Exhibit 99.1
Verint Systems Reports Record Fiscal 2004 Fourth Quarter Sales
MELVILLE, N.Y.--(BUSINESS WIRE)--March 14, 2005--Verint Systems
Inc. (NASDAQ: VRNT):
-- Sales Grow to $69 Million; Increases 32% y-o-y and 8%
Sequentially
-- GAAP Earnings Per Diluted Share of $0.20
-- Pro Forma Earnings Per Diluted Share of $0.23
Verint Systems Inc. (NASDAQ: VRNT), announced record sales of
$69,030,000 for the fourth quarter of fiscal 2004, ended January 31,
2005, a 32% increase compared with sales of $52,425,000 for the fourth
quarter of fiscal 2003. Verint's sales increased approximately 8%
sequentially, compared with $63,989,000 for the third quarter of
fiscal 2004.
Net income on a generally accepted accounting principles ("GAAP")
basis was $6,707,000 for the fourth quarter of fiscal 2004, ($0.20 per
diluted share), compared with net income of $5,180,000 ($0.16 per
diluted share) for the third quarter of fiscal 2004, and net income of
$5,782,000 ($0.18 per diluted share) for the fourth quarter of fiscal
2003. Net income on a pro forma basis was $7,558,000 for the fourth
quarter of fiscal 2004, ($0.23 per diluted share), compared with a pro
forma net income of $6,903,000 ($0.21 per diluted share) for the third
quarter of fiscal 2004, and pro forma net income of $6,025,000 ($0.19
per diluted share) for the fourth quarter of fiscal 2003. A
reconciliation between results on a GAAP basis and results on a pro
forma basis is provided in a table immediately following the Pro Forma
Consolidated Statement of Operations.
Dan Bodner, President and CEO of Verint, stated, "Our record
fourth quarter sales were due to continued demand for our actionable
intelligence solutions. Pro forma income from operations of $7.1
million, which was also a record, grew 32.2% year-over-year."
The Company ended the quarter with cash, cash equivalents and
short-term investments of $240,414,000, working capital of
$196,381,000 total assets of $398,978,000, and stockholders' equity of
$283,375,000.
Conference Call Information
The Company will be conducting a conference call to review its
fiscal 2004 fourth quarter results today at 4:30 PM EDT. An on-line,
real-time Web cast of the conference call will be available on our
website at www.verint.com. The conference call can also be accessed
live via telephone at 703-639-1325. Please dial in 5-10 minutes prior
to the scheduled start time.
A replay of the conference call will be available on our website
at www.verint.com until April 30, 2005 and by telephone at
703-925-2533, passcode 661649 for 7 days.
Financial highlights at and for the twelve and three month periods
ended January 31, 2005 and prior year comparisons are as follows:
Consolidated Statement of Operations (GAAP Basis)
(In thousands, except per share data)
Three Months
Twelve Months Ended Jan. 31,
Ended Jan. 31, (Unaudited)
----------------------------------
2004 2005 2004 2005
-------- -------- ------- --------
Sales $192,744 $249,824 $52,425 $69,030
Cost of sales 89,302 112,774 24,064 30,676
-------- -------- ------- --------
Gross Profit 103,442 137,050 28,361 38,354
Operating Expenses
Research and development, net 23,233 31,961 6,254 8,872
Selling, general and
administrative 63,020 83,070 17,006 23,366
In-process research and
development - 3,154 - -
Write-down of capitalized
software - 1,481 - -
-------- -------- ------- --------
Income from operations 17,189 17,384 5,101 6,116
Interest and other income, net 2,670 3,618 857 1,239
-------- -------- ------- --------
Income before income tax provision 19,859 21,002 5,958 7,355
Income tax provision 1,921 1,930 176 648
-------- -------- ------- --------
Net income $17,938 $19,072 $5,782 $6,707
======== ======== ======= ========
Earnings per share:
Basic $0.65 $0.62 $0.19 $0.21
======== ======== ======= ========
Diluted $0.61 $0.58 $0.18 $0.20
======== ======== ======= ========
Weighted average shares:
Basic 27,690 30,894 29,977 31,394
Diluted 29,437 32,626 31,719 33,077
Verint Systems provides pro forma net income and pro forma
earnings per share data as additional information of its operating
results. These measures are not in accordance with, or an alternative
for, GAAP and may be different from pro forma measures used by other
companies. The company believes that this presentation of pro forma
data provides useful information to management and investors regarding
certain additional financial and business trends relating to its
financial condition and result of operations. In addition, the
Company's management uses these measures for reviewing the financial
results of the Company and for budget purposes:
Consolidated Statement of Operations (Pro Forma Basis)
(In thousands, except per share data)
(Unaudited)
Twelve Months Three Months
Ended Ended
January 31, January 31,
----------------------------------
2004 2005 2004 2005
-------- -------- ------- --------
Sales $192,744 $249,824 $52,425 $69,030
Cost of sales 89,064 110,586 23,996 30,204
-------- -------- ------- --------
Gross Profit 103,680 139,238 28,429 38,826
Operating Expenses
Research and development, net 23,233 31,961 6,254 8,872
Selling, general and
administrative 62,217 81,239 16,831 22,889
-------- -------- ------- --------
Income from operations 18,230 26,038 5,344 7,065
Interest and other income, net 2,670 3,618 857 1,239
-------- -------- ------- --------
Income before income tax provision 20,900 29,656 6,201 8,304
Income tax provision 1,921 2,838 176 746
-------- -------- ------- --------
Net income $18,979 $26,818 $6,025 $7,558
