Exhibit 99.1
PeopleSoft Reports First Quarter 2004 Results
PLEASANTON, Calif.--(BUSINESS WIRE)--April 22, 2004--PeopleSoft, Inc.
(Nasdaq:PSFT) today announced its first quarter 2004 financial results. For the
first quarter ended March 31, 2004, the Company reported total revenue of $643
million, exceeding the company's guidance of $625 million to $635 million.
License revenue for the quarter was $131 million, consistent with the Company's
guidance.
Pro forma net income for the first quarter of 2004 was $62 million, an
increase of 62% when compared to pro forma net income of $38 million in the
first quarter of 2003. First quarter pro forma earnings per share rose 42% to
$0.17, meeting the Company's guidance.
On a GAAP basis first quarter 2004 earnings per share was $0.07, meeting
the Company's guidance. GAAP net income for the quarter was $24 million compared
with $38 million in the same period last year. GAAP results include charges for
purchase accounting adjustments related to the acquisition of J.D. Edwards.
At March 31, 2004, the Company's cash and investment balances were $1.6
billion. First quarter cash flow from operations was $116 million, a 55%
increase from the first quarter of 2003. Days Sales Outstanding for the quarter
was an industry leading 53 days, an improvement from 61 days in the fourth
quarter of 2003.
The first quarter 2004 pro forma results exclude charges for purchase
accounting adjustments related to the acquisition of J.D. Edwards, including the
revenue impact of the deferred maintenance write-down to fair value,
amortization of capitalized software and other restructuring charges. A
reconciliation of GAAP to non-GAAP financial results is included in this press
release and is available on our website at www.peoplesoft.com.
Management Commentary
"We announced a growth objective for 2004 that was by far the most
aggressive in the enterprise application software business, and we are
delivering to that plan," said President and CEO Craig Conway.
"With most of the extraordinary distractions now behind us, we can return
our full attention to our business," continued Conway.
Customer Wins
Leading organizations around the world continue to choose PeopleSoft
applications to move their business processes on line and operate in real time.
During the quarter, organizations that purchased PeopleSoft's industry leading
applications included: AGCO, Amersham Biosciences UK, Asia Optical, British
Telecommunications, Cincinnati Children's Hospital Medical Center, CR Bard,
Ecolab, Edens & Avant, FedEx, Hovnanian Enterprises, NYU Hospitals Center, RR
Donnelley & Sons, Saint-Gobain Distribution Batiment, Sodisco-Howden Group, Sony
Global Solutions, Staples and the U.S. Department of Defense.
Non-GAAP Financial Measures
The Company uses non-GAAP pro forma financial measures, which exclude
adjustments related to purchase accounting and restructuring costs, in analyzing
financial results because they provide meaningful information regarding the
Company's operational performance and facilitate management's internal
comparisons to the Company's historical operating results and comparisons to
competitors' operating results.
The Company believes that these non-GAAP financial measures are useful to
investors because they allow for greater transparency. Wherever non-GAAP
financial measures have been included in this press release, the Company has
reconciled them in the tables below to their GAAP counterparts. Reconciliation
of these GAAP to non-GAAP financial measures is also included on our web site at
www.peoplesoft.com.
These non-GAAP financial measures are not prepared in accordance with
generally accepted accounting principles and may be different from non-GAAP
financial measures used by other companies. Non-GAAP financial measures should
not be considered as a substitute for, or superior to, measures of financial
performance prepared in accordance with GAAP.
The following tables reconcile the non-GAAP financial measures to GAAP:
Q1 04 Q1 04
Net Income* EPS*
----------- ---------
Pro forma $ 62,422 $ 0.17
Revenue impact of deferred maintenance
write-down (16,572) (0.05)
Restructuring charges (5,090) (0.01)
Amortization of capitalized software
and intangible assets (16,555) (0.04)
----------- ---------
GAAP $ 24,205 $ 0.07
=========== =========
* There are no reconciling items between pro forma and GAAP relating to net
income and EPS for the first quarter of 2003.
Company to Host Conference Call
PeopleSoft will host a conference call today, April 22, 2004, at 3:00 p.m.
PT/6:00 p.m. ET to discuss the quarterly results. A live audio-only web cast of
the call will be made available in the Investor Relations section of the
Company's web site at www.peoplesoft.com. A replay of the call will be made
available for seven days following the call and will be accessible on the
Company's web site.
About PeopleSoft
PeopleSoft (Nasdaq: PSFT) is the world's second largest provider of
enterprise application software with 12,200 customers in more than 25 industries
and 150 countries. For more information, visit us at www.peoplesoft.com.
PeopleSoft and the PeopleSoft logo are registered trademarks of PeopleSoft,
Inc. All other Company and product names may be trademarks of their respective
owners. Copyright (C) 2004 PeopleSoft, Inc. All rights reserved.
Forward-Looking Statements
This press release may contain forward-looking statements that state
PeopleSoft's intentions, beliefs, expectations, or predictions for the future.
You are cautioned that these statements are only predictions and may differ
materially from actual future events or results. All forward-looking statements
are only as of the date they are made and PeopleSoft undertakes no obligation to
update or revise them. The specific forward-looking statements relate to such
matters as the impact of PeopleSoft's combination with J.D. Edwards including
the integration, the profitability of our international operations, and the
combined Company's projected financial performance. Such forward-looking
statements are subject to a number of risks, assumptions and uncertainties that
could cause the PeopleSoft's actual results to differ materially from those
projected in such forward-looking statements. These risks, assumptions and
uncertainties include: our ability to successfully complete the integration of
J.D. Edwards into PeopleSoft and to achieve anticipated synergies; the costs and
disruption to our business arising from the Oracle tender offer; economic and
political conditions in the U.S. and abroad; the ability to complete and deliver
products and services within currently estimated time frames and budgets; the
ability to manage expenses effectively; the ability to achieve revenue from
products and services that are under development; competitive and pricing
pressures; and other risks referenced from time to time in PeopleSoft's filings
with the Securities and Exchange Commission. Please refer to PeopleSoft's
current annual report on Form 10-K for more information on the risk factors that
could cause actual results to differ.
