ATG Reports Second Quarter 2006 Financial Results; Revenue Grew 25 Percent Year-Over-Year to $25.2 Million; Company Raises Full-Year 2006 GAAP Net Income Guidance.CAMBRIDGE, Mass. -- Art Technology Group, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : ARTG ARTG Australian Register of Therapeutic Goods ) whose licensed and on demand technology powers e-commerce e-commerce, commerce conducted over the Internet, most often via the World Wide Web. E-commerce can apply to purchases made through the Web or to business-to-business activities such as inventory transfers. sites and supporting e-marketing and customer care solutions for the world's most customer-centric enterprises, today reported financial results for the second quarter ended June 30, 2006. Revenue for the second quarter of 2006 was $25.2 million, a 25 percent increase over second quarter 2005 revenue of $20.3 million. Net income for the second quarter of 2006, in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. Generally Accepted Accounting Principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ), was $2.3 million, or $0.02 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share. This compares with a net loss of $0.3 million, or $0.00 per share, in the second quarter of 2005. GAAP net income in the second quarter of 2006 includes equity-related compensation charges of approximately $906,000 reflecting the company's adoption of Statement of Financial Accounting Standards No. 123R on January 1, 2006. Non-GAAP net income (1) for the second quarter of 2006 was $4.0 million, or $0.03 per diluted share. This compares to non-GAAP net income of $0.9 million, or $0.01 per diluted share for the second quarter of 2005. Cash, cash equivalents, and marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has as of June 30, 2006 increased $3.8 million to $37.4 million from $33.6 million as of December 31, 2005. "ATG ATG antithymocyte globulin. lymphocyte immune globulin (antithymocyte globulin equine, ATG, ATG equine, LIG) Atgam Pharmacologic class: Immunoglobulin Therapeutic class: Immunosuppressant delivered another solid quarter with revenue growth of 25%," said Bob Burke The name Burke (from Irish Gaelic de Burca, of Norman origin). In English the meaning of the name Burke is "fortified hill." See also Berkley. Places Australia
Julie Bradley, ATG's senior vice president and CFO See Chief Financial Officer. , said, "We are very pleased with our financial performance for the second quarter and the first half of 2006. Our increased net income guidance for the full year reflects the company's ability to manage expenses while executing on its growth strategy." Second-Quarter Highlights --Generated business from new and repeat customers including Allstate, AT&T, American Heart Association American Heart Association (AHA), n.pr a national voluntary health agency that has the goal of increasing public and medical awareness of cardiovascular diseases and stroke, and thereby reducing the number of associated deaths and disabilities. , Body Shop, CapGemini, CCH CCH Colegio de Ciencias y Humanidades (Spanish) CCH Certified Clinical Hypnotherapist CCH Cook County Hospital CCH Certified in Classical Homeopathy CCH Country Club Hills (Fairfax City, VA, USA) , The Container Store, Deutsche Post Deutsche Post AG (ISIN: DE0005552004, LSE: DPO) is a German post, logistics and courier headquartered in Bonn, previously the German state-owned mail monopoly. It has 520,000 employees in more than 220 countries and territories worldwide and generated revenue of € 60. , Dell, El Corte Ingles This article is about an American supermarket chain. For a town in Gran Canaria, see Playa del Inglés. Ingles (NYSE: IMKTA) is a regional supermarket chain based in Asheville, North Carolina, where Robert "Bob" Ingle opened the first store in Asheville, NC in (the largest retailer in Spain and one of the largest such groups in all of Europe), Irwin Financial, Jeppesen Sanderson (division of Boeing), Loyalty Management Group, Motricity, Oriflame Cosmetics cosmetics, preparations externally applied to change or enhance the beauty of skin, hair, nails, lips, and eyes. The use of body paint for ornamental and religious purposes has been common among primitive peoples from prehistoric times (see body-marking). , PayPal, Symantec, and Viking Range This article or section needs sources or references that appear in reliable, third-party publications. Alone, primary sources and sources affiliated with the subject of this article are not sufficient for an accurate encyclopedia article. . --Hired Lou Frio as Senior Vice President, Services, adding significant depth to the Services management team. Frio brings to ATG more than 20 years of experience managing worldwide services organizations, business consulting groups and managed services An umbrella term for third-party monitoring and maintaining of computers, networks and software. The actual equipment may be inhouse or at the third-party's facilities, but the "managed" implies an ongoing effort; for example, making sure the equipment is running at a certain quality offerings at companies such as Unisys, ePresence and Data General. --Launched ATG Live Chat, available licensed or OnDemand. Based on the Wisdom platform, and fully integrated with ATG commerce and response management capabilities, ATG Live Chat leverages the customer's profile and purchase history to suggest highly relevant up-sell and cross-sell offers - increasing conversion rates and basket size. No other chat product does this. --Announced a significant advance in "searchandising." ATG now offers the only solution that integrates catalog catalog, descriptive list, on cards or in a book, of the contents of a library. Assurbanipal's library at Nineveh was cataloged on shelves of slate. The first known subject catalog was compiled by Callimachus at the Alexandrian Library in the 3d cent. B.C. search