Exhibit 99.1
SERENA Software Reports Second Quarter Results
Non GAAP EPS of $0.17 and Total Revenues of $24.9 Million
SAN MATEO, Calif., Aug. 21 /PRNewswire-FirstCall/ -- SERENA Software, Inc.
(Nasdaq: SRNA), an industry-leading supplier of software that automates change
to enterprise code and content, announced today net income per diluted share,
excluding amortization of intangible assets, of $0.17 for the second fiscal
quarter ending July 31, 2003. Net income per diluted share, excluding
intangibles amortization, exceeded the range provided in the Company's pre-
announcement on August 5, 2003, and both license revenue and total revenue
were at the high end of the ranges provided.
Total revenues of $24.9 million in the second quarter of fiscal 2004
represented an 8% increase over the second quarter of fiscal 2003. Software
licenses revenue was $10.0 million, maintenance revenue was $12.5 million, and
services revenue was $2.4 million. License revenue from software change
management was 66% of license revenue, with 35% of license revenues coming
from distributed systems platforms.
Excluding intangibles amortization, operating income for the second
quarter ended July 31, 2003 was $8.7 million, up 3% over the second quarter a
year ago. Operating margin excluding intangibles amortization was 35%.
Excluding intangibles amortization, net income and net income per diluted
share for the second quarter of fiscal 2004 increased 7% and 6%, respectively,
to $6.9 million and $0.17 from $6.4 million and $0.16 in the second quarter of
fiscal 2003. Net income and net income per diluted share computed in
accordance with generally accepted accounting principles decreased 11% and 8%,
respectively, to $4.7 million and $0.12 from $5.3 million and $0.13 in the
same quarter a year ago.
Cash and investments at July 31, 2003 was $173 million or $4.21 per
diluted share. Total deferred revenue increased slightly sequentially to
$37.2 million. Days Sales Outstanding were 58 days in the second quarter.
"I am pleased to have our second quarter results exceed or come in at the
high end of our preannounced ranges, said Mark Woodward, President and CEO. In
addition, we have already closed the largest of the deals that slipped from
the second quarter and I fully expect to close the other three that slipped in
the third quarter."
The Company also announced guidance for the third quarter of fiscal 2004.
For the third quarter total revenues are expected to be in the range of $25.5
to $26.5 million and net income per fully diluted share excluding intangibles
amortization is expected to be between $0.17 and $0.18.
Second Quarter Highlights
-- Held our 10th Annual Global User Conference -- Serena Xchange 2003,
focusing on helping customers do more with less by leveraging existing
resources and optimizing new technology.
-- Announced Extended Integration with Test Management Software from
Mercury Interactive providing best-of-breed solutions for application
development.
-- Delivered the latest release of Serena ChangeMan ZDD 3.1, an innovative
mainframe desktop development solution with several usability, access
and development enhancements.
-- Announced that Serena received Microsoft Gold Certification for
innovative desktop development technology enabling Serena to provide
customers with a more robust enterprise change management solution
offering and increasing market channel opportunities.
-- Announced that Serena earned placement on the first annual SD Times
100, a ranking of software development companies that demonstrated the
greatest innovation and leadership during 2002.
-- Completed the acquisition of TeamShare Incorporated enabling Serena to
compete more effectively in the growing Application Life Cycle
Management market.
-- Announced that Serena remains among the top three SCM revenue leaders
according to the latest market share and revenue findings for the
software configuration management (SCM) market as published by IDC.
-- Shipped the latest release of the newly acquired TeamTrack product on
schedule, TeamTrack 5.8. which includes broader platform support,
usability and performance enhancements.
-- Announced partnerships with Polaris Technologies, Intergen, and Pro
Systems Consulting where these partners will implement Serena ECM
solutions and services, helping Serena extend capabilities and support
to better meet market needs.
-- Announced extended support for the ECLIPSE platform. Serena's Best-of-
Breed ECM solution and support for Ppen Source technology helps
customers increase enterprise efficiency and accelerate next-generation
development.
Commentary Available
A conference call to discuss the preliminary results is scheduled for 2:00
PM Pacific time today and may be accessed live via the Internet at
www.companyboardroom.com or www.serena.com/q2results. Additionally investors
can listen to the call by dialing 877-706-2563 or 706-679-5994 at least 5
minutes prior to the start time. A replay of the call will be available
through August 28, 2003 by dialing 706-645-9291, code #2240110.
About SERENA Software, Inc.
SERENA Software Inc. is the Enterprise Change Management (ECM) industry
leader. For over twenty years Serena has focused exclusively on providing
application change management solutions to the world's leading enterprises,
and today its products are in use at over 3,000 customer sites -- including 46
of the fortune 50. Serena leads the way in ECM by providing a single point of
control to manage software code and Web content changes throughout the
enterprise, from the mainframe to the Web. Serena is headquartered in San
Mateo, California and maintains international offices in Canada, Germany,
France, Benelux and the United Kingdom. Serena can be reached through the
World Wide Web at www.serena.com.
