BladeLogic Announces Fourth
Fiscal Quarter and Fiscal Year Financial Results; Full Year Revenue
Grew Organically 105% Compared to the Prior Year
Year-Over-Year License Revenue Grew 110%
LEXINGTON, MA, November 7, 2007—BladeLogic,
Inc. (NASDAQ:BLOG), a provider of leading data center automation
software, today announced its financial results for the fourth
fiscal quarter and fiscal year ended September 30, 2007.
Financial Highlights
Revenue for the fourth fiscal quarter of 2007 was $19,403,000,
compared to $10,647,000 in the fourth fiscal quarter of 2006,
an increase of 82%. Revenue for the twelve months ended September
30, 2007 was $62,679,000 compared to $30,616,000 for the twelve
months ended September 30, 2006, an increase of 105%.
Net income for the fourth fiscal quarter of 2007 was $293,000,
compared with a net loss of $(1,191,000) in the fourth fiscal
quarter of 2006. Net loss applicable to common stockholders, which
includes the accretion of the Company's redeemable preferred stock
that was either redeemed or fully converted into common stock
at the time of the Company's initial public offering, was $(183,000),
or $(0.01) of diluted net income per share, in the fourth fiscal
quarter of 2007, compared with net loss applicable to common stockholders
of $(1,312,000), or $(0.11) of diluted net loss per share, in
the fourth fiscal quarter of 2006.
The Company's net loss for the twelve months ended September
30, 2007 was $(174,000), compared with a net loss of $(8,251,000)
in the twelve months ended September 30, 2006. Net loss applicable
to common stockholders was $(956,000), or $(0.07) of diluted net
loss per share, in the twelve months ended September 30, 2007,
compared with net loss applicable to common stockholders of $(8,722,000),
or $(0.76) of diluted net loss per share, in the twelve months
ended September 30, 2006. As of September 30, 2007, the Company
had approximately 26.9 million shares of common stock outstanding.
Non-GAAP adjusted income from operations was $287,000 for the
fourth fiscal quarter of 2007, which excludes non-cash stock-based
compensation expense of $642,000, compared to a non-GAAP adjusted
loss from operations of $(497,000) for the fourth fiscal quarter
of 2006, which excludes non-cash stock-based compensation expense
of $806,000. Net income on a non-GAAP adjusted basis, excluding
stock-based compensation and accretion of preferred stock dividends,
was $0.03 per share for the fourth fiscal quarter of 2007. Non-GAAP
adjusted income from operations was $583,000 for the twelve months
ended September 30, 2007, which excludes non-cash stock-based
compensation expense of $1,522,000, compared to a non-GAAP adjusted
loss from operations of $(6,362,000) for the twelve months ended
September 30, 2006, which excludes non-cash stock-based compensation
expense of $2,137,000.
Non-GAAP adjusted income (loss) from operations and net income
per share are non-GAAP financial measures that the Company's management
uses to evaluate the Company's performance and for internal planning
and forecasting purposes. In addition, many financial analysts
that follow our Company focus on and publish both historical results
and future projections based on non-GAAP financial measures. We
believe that it is in the best interest of our investors to provide
this information to analysts so that they accurately report the
non- GAAP financial information. Moreover, investors have historically
requested these non-GAAP financial measures as a means of providing
consistent and comparable information with past reports of financial
results. A reconciliation of the non-GAAP financial measures used
in this release to the most comparable GAAP measure is included
at the end of this press release.
"BladeLogic's strong revenue growth in the fourth fiscal
quarter demonstrates both the demand for our next-generation data
center automation solutions as well as our ability to capitalize
on opportunities to increase our market share," said Dev
Ittycheria, BladeLogic's President and CEO. "I am pleased
to report that this past year BladeLogic delivered 105% annual
revenue growth, generated $6.5 million in cash from operations,
demonstrated clear operating leverage in our business, and was
recently recognized as the fastest growing vendor in the data
center automation market by IDC Research."
Recent Business Highlights:
— BladeLogic successfully completed an
initial public offering
and achieved positive operating cash flows of $1,442,000 for
the three months and $6,544,000 for the twelve months ended
September 30, 2007. The combination of these positive
accomplishments resulted in an ending cash balance of
$80,694,000.
— BladeLogic closed business with 54
different customers during
the fourth fiscal quarter. These customers included companies
from a broad range of vertical industries, such as banking,
financial services, government, healthcare, pharmaceuticals,
retail, technology, telecommunications and travel.