======== ======== ======= ========
Earnings per share:
Basic $0.69 $0.87 $0.20 $0.24
======== ======== ======= ========
Diluted $0.64 $0.82 $0.19 $0.23
======== ======== ======= ========
Weighted average shares:
Basic 27,690 30,894 29,977 31,394
Diluted 29,437 32,626 31,719 33,077
Reconciliation of GAAP net income to pro forma net income
GAAP net income 17,938 19,072 5,782 6,707
Amortization of intangible assets
related to acquisitions:
Included in gross profit 238 1,655 68 472
Included in operating expenses 746 975 118 289
Amortization of stock based
compensation 57 501 57 188
Acquisition-related charges:
In-process research and development - 3,154 - -
Write-down of capitalized software - 1,481 - -
Other, included in gross profit and
in operating expenses - 888 - -
Income tax effect - (908) - (98)
-------- -------- ------- --------
Pro forma net income 18,979 26,818 6,025 7,558
======== ======== ======= ========
Balance Sheet Highlights
(In thousands)
ASSETS
January January
31, 31,
2004 2005
-------- ---------
CURRENT ASSETS:
Cash, cash equivalents and short-term
investments $228,713 $240,414
Accounts receivable, net 33,654 39,072
Inventories 15,833 17,267
Prepaid expenses and other current assets 6,007 9,880
-------- ---------
TOTAL CURRENT ASSETS 284,207 306,633
PROPERTY AND EQUIPMENT, net 14,129 17,540
INTANGIBLE ASSETS 2,051 12,026
GOODWILL 14,364 49,625
OTHER ASSETS 13,955 13,154
-------- ---------
TOTAL ASSETS $328,706 $398,978
======== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $50,301 $68,514
Convertible note 2,200 -
Short term bank loans and current maturities
of long-term bank loans 441 652
Advance payments from customers 26,701 41,086
-------- ---------
TOTAL CURRENT LIABILITIES 79,643 110,252
LONG-TERM LIABILITIES 4,395 5,351
-------- ---------
TOTAL LIABILITIES 84,038 115,603
STOCKHOLDERS' EQUITY 244,668 283,375
-------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $328,706 $398,978
======== =========
About Verint Systems Inc.
Verint Systems Inc., headquartered in Melville, New York, is a
leading provider of analytic software-based solutions for
communications interception, digital video security and surveillance,
and enterprise business intelligence. Verint software, which is used
by over 1,000 organizations in over 50 countries worldwide, generates
actionable intelligence through the collection, retention and analysis
of voice, fax, video, email, Internet and data transmissions from
multiple communications networks. Verint is a subsidiary of Comverse
Technology Inc. (NASDAQ: CMVT). Visit us at our website
www.verintsystems.com.
Note: Certain statements concerning Verint's future revenues,
earnings per share, results or prospects are "forward-looking
statements" under the Private Securities Litigation Reform Act of
1995. There can be no assurances that forward-looking statements will
be achieved, and actual results could differ materially from forecasts
and estimates. Important risks, uncertainties and other important
factors that could cause actual results to differ materially include,
among others: changes in the demand for Verint's products; further
decline in information technology spending; risks associated with
acquiring and integrating the assets and business acquired from ECtel
and RP Security including products and technologies, as well as
retaining key employees and customers, which could result in a
substantial diversion of management resources, the incurrence of
contingent liabilities, amortization of certain identifiable
intangible assets, research and development write-offs and other
acquisition-related expenses; the uncertainty of customer acceptance
of Verint's products; aggressive competition may force Verint to
reduce prices; Verint's lengthy and variable sales cycle makes it
difficult to predict operating results; dependence on contracts with
governments for a significant portion of Verint's revenues; inability
to expand gross margin by reducing hardware in its product offerings;
markets for Verint's products failing to develop; risks that Verint's
intellectual property rights may not be adequate to protect its
business; risks associated with rapidly changing technology and the
ability of Verint to introduce new products on a timely and
cost-effective basis; inability to maintain relationships with value
added resellers and systems integrators; risks associated with
Verint's ability to retain existing personnel and recruit and retain
qualified personnel; risks associated with changes in the competitive
or regulatory environment in which Verint operates; risks associated
with significant foreign operations, including fluctuations in foreign
currency exchange rates; risks associated with Comverse Technology,
Inc. controlling Verint's business and affairs; and other risks
described in filings with the Securities and Exchange Commission. All
documents are available through the SEC's Electronic Data Gathering
Analysis and Retrieval system (EDGAR) at www.sec.gov or from Verint's
website at www.verint.com. Verint makes no commitment to revise or
update any forward-looking statements.
Verint, the Verint word mark, Actionable Intelligence, Powering
Actionable Intelligence, STAR-GATE, RELIANT, LORONIX, SmartSight,
Lanex and ULTRA are trademarks of Verint Systems Inc. Other names may
be trademarks of their respective owners.
CONTACT: Verint Systems Inc.
Alan Roden
VP, Corporate Development and Investor Relations
631-962-9304
alan.roden@verint.com