FAIR ISAAC CORPORATION 
By SAN JOSE, Calif., Jan. 30, 2013 /PRNewswire/ -- FICO (NYSE:FICO), the leading provider of analytics and decision management technology, today announced financial results for its first fiscal quarter ended December 31, 2012.
(Logo: http://photos.prnewswire.com/prnh/20111010/CG83314LOGO)
First Quarter Fiscal 2013 GAAP Results
Net income for the quarter totaled $23.4 million, or $0.65 per share, versus $30.0 million, or $0.81 per share, reported in the prior year period. The current quarter results include $2.2 million, net of tax, or $0.06 per share, in restructuring and acquisition related costs.
First Quarter Fiscal 2013 Non-GAAP Results
Beginning in fiscal 2013, the company will report Non-GAAP results for net income, EPS and free cash flow. The Non-GAAP financial measures are described in the financial table captioned "Non-GAAP Results" and are reconciled to the corresponding GAAP results in the financial tables at the end of this release.
-- Non-GAAP Net Income for the quarter was $31.8 million vs. $34.5 million
in the prior year period.
-- Non-GAAP EPS for the quarter was $0.88 vs. $0.94 in the prior year
period.
-- Free cash flow for the quarter was $19.0 million vs. $32.7 million in
the prior year period.
First Quarter Fiscal 2013 GAAP Revenue
The company reported revenues of $190.0 million for the quarter as compared to $170.3 million reported in the prior year period, an increase of 12%.
"We had a strong start to fiscal 2013, with solid Q1 results driven by revenue growth across our entire portfolio," said Will Lansing, chief executive officer. "The investments we have made during the past nine months, including our acquisitions, are delivering results in line with our plans."
Revenues for the first quarter fiscal 2013 across each of the company's three operating segments were as follows:
-- Applications revenues, which include the company's preconfigured
Decision Management applications and associated professional services,
were $124.7 million in the first quarter compared to $110.2 million in
the prior year quarter, an increase of 13%. This was due primarily to
revenue associated with last year's acquisition of Adeptra, Ltd. and
increases in revenue from Customer Management and Marketing Solutions,
partially offset by a decrease in Fraud Solutions.
-- Scores revenues, which include the company's business-to-business (B2B)
scoring solutions and associated professional services, and the
myFICO(®) business-to-consumer (B2C) service, were $43.4 million in the
first quarter compared to $42.5 million in the prior year quarter, an
increase of 2%.
-- Tools revenues, which include Blaze Advisor(®), Xpress Optimization and
related professional services, were $21.9 million in the first quarter
compared to $17.6 million in the prior year quarter, an increase of 24%,
primarily due to an increase in Blaze license and professional services
partially offset by a decrease in Xpress license sales during the
quarter.
Outlook
As a result of the recently announced acquisition of CR Software LLC, the company is increasing the previously issued revenue guidance for fiscal 2013, as follows:
New Fiscal 2013 GAAP Previous Fiscal 2013
Guidance GAAP Guidance
-------- -------------
Revenue $760 million - $770 million $740 million - $750 million
------- ---------------------------- ----------------------------
GAAP
Net
Income $100 million $100 million
------- ------------ ------------
GAAP
Earnings
Per
Share $2.80 $2.80
--------- ----- -----
Company to Host Conference Call
The company will host a webcast today at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) to report its first quarter fiscal 2013 results and provide various strategic and operational updates. The call can be accessed at FICO's Web site at www.FICO.com (follow the instructions on the Investor Relations page). A replay of the webcast will be available through February 28, 2013.
The webcast will also be distributed through the Thomson StreetEvents Network to both institutional and individual investors. Individual investors can listen to the call at www.fulldisclosure.com, Thomson/CCBN's individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson's password-protected event management site, StreetEvents (www.streetevents.com).
