Exhibit 99.1
Callidus Software Reports First Quarter 2005 Results
Q1 Revenues $14.5 million
San Jose, Calif., April 28, 2005 -- Callidus Software Inc. (Nasdaq: CALD), a
leader in Enterprise Incentive Management (EIM), today announced financial
results for the first quarter ended March 31, 2005.
Total first quarter revenues were $14.5 million, a decrease of 4% compared to
prior quarter revenues of $15.1 million, and a decrease of 12% compared to first
quarter 2004 revenues of $16.5 million. First quarter net loss was $2.5 million,
or ($0.10) per share, compared to a net loss of $1.3 million, or ($0.05) per
share for the prior quarter and a net loss of $6.1 million, or ($0.25) per share
for the first quarter of 2004.
Non-GAAP net loss for the first quarter was $2.1 million, or ($0.08) per share,
as compared to non-GAAP net loss of $0.8 million, or ($0.03) per share in the
prior quarter and non-GAAP net loss of $4.3 million, or ($0.18) per share in the
first quarter of 2004. A reconciliation between GAAP and non-GAAP information is
contained in the attached tables.
"The first quarter often presents a seasonal challenge in the enterprise
software sector. Against this backdrop, performance in the first quarter was
about what we expected. We met or exceeded our revenue and margin targets in our
maintenance and services organization and had operating expenses that were at
the low end of our range. Cash and investments increased by $1.9 million in the
quarter. License revenues were shy of the sequential growth we had targeted
internally," said David Pratt, interim president and chief executive officer of
Callidus Software.
Callidus Software also announced today that Robert H. Youngjohns was appointed
president and chief executive officer and a director of Callidus Software
effective May 31, 2005. Mr. Youngjohns is a technology industry veteran with 30
years of experience, including managing worldwide sales at Sun Microsystems and
IBM's RS/6000 business for the EMEA region. Callidus also announced earlier this
month that William B. Binch was appointed to its' board of directors. Mr. Binch
has extensive experience with a number of leading enterprise software companies
including Hyperion, Oracle, Business Objects, Prism and IBM. David Pratt,
interim president and chief executive officer will continue as a director of
Callidus.
Q1 2005 Financial Summary
o License revenues were $3.5 million, decreasing 13% sequentially from
the prior quarter and 23% year-over-year.
o Maintenance and service revenues were $11.0 million, equal to the
prior quarter but decreasing 8% year-over-year.
o Maintenance and service gross margin was 35%, up from 33% in Q4 2004
and up from 28% in Q1 2004. License gross margin was 97%, equal to
97% in Q4 2004 and up from 94% in Q1 2004.
o Operating expenses were $10.0 million compared to $9.2 million in Q4
2004 and $13.8 million in Q1 2004. Non-GAAP operating expenses,
which exclude stock based compensation, were $9.6 million, compared
to non-GAAP operating expenses of $8.7 million in Q4 2004 and $12.1
million in Q1 2004.
o Cash and investments totaled $61.7 million at March 31, 2005 as
compared to $59.8 million at December 31, 2004.
o Days Sales Outstanding (DSO) in accounts receivable at the end of
the quarter was 68 days, up from 66 days at the end of the fourth
quarter of 2004.
Q2 2005 Guidance
o Maintenance and services revenue is expected to be between $11.0
million and $11.5 million with a corresponding gross margin between
30% and 32%.
o Operating expenses are expected to be between $10.7 million and
$11.2 million. Non-GAAP operating expenses, which exclude
stock-based compensation, are expected to be between $10.0 million
and $10.5
million. Stock-based compensation is expected to be $0.7 million,
which includes increased stock expense associated with the hiring of
our new president and chief executive officer.
o No guidance is being given on license revenues or earnings.
Conference Call
Callidus Software's first quarter 2005 conference call is scheduled for 1:30
p.m. Pacific Daylight Time (PDT), on Thursday, April 28, 2005. The conference
call is available via live webcast at the Investor Relations section of Callidus
Software's website at www.CallidusSoftware.com. To participate in the call via
telephone, the dial-in number is 800-291-9234 (international 617-614-3923),
passcode 28820226.
A telephone playback and webcast replay will be available after 3:30 p.m. PDT on
April 28, 2005 through May 12, 2005. The telephone replay will be available by
calling 888-286-8010 (International callers: 617-801-6888) passcode 66835096.
The webcast replay will be available at the Investor Relations section of our
website under Calendar of Events.
