Business Objects Reports Second Quarter 2005 Results; Total Revenues Up 18 Percent Year over Year; BusinessObjects XI(TM) Revenues More Than Triple from prior Quarter; Full Year Guidance Raised.SAN JOSE San Jose, city, United States San Jose (sănəzā`, săn hōzā`), city (1990 pop. 782,248), seat of Santa Clara co., W central Calif.; founded 1777, inc. 1850. , Calif. & PARIS Paris, in Greek mythology Paris or Alexander, in Greek mythology, son of Priam and Hecuba and brother of Hector. Because it was prophesied that he would cause the destruction of Troy, Paris was abandoned on Mt. -- Business Objects (Nasdaq:BOBJ BOBJ Business Objects SA )(Euronext Paris Euronext Paris is France's securities market, formerly known as the Paris Bourse, which merged with the Amsterdam and Brussels exchanges in September 2000 to form Euronext NV, which is the second largest exchange in Europe behind the London Stock Exchange. ISIN Isin (ĭs`ĭn), capital of an ancient Semitic kingdom of N Babylonia. The city became important after the third dynasty of Ur fell to the Elamites and the Amorites (c.2025 B.C.). The phase from c.2025–c.1763 B.C. code FR0004026250 - BOB), the world's leading provider of business intelligence (BI) solutions, today announced results for the second quarter ended June June: see month. 30, 2005. For the second quarter of 2005, the company reported total revenues of $262.4 million, an increase of 18 percent year over year. US GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were $0.25 and non-GAAP diluted earnings per share were $0.32 in the second quarter of 2005. The US GAAP and non-GAAP diluted earnings per share exceeded the high end of the company's guidance for the quarter of US GAAP $0.20 to $0.22 per share and non-GAAP $0.26 to $0.28 per share. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. improved significantly on both a US GAAP and non-GAAP basis during the second quarter of 2005. On a US GAAP basis, income from operations was $34.9 million or 13 percent of total revenues, up 91 percent year over year. On a non-GAAP basis, income from operations was $43.9 million or 17 percent of total revenues, up 51 percent from the second quarter of 2004. All figures referred to herein are stated in US Dollars unless otherwise indicated. Second quarter 2005 non-GAAP results as defined in the section "Use of Non-GAAP Financial Measures" below differ from results measured under US GAAP as they exclude $7.9 million of 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 $1.1 million of deferred stock-based compensation expense, all primarily associated with the acquisition of Crystal Decisions. Reconciliations of US GAAP to non-GAAP results are included at the end of this press release. "Second quarter results highlight our momentum since the launch of BusinessObjects A query, reporting and analysis suite of tools from Business Objects that runs under all versions of Windows and various Unix clients. It is the leading decision support tool in the business intelligence market, providing access to a wide variety of databases, including Oracle, INFORMIX XI," said Bernard Liautaud Bernard Liautaud is chairman and chief strategy officer of Business Objects. Liautaud cofounded Business Objects in 1990 and was chief executive officer until September 2005. , chairman and chief executive officer. "The newest release of our flagship product A primary product of a company, which is typically why the company was founded and/or what made it well known. For example, MS-DOS, Windows and the Microsoft Office suite have been flagship products of Microsoft. CorelDRAW is a flagship product of Corel Corporation. suite has allowed us to develop strategic relationships with more customers, increasing license deals over $1 million to 13 in the quarter. We accelerated revenue growth across all major geographies, with particularly strong success in the Americas A·mer·i·cas , the See America. , up 19 percent year over year. At the same time, we have been focusing on operating income which increased 91 percent in the quarter versus the second quarter of last year." "Going forward," Liautaud continued, "we remain focused on our core strategy of expanding our footprint The amount of geographic space covered by an object. A computer footprint is the desk or floor surface it occupies. A satellite's footprint is the earth area covered by its downlink. See form factor. 1. in the enterprise, leveraging our strength in the mid market and growing performance management across new markets. We believe that our planned acquisition of SRC (SouRCe) Contrast with DST, which is an abbreviation of "destination." Software, Inc. fits well with these three objectives and with our ultimate goal of driving increased standardization standardization In industry, the development and application of standards that make it possible to manufacture a large volume of interchangeable parts. Standardization may focus on engineering standards, such as properties of materials, fits and tolerances, and drafting of Business Objects." Large Deals Increase Versus the Previous Year --There were 13 transactions over $1 million in license revenues in the second quarter, up from 8 transactions over $1 million in the year ago quarter. --Notable customer wins included Australia Post