About FICO
FICO (NYSE:FICO) delivers superior predictive analytics that drive smarter decisions. The company's groundbreaking use of mathematics to predict consumer behavior has transformed entire industries and revolutionized the way risk is managed and products are marketed. FICO's innovative solutions include the FICO(®) Score -- the standard measure of consumer credit risk in the United States -- along with the industry-leading solutions for managing credit accounts, identifying and minimizing the impact of fraud, and customizing consumer offers with pinpoint accuracy. Most of the world's top banks, as well as leading insurers, retailers, pharma businesses and government agencies rely on FICO solutions to accelerate growth, control risk, boost profits and meet regulatory and competitive demands. FICO also helps millions of individuals manage their personal credit health through www.myFICO.com. Learn more at www.fico.com. FICO: Make every decision count.
Statement Concerning Forward-Looking Information
Except for historical information contained herein, the statements contained in this news release that relate to FICO or its business 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 success of the Company's Decision Management strategy and reengineering initiative, 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, its ability to recruit and retain key technical and managerial personnel, competition, regulatory changes applicable to the use of consumer credit and other data, the failure to realize the anticipated benefits of any acquisitions, continuing material adverse developments in global economic conditions or in the markets we serve, and other risks described from time to time in FICO's SEC reports, including its Annual Report on Form 10-K for the year ended September 30, 2012. If any of these risks or uncertainties materializes, FICO's results could differ materially from its expectations. FICO disclaims any intent or obligation to update these forward-looking statements.
FICO, myFICO and Blaze Advisor are all trademarks or registered trademarks of Fair Isaac Corporation in the United States and in other countries.
-Financial tables follow-
FAIR ISAAC CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
December 31, 2012 and September 30, 2012
(In thousands)
(Unaudited)
December 31, September 30,
2012 2012
---- ----
ASSETS:
Current assets:
Cash and
cash
equivalents $90,839 $71,609
Marketable
securities - 22,008
Accounts
receivable,
net 138,159 142,595
Prepaid
expenses
and other
current
assets 22,376 23,113
Total
current
assets 251,374 259,325
------- -------
Marketable
securities
and
investments 16,529 16,500
Property and
equipment,
net 45,788 41,080
Goodwill and
intangible
assets, net 835,263 809,803
Other assets 27,160 31,903
$1,176,114 $1,158,611
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts
payable and
other
accrued
liabilities $62,378 $62,603
Accrued
compensation
and
employee
benefits 30,170 50,043
Deferred
revenue 47,455 47,959
Current
maturities
on long-
term debt 49,000 49,000
Total
current
liabilities 189,003 209,605
------- -------
Senior notes 455,000 455,000
Other
liabilities 23,383 19,600
Total
liabilities 667,386 684,205
------- -------
Stockholders'
equity 508,728 474,406
$1,176,114 $1,158,611
========== ==========
FAIR ISAAC CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
For the Quarters Ended December 31, 2012 and 2011
(In thousands, except per share data)
(Unaudited)
Quarter Ended
December 31,
------------
2012 2011
---- ----
Revenues:
Transactional and maintenance 129,898 114,183
Professional services 32,337 28,693
License 27,785 27,473
------ ------
Total revenues 190,020 170,349
------- -------
Operating expenses:
Cost of revenues 56,148 45,974
Research & development 14,552 13,049
Selling, general and administrative 69,665 57,324
Amortization of intangible assets 3,372 1,930
Restructuring and acquisition-
related 3,289 -
147,026 118,277
------- -------
Operating income 42,994 52,072
Other expense, net (7,951) (8,447)
Income from operations before
income taxes 35,043 43,625
Provision for income taxes 11,622 13,628
------ ------
Net income 23,421 29,997
====== ======
Basic earnings per share: 0.67 0.83
==== ====
Diluted earnings per share: 0.65 0.81
==== ====
Shares used in computing earnings per share:
Basic 35,043 36,034
====== ======
Diluted 36,151 36,887
====== ======
FAIR ISAAC CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Quarters Ended December 31, 2012 and 2011