This press release contains "forward-looking statements" under the Private
Securities Reform Act of 1995. There can be no assurance that future results
will be achieved, and actual results could differ materially from forecasts
and estimates. Factors that could cause or contribute to such differences
include, but are not limited to, our reliance on our mainframe products for
revenue; the percentage of license revenue typically closed at the end of each
quarter making estimation of operating results prior to the end of the quarter
extremely uncertain; weak economic conditions worldwide which may continue to
affect the overall demand for software and services, which has resulted in and
could continue to result in decreased revenues or lower revenue growth rates;
changes in revenue mix and seasonality; our ability to deliver our products on
the distributed systems platform; dependence on revenues from our installed
base; continued demand for additional mainframe MIPS capacity; successful
integration of our recent acquisition; expansion of our international
organizations; and our ability to manage our growth. Information about
potential factors that could affect the Company's financial results is
included in the Company's Form 10K filed on April 29, 2003 and Form 10Q filed
on June 13, 2003. SERENA assumes no obligation to update the forward-looking
information contained in this press release.
Trademarks
Serena, ChangeMan and StarTool are registered trademarks of SERENA
Software Inc. All other products or company names mentioned are used for
identification purposes only, and may be trademarks of their respective
owners.
(C) 2003 SERENA Software, Inc. All Rights Reserved.
- FINANCIAL TABLES TO FOLLOW -
SERENA Software, Inc.
Condensed Consolidated Statements of Income
(In thousands, except per share data)
(Unaudited)
Three Months Ended Six Months Ended
July 31, July 31,
2003 2002 2003 2002
Revenue:
Software licenses $10,047 $10,305 $20,899 $19,956
Maintenance 12,449 11,016 24,360 21,792
Professional services 2,417 1,677 4,021 3,296
Total revenue 24,913 22,998 49,280 45,044
Cost of revenue:
Software licenses 171 332 383 582
Maintenance 1,605 1,415 3,109 2,787
Professional services 2,278 1,500 4,044 2,922
Total cost of revenue 4,054 3,247 7,536 6,291
Gross profit 20,859 19,751 41,744 38,753
Operating expenses:
Sales and marketing 7,014 6,637 13,667 13,001
Research and development 3,420 2,973 6,459 5,892
General and administrative 1,728 1,679 3,468 3,389
Stock-based compensation -- 6 -- 17
Amortization of intangible
assets 2,136 1,146 3,217 2,291
Total operating expenses 14,298 12,441 26,811 24,590
Operating income 6,561 7,310 14,933 14,163
Interest and other income, net 814 1,198 1,819 2,395
Income before income taxes 7,375 8,508 16,752 16,558
Income taxes 2,655 3,233 6,218 6,292
Net income $4,720 $5,275 $10,534 $10,266
Net income, excluding
intangibles amortization $6,856 $6,421 $13,751 $12,557
Net income per share:
Basic $0.12 $0.13 $0.26 $0.25
Diluted $0.12 $0.13 $0.26 $0.25
Diluted, excluding intangibles
amortization $0.17 $0.16 $0.34 $0.31
Weighted average shares used in
per share calculations:
Basic 40,102 40,288 40,276 40,228
Diluted 41,028 40,655 40,973 40,658
Reconciliation of U.S. GAAP to
Non-U.S. GAAP Financial
Information:
U.S. GAAP operating income $6,561 $7,310 $14,933 $14,163
Add back: Amortization of
intangible assets 2,136 1,146 3,217 2,291
Non-U.S. GAAP operating income $8,697 $8,456 $18,150 $16,454
U.S. GAAP net income $4,720 $5,275 $10,534 $10,266
Add back: Amortization of
intangible assets 2,136 1,146 3,217 2,291
Non-U.S. GAAP net income $6,856 $6,421 $13,751 $12,557
SERENA Software Inc.
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
July 31, January 31,
2003 2003
Assets
Current assets
Cash and cash equivalents $97,951 $105,402
Short-term investments 19,004 37,672
Accounts receivable, net 16,058 16,514
Deferred taxes, net 4,862 6,549
Prepaid expenses and other current assets 1,410 744
Total current assets 139,285 166,881
Long-term investments 55,722 48,374
Property and equipment, net 3,208 3,078
Deferred taxes, net 259 103
Goodwill and other intangible assets, net 64,296 45,360
Other assets 300 269
Total assets $263,070 $264,065
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $1,298 $533
Income taxes payable 3,951 7,921
Accrued expenses 7,437 8,266
Deferred revenue 28,523 26,010
Total current liabilities 41,209 42,730
Deferred revenue, net of current portion 8,711 8,373
Total liabilities 49,920 51,103
Stockholders' equity:
Total stockholders' equity 213,150 212,962
Total liabilities and stockholders' equity $263,070 $264,065
SOURCE SERENA Software, Inc.
-0- 08/21/2003
/CONTACT: Robert I. Pender, Jr., Chief Financial Officer of SERENA
Software, Inc., +1-650-522-6604/
/Web site: http://www.serena.com /
(SRNA)
CO: SERENA Software, Inc.
ST: California
IN: CPR STW
SU: ERN ERP CCA