and Web store merchandising merchandising Element of marketing concerned especially with the sale of goods and services to customers. One aspect of merchandising is advertising, which aims to capture the interest of the segment of the population most likely to buy the product. functionality, to ensure that online shoppers find merchandise in a way that fits the merchandisers' strategy. --Introduced a new analytics platform called ATG Customer Intelligence, delivering integrated reporting across the ATG product line and with external data sources. --Enhanced the ATG email response management See e-mail response management. product, already rated number one by Gartner, and made it available as part of the OnDemand suite. --Hosted record number of customers, prospects and partners at third annual ATG Insight Live conference in April. Financial Guidance and Business Outlook Based on its first half 2006 results and current market conditions, ATG is reiterating its previously announced revenue guidance and raising its net income guidance for the full year 2006. Revenue for 2006 is expected to be in the range of $97 million to $105 million. GAAP net income for the year ending December 31, 2006 is expected to be in the range of $8 to $11 million. This guidance includes an estimated $3 million to $4 million of non-cash stock-based compensation expense, reflecting the company's adoption of SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System 123R effective January 1, 2006.
Forward-Looking Guidance Reconciliation
Year Ending December 31, 2006
GAAP Guidance Non-GAAP Guidance
FROM TO Adjustment FROM TO
Revenue $97 $105 $ - $97 $105
Net Income 8 11 $5 - $6 (a) 13 17
Diluted EPS 0.07 0.09 $0.04 - $0.05 (b) 0.11 0.14
(a) Estimated annual amortization of acquired intangibles of $2
million and estimated stock based compensation expense of $3 -
4 million to be recorded for the periods indicated in
accordance with Statement of Financial Accounting Standards
No. 123R, Share-Based Payments, ("SFAS 123R") which is
effective for periods beginning January 1, 2006. Periods prior
to 2006 do not include stock-based compensation expense.
(b) Estimated per diluted share effect of amortization and
stock-based compensated noted in (a).
Conference Call Reminder ATG management will discuss the company's second-quarter 2006 financial results, recent highlights, and business outlook for the remainder of 2006 on its quarterly conference call for investors at 10:00 a.m. ET today. The conference call will be broadcast live over the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the . Investors interested in listening to the webcast should log on to the "For Investors" section of the ATG website, www.atg.com. The live conference call also can be accessed by dialing (719) 457-2626 or (800) 967-7135. A replay of the call will be available on the company's website later in the day. (1) Use of Non-GAAP Financial Measures ATG is providing the non-GAAP historical and forward-looking financial measures presented below as the company believes that these figures are helpful in allowing individuals to better assess the ongoing nature of ATG's core operations. A "non-GAAP financial measure" is a numerical numerical expressed in numbers, i.e. Arabic numerals of 0 to 9 inclusive. numerical nomenclature a numerical code is used to indicate the words, or other alphabetical signals, intended. measure of a company's historical or future financial performance that excludes amounts that are included in the most directly comparable measure calculated and presented in the GAAP statement of operations See Income statement. . Net income (non-GAAP) and net income per share (non-GAAP), as we present them in the financial data below included in this press release, have been normalized to exclude the net effects of restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). actions and the amortization of intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. and non-cash compensation charges. Management believes that these normalized non-GAAP financial measures excluding restructuring and amortization better reflect its operating performance as these non-GAAP figures exclude the effects of non-recurring or non-cash expenses Noun 1. non-cash expense - an expense (such as depreciation) that is not paid for in cash disbursal, disbursement, expense - amounts paid for goods and services that may be currently tax deductible (as opposed to capital expenditures) . Management believes that these charges are not necessarily representative of underlying trends in the company's performance and their exclusion provides individuals with additional information to compare the company's results over multiple periods. Also, the company's financial results have not historically reflected the impact of non-cash compensation charges required by the adoption of SFAS 123R effective in 2006, and management believes it may be helpful to investors to present a measure of its financial results that is prepared on a basis that is comparable to its reported results for prior periods. The company uses the normalized non-GAAP financial measures internally to focus management on period-to-period changes in the company's core business. Therefore, the company believes that this information is meaningful in addition to the information contained in the GAAP presentation of financial information. The presentation of this additional non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. In accordance with the requirements of Regulation G issued by the Securities and Exchange Commission, the table below presents the most directly comparable GAAP financial measure and reconciles the normalized non-GAAP financial metrics metrics Managed care A popular term for standards by which the quality of a product, service, or outcome of a particular form of Pt management is evaluated. See TQM. to the comparable GAAP measures.