Australia Post is trading name of the Australian Postal Corporation, the postal service with a monopoly in small letter mail Australia. , FedEx Corp., ING Nederland Nederland (nē`dərlənd), city (1990 pop. 16,192), Jefferson co., SE Tex.; founded by Dutch settlers as a rice-farming community in 1897, inc. 1940. N.V., Ministere de l'Economie, des Finances et de l'Industrie (French Ministry of Economy, Finance and Industry) and U.S. General Services Administration The General Services Administration (GSA) was established by section 101 of the Federal Property and Administrative Services Act of 1949 (40 U.S.C.A. § 751). The GSA sets policy for and manages government property and records. (GSA (1) (Global mobile Suppliers Association, Sawbridgeworth, U.K., www.gsacom.com) A membership organization of suppliers of GSM products and services. Its goal is to promote GSM as the worldwide mobile communications standard. See GSM Association and GSM. ), many of which were driven by BusinessObjects XI. All Major Geographies Reported Double Digit Noun 1. double digit - a two-digit integer; from 10 to 99 integer, whole number - any of the natural numbers (positive or negative) or zero; "an integer is a number that is not a fraction" Growth --Revenues in the Americas reached $123.6 million in the second quarter of 2005, up 19 percent year over year with 7 transactions over $1 million in license revenue. --Revenues in EMEA (Europe, Middle East, Africa) Refers to that region of the world. For example, one might see products packaged differently for the UK, EMEA and Asia Pacific markets. (Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , Middle East, and Africa) totaled $116.5
million, up 17 percent year over year (up 11 percent at 92.2 million in
Euros), with 6 transactions over $1 million in license revenues.
--Revenues in Asia Pacific, including Japan, rose to $22.3 million, up 21 percent year over year. Software License and Services Revenues up Year Over Year --Software license revenues totaled $124.9 million in the second quarter of 2005, up 7 percent year over year. --The company reported growth in each major product area, with 36 percent growth year over year in Enterprise Performance Management Applications. --Sales of core business intelligence products including query To interrogate a collection of data such as records in a database. The term may also be used to search a single file or collection of files such as HTML files on the Web. However, in addition to obtaining lists of records that match the search criteria, queries to a database allow for , reporting and analysis resulted in $109.3 million in license revenues, representing 88 percent of total license revenues. --Enterprise Performance Management Applications reached $8.9 million in license revenues, representing 7 percent of total license revenues. --Data Integration products reached $6.7 million in license revenues, representing 5 percent of total license revenues. --Services revenues totaled $137.5 million in the second quarter, up 31 percent year over year. Earnings per Share Up Year over Year --On a US GAAP basis, operating income was $34.9 million in the second quarter of 2005, up 91 percent year over year, representing a US GAAP operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: of 13 percent. In the second quarter, US GAAP net income was $23.1 million and US GAAP diluted earnings per share were $0.25 per share. --On a non-GAAP basis, operating income was $43.9 million in the second quarter of 2005, up 51 percent year over year, representing a non-GAAP operating margin of 17 percent. In the second quarter, non-GAAP net income was $29.7 million and non-GAAP diluted earnings per share were $0.32 per share. Balance Sheet Remains Strong --Total cash and investments (cash, cash equivalents, restricted cash and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments) were $383.9 million at June 30, 2005. --Deferred and long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. deferred revenues totaled $207.2 million at June 30, 2005. --Days Sales Outstanding (DSOs) increased slightly to 72 days as of June 30, 2005, which is within the Company's target range of 60 to 75 days. BusinessObjects XI Momentum Accelerates --Customer acceptance of BusinessObjects XI continued to accelerate throughout the second quarter of 2005. --BusinessObjects XI license revenues totaled more than $50 million in the second quarter of 2005, more than tripling sequentially se·quen·tial adj. 1. Forming or characterized by a sequence, as of units or musical notes. 2. Sequent. se·quen . --BusinessObjects XI performed well in the Americas and with new customers overall in the second quarter. Business Objects to Acquire SRC Software, Inc. --On July July: see month. 20, 2005 Business Objects announced that it entered into a definitive agreement to acquire privately held SRC Software, Inc., a leading vendor of financial planning Financial planning Evaluating the investing and financing options available to a firm. Planning includes attempting to make optimal decisions, projecting the consequences of these decisions for the firm in the form of a financial plan, and then comparing future performance against and performance management software. --The acquisition will be an all cash transaction of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $100 million US and will be accounted for under the purchase method of accounting. --The transaction is subject to regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. approvals and other customary closing conditions, and is expected to close in September September: see month. 2005. Business Outlook Since the guidance issued in April 2005, the US Dollar to euro exchange rate declined significantly, moving the company's exchange rate assumption for guidance from $1.30 to $1.22 per EUR EUR In currencies, this is the abbreviation for the Euro. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 1.00. This exchange rate decline resulted in a negative impact of approximately $12 million in total revenues for the second half of fiscal 2005. Despite the negative currency impact, the company is raising its guidance for the full year, indicating that the strength in the overall business substantially offsets the currency change. Business Objects offers the following guidance for the quarter ending September 30, 2005: --Total revenues are expected to range from $248 million to $253 million. --US GAAP diluted earnings per share are expected to range from $0.19 to $0.22. --Non-GAAP diluted earnings per share are expected to range from $0.25 to $0.28. --This guidance does not include the impact of the proposed SRC Software, Inc. acquisition which is expected to close in September 2005. The non-GAAP diluted earnings per share guidance for the quarter ending September 30, 2005 excludes amortization of intangible assets and deferred stock-based compensation expense of approximately $9 million, which is an increase of approximately $0.06 per share. Assumptions for the third quarter guidance assume a US GAAP tax rate of 37% and a US Dollar to Euro exchange rate of $1.22 per EUR 1.00. Business Objects offers the following updated guidance for the year ending December December: see month. 31, 2005: --Total revenues are expected to range from $1.025 billion to $1.040 billion. --US GAAP diluted earnings per share are expected to range from $0.89 to $0.97. --Non-GAAP diluted earnings per share are expected to range from $1.16 to $1.24. --This guidance does not include the impact of the proposed SRC Software, Inc. acquisition which is expected to close in September 2005. The non-GAAP diluted earnings per share guidance for the year ending December 31, 2005 excludes amortization of intangible assets and deferred stock-based compensation expense of approximately $37.0 million, which represents an increase of approximately $0.27 per share. The outlook for the full year 2005 assumes a US Dollar to euro exchange rate of $1.22 per EUR 1.00 and an effective US GAAP tax rate of 38 percent for the full year 2005. The above information concerning our forecast for the third quarter and full year 2005 represents our outlook only as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" , and we undertake no obligation to update or revise any financial forecast or other forward looking statements, as a result of new developments or otherwise. Conference Call Business Objects will hold a conference call to discuss its financial results for the second quarter of 2005. The call will begin at 2:00 p.m. PT (5:00 p.m. 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 , 11:00 p.m. Paris, 10:00 p.m., London London, city, Canada London, city (1991 pop. 303,165), SE Ont., Canada, on the Thames River. The site was chosen in 1792 by Governor Simcoe to be the capital of Upper Canada, but York was made capital instead. London was settled in 1826. ). The call-in call-in adj. Being in a format such that listeners or viewers are invited to have their telephone conversations with the host or guests on a show broadcast to other listeners: a call-in radio show. n. numbers are 800-399-7988 for 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 706-634-5428 for Europe and Asia with ID #7636234. The conference call also will be webcast live, and can be accessed on the company's website - www.businessobjects.com. A replay of the webcast will be available on the site approximately two hours after the end of the live call. Accounting Principles Business Objects prepares its financial statements 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 US GAAP. Because the company is listed on both the Eurolist by Euronext  Euronext N.V. is a pan-European stock exchange based in Paris[1] (TM) in France and the Nasdaq National Market in the 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. , it is required to separately report consolidated financial
statements Consolidated Financial StatementsThe combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge prepared in accordance with US GAAP and International Financial Reporting Standards International Financial Reporting Standards (IFRS) are standards and interpretations adopted by the International Accounting Standards Board (IASB). Many of the standards forming part of IFRS are known by the older name of International Accounting Standards (IAS). ("IFRS IFRS International Financial Reporting Standard(s) IFRS Inter Frame Relay Service IFRS Indiana Facilities Registry System "). The most significant identified differences between the two reporting standards for Business Objects relate to the treatment of stock-based compensation expense and the accounting for treasury shares related to a prior acquisition. In accordance with French regulations and IFRS, Business Objects will report its consolidated financial statements for the first half of 2005 on or before October October: see month. 31, 2005. In addition, Business Objects expects to report its consolidated financial statements for the full year 2005 in April 2006. Business Objects filed with the Autorite des Marches Financiers in France its 2004 Document de Reference which included the opening balance sheet of the Company as of January January: see month. 