About Callidus Software
Founded in 1996, Callidus Software (www.CallidusSoftware.com) is a leading
enterprise incentive management (EIM) provider to global companies across
multiple industries. Callidus' EIM systems allow enterprises to develop and
manage incentive compensation linked to the achievement of strategic business
objectives. Through its TrueComp(R) Grid architecture, Callidus delivers an EIM
solution that combines the power and scalability of grid computing with the
flexibility of a rules-based interface. Customers/Partners include AOL Time
Warner Corporation, AT&T Wireless, BMC Software, CUNA Mutual, DIRECTV, Dun &
Bradstreet, IBM, Pennzoil-Quaker State Company, SBC Communications and Sun
Microsystems. Callidus is publicly traded on the NASDAQ under the symbol CALD.
Non-GAAP Financial Measures
The non-GAAP information provided in this press release is a supplement to, and
not a substitute for, our financial results presented in accordance with
generally accepted accounting principles (GAAP) in the United States. The
non-GAAP financial results exclude stock-based compensation expense. The
non-GAAP financial measures provide what we believe is an additional tool for
investors to use in understanding our operational results and trends. These
non-GAAP financial results are used internally by management to evaluate our
operations, plan and forecast for future periods and to allocate resources
within the organization. A reconciliation between GAAP and non-GAAP financial
measures is included in the accompanying tables.
Note on Forward-Looking Statements
The forward looking statements included in this press release, including
estimates of maintenance and service revenues and associated gross margin and of
operating expenses and stock-based compensation for the second quarter of 2005,
reflect management's best judgment based on factors currently known and involve
risks and uncertainties. These risks and uncertainties include, but are not
limited to, changes in executive management, timing of software license orders,
potential material fluctuations in financial results and future growth rates,
decreases in customer spending, increased competition or new entrants in the
marketplace, litigation and other risks detailed in the company's SEC reports,
including its Form 10-K and Form 10-Qs, copies of which may be obtained by
contacting Callidus Software's Investor Relations department at 408-808-6577, or
the Investor Relations section of Callidus Software's website
(www.CallidusSoftware.com). Actual results may differ materially from those
presently reported. We assume no obligation to update the information contained
in this release.
(C) 2005 by Callidus Software Inc. All rights reserved. Callidus Software, the
Callidus Software logo, Everyone Profits, TrueChannel, TrueComp, TrueComp Grid,
TrueInformation, TruePerformance, TrueReferral, and TrueResolution are
trademarks of Callidus Software Inc. All other trademarks are the property of
their respective owners.
###
Investor Relations Contact: Press Contact:
Jon Pexton Jane Le Fevre
408-808-6577 408-808-6511
ir@callidussoftware.com pr@callidussoftware.com
CALLIDUS SOFTWARE INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except for per share data)
(unaudited)
Three months ended
March 31,
----------------------
2005 2004
-------- --------
Revenues:
License revenues $ 3,500 $ 4,539
Maintenance and service revenues 11,001 11,923
-------- --------
Total revenues 14,501 16,462
Cost of revenues:
License revenues 97 263
Maintenance and service revenues 7,180 8,610
-------- --------
Total cost of revenues 7,277 8,873
-------- --------
Gross profit 7,224 7,589
Operating expenses:
Sales and marketing 4,412 6,400
Research and development 2,951 3,710
General and administrative 2,202 1,972
Stock-based compensation 440 1,744
-------- --------
Total operating expenses 10,005 13,826
-------- --------
Operating loss (2,781) (6,237)
Interest and other income, net 312 193
-------- --------
Loss before provision for income taxes (2,469) (6,044)
Provision for income taxes 25 25
-------- --------
Net loss $ (2,494) $ (6,069)
======== ========
Basic net loss per share $ (0.10) $ (0.25)
======== ========
Diluted net loss per share $ (0.10) $ (0.25)
======== ========
Shares used in basic per share computation 25,742 23,988
======== ========
Shares used in diluted per share computation 25,742 23,988
======== ========
CALLIDUS SOFTWARE INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(unaudited)
March 31, December 31,
Assets 2005 2004
--------- ------------
Current assets:
Cash and cash equivalents $ 11,100 $ 7,651
Short-term investments 50,622 52,166
Accounts receivable, net 9,882 12,126
Prepaid and other current assets 1,854 1,868