ART TECHNOLOGY GROUP, INC.
(In thousands, except per share data)
(UNAUDITED)
Three Months Six Months Ended
Ended June 30, June 30,
------------------ -----------------
2006 2005 2006 2005
-------- -------- -------- --------
Net Income (GAAP) $2,274 $(327) $4,914 $1,081
Amortization of Acquired
Intangibles 513 580 1,026 976
Net Restructuring 323 671 323 875
Equity Related Compensation 905 - 1,500 -
-------- -------- -------- --------
Net Income (non-GAAP) $4,015 $924 $7,763 $2,932
======== ======== ======== ========
Net Income (non-GAAP) per share:
Basic $0.04 $0.01 $0.07 $0.03
Diluted $0.03 $0.01 $0.07 $0.03
Shares used in per share
calculations:
Basic 111,515 109,218 111,225 109,218
Diluted 117,161 109,218 116,471 109,218
About ATG ATG (Art Technology Group, Inc., NASDAQ: ARTG) makes the software that the world's most customer-conscious companies use to create a more relevant and consistent customer experience, throughout the marketing, commerce, and customer care lifecycle, and across the Web, e-mail, chat, call center, and mobile channels. Offering an alternative to the traditional silo-based approach to customer-facing applications, the ATG Wisdom(TM) platform integrates ATG's best of breed products into a seamless, more compelling experience made relevant to each customer and segment through unique content targeting technology. ATG solutions are available through traditional licensing or delivered as a service, on-demand. ATG's solutions power over 600 major brands, including Adobe adobe (ədō`bē): see rammed earth. adobe Handmade sun-dried bricks formed from a mixture of heavy clay and straw found in arid regions. , A&E Networks, American Eagle Outfitters, B&Q, Best Buy, Cingular Wireless, Dell, DirecTV, France Telecom, Hewlett-Packard, Intuit in·tu·it tr.v. in·tu·it·ed, in·tu·it·ing, in·tu·its Usage Problem To know intuitively. [Back-formation from intuition. , Johnson & Johnson, Louis Johnson, Louis (Arthur) (1891–1966) administrator; born in Roanoke, Va. A West Virginia lawyer and army colonel in World War I, he commanded the American Legion (1932–33). As assistant secretary of war (1937–40), he modernized the army. Vuitton, Mercedes-Benz, Neiman Marcus Neiman Marcus U.S. department-store chain. It was founded in Dallas, Texas, in 1907 by Herbert Marcus, his sister Carrie Marcus Neiman, and her husband, A.L. Neiman. , New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of & Company, Nokia, Nike, OfficeMax, PayPal, Philips, Procter & Gamble, Rubbermaid, Smith & Hawken, Symantec, T-Mobile, Target, Urban Outfitters Urban Outfitters, Inc. NASDAQ: URBN owns and operates three retail clothing brands: Urban Outfitters, Anthropologie and Free People. The first store opened in 1970 in Philadelphia, Pennsylvania, focusing on "funky" fashion and household products. , Verisign, and Walgreens. The company is headquartered in Cambridge, Massachusetts This article is about the city of Cambridge in Massachusetts. For the English university town, see Cambridge, England. For other places, see Cambridge (disambiguation). Cambridge, Massachusetts is a city in the Greater Boston area of Massachusetts, United States. , with additional locations throughout North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. and Europe. For more information about ATG, please visit www.atg.com. (C) 2006 Art Technology Group, Inc. ATG and Art Technology Group are registered trademarks and ATG Wisdom is a trademark of Art Technology Group, Inc. All other product names, service marks, and trademarks mentioned herein are trademarks of their respective owners. This press release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. about the company's estimated revenue and earnings. These statements involve known and unknown risks and uncertainties that may cause ATG's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. These risks include the effect of weakened weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. or weakening weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak en·er n. economic conditions or perceived conditions on the level of spending by
customers and prospective customers for ATG's software and
services; financial and other effects of cost control measures;
quarterly fluctuations in ATG's revenues or other operating
results; customization and deployment delays or errors associated with
ATG's products; the risk of longer sales cycles for ATG's
products and ATG's ability to conclude sales based on purchasing
decisions that are delayed; satisfaction levels of customers regarding
the implementation and performance of ATG's products; ATG's
need to maintain, enhance, and leverage business relationships with
resellers and other parties who may be affected by changes in the
economic climate; ATG's ability to attract and maintain qualified
executives and other personnel and to motivate employees; activities by
ATG and others related to the protection of intellectual property;
potential adverse financial and other effects of litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute.When a person begins a civil lawsuit, the person enters into a process called litigation. (including intellectual property infringement The encroachment, breach, or violation of a right, law, regulation, or contract. The term is most frequently used in reference to the invasion of rights secured by Copyright, patent, or trademark. claims) and the release of competitive products and other activities by competitors. Further details on these risks are set forth in ATG's filings with the Securities and Exchange Commission (SEC), including the company's annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the period ended December 31, 2005, as filed with the SEC. These filings are available free of charge on a website maintained by the SEC at http://www.sec.gov.