1, 2004 prepared in accordance with IFRS. In addition, the Company will publish net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for its second quarter in accordance with IFRS in the Bulletin des Annonces Legales Obligatoires in France by August 15, 2005. Use of Non-GAAP Financial Measures The non-GAAP financial measures such as operating income, net income and earnings per share information for the second quarters of 2005 and 2004 included in this press release are different from those otherwise presented under US GAAP as these non-GAAP measures excluded certain charges. These charges include amortization of intangible assets, deferred stock-based compensation expense and restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. , all of which are primarily associated with the acquisition of Crystal Decisions. Business Objects has provided these measures in addition to US GAAP financial results because management believes these non-GAAP measures provide a consistent basis for comparison between quarters and of growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. year-over-year that are not influenced by certain non-cash charges Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. or impacts of prior period acquisitions, and therefore are helpful in understanding Business Objects' underlying operating results. In addition, this press release also includes non-GAAP measures that use a constant currency to separate the impact of conversion from other foreign currencies to US dollars from other changes in our business. These non-GAAP measures are some of the primary measures Business Objects' management uses for planning and forecasting. These measures are not in accordance with, or an alternative to US GAAP and these non-GAAP measures may not be comparable to information provided by other companies. Reconciliations of US GAAP to non-GAAP results are presented at the end of this press release. About Business Objects Business Objects is the world's leading business intelligence (BI) software company. With over 30,000 customers worldwide, including over 80 percent of the Fortune 500, Business Objects helps organizations gain better insight into their business, improve decision making, and optimize optimize - optimisation enterprise performance. The company's business intelligence platform, BusinessObjects XI, offers the BI industry's most complete and trusted platform for query, reporting and analysis, performance management, and data integration. BusinessObjects XI includes Crystal Reports(R), the industry standard for enterprise reporting With the dramatic expansion of information technology, and the desire for increased competitiveness in corporations, there has been an increase in the use of computing power to produce unified reports which join different views of the enterprise in one place. . Business Objects has built the industry's strongest and most diverse partner community, and also offers consulting and education services to help customers effectively deploy their business intelligence projects. Business Objects has headquarters in San Jose, Calif., and Paris, France. The company's stock is traded on both the Nasdaq (BOBJ) and Euronext Paris (ISIN: FR0004026250 - BOB) stock exchanges. More information about Business Objects can be found at www.businessobjects.com. 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. This document contains forward-looking statements that involve risks and uncertainties concerning the company, including the company's expected financial performance for the third quarter and full year 2005, the company's core strategy and the company's expectations regarding its planned acquisition of SRC Software, Inc. Actual events or results may differ materially from those described in this document due to a number of risks and uncertainties. These potential risks and uncertainties include, among others, fluctuations in the company's quarterly operating results; the company's ability to sustain or increase its profitability; the company's ability to attract and retain customers for BusinessObjects XI; the company's ability to issue new releases of BusinessObjects XI on other platforms; changes to current accounting policies which may have a significant, adverse impact upon the company's financial results; risks related to the company's purchase and integration of SRC Software, Inc. ; the introduction of new products by competitors COMPETITORS, French law. Persons who compete or aspire to the same office, rank or employment. As an English word in common use, it has a much wider application. Ferriere, Dict. de Dr. h.t. or the entry of new competitors into the markets for Business Objects' products; the impact of the pricing of competing technologies; the company's ability to preserve its key strategic relationships; the company's reliance upon selling products only in the Business Intelligence software market; and economic and political conditions in the US and abroad. More information about potential factors that could affect Business Objects' business and financial results is included in Business Objects' 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 year ended December 31, 2004 and Business Objects' Amendment No. 3 to its Registration Statement on Form S-3 filed with the Securities and Exchange Commission, or the "SEC", on July 20, 2005 (File No. 333-119662), each of which are on file with the SEC and available at the SEC's website at www.sec.gov See .gov and GovNet. (networking) gov - The top-level domain for US government bodies. . Business Objects is not obligated ob·li·gate tr.v. ob·li·gat·ed, ob·li·gat·ing, ob·li·gates 1. To bind, compel, or constrain by a social, legal, or moral tie. See Synonyms at force. 2. To cause to be grateful or indebted; oblige. to undertake any obligation to update these forward-looking statements to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date of this document. Business Objects and the Business Objects logo, BusinessObjects, WebIntelligence, Crystal Reports, Crystal Enterprise, Crystal Analysis, RapidMarts, and BusinessQuery are trademarks or registered trademarks of Business Objects S.A. or its affiliated companies Affiliated Companies A situation that occurs when one company owns a minority interest (less than 50%) in another company. Also refers to companies that are related to each other in some way. Notes: An affiliated company is sometimes referred to as a subsidiary. in the United States and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. other countries. All other names mentioned herein may be trademarks of their respective owners.
