EXHIBIT 99
[FAIRISAAC LOGO]
Contacts: INVESTORS & ANALYSTS:
Heidi Flannery
Fair Isaac Corporation
(800) 213-5542
investor@fairisaac.com
FAIR ISAAC REPORTS STRONG SECOND QUARTER RESULTS
82% Year-over-Year Revenue Growth with HNC Revenues
SAN RAFAEL, Calif. -- April 23, 2003 -- Fair Isaac Corporation (NYSE:FIC), the
leader in customer analytics and decision technology, today announced financial
results for the second fiscal quarter ended March 31, 2003.
The company achieved second quarter revenues of $158.6 million versus $87.1
million reported in the second quarter of fiscal 2002, and above the company's
previous guidance. Revenues for the six months ended March 31, 2003 totaled
$305.3 million as compared to revenues of $172.1 million reported in the same
period last year. Net income for the second quarter of fiscal 2003 totaled $25.6
million, or $0.51 per share on 50.5 million diluted shares outstanding, compared
with $14.2 million, or $0.39 per share on 36.3 million diluted shares
outstanding reported in the same quarter last year. Net income for the six
months ended March 31, 2003 totaled $45.4 million, or $0.89 per share on 51.3
million diluted shares outstanding, compared with $27.7 million, or $0.77 per
share on 36.1 million diluted shares outstanding reported in the same period
last year.
Results for the second quarter and six months ended March 31, 2003 include $0.6
million and $2.6 million in merger-related charges, respectively, resulting from
the HNC Software acquisition, which resulted in a negative one-cent(1) and a
negative three-cent(2) impact to diluted earnings per share during these
periods, respectively.
"I'm very pleased with our results this quarter, producing both revenue and
earnings above our previous guidance," said Tom Grudnowski, President and CEO of
Fair Isaac. "Now with two full quarters behind us as a combined company, we are
proud to say that we have delivered positive results in both revenue and expense
synergies. I think our results demonstrate how the predictive analytics market
is heating up, and we're right in the middle of it all. Our strategy to sell
transaction-based services around analytically-based solutions now in nine
different markets gives us even greater stability and opportunities for future
growth."
The company will host a conference call today at 2:00 p.m. Pacific Time / 5:00
p.m. Eastern Time to discuss its second quarter results and provide guidance for
the remainder of fiscal 2003.
The call can be accessed live on the Investor Relations' section of the
company's Web site at www.fairisaac.com, and will be archived on the site
immediately following the call.
ABOUT FAIR ISAAC
Fair Isaac Corporation (NYSE:FIC) is the preeminent provider of creative
analytics that unlock value for people, businesses and industries. The company's
predictive modeling, decision analysis, intelligence management, decision
management systems and consulting services power more than 25 billion
mission-critical customer decisions a year. Founded in 1956, Fair Isaac helps
thousands of companies in over 60 countries acquire customers more efficiently,
increase customer value, reduce fraud and credit losses, lower operating
expenses and enter new markets more profitably. Most leading banks and credit
card issuers rely on Fair Isaac solutions, as do insurers, retailers,
telecommunications providers, healthcare organizations and government agencies.
Through the www.myfico.com Web site, consumers use the company's FICO(R) scores,
the standard measure of credit risk, to manage their financial health. As of
August 5, 2002, the business of HNC Software Inc., a leading provider of
high-end analytic and decision management software, is part of Fair Isaac. For
more information, visit www.fairisaac.com.
FORWARD-LOOKING STATEMENTS
Except for historical information contained herein, the statements contained in
this press release that relate to Fair Isaac, including statements regarding our
ability to build and maintain customer and other business relationships, 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 company's ability to recruit and retain key
technical and managerial personnel, 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, competition, regulatory changes applicable to the use of consumer
credit and other data, the possibility that the anticipated benefits of its
recent merger with HNC, including expected synergies, cannot be fully realized,
the possibility that costs or difficulties related to the integration of our
business and HNC's business will be greater than expected, and other risks
described from time to time in Fair Isaac's SEC reports, including its Annual
Report on Form 10-K for the year ended September 30, 2002. If any of these risks
or uncertainties materializes, Fair Isaac's results could differ materially from
Fair Isaac's expectations in these statements. Fair Isaac disclaims any intent
or obligation to update these forward-looking statements.