— International revenue increased to
41% of total revenue for
the fourth fiscal quarter ended September 30, 2007 compared to
20% in the prior year period and increased to 37% of total
revenue for the twelve months ended September 30, 2007
compared to 22% in the prior year period, as the Company
continues to expand its presence in Europe.
— BladeLogic improved its non-GAAP adjusted
income from
operations as a percentage of revenue for the fourth fiscal
quarter ended September 30, 2007 to 1% from (5%) when compared
to the prior year period. The improvement in non-GAAP adjusted
income from operations continues to demonstrate the operating
leverage in the business.
— IDC Research named BladeLogic the fastest
growing data center
automation vendor in 2006 based on revenue growth. The IDC
report stated that BladeLogic grew faster than its nearest
competitor by more than a factor of two.
— BladeLogic announced enhanced management
capabilities for
VMware Infrastructure 3. By seamlessly integrating BladeLogic
Virtualization Manager with the VMware application programming
interface (API), IT organizations can better manage the VMware
virtualization platform allowing those organizations to
respond more quickly to changing business requirements, reduce
systems management costs and increase the overall efficiency
of their physical and virtualized infrastructure.
— BladeLogic announced that it has been
awarded a U.S. patent
entitled "Method and System for Executing and Undoing
Distributed Server Change Operations," which allows IT
organizations to automate change to their server and
application environments.
First Fiscal Quarter and Fiscal Year 2008 Outlook
BladeLogic expects revenue for the first fiscal quarter of 2008
to be in the range of $19.0 million to $20.0 million, and non-GAAP
adjusted income from operations, excluding stock-based compensation,
to be in the range of $0.1 million to $0.4 million. Stock-based
compensation is estimated to be in the range of $1.0 million to
$1.1 million for the first fiscal quarter of 2008. In addition,
BladeLogic expects net income per diluted share on a GAAP basis
to be in the range of $(0.01) to $0.00 for the first fiscal quarter
of 2008 and on a non-GAAP adjusted basis, excluding stock-based
compensation, to be in the range of $0.02 to $0.03 for the period.
For fiscal year 2008, revenue is expected to be in the range of
$84.0 million to $88.0 million, and non-GAAP adjusted income from
operations, excluding stock-based compensation, is expected to
be in the range of $2.0 million to $3.0 million. Stock-based compensation
is estimated to be in the range of $5.0 million to $6.0 million
for the full fiscal year of 2008. In addition, BladeLogic expects
net income per diluted share on a GAAP basis to be in the range
of $(0.02) to $0.02 for the full fiscal year of 2008 and on a
non-GAAP adjusted basis, excluding stock-based compensation, to
be in the range of $0.15 to $0.19 for the period.
Conference Call Information
BladeLogic will hold a conference call on November 7, 2007 to
discuss the results from the fourth fiscal quarter of 2007 at
5:00 p.m. (ET). The conference call can be accessed by dialing
+1-866-700-6979 (domestic) or +1-617-213-8836 (international),
and entering the passcode 75101375. A telephonic replay of the
conference call will be available from 7:00 p.m. on November 7,
2007 until November 14, 2007, and can be accessed by dialing toll-free
+1-888-286-8010 (domestic) or +1-617-801-6888 (international).
The pass code for the replay is 48734830. A webcast of the conference
call will be available online at http://ir.bladelogic.com for
30 days.
About BladeLogic (NASDAQ: BLOG)
BladeLogic is a provider of leading data center automation software
with a large installed base of Fortune Global 500 customers, including
21 of the top 100 global companies, 3 of the top 10 aerospace
and defense companies, 7 of the top 25 commercial and savings
banks, 3 of the top 5 securities companies, 2 of the top 3 entertainment
companies, 2 of the top 3 general merchandisers, 7 of the top
12 pharmaceutical companies and 7 of the top 10 telecommunications
companies. BladeLogic's data center automation software solutions
enable enterprises, service providers and government organizations
to easily browse, provision, configure, patch, audit and remediate
physical and virtual servers and applications, allowing customers
to achieve reduced data center operating costs, improved service
quality and enhanced security and compliance. BladeLogic is headquartered
in Lexington, Massachusetts, USA. For more information, please
visit www.bladelogic.com.
Reconciliation of Non-GAAP Measures
This earnings release contains non-GAAP financial measures. For
purposes of Regulation G, a non-GAAP financial measure is a numerical
measure of a registrant's historical or future financial performance,
financial position or cash flows that excludes amounts, or is
subject to adjustments that have the effect of excluding amounts,
that are included in the most directly comparable measure calculated
and presented in accordance with GAAP in the statement of operations,
balance sheet or statement of cash flows of the issuer; or includes
amounts, or is subject to adjustments that have the effect of
including amounts, that are excluded from the most directly comparable
measure so calculated and presented. In this regard, GAAP refers
to generally accepted accounting principles in the United States.
