, and leadership and other organizational enhancements made during the past year.”
Revenues for fourth quarter fiscal 2010 across each of the company’s three operating segments were as follows:
- Applications revenues, which include the company’s preconfigured Decision Management applications and associated professional services, were $96.1 million in the fourth quarter compared to $94.5 million in the prior year quarter, an increase of 2%, primarily due to an increase in revenue from Fraud Management solutions and Marketing Solutions, slightly offset by a decline in Customer Management solutions.
- Scores revenues, which include the company’s business-to-business (B2B) scoring solutions and associated professional services, and the myFICO® business-to-consumer (B2C) service, were $41.7 million in the fourth quarter, which is consistent with the $42.1 million in the prior year quarter.
- Tools revenues, which include Blaze Advisor®, Xpress Optimization and related professional services, were $17.3 million in the fourth quarter compared to $15.3 million in the prior year quarter, an increase of 13%, primarily due to increases associated with several large license sales during the quarter.
Bookings
Bookings for the fourth quarter were $105.6 million compared to $85.9 million in the same period last year. Bookings represent contracts signed in the current reporting period that will generate new future revenue streams. Management regards the volume of bookings achieved, among other factors, as an important indicator of future revenues, but they are not comparable to, nor should they be substituted for, an analysis of the company’s revenues, and they are subject to a number of risks and uncertainties concerning timing and contingencies affecting product delivery and performance.
Balance Sheet and Cash Flow
Cash and cash equivalents, and investments were $230.3 million at September 30, 2010, as compared to $390.3 million at September 30, 2009. Significant changes in cash and cash equivalents from September 30, 2009 include $105.8 million of cash provided by operations, $196.1 million of cash used to repurchase common stock, $50.0 million related to the repayment of our net debt outstanding, $17.5 million related to the purchase of property and equipment, and $3.6 million of dividends paid.
Outlook
The company is providing the following financial guidance for fiscal 2011.
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| | | | | Fiscal 2011 GAAP Guidance |
| Revenue | | | | $620 million - $625 million |
| Net Income | | | | $65 million - $67 million |
| Earnings Per Share (assumes 39.9 million outstanding shares) | | | | $1.63 - $1.68 |
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Company to Host Conference Call
The company will host a webcast today at 5:00 p.m. Eastern Time (4:00 p.m. Central Time/2:00 p.m. Pacific Time) to report its fourth quarter fiscal 2010 results and provide various strategic and operational updates. The call can be accessed at FICO's Web site at www.FICO.com (follow the instructions on the Investor Relations page). A replay of the webcast will be available through December 3, 2010.
The webcast will also be distributed through the Thomson StreetEvents Network to both institutional and individual investors. Individual investors can listen to the call at www.fulldisclosure.com, Thomson/CCBN's individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson's password-protected event management site, StreetEvents (www.streetevents.com).
About FICO
FICO (NYSE:FICO; www.FICO.com) is the leader in decision management, transforming business by making every decision count. FICO combines trusted advice, world-class analytics, and innovative applications to help businesses automate, improve, and connect decisions over customer lifecycles and across the enterprise. Clients in 80 countries work with FICO to increase customer loyalty and profitability, reduce fraud losses, manage credit risk, meet regulatory and competitive demands, and rapidly build market share. FICO also helps millions of individuals manage their credit health through its consumer website, www.myFICO.com.
Statement Concerning Forward-Looking Information
Except for historical information contained herein, the statements contained in this news release that relate to FICO or its business are forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including the success of the Company’s Decision Management strategy and reengineering initiative, the maintenance of its existing relationships and ability to create new relationships with customers and key alliance partners, its ability to continue to develop new and enhanced products and services, its ability to recruit and retain key technical and managerial personnel, competition, regulatory changes applicable to the use of consumer credit and other data, the failure to realize the anticipated benefits of any acquisitions, continuing material adverse developments in global economic conditions, and other risks described from time to time in FICO’s SEC reports, including its Annual Report on Form 10-K for the year ended September 30, 2009 and its last quarterly report on Form 10-Q for the period ended June 30, 2010. If any of these risks or uncertainties materializes, FICO’s results could differ materially from its expectations. FICO disclaims any intent or obligation to update these forward-looking statements.
FICO, myFICO and Blaze Advisor are all trademarks or registered trademarks of Fair Isaac Corporation in the United States and in other countries.