ART TECHNOLOGY GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(UNAUDITED)
For the Periods ended
------------------------------
June 30, December 31,
2006 2005
------------ -----------
Assets
Current assets:
Cash, cash equivalents
and marketable
securities $37,405 $33,569
Accounts receivable, net 24,557 21,459
Prepaid expenses and
other current assets 2,148 1,130
------------ --------
Total current assets 64,110 56,158
Property and equipment, net 3,619 2,995
Intangible assets, net 3,832 4,859
Other assets 1,275 1,406
Goodwill 27,347 27,347
------------ --------
Total long-term assets 36,073 36,607
------------ --------
Total assets $100,183 $92,765
============ ========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $3,428 $2,719
Accrued expenses 12,398 13,359
Deferred revenue 22,336 21,113
Accrued restructuring, current portion 1,711 3,012
Other current liabilities 66 254
------------ --------
Total current liabilities 39,939 40,457
Accrued restructuring, less current
portion 2,384 2,085
Capital lease obligations, less current
portion 24 63
------------ --------
Total long-term liabilities 2,408 2,148
Stockholders' equity 57,836 50,160
-------- --------
Total liabilities and
stockholders' equity $100,183 $92,765
============ ========
ART TECHNOLOGY GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(UNAUDITED)
Three Months Six Months Ended
Ended June 30, June 30,
------------------ -----------------
2006 2005 2006 2005
-------- -------- -------- --------
Revenues:
Product License $9,122 $5,319 $17,222 $12,702
Services 16,107 14,942 31,963 29,553
-------- -------- -------- --------
Total Revenue 25,229 20,261 49,185 42,255
Cost of Revenues:
Product License 518 378 1,016 942
Services 6,903 5,367 13,568 10,806
-------- -------- -------- --------
Total Cost of Revenues 7,421 5,745 14,584 11,748
-------- -------- -------- --------
Gross Profit 17,808 14,516 34,601 30,507
Gross Profit % 71% 72% 70% 72%
Operating Expenses:
Research and development 5,119 4,548 9,946 9,137
Sales and marketing 7,894 6,996 14,817 13,796
General and administrative 2,744 2,704 5,424 5,692
Restructuring 323 671 323 875
-------- -------- -------- --------
Total Operating Expenses 16,080 14,919 30,510 29,500
Income from Operations 1,727 (403) 4,090 1,007
Interest and other income, net 547 89 824 100
-------- -------- -------- --------
Income before tax provision 2,274 (314) 4,914 1,107
Provision (benefit) for income
taxes - 13 - 26
-------- -------- -------- --------
Net Income $2,274 $(327) $4,914 $1,081
======== ======== ======== ========
Earnings Per Share
Basic $0.02 $(0.00) $0.04 $0.01
Diluted $0.02 $(0.00) $0.04 $0.01
Shares Outstanding
Basic 111,515 109,218 111,225 108,950
Diluted 117,161 109,218 116,471 110,739
ART TECHNOLOGY GROUP, INC.
(UNAUDITED)
Three Months Six Months
Ended June 30, Ended June 30,
------------------------------
2006 2005 2006 2005
------- ------- ------- ------
Equity-Related Compensation:
Cost of Revenues $209 $- $354 $-
Research and Development 234 - 388 -
Sales and Marketing 264 - 429 -
General and Administrative 198 - 328 -
------- ------- ------- ------
Total Equity-Related Compensation $905 $- $1,499 $-
======= ======= ======= ======
Depreciation and Amortization:
Depreciation $581 $427 $1,118 $938
Amortization 513 580 1,026 1,159
------- ------- ------- ------
Total Depreciation and Amortization $1,094 $1,007 $2,144 $2,097
======= ======= ======= ======
Capital Expenditures:
Purchases of Property and Equipment $742 $175 $1,743 $271
Total Capital Expenditures $742 $175 $1,743 $271
======= ======= ======= =====
End of Period Statistics:
Number of Employees 330 317 330 317
Number of Hosted Sites 60 n/a 60 n/a
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