Pursuant to the requirements of Regulation G, the Company has
provided a reconciliation of the adjusted (non-GAAP) financial
measures to the most directly comparable GAAP financial measures.
Non-GAAP adjusted income (loss) from operations is discussed
in this earnings release because management uses this information
in evaluating the results of the continuing operations of the
business and believes that this information provides the users
of the financial statements a valuable insight into the operating
results. Additionally, management believes that it is in the best
interest of its investors to provide financial information that
will facilitate comparison of both historical and future results
and allows greater transparency to supplemental information used
by management in its financial and operational decision making.
Management encourages investors to review the reconciliations
of the non-GAAP financial measures to the most directly comparable
GAAP measures that are provided within the financial information
attached to this release.
BladeLogic is providing its current quarter GAAP results as well
as financial results that have been adjusted for the impact of
non-cash stock-based compensation expense, as such item may be
considered to be of a non-operational nature. The Company believes
that these non-GAAP measures supplement its consolidated GAAP
financial statements as they provide a consistent basis for comparison
between reporting periods that are not influenced by certain non-cash
or non-recurring items and are, therefore, useful to investors
in helping them to better understand the Company's operating results.
Cautionary Language Concerning Forward-Looking Statements
Certain items in this press release may constitute forward-looking
statements within the meaning of the "safe harbor" provisions
of the
Private Securities Litigation Reform Act of 1995. These statements
are
based on management's current expectations and beliefs and are
subject
to a number of trends and uncertainties that could cause actual
results to differ materially from those described in the
forward-looking statements. BladeLogic can give no assurance that
expectations will be attained. Factors that could cause actual
results
to differ materially from BladeLogic's expectations include, but
are
not limited to, the success and growth of the company's product;
competition and other risks associated with the market for the
Company's products and services; the company's ability to develop
and
introduce new products or enhancements to existing products; the
company's ability to achieve and maintain market acceptance of
new
products or enhancements; the company's ability to attract and
retain
key personnel; the company's ability to protect its intellectual
property and other proprietary rights; conflicts with the intellectual
property of third parties; adverse regulatory or legal actions;
the
company's ability to manage its growth; risks associated with
potential future acquisitions; the company's ability to maintain
compliance with the restrictions and covenants contained in its
existing credit and security agreement; the company's ability
to
successfully maintain effective internal controls; other risks
detailed in BladeLogic's Registration Statement on Form S-1/A
(File
No. 333-141915), filed with the Securities and Exchange Commission
on
July 23, 2007, and other reports filed with the Securities and
Exchange Commission. Such forward-looking statements speak only
as of
the date of this press release. BladeLogic expressly disclaims
any
obligation or undertaking to release publicly any updates or revisions
to any forward-looking statements contained herein to reflect
any
change in BladeLogic's expectations with regard thereto or change
in
events, conditions, or circumstances on which any such statement
is
based.
BladeLogic, Inc.
CONSOLIDATED BALANCE SHEETS
(in thousands except share and par value data)
(unaudited)
September 30, September 30,
2007 2006
------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $80,694 $ 7,835
Accounts receivable, net 11,907 6,598
Prepaid expenses and other current assets 2,171 490
------------- -------------
Total current assets 94,772 14,923
Property and equipment, net 1,237 882
Other assets 196 215
------------- -------------
Total assets $96,205 $ 16,020
============= =============
LIABILITIES, REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY
(DEFICIT)
Current liabilities:
Accounts payable $ 671 $ 511
Accrued employee costs 5,906 2,359
Accrued other expenses 4,001 1,641
Deferred revenue, current portion 12,336 8,097
------------- -------------
Total current liabilities 22,914 12,608
Deferred revenue, net of current portion 2,513 677
Stockholder deposits on restricted stock
purchase 228 445
------------- -------------
Total liabilities 25,655 13,730
Redeemable preferred stock:
Redeemable series A preferred stock,
$0.001 par value; 12,000,000 shares
authorized, issued and outstanding
(liquidation preference $5,880) - 5,137
Redeemable convertible preferred stock,
$0.001 par value; 19,114,222 total