Important Additional Information
PeopleSoft has filed a Solicitation/Recommendation Statement on Schedule
14D-9 regarding Oracle's tender offer. PeopleSoft stockholders should read the
Schedule 14D-9 (including any amendments) because these documents contain
important information. The Schedule 14D-9 and other public filings made by
PeopleSoft with the SEC are available without charge from the SEC's website at
www.sec.gov and from PeopleSoft at www.peoplesoft.com.
PEOPLESOFT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(unaudited)
THREE MONTHS ENDED
MARCH 31,
------------------
2004 2003
-------- --------
Revenues:
License fees $130,886 $ 80,841
Maintenance revenue 296,850 199,921
Professional services revenue 215,383 179,494
-------- --------
Service revenues 512,233 379,415
-------- --------
Total revenues 643,119 460,256
Costs and expenses:
Cost of license fees 23,374 8,726
Cost of services 222,966 163,469
Sales and marketing expense 169,171 119,558
Product development expense 127,374 83,705
General and administrative expense 59,075 33,015
Restructuring, acquisition and other
charges 8,229 -
-------- --------
Total costs and expenses 610,189 408,473
-------- --------
Operating income 32,930 51,783
Other income, net 5,100 6,966
-------- --------
Income before provision for income taxes 38,030 58,749
Provision for income taxes 13,825 20,270
-------- --------
Net income $ 24,205 $ 38,479
======== ========
Basic income per share $ 0.07 $ 0.12
======== ========
Shares used in basic per share computation 361,866 314,782
======== ========
Diluted income per share $ 0.07 $ 0.12
======== ========
Shares used in diluted per share computation 370,776 319,831
======== ========
PEOPLESOFT, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except employee count)
(unaudited)
MARCH 31, DECEMBER 31,
2004 2003
---------- ----------
Assets:
Current assets:
Cash and cash equivalents $ 493,539 $ 439,385
Short-term investments and restricted
cash 1,043,555 961,906
Accounts receivable, net 376,787 462,528
Income taxes receivable 19,125 18,749
Deferred tax assets 51,043 58,630
Other current assets 68,267 69,997
---------- ----------
Total current assets 2,052,316 2,011,195
Property and equipment, net 435,147 448,211
Investments 44,945 29,219
Deferred tax assets 51,279 42,049
Capitalized software, net 219,132 234,217
Goodwill 1,005,970 1,005,660
Other intangible assets 429,141 444,767
Other assets 8,872 9,410
---------- ----------
$4,246,802 $4,224,728
========== ==========
Liabilities and Stockholders' Equity:
Current liabilities:
Accounts payable and accrued liabilities $ 200,049 $ 211,389
Restructuring reserves 56,297 76,411
Accrued compensation and related expenses 154,740 224,983
Income taxes payable 78,290 106,355
Short-term deferred revenues 649,861 588,590
---------- ----------
Total current liabilities 1,139,237 1,207,728
Long-term deferred revenues 115,435 119,896
Other liabilities 38,253 37,655
Stockholders' equity:
Common stock 3,922 3,776
Additional paid-in capital 2,581,801 2,508,995
Retained earnings 709,052 684,847
Treasury stock (387,571) (387,046)
Accumulated other comprehensive income 46,673 48,877
---------- ----------
2,953,877 2,859,449
---------- ----------
$4,246,802 $4,224,728
========== ==========
Worldwide employee count 11,779 12,163
PEOPLESOFT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)
THREE MONTHS ENDED
MARCH 31,
------------------------
2004 2003
----------- -----------
Operating activities:
Net income $ 24,205 $ 38,479
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization 55,813 26,884
Provision for doubtful accounts 2,605 3,780
Tax benefits from employee stock
transactions 7,955 1,956
Provision (benefit) for deferred income
taxes (1,949) 6,562
Gain on sales of investments and
disposition
of property and
equipment, net (100) (649)
Non-cash stock compensation 3,396 2,304
Restructuring, acquisition and other
charges 3,964 -
Changes in operating assets and
liabilities,
net of effects of acquisitions:
Accounts receivable 87,607 41,742
Accounts payable and accrued
liabilities (32,667) (11,509)
Accrued compensation and related
expenses (71,014) (39,701)
Income taxes, net (28,093) (16,698)
Deferred revenues 59,217 21,015
Other 4,593 584
----------- -----------
Net cash provided by operating
activities 115,532 74,749
Investing activities:
Purchase of investments (1,627,417) (3,226,843)
Proceeds from sales and maturities of
investments 1,529,144 3,123,799
Purchases of property and equipment (15,195) (86,695)
----------- -----------
Net cash used in investing activities (113,468) (189,739)
Financing activities:
Net proceeds from employee stock
transactions 60,901 30,068
----------- -----------
Net cash provided by financing
activities 60,901 30,068
Effect of foreign exchange rate changes on
cash
and cash equivalents (8,811) 4,609
----------- -----------
Net increase (decrease) in cash and cash
equivalents 54,154 (80,313)
Cash and cash equivalents at beginning of
period 439,385 319,344
----------- -----------
Cash and cash equivalents at end of period $ 493,539 $ 239,031
=========== ===========
CONTACT: PeopleSoft
Investor Relations:
Bob Okunski, 877-528-7413
bob_okunski@peoplesoft.com
Public Relations:
Steve Swasey, 925-694-5230
steve_swasey@peoplesoft.com