BUSINESS OBJECTS S.A.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per ordinary share and ADS data)
Three Months Ended Six Months Ended
June 30, June 30,
2005 2004 2005 2004
--------- --------- --------- ---------
Revenues: (unaudited) (unaudited)
Net license fees $124,858 $117,182 $240,009 $231,675
Services 137,551 105,056 271,175 207,798
--------- --------- --------- ---------
Total revenues 262,409 222,238 511,184 439,473
Cost of revenues:
Net license fees 7,249 5,971 14,417 13,653
Services 52,781 41,444 104,162 83,074
--------- --------- --------- ---------
Total cost of
revenues 60,030 47,415 118,579 96,727
--------- --------- --------- ---------
Gross margin 202,379 174,823 392,605 342,746
Operating expenses:
Sales and marketing 104,787 99,271 208,509 196,452
Research and development 40,427 36,541 80,701 76,244
General and
administrative 22,218 19,234 47,031 40,946
Restructuring costs - 1,492 - 1,492
--------- --------- --------- ---------
Total operating
expenses 167,432 156,538 336,241 315,134
--------- --------- --------- ---------
Income from operations 34,947 18,285 56,364 27,612
Interest and other income
(expense), net 3,178 261 7,578 (3,807)
--------- --------- --------- ---------
Income before provision for
income taxes 38,125 18,546 63,942 23,805
Provision for income taxes (14,986) (7,058) (25,797) (9,057)
--------- --------- --------- ---------
Net income $23,139 $11,488 $38,145 $14,748
========= ========= ========= =========
Basic net income per ordinary
share and ADS $0.26 $0.13 $0.43 $0.17
========= ========= ========= =========
Diluted net income per
ordinary share and ADS $0.25 $0.13 $0.42 $0.16
========= ========= ========= =========
Ordinary shares and ADSs used
in computing basic net income
per ordinary share and ADS 90,030 89,095 89,727 88,864
========= ========= ========= =========
Ordinary shares and ADSs and
equivalents used in computing
diluted net income per
ordinary share and ADS 92,089 91,061 91,650 91,730
========= ========= ========= =========
BUSINESS OBJECTS S.A.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except nominal value per ordinary share)
June 30, Dec. 31,
2005 2004
----------- -----------
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 365,994 $ 293,485
Restricted cash 14,052 14,043
Short-term investments 3,846 3,831
Accounts receivable, net 208,637 248,957
Deferred tax assets 3,992 8,328
Prepaid and other current assets 52,902 46,575
---------- ----------
Total current assets 649,423 615,219
Goodwill 1,065,335 1,067,694
Other intangible assets, net 100,522 124,599
Property and equipment, net 59,811 64,053
Deposits and other assets 41,473 49,296
Long-term deferred tax assets 2,476 2,067
---------- ----------
Total assets $1,919,040 $1,922,928
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 42,944 $ 40,939
Accrued payroll and related expenses 66,174 84,918
Income taxes payable 67,896 85,000
Deferred revenues 201,238 194,366
Other current liabilities 55,973 83,544
Escrows payable 6,700 6,654
---------- ----------
Total current liabilities 440,925 495,421
Other long-term liabilities 7,021 6,448
Long-term deferred revenues 5,994 6,316
Long-term deferred tax liabilities 5,628 7,599
---------- ----------
Total liabilities 459,568 515,784
Shareholders' equity
Ordinary shares, Euro 0.10 nominal value 10,442 10,312
Additional paid-in capital 1,182,728 1,167,336
Treasury and Business Objects Option LLC
shares (53,335) (53,335)
Retained earnings 287,865 249,720
Unearned compensation (5,221) (8,079)
Accumulated other comprehensive income 36,993 41,190
---------- ----------
Total shareholders' equity 1,459,472 1,407,144
---------- ----------
Total liabilities and shareholders'
equity $1,919,040 $1,922,928
========== ==========
BUSINESS OBJECTS S.A.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Six Months Ended
June 30,
-------------------
2005 2004
-------- --------
(unaudited)
Operating activities:
Net income $ 38,145 $ 14,748
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization of property
and equipment 16,516 16,113
Amortization of other intangible assets 16,040 15,435
Stock-based compensation expense 2,360 3,787
Deferred income taxes 3,850 (14,795)
Tax benefit from employee stock plans - 2,517
Changes in operating assets and liabilities:
Accounts receivable, net 29,019 (14,849)
Prepaid and other current assets (8,865) (9,226)
Deposits and other assets 7,563 (13,717)
Accounts payable 4,523 (8,808)
Accrued payroll and related expenses (14,389) (21,503)
Income taxes payable (14,067) 6,501
Deferred revenues 15,517 41,576
Other liabilities (24,943) (4,991)
Short-term investments classified as trading (15) (290)
-------- --------
Net cash provided by operating
activities 71,254 12,498
-------- --------
Investing activities:
Purchases of property and equipment (13,891) (16,272)
-------- --------
Net cash used in investing activities (13,891) (16,272)
-------- --------
Financing activities:
Issuance of shares 16,020 20,746
Purchase of treasury shares - (20,961)
Transfer of cash from (to) restricted cash
accounts 37 (30,037)
Payments on escrows payable - (3,092)
-------- --------
Net cash provided by (used in)
financing activities 16,057 (33,344)
-------- --------
Effect of foreign exchange rate changes on cash
and cash equivalents (911) 4,355
-------- --------
Net increase (decrease) in cash and
cash equivalents 72,509 (32,763)
Cash and cash equivalents, beginning of the period 293,485 235,380
-------- --------
Cash and cash equivalents, end of the period $365,994 $202,617
======== ========
BUSINESS OBJECTS S.A.
STATEMENT OF INCOME -- Reconciliation of US GAAP to Non-GAAP Results
Three Months Ended June 30, 2005
(in millions, except per ordinary share and ADS data)
(Unaudited)
Add back: Add back:
Amortization Amortization
of of stock-
intangible based Non-GAAP
US GAAP assets compensation Results
------- ----------- --------------------
Revenues:
Net license fees $124.9 $124.9
Services 137.5 137.5
------- ----------- ----------- --------
Total revenues 262.4 - - 262.4
Cost of revenues:
Net license fees 7.2 (5.3) 1.9
Services 52.8 (2.3) (0.2) 50.3
------- ----------- ----------- --------
Total cost of revenues 60.0 (7.6) (0.2) 52.2
------- ----------- ----------- --------
Gross margin 202.4 7.6 0.2 210.2
Gross margin % 77% 80%
Operating expenses:
Sales and marketing 104.8 (0.5) 104.3
Research and development 40.4 (0.3) 40.1
General and administrative 22.3 (0.3) (0.1) 21.9
------- ----------- ----------- --------
Total operating expenses 167.5 (0.3) (0.9) 166.3
------- ----------- ----------- --------
Income from operations 34.9 7.9 1.1 43.9
Interest and other income
(expense), net 3.2 3.2
------- ----------- ----------- --------
Income before provision for
income taxes 38.1 7.9 1.1 47.1
Provision for income taxes (15.0) (17.4)
------- --------
Net income $23.1 $29.7
======= ========
Basic net income per ordinary
share and ADS $0.26 $0.33
======= ========
Diluted net income per
ordinary share and ADS $0.25 $0.32
======= ========
BUSINESS OBJECTS S.A.
STATEMENT OF INCOME -- Reconciliation of US GAAP to Non-GAAP Results
Six Months Ended June 30, 2005
(in millions, except per ordinary share and ADS data)
(Unaudited)
Add back:
Amortization Add back:
of intangible Amortization
assets and of stock-
restructuring based Non-GAAP
US GAAP costs compensation Results
-----------------------------------------
Revenues:
Net license fees $ 240.0 $240.0
Services 271.2 271.2
-------------------------------- ------
Total revenues 511.2 - - 511.2
Cost of revenues:
Net license fees 14.4 (10.7) - 3.7
Services 104.2 (4.6) (0.4) 99.2
-------------------------------- ------
Total cost of revenues 118.6 (15.3) (0.4) 102.9
-------------------------------- ------
Gross margin 392.6 15.3 0.4 408.3
Gross margin % 77% 80%
Operating expenses:
Sales and marketing 208.5 (1.0) 207.5
Research and development 80.7 (0.7) 80.0
General and administrative 47.1 (0.7) (0.3) 46.1
Restructuring costs (0.1) 0.1 - -
-------------------------------- ------
Total operating expenses 336.2 (0.6) (2.0) 333.6
-------------------------------- ------
Income from operations 56.4 15.9 2.4 74.7
Interest and other income
(expense), net 7.5 7.5
-------------------------------- ------
Income before provision for
income taxes 63.9 15.9 2.4 82.2
Provision for income taxes (25.8) (30.3)
------- ------
Net income $ 38.1 $ 51.9
======= ======
Basic net income per ordinary
share and ADS $ 0.43 $ 0.58
======= ======
Diluted net income per
ordinary share and ADS $ 0.42 $ 0.57
======= ======
BUSINESS OBJECTS S.A.