Fair Isaac, HNC and FICO are trademarks or registered trademarks of Fair Isaac
Corporation, in the United States and/or in other countries. Other product and
company names herein may be trademarks of their respective owners.
- ----------------------------
(1) Calculated as $0.6 million in merger-related charges less $0.2 million
income tax benefit (by application of the company's 37.6 percent effective tax
rate for the quarter), or $0.4 million, divided by 50.5 million diluted shares
outstanding for the quarter.
(2) Calculated as $2.6 million in merger-related charges less $1.0 million
income tax benefit (by application of the company's 38.0 percent effective tax
rate for the six month period), or $1.6 million, divided by 51.3 million diluted
shares outstanding for the six month period.
2
FAIR ISAAC CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE QUARTERS AND SIX MONTHS ENDED MARCH 31, 2003 AND 2002
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
Quarter Ended Six Months Ended
March 31, March 31,
------------------------- ------------------------
2003 2002 2003 2002
--------- ------- -------- --------
Revenues $ 158,598 $87,050 $305,330 $172,111
--------- ------- -------- --------
Operating expenses:
Cost of revenues 64,041 39,127 124,695 77,712
Research and development 17,119 7,301 34,366 14,778
Selling, general and administrative 31,724 18,719 63,898 36,661
Amortization of intangibles 3,419 609 6,681 1,134
Merger-related expenses 606 -- 2,616 --
--------- ------- -------- --------
Total operating expenses 116,909 65,756 232,256 130,285
--------- ------- -------- --------
Operating income 41,689 21,294 73,074 41,826
Other (expense) income, net (585) 1,964 208 3,823
--------- ------- -------- --------
Income before income taxes 41,104 23,258 73,282 45,649
Provision for income taxes 15,459 9,073 27,847 17,917
--------- ------- -------- --------
Net income $ 25,645 $14,185 $ 45,435 $ 27,732
========= ======= ======== ========
Earnings per share:
Basic $ 0.54 $ 0.41 $ 0.93 $ 0.81
========= ======= ======== ========
Diluted $ 0.51 $ 0.39 $ 0.89 $ 0.77
========= ======= ======== ========
Shares used in computing earnings per share:
Basic 47,898 34,532 49,042 34,359
========= ======= ======== ========
Diluted 50,453 36,287 51,291 36,120
========= ======= ======== ========
3
FAIR ISAAC CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
MARCH 31, 2003 AND SEPTEMBER 30, 2002
(IN THOUSANDS)
(UNAUDITED)
March 31, September 30,
2003 2002
---------- ----------
ASSETS:
Current assets:
Cash and investments $ 165,817 $ 281,211
Receivables, net 124,820 121,456
Other current assets 27,923 25,507
---------- ----------
Total current assets 318,560 428,174
Investments 136,459 150,202
Property and equipment, net 53,792 63,898
Goodwill and intangibles, net 515,894 520,114
Other noncurrent assets 52,051 50,125
---------- ----------
$1,076,756 $1,212,513
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts payable and other accrued liabilities $ 44,711 $ 44,135
Accrued compensation and employee benefits 26,409 28,153
Deferred revenue 19,735 17,921
---------- ----------
Total current liabilities 90,855 90,209
Convertible subordinated notes 140,631 139,922
Other noncurrent liabilities 6,261 8,910
---------- ----------
Total liabilities 237,747 239,041
Stockholders' equity 839,009 973,472
---------- ----------
$1,076,756 $1,212,513
========== ==========
4
FAIR ISAAC CORPORATION
REVENUES BY SEGMENT
FOR THE QUARTERS AND SIX MONTHS ENDED MARCH 31, 2003 AND 2002
(IN THOUSANDS)
(UNAUDITED)
Quarter Ended Six Months Ended
March 31, March 31,
----------------------- ------------------------
2003 2002 2003 2002
-------- ------- -------- --------
Scoring Solutions $ 32,868 $30,165 $ 66,960 $ 60,710
Strategy Machine Solutions 100,563 39,657 186,552 80,122
Professional Services 20,231 14,590 40,481 26,838
Analytic Software Tools 4,936 2,638 11,337 4,441
-------- ------- -------- --------
Total Revenues $158,598 $87,050 $305,330 $172,111
======== ======= ======== ========
5