(In thousands)
(Unaudited)
Quarter Ended
December 31,
------------
2012 2011
---- ----
Cash flows from operating activities:
Net income $23,421 $29,997
Adjustments to reconcile net income to
net cash provided by
operating activities:
Depreciation
and
amortization 7,973 5,528
Share-based
compensation 5,832 4,757
Changes in
operating
assets and
liabilities (5,492) 670
Other, net (3,005) 197
Net cash
provided by
operating
activities 28,729 41,149
------ ------
Cash flows from investing activities:
Purchases of
property and
equipment (9,012) (7,757)
Net activity
from
marketable
securities 22,000 49,473
Cash paid for
acquisitions,
net of cash
acquired (27,605) -
Other, net 50 -
Net cash
provided by
(used in)
investing
activities (14,567) 41,716
------- ------
Cash flows from financing activities:
Proceeds from
issuances of
common stock 6,189 15,023
Repurchases of
common stock - (57,685)
Other, net (695) 954
Net cash
provided by
(used in)
financing
activities 5,494 (41,708)
----- -------
Effect of
exchange rate
changes on
cash (426) (1,534)
---- ------
Increase in
cash and cash
equivalents 19,230 39,623
Cash and cash
equivalents,
beginning of
period 71,609 135,752
Cash and cash
equivalents,
end of period $90,839 $175,375
======= ========
FAIR ISAAC CORPORATION
REVENUE BY SEGMENT
For the Quarters Ended December 31, 2012 and 2011
(In thousands)
(Unaudited)
Quarter Ended
December 31,
------------
2012 2011
---- ----
Applications revenues:
Transactional and
maintenance $79,625 $64,272
Professional services 26,159 24,327
License 18,923 21,617
Total applications
revenues $124,707 $110,216
======== ========
Scores revenues:
Transactional and
maintenance $42,437 $42,197
Professional services 903 288
License 107 57
Total scores revenues $43,447 $42,542
======= =======
Tools revenues:
Transactional and
maintenance $7,836 $7,714
Professional services 5,275 4,078
License 8,755 5,799
Total tools revenues $21,866 $17,591
======= =======
Total revenues:
Transactional and
maintenance $129,898 $114,183
Professional services 32,337 28,693
License 27,785 27,473
Total revenues $190,020 $170,349
======== ========
FAIR ISAAC CORPORATION
NON-GAAP RESULTS
For the Quarters Ended December 31, 2012 and 2011
(In thousands, except per share data)
(Unaudited)
Quarter Ended
December 31,
------------
2012 2011
---- ----
GAAP net income $23,421 $29,997
Amortization of intangible assets
(net of tax) 2,265 1,308
Restructuring and acquisition-
related (net of tax) 2,209 -
Stock-based compensation expense
(net of tax) 3,917 3,224
Non-GAAP net income $31,812 $34,529
------- -------
GAAP diluted earnings per share $0.65 $0.81
Amortization of intangible assets
(net of tax) 0.06 0.04
Restructuring and acquisition-
related (net of tax) 0.06 -
Stock-based compensation expense
(net of tax) 0.11 0.09
Non-GAAP diluted earnings per share $0.88 $0.94
----- -----
Free cash flow
Net cash provided by operating
activities $28,729 $41,149
Capital expenditures (9,012) (7,757)
Dividends paid (702) (717)
---- ----
Free cash flow $19,015 $32,675
------- -------
About Non-GAAP Financial Measures
To supplement the consolidated GAAP financial statements, the company uses the following non-GAAP financial measures: non-GAAP net income, non-GAAP EPS, and free cash flow. Non-GAAP net income and non-GAAP EPS exclude the impact of amortization expense, share-based compensation expense, and restructuring and acquisition-related items. Free cash flow excludes capital expenditures and dividends paid. The presentation of these financial measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.
Management uses these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. Our management believes these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain items that may not be indicative of recurring business results including significant non-cash expenses. We believe management and investors benefit from referring to these non-GAAP financial measures in assessing our performance when planning, forecasting and analyzing future periods. These non-GAAP financial measures also facilitate management's internal comparisons to historical performance and liquidity as well as comparisons to our competitors' operating results. We believe these non-GAAP financial measures are useful to investors because they allow for greater transparency with respect to key measures used by management in its financial and operating decision-making.
SOURCE FICO
