Business Objects (BOBJY) 8-K Business Objects Reports Q2 2006 Results

Exhibit 99.2

BUSINESS OBJECTS S.A.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per ordinary share and ADS data)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2006			2005			2006			2005
	(unaudited)						(unaudited)
Revenues:
Net license fees	$	123,110		$	124,858		$	249,004		$	240,009
Services		171,374			137,551			323,751			271,175
Total revenues		294,484			262,409			572,755			511,184
Cost of revenues:
Net license fees		10,276			7,249			18,252			14,417
Services		66,023			52,781			126,790			104,162
Total cost of revenues		76,299			60,030			145,042			118,579
Gross profit		218,185			202,379			427,713			392,605
Operating expenses:
Sales and marketing		123,123			104,787			240,623			208,509
Research and development		52,644			40,427			96,381			80,701
General and administrative		28,965			22,218			59,328			47,031
Total operating expenses		204,732			167,432			396,332			336,241
Income from operations		13,453			34,947			31,381			56,364
Interest and other income, net		3,008			3,178			5,863			7,578
Income before provision for income taxes		16,461			38,125			37,244			63,942
Provision for income taxes		(8,512	)		(14,986	)		(16,958	)		(25,797	)
Net income	$	7,949		$	23,139		$	20,286		$	38,145
Basic net income per ordinary share and ADS	$	0.09		$	0.26		$	0.22		$	0.43
Diluted net income per ordinary share and ADS	$	0.08		$	0.25		$	0.21		$	0.42
Ordinary shares and ADSs used in computing basic net income per ordinary share and ADS		93,310			90,030			92,946			89,727
Ordinary shares and ADSs and equivalents used in computing diluted net income per ordinary share and ADS		95,083			92,089			95,162			91,650

BUSINESS OBJECTS S.A.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except nominal value per ordinary share)

	June 30, 2006			December 31, 2005
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	469,490		$	332,777
Restricted cash		30,545			22,157
Short-term investments		5,041			4,651
Accounts receivable, net		239,401			265,672
Deferred tax assets		13,106			13,605
Prepaid and other current assets		60,919			60,880
Total current assets		818,502			699,742
Goodwill		1,210,775			1,166,043
Other intangible assets, net		122,607			110,512
Property and equipment, net		85,888			74,116
Deposits and other assets		28,766			34,945
Long-term restricted cash		26,428			20,858
Long-term deferred tax assets		15,230			17,142
Total assets	$	2,308,196		$	2,123,358
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	52,118		$	45,777
Accrued payroll and related expenses		73,940			83,332
Income taxes payable		95,034			79,820
Deferred revenues		265,920			201,788
Other current liabilities		78,799			72,098
Escrows payable		24,970			21,728
Total current liabilities		590,781			504,543
Long-term escrows payable		19,951			10,902
Other long-term liabilities		8,487			8,871
Long-term deferred tax liabilities		2,290			2,853
Long-term deferred revenues		8,480			6,734
Total liabilities		629,989			533,903
Shareholders’ equity
Ordinary shares, Euro 0.10 nominal value		10,524			10,359
Additional paid-in capital		1,257,437			1,217,473
Treasury, Business Objects Option LLC, and Employee Benefit Sub-Plan Trust shares		(4,214	)		(3,223	)
Retained earnings		362,631			342,345
Unearned compensation		—			(12,243	)
Accumulated other comprehensive income		51,829			34,744
Total shareholders’ equity		1,678,207			1,589,455
Total liabilities and shareholders’ equity	$	2,308,196		$	2,123,358

BUSINESS OBJECTS S.A.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

	Six Months Ended
	June 30,
	2006			2005
	(unaudited)
Operating activities:
Net income	$	20,286		$	38,145
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of property and equipment		15,770			16,516
Amortization of other intangible assets		19,146			16,040
Stock-based compensation expense		24,917			2,360
Excess tax benefits from stock-based compensation		(2,422	)		—
Acquired in-process research and development		3,300			—
Deferred income taxes		(5,789	)		3,850
Changes in operating assets and liabilities:
Accounts receivable, net		45,546			29,019
Prepaid and other current assets		6,654			(8,865	)
Deposits and other assets		6,282			7,563
Accounts payable		2,499			4,523
Accrued payroll and related expenses		(21,645	)		(14,389	)
Income taxes payable		16,937			(14,067	)
Deferred revenues		45,860			15,517
Other liabilities		(1,953	)		(24,943	)
Short-term investments classified as trading		(390	)		(15	)
Net cash provided by operating activities		174,998			71,254
Investing activities:
Purchases of property and equipment		(22,807	)		(13,891	)
Business acquisitions, net of acquired cash		(55,482	)		—
Increase in escrows payable		12,099			—
Transfer of cash to restricted cash accounts		(13,766	)
Net cash used in investing activities		(79,956	)		(13,891	)
Financing activities:
Issuance of shares		25,361			16,057
Excess tax benefits from stock-based compensation		2,422			—
Net cash provided by financing activities		27,783			16,057
Effect of foreign exchange rate changes on cash and cash equivalents		13,888			(911	)
Net increase in cash and cash equivalents		136,713			72,509
Cash and cash equivalents, beginning of the period		332,777			293,485
Cash and cash equivalents, end of the period	$	469,490		$	365,994