shares authorized, issued and
outstanding (liquidation preference
$22,800) - 22,756
Stockholders' (deficit) equity:
Total stockholders' (deficit) equity 70,550 (25,603)
------------- -------------
Total liabilities, redeemable preferred
stock and stockholders' (deficit) equity $96,205 $ 16,020
============= =============
BladeLogic, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended Twelve Months Ended
September 30, September 30,
------------------ -------------------
2007 2006 2007 2006 (2)
--------- -------- ---------- --------
Net revenue:
License $13,046 $ 7,562 $43,313 $ 20,592
Services 6,357 3,085 19,366 10,024
--------- -------- ---------- --------
Total net revenue 19,403 10,647 62,679 30,616
Cost of revenue:
License 515 239 1,498 604
Services (1) 2,962 1,294 8,654 4,386
--------- -------- ---------- --------
Total cost of revenue 3,477 1,533 10,152 4,990
--------- -------- ---------- --------
Gross profit 15,926 9,114 52,527 25,626
--------- -------- ---------- --------
Operating expense: (1)
Sales and marketing 11,317 6,556 35,998 21,304
Research and development 3,582 3,117 12,604 10,260
General and administrative 1,382 744 4,864 2,561
--------- -------- ---------- --------
Total operating expenses 16,281 10,417 53,466 34,125
--------- -------- ---------- --------
Loss from operations (355) (1,303) (939) (8,499)
--------- -------- ---------- --------
Other income:
Interest income 686 106 931 348
Interest expense (1) - (1) -
Other income 226 51 406 65
--------- -------- ---------- --------
Total other income, net 911 157 1,336 413
--------- -------- ---------- --------
Income (loss) before provision
for income tax 556 (1,146) 397 (8,086)
--------- -------- ---------- --------
Provision for income taxes 263 45 571 165
--------- -------- ---------- --------
Net income (loss) 293 (1,191) (174) (8,251)
--------- -------- ---------- --------
Basic and diluted net (loss)
per share $(0.01) $ (0.11) $(0.07) $ (0.76)
========= ======== ========== ========
Weighted average common shares
used in calculation of basic
and diluted net (loss) per
share 22,799 11,693 14,694 11,454
BladeLogic, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Twelve Months Ended
September 30,
-------------------
2007 2006 (2)
---------- --------
Cash flows from operating activities:
Net loss $ (174) $ (8,251)
Adjustments to reconcile net loss to net cash
(used in) provided by operating activities:
Depreciation 674 530
Loss on disposal of fixed assets 3 -
Provision for bad debt (66) 15
Interest on stockholder loans - (28)
Stock-based compensation 1,522 2,137
Changes in operating accounts:
Accounts receivable (5,243) (4,243)
Prepaid expenses and other current assets (1,656) (136)
Other long-term assets 19 (215)
Accounts payable 150 98
Accrued employee costs 2,186 310
Accrued other expenses 3,054 981
Deferred revenue 6,075 5,186
--------- ---------
Net cash provided by (used in) operating
activities 6,544 (3,616)
--------- ---------
Cash flows from investing activities:
Purchase of property and equipment (1,014) (642)
--------- ---------
Net cash used in investing activities (1,014) (642)
--------- ---------
Cash flows from financing activities:
Proceeds from sale of common stock in connection
with the Company's initial public offering, net
of issuance costs 72,077 -
Proceeds from sale of common and restricted stock 543 915
Redemption of Series A redeemable preferred stock (5,880) -
Payment of equipment loans and capital lease
obligations - (119)
Proceeds from repayment of shareholder notes
receivable 362 -
--------- ---------
Net cash provided by financing activities 67,102 796
Effect of exchange rates on cash 227 25
--------- ---------
Net increase (decrease) in cash and cash
equivalents 72,859 (3,437)
Cash and cash equivalents at beginning of period 7,835 11,272
--------- ---------
Cash and cash equivalents at end of period $ 80,694 $ 7,835
========= =========
Note:
(1) Amounts include stock-based compensation expense, as follows
(in thousands):
Three Months Ended Twelve Months Ended
September 30, September 30,
------------------ -------------------
2007 2006 2007 2006 (2)
------------- ---- ---------- --------
(unaudited)
Cost of revenue:
License $ - $ - $ - $ -
Services 32 3 67 5
------------- ---- ---------- --------
Sub Total 32 3 67 5
------------- ---- ---------- --------
Operating expense:
Sales and marketing 184 34 441 184
Research and development 219 750 465 1,905
General and administrative 207 19 549 43
------------- ---- ---------- --------
Sub Total 610 803 1,455 2,132
------------- ---- ---------- --------
Total stock-based compensation $642 $806 $1,522 $2,137
============= ==== ========== ========
(2) In November 2005, the Company's management and the Board of
Directors elected to change, effective January 1, 2006, the Company's
fiscal year end from December 31 to September 30. Therefore, for
comparison purposes, the twelve months ended September 30, 2006
combines the unaudited three months ended December 31, 2005 with
fiscal period 2006 to arrive at the twelve months ended September 30,
2006.