--------- ---------
Total current assets 73,458 73,811
Property and equipment, net 3,325 3,361
Deposits and other assets 1,645 1,317
--------- ---------
Total assets $ 78,428 $ 78,489
========= =========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 1,619 $ 1,904
Current portion of long-term debt 346 471
Accrued payroll and related expenses 3,513 3,827
Accrued expenses 1,912 1,881
Deferred revenue 7,837 6,856
--------- ---------
Total current liabilities 15,227 14,939
Long-term debt, less current portion 24 48
Deferred rent 307 292
Long-term deferred revenue 102 178
--------- ---------
Total liabilities 15,660 15,457
--------- ---------
Stockholders' equity
Common stock 26 26
Additional paid-in capital 186,100 184,443
Deferred stock-based compensation (1,688) (2,316)
Accumulated other comprehensive income 53 108
Accumulated deficit (121,723) (119,229)
--------- ---------
Total stockholders' equity 62,768 63,032
--------- ---------
Total liabilities and stockholders'
equity $ 78,428 $ 78,489
========= =========
CALLIDUS SOFTWARE INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
QUARTER OVER QUARTER COMPARISON
(In thousands, except for per share data)
(unaudited)
Three months ended Three months ended
March 31, 2005 December 31, 2004
---------------------------------- ---------------------------------
Non-GAAP Non-GAAP
GAAP Adjustments Non-GAAP GAAP Adjustments Non-GAAP
-------- ----------- --------- -------- ----------- --------
Revenues:
License revenues $ 3,500 $ 3,500 $ 4,013 $ 4,013
Maintenance and service revenues 11,001 11,001 11,047 11,047
-------- -------- -------- --------
Total revenues 14,501 14,501 15,060 15,060
Cost of revenues:
License revenues 97 97 137 137
Maintenance and service revenues 7,180 7,180 7,396 7,396
-------- -------- -------- --------
Total cost of revenues 7,277 7,277 7,533 7,533
-------- -------- -------- --------
Gross profit 7,224 7,224 7,527 7,527
Operating expenses:
Sales and marketing 4,412 4,412 4,377 4,377
Research and development 2,951 2,951 2,809 2,809
General and administrative 2,202 2,202 1,516 1,516
Stock-based compensation 440 (a) (440) -- 500 (a) (500) --
-------- -------- -------- --------
Total operating expenses 10,005 9,565 9,202 8,702
-------- -------- -------- --------
Operating loss (2,781) (2,341) (1,675) (1,175)
Interest and other income, net 312 312 335 335
-------- -------- -------- --------
Loss before provision for income taxes (2,469) (2,029) (1,340) (840)
Provision for income taxes 25 25 - -
-------- -------- -------- --------
Net loss $ (2,494) $ (2,054) $ (1,340) $ (840)
======== ======== ======== ========
Diluted net loss per share $ (0.10) $ (0.08) $ (0.05) $ (0.03)
======== ======== ======== ========
Shares used in diluted per share computation 25,742 25,742 24,989 24,989
======== ======== ======== ========
- ----------
(a) Non-cash stock based compensation
CALLIDUS SOFTWARE INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
YEAR OVER YEAR COMPARISON OF THE QUARTER
(In thousands, except for per share data)
(unaudited)
Three months ended Three months ended
March 31, 2005 March 31, 2004
---------------------------------- ----------------------------------
Non-GAAP Non-GAAP
GAAP Adjustments Non-GAAP GAAP Adjustments Non-GAAP
-------- ----------- -------- -------- ----------- --------
Revenues:
License revenues $ 3,500 $ 3,500 $ 4,539 $ 4,539
Maintenance and service revenues 11,001 11,001 11,923 11,923
-------- -------- -------- --------
Total revenues 14,501 14,501 16,462 16,462
Cost of revenues:
License revenues 97 97 263 263
Maintenance and service revenues 7,180 7,180 8,610 8,610
-------- -------- -------- --------
Total cost of revenues 7,277 7,277 8,873 8,873
-------- -------- -------- --------
Gross profit 7,224 7,224 7,589 7,589
Operating expenses:
Sales and marketing 4,412 4,412 6,400 6,400
Research and development 2,951 2,951 3,710 3,710
General and administrative 2,202 2,202 1,972 1,972
Stock-based compensation 440 (a) (440) -- 1,744 (a) (1,744) --
-------- -------- -------- --------
Total operating expenses 10,005 9,565 13,826 12,082
-------- -------- -------- --------
Operating loss (2,781) (2,341) (6,237) (4,493)
Interest and other income, net 312 312 193 193
-------- -------- -------- --------
Loss before provision for income taxes (2,469) (2,029) (6,044) (4,300)
Provision for income taxes 25 25 25 25
-------- -------- -------- --------
Net loss $ (2,494) $ (2,054) $ (6,069) $ (4,325)
======== ======== ======== ========
Diluted net loss per share $ (0.10) $ (0.08) $ (0.25) $ (0.18)
======== ======== ======== ========
Shares used in diluted per share computation 25,742 25,742 23,988 23,988
======== ======== ======== ========
- ----------
(a) Non-cash stock based compensation