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| FAIR ISAAC CORPORATION |
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME |
| For the Quarters and Years Ended September 30, 2010 and 2009 |
| (In thousands, except per share data) |
| (Unaudited) |
| | | | | | | | | |
| | Quarter Ended | | | Year Ended |
| | September 30, | | | September 30, |
| | 2010 | | 2009 | | | 2010 | | 2009 |
| | | | | | | | | |
| Revenues: | | | | | | | | | |
| Transactional and maintenance | | $ | 110,778 | | | $ | 116,056 | | | | $ | 455,487 | | | $ | 478,702 | |
| Professional services | | | 27,174 | | | | 24,621 | | | | | 102,878 | | | | 112,413 | |
| License | | | 17,146 | | | | 11,245 | | | | | 47,278 | | | | 39,620 | |
| Total revenues | | | 155,098 | | | | 151,922 | | | | | 605,643 | | | | 630,735 | |
| | | | | | | | | |
| Operating expenses: | | | | | | | | | |
| Cost of revenues | | | 48,456 | | | | 45,793 | | | | | 180,932 | | | | 206,448 | |
| Research and development | | | 16,178 | | | | 18,217 | | | | | 73,581 | | | | 73,626 | |
| Selling, general and administrative | | | 59,286 | | | | 51,800 | | | | | 225,263 | | | | 209,319 | |
| Amortization of intangible assets | | | 1,983 | | | | 3,269 | | | | | 10,901 | | | | 12,891 | |
| Restructuring | | | 1,617 | | | | - | | | | | 1,617 | | | | 8,711 | |
| Loss on sale of product line assets | | | - | | | | - | | | | | - | | | | 2,993 | |
| Total operating expenses | | | 127,520 | | | | 119,079 | | | | | 492,294 | | | | 513,988 | |
| Operating income | | | 27,578 | | | | 32,843 | | | | | 113,349 | | | | 116,747 | |
| Other expense, net | | | (7,538 | ) | | | (4,893 | ) | | | | (21,045 | ) | | | (19,177 | ) |
| Income from operations before income taxes | | | 20,040 | | | | 27,950 | | | | | 92,304 | | | | 97,570 | |
| Provision for income taxes | | | 4,199 | | | | 10,842 | | | | | 27,847 | | | | 32,105 | |
| Income from continuing operations | | | 15,841 | | | | 17,108 | | | | | 64,457 | | | | 65,465 | |
| Loss from discontinued operations | | | - | | | | - | | | | | - | | | | (363 | ) |
| Net income | | $ | 15,841 | | | $ | 17,108 | | | | $ | 64,457 | | | $ | 65,102 | |
| | | | | | | | | |
| Basic earnings (loss) per share: | | | | | | | | | |
| Continuing operations | | $ | 0.39 | | | $ | 0.35 | | | | $ | 1.44 | | | $ | 1.35 | |
| Discontinued operations | | | - | | | | - | | | | | - | | | | (0.01 | ) |
| Total | | $ | 0.39 | | | $ | 0.35 | | | | $ | 1.44 | | | $ | 1.34 | |
| | | | | | | | | |
| Diluted earnings (loss) per share: | | | | | | | | | |
| Continuing operations | | $ | 0.38 | | | $ | 0.35 | | | | $ | 1.42 | | | $ | 1.34 | |
| Discontinued operations | | | - | | | | - | | | | | - | | | | (0.01 | ) |
| Total | | $ | 0.38 | | | $ | 0.35 | | | | $ | 1.42 | | | $ | 1.33 | |
| | | | | | | | | |
| Shares used in computing earnings (loss) per share: | | | | | | | | | |
| Basic | | | 41,141 | | | | 48,513 | | | | | 44,903 | | | | 48,658 | |
| Diluted | | | 41,590 | | | | 48,772 | | | | | 45,308 | | | | 48,776 | |
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| FAIR ISAAC CORPORATION |
| CONDENSED CONSOLIDATED BALANCE SHEETS |
| September 30, 2010 and 2009 |
| (In thousands) |
| (Unaudited) |
| | | | | |
| | September 30, | | | September 30, |
| | 2010 | | | 2009 |
| | | | | |
| ASSETS: | | | | | |
| Current assets: | | | | | |
| Cash and cash equivalents | | $ | 146,199 | | | $ | 178,157 |
| Marketable securities | | | 68,615 | | | | 139,673 |
| Accounts receivable, net | | | 113,187 | | | | 101,742 |
| Prepaid expenses and other current assets | | | 19,174 | | | | 22,986 |
| Total current assets | | | 347,175 | | | | 442,558 |
| | | | | |
| Marketable securities and investments | | | 15,441 | | | | 72,445 |
| Property and equipment, net | | | 30,975 | | | | 34,340 |
| Goodwill and intangible assets, net | | | 693,197 | | | | 705,895 |
| Other assets | | | 36,928 | | | | 48,650 |
| | $ | 1,123,716 | | | $ | 1,303,888 |
| | | | | |
| LIABILITIES AND STOCKHOLDERS' EQUITY: | | | | | |
| Current liabilities: | | | | | |
| Accounts payable and other accrued liabilities | | $ | 37,497 | | | $ | 46,776 |
| Accrued compensation and employee benefits | | | 33,697 | | | | 28,139 |
| Deferred revenue | | | 42,953 | | | | 39,673 |
| Current maturities on long-term debt | | | 8,000 | | | | - |
| Total current liabilities | | | 122,147 | | | | 114,588 |
| | | | | |
| Revolving line of credit | | | - | | | | 295,000 |
| Senior notes | | | 512,000 | | | | 275,000 |