Q2 FISCAL 2005 SUPPLEMENTAL INFORMATION
(in millions, except per ordinary share and ADS data)
(Unaudited)
Fiscal 2004 Fiscal 2005
----------------------------------- --------------
Q1 Q2 Q3 Q4 Total Q1 Q2
----------------------------------------------------------------------
SUPPLEMENTAL INCOME STATEMENT
INFORMATION
Revenues
Net license
fees $114.5 $117.2 $105.7 $136.0 $473.4 $115.2 $124.9
Maintenance 73.8 75.6 84.4 97.0 330.8 100.1 100.7
Consulting
and training 28.9 29.4 29.4 33.7 121.4 33.5 36.8
------- ------- ------- ------- ------- ------- -------
Total
revenues 217.2 222.2 219.5 266.7 925.6 248.8 262.4
------- ------- ------- ------- ------- ------- -------
Total expenses
Cost of net
license fees 2.5 1.0 2.1 2.4 8.0 1.7 1.9
Cost of
services
revenues 39.0 38.8 39.9 44.1 161.8 48.9 50.3
Sales and
marketing 96.5 98.6 95.9 113.2 404.2 103.2 104.3
Research and
development 39.1 36.1 34.9 38.7 148.8 40.0 40.1
General and
admin-
istrative 20.9 18.6 20.9 21.1 81.5 24.4 21.9
Amortization
of
intangible
assets 7.8 7.6 7.6 7.7 30.7 8.1 7.9
Stock-based
compensation(1) 2.1 1.7 1.5 1.4 6.7 1.2 1.1
Restructuring
costs - 1.5 - 0.7 2.2 (0.1) -
------- ------- ------- ------- ------- ------- -------
Total
expenses 207.9 203.9 202.8 229.3 843.9 227.4 227.5
------- ------- ------- ------- ------- ------- -------
Income from
operations 9.3 18.3 16.7 37.4 81.7 21.4 34.9
------- ------- ------- ------- ------- ------- -------
Interest and
other income
(expense),
net (4.0) 0.3 1.1 (1.6) (4.2) 4.4 3.2
Income before
provision
for income
taxes 5.3 18.6 17.8 35.8 77.5 25.8 38.1
Provision for
income taxes (2.0) (7.1) (6.8) (14.5) (30.4) (10.8) (15.0)
Effective tax
rate 38% 38% 38% 41% 39% 42% 39%
------- ------- ------- ------- ------- ------- -------
Net income 3.3 11.5 11.0 21.3 47.1 15.0 23.1
======= ======= ======= ======= ======= ======= =======
Net income per
ordinary
share and ADS
Basic 0.04 0.13 0.12 0.24 0.53 0.17 0.26
Diluted 0.04 0.13 0.12 0.24 0.52 0.16 0.25
Ordinary
shares and
ADSs used in
computing net
income per
share (000's)
Basic 88,632 89,095 88,495 88,769 88,748 89,424 90,030
Diluted 92,305 91,061 89,792 90,390 91,077 91,184 92,089
-------------- ------- ------- ------- ------- ------- ------- -------
Amortization of
intangible assets
Cost of net
license fees 5.2 5.0 5.0 5.1 20.3 5.5 5.3
Cost of
services
revenues 2.3 2.3 2.3 2.3 9.2 2.3 2.3
General and
admin-
istrative 0.3 0.3 0.3 0.3 1.2 0.3 0.3
------- ------- ------- ------- ------- ------- -------
Total 7.8 7.6 7.6 7.7 30.7 8.1 7.9
======= ======= ======= ======= ======= ======= =======
Stock-based
compensation(1)
Cost of
services
revenues 0.3 0.3 0.3 0.2 1.1 0.2 0.2
Sales and
marketing 0.7 0.7 0.6 0.6 2.6 0.5 0.5
Research and
development 0.6 0.4 0.4 0.4 1.8 0.3 0.3
General and
admin-
istrative 0.5 0.3 0.2 0.2 1.2 0.2 0.1
------- ------- ------- ------- ------- ------- -------
Total 2.1 1.7 1.5 1.4 6.7 1.2 1.1
======= ======= ======= ======= ======= ======= =======
Non-GAAP
income from
operations(2) 19.2 29.1 25.8 47.2 121.3 30.6 43.9
------- ------- ------- ------- ------- ------- -------
% of total
revenues 9% 13% 12% 18% 13% 12% 17%
Interest and
other income
(expense),
net (4.0) 0.3 1.1 (1.6) (4.2) 4.4 3.2
Income before
provision
for income
taxes 15.2 29.4 26.9 45.6 117.1 35.0 47.1
Provision for
income taxes (5.8) (11.2) (10.2) (18.3) (45.5) (12.9) (17.4)
Effective tax
rate 38% 38% 38% 40% 39% 37% 37%
------- ------- ------- ------- ------- ------- -------
Non-GAAP net