A reconciliation of the numerator and denominator used in the
calculation of basic and diluted net income (loss) per common share is
as follows:
Three Months Ended Twelve Months Ended
September 30, September 30,
---------------------- -------------------
2007 2006 2007 2006 (2)
------------- -------- ---------- --------
(data in thousands, except per share data)
(unaudited)
Numerator:
Net income (loss) $ 293 $(1,191) $ (174) $(8,251)
============= ======== ========== ========
Allocation of net income
(loss) to periods(2):
Net income (loss)
allocable to period
during which two
classes of equity
securities were
outstanding 76 (1,191) (142) (8,251)
Net income (loss)
allocable to period
during which one class
of equity securities
was Outstanding 217 - (32) -
------------- -------- ---------- --------
Net Income $ 293 $(1,191) $ (174) $(8,251)
============= ======== ========== ========
Net income (loss) allocable
to two class period $ 76 $(1,191) $ (142) $(8,251)
Accretion of preferred
stock dividends 476 121 782 471
Net income (loss)
applicable to common
stockholders for two class
period (400) (1,312) (924) (8,722)
Net income (loss) allocable
to one class period 217 - (32) -
------------- -------- ---------- --------
Net income (loss)
applicable to common
stockholders $ (183) $(1,312) $ (956) $(8,722)
============= ======== ========== ========
Denominator:
Basic and diluted:
Weighted average shares
of common stock
outstanding 22,799 11,693 14,694 11,454
============= ======== ========== ========
Calculation of (Loss) Per
Common Share:
Basic and diluted:
Net (loss) applicable to
common stockholders $ (183) $(1,312) $ (956) $(8,722)
------------- -------- ---------- --------
Weighted average shares
of common stock
outstanding 22,799 11,693 14,694 11,454
============= ======== ========== ========
Net income (loss) per
common share $(0.01) $ (0.11) $(0.07) $ (0.76)
============= ======== ========== ========
(2) As of July 25, 2007, the effective date of the
Company's IPO, the Company transitioned from having two classes of
equity securities outstanding, common and preferred stock, to a single
class of equity securities outstanding, common stock, upon automatic
conversion of shares of redeemable convertible preferred stock into
shares of common stock.
(3) For the three months ended September 30, 2007 undistributed
net income, which equals a pro-rata allocation of net income for the
quarter to the period prior to July 25, 2007 less the accretion of
preferred stock dividends for that period, is allocated to preferred
and common stockholders based on the pro-rata percentage of weighted
average preferred shares outstanding and weighted average common
shares outstanding to the total weighted average shares outstanding
for the period.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
Three Months Ended Twelve Months Ended
September 30, September 30,
------------------ -------------------
2007 2006 2007 2006 (2)
--------- -------- --------- ---------
(in thousands)
(unaudited)
Income (loss) from operations $ (359) $(1,303) $(943) $ (8,499)
Non-cash stock-based
compensation (1) 642 806 1,522 2,137
--------- -------- --------- ---------
Non-GAAP adjusted income (loss)
from operations $ 283 $ (497) $ 579 $ (6,362)
========= ======== ========= =========
Net loss applicable to common
Stockholders $ (183)
Non-cash stock-based
compensation 642
Accretion of preferred stock
dividends 476
---------
Non-GAAP adjusted net income $ 935
=========
Non-GAAP adjusted diluted net
Income per common share $ 0.03
=========
Diluted weighted average common
stock outstanding 30,046
OUTLOOK RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
Three Months Ended Twelve Months Ended
December 31, September 30,
2007 2008
(in millions)
Loss from operations $0.6 to $0.9 $2.0 to $3.0
Non-cash stock-based $1.0 to $1.1 $5.0 to $6.0
compensation
------------------ -------------------
Non-GAAP adjusted income from $0.1 to $0.4 $2.0 to $3.0
operations
Net income $(0.2) to $0.1 $0 to $0.3
Non-cash stock-based $1.0 to $1.1 $5.0 to $6.0
compensation
------------------ -------------------
Non-GAAP adjusted net income $0.8 to $1.0 $5.0 to $6.3
Non-GAAP adjusted net income $0.02 to $0.03 $0.15 to $0.19
per share
CONTACT:
BladeLogic, Inc.
John Gavin
781-257-3500
Chief Financial Officer
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