| Other liabilities | | | 14,655 | | | | 19,031 |
| Total liabilities | | | 648,802 | | | | 703,619 |
| | | | | |
| Stockholders’ equity | | | 474,914 | | | | 600,269 |
| | $ | 1,123,716 | | | $ | 1,303,888 |
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| FAIR ISAAC CORPORATION |
| REVENUE BY SEGMENT |
| For the Quarters and Years Ended September 30, 2010 and 2009 |
| (In thousands) |
| (Unaudited) |
| | | | | | | | | |
| | Quarter Ended | | | Year Ended |
| | September 30, | | | September 30, |
| | 2010 | | 2009 | | | 2010 | | 2009 |
| | | | | | | | | |
| Applications revenues: | | | | | | | | | |
| Transactional and maintenance | | $ | 62,899 | | $ | 67,440 | | | $ | 257,275 | | $ | 274,123 |
| Professional services | | | 23,514 | | | 21,303 | | | | 86,097 | | | 92,000 |
| License | | | 9,647 | | | 5,843 | | | | 23,886 | | | 17,007 |
| Total applications revenues | | $ | 96,060 | | $ | 94,586 | | | $ | 367,258 | | $ | 383,130 |
| | | | | | | | | |
| Scores revenues: | | | | | | | | | |
| Transactional and maintenance | | $ | 40,960 | | $ | 41,786 | | | $ | 170,141 | | $ | 178,048 |
| Professional services | | | 631 | | | 298 | | | | 2,042 | | | 1,527 |
| License | | | 156 | | | - | | | | 156 | | | - |
| Total scores revenues | | $ | 41,747 | | $ | 42,084 | | | $ | 172,339 | | $ | 179,575 |
| | | | | | | | | |
| Tools revenues: | | | | | | | | | |
| Transactional and maintenance | | $ | 6,919 | | $ | 6,830 | | | $ | 28,071 | | $ | 26,531 |
| Professional services | | | 3,029 | | | 3,020 | | | | 14,739 | | | 18,886 |
| License | | | 7,343 | | | 5,402 | | | | 23,236 | | | 22,613 |
| Total tools revenues | | $ | 17,291 | | $ | 15,252 | | | $ | 66,046 | | $ | 68,030 |
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| Total revenues: | | | | | | | | | |
| Transactional and maintenance | | $ | 110,778 | | $ | 116,056 | | | $ | 455,487 | | $ | 478,702 |
| Professional services | | | 27,174 | | | 24,621 | | | | 102,878 | | | 112,413 |
| License | | | 17,146 | | | 11,245 | | | | 47,278 | | | 39,620 |
| Total revenues | | $ | 155,098 | | $ | 151,922 | | | $ | 605,643 | | $ | 630,735 |
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| FAIR ISAAC CORPORATION |
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
| For the Years Ended September 30, 2010 and 2009 |
| (In thousands) |
| (Unaudited) |
| | | | | |
| | Year Ended |
| | September 30, |
| | 2010 | | | 2009 |
| Cash flows from operating activities: | | | | | |
| Net income | | $ | 64,457 | | | | $ | 65,102 | |
| Adjustments to reconcile net income to net cash provided by | | | | | |
| operating activities: | | | | | |
| Depreciation and amortization | | | 30,918 | | | | | 38,419 | |
| Share-based compensation | | | 17,305 | | | | | 19,935 | |
| Changes in operating assets and liabilities net of disposition effects | | | (10,536 | ) | | | | 38,369 | |
| Other, net | | | 3,636 | | | | | (10,192 | ) |
| Net cash provided by operating activities | | | 105,780 | | | | | 151,633 | |
| | | | | |
| Cash flows from investing activities: | | | | | |
| Purchases of property and equipment | | | (17,453 | ) | | | | (13,958 | ) |
| Cash proceeds from sales of product line assets | | | 2,182 | | | | | 4,000 | |
| Net activity from marketable securities | | | 125,858 | | | | | (73,289 | ) |
| Other, net | | | 50 | | | | | 1,300 | |
| Net cash provided by (used in) investing activities | | | 110,637 | | | | | (81,947 | ) |
| | | | | |
| Cash flows from financing activities: | | | | | |
| Payments on revolving line of credit | | | (295,000 | ) | | | | - | |
| Proceeds from issuance of Senior Notes | | | 245,000 | | | | | - | |
| Proceeds from issuances of common stock | | | 1,410 | | | | | 3,289 | |
| Repurchases of common stock | | | (196,119 | ) | | | | (18,500 | ) |
| Other, net | | | (3,764 | ) | | | | (3,607 | ) |
| Net cash used in financing activities | | | (248,473 | ) | | | | (18,818 | ) |
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| Effect of exchange rate changes on cash | | | 98 | | | | | (2,389 | ) |
| | | | | |
| Increase (decrease) in cash and cash equivalents | | | (31,958 | ) | | | | 48,479 | |
| Cash and cash equivalents, beginning of period | | | 178,157 | | | | | 129,678 | |
| Cash and cash equivalents, end of period | | $ | 146,199 | | | | $ | 178,157 | |
CONTACT:
FICO
Investors/Analysts:
Michael Pung, 800-213-5542
investor@fico.com
or
Media:
Steve Astle, 415-446-6204
stephenastle@fico.com