income 9.4 18.2 16.7 27.3 71.6 22.1 29.7
======= ======= ======= ======= ======= ======= =======
% of total
revenues 4% 8% 8% 10% 8% 9% 11%
Non-GAAP net income
per ordinary share
and ADS
Basic 0.11 0.20 0.19 0.31 0.81 0.25 0.33
Diluted 0.10 0.20 0.19 0.30 0.79 0.24 0.32
-------------- ------- ------- ------- ------- ------- ------- -------
(1) Represents stock-based compensation expense charged to expense as
a result of assumption of unvested options in Crystal Decisions
acquisition.
(2) Non-GAAP measures are reconciled from US GAAP figures. Non-GAAP
measures exclude amortization of intangible assets, non-cash stock-
based compensation expense, and restructuring costs.
BUSINESS OBJECTS S.A.
Q2 FISCAL 2005 SUPPLEMENTAL INFORMATION
(in millions, except for number of transactions, DSO and headcount
information)
(Unaudited)
Fiscal 2004 Fiscal 2005
-------------------------------------- -------------
Q1 Q2 Q3 Q4 Total Q1 Q2
----------------------------------------------------------------------
REVENUE ANALYSIS
Total revenues
by geography
Americas $104.1 $104.3 $113.8 $131.0 $453.3 $118.1 $123.6
EMEA 96.4 99.6 87.6 114.2 397.7 111.2 116.5
Asia Pacific,
including
Japan 16.7 18.3 18.1 21.5 74.6 19.5 22.3
------- ------- ------- ------- ------- ------- -------
Total $217.2 $222.2 $219.5 $266.7 $925.6 $248.8 $262.4
----------------------------------------------------------------------
Analysis of currency
impact (year-over-
year)(3)
Reported
revenue
growth rate 13% 7% 4% 13% 9% 15% 18%
Constant
currency
growth rate 5% 3% -1% 7% 4% 11% 15%
------- ------- ------- ------- ------- ------- -------
Impact of
foreign
currency on
growth rate 9% 4% 4% 6% 6% 3% 3%
----------------------------------------------------------------------
Fiscal 2004 Fiscal 2005
-------------------------------------- -------------
Q1 Q2 Q3 Q4 Total Q1 Q2
----------------------------------------------------------------------
LICENSE REVENUE
ANALYSIS
License
revenues by
channel
Direct 53% 55% 49% 50% 52% 47% 51%
Indirect 47% 45% 51% 50% 48% 53% 49%
------- ------- ------- ------- ------- ------- -------
Total 100% 100% 100% 100% 100% 100% 100%
----------------------------------------------------------------------
Number of
transactions
by size
Over $1
million 7 8 4 14 33 9 13
Over $200
thousand 104 91 78 103 376 101 96
----------------------------------------------------------------------
Fiscal 2004 Fiscal 2005
-------------------------------------- -------------
Q1 Q2 Q3 Q4 Q1 Q2
----------------------------------------------------------------------
SELECTED BALANCE
SHEET ITEMS
Cash and cash
equivalents,
restricted
cash, and
short-term
investments $269 $256 $263 $311 $392 $384
DSO (Days
sales
outstanding) 75 81 75 84 66 72
----------------------------------------------------------------------
HEADCOUNT
Total
headcount 3,756 3,707 3,815 3,834 3,944 4,039
----------------------------------------------------------------------
(3) For 2004, reported revenue growth rates are calculated on a
Non-GAAP basis including the impact of inclusion of Crystal Decisions'
operations for fiscal 2003. Certain information on constant currency
to separate out the impact of conversion from other foreign currencies
to US dollars from other changes in our business is also presented.
The impact of foreign currency on growth rate is calculated from
absolute amounts and thus this presentation in full percentages does
not always add.
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion