CIMdata PLM Industry Summary Online Archive
22 March 2007
Financial News
Serena Software Reports Fourth Quarter and Fiscal 2007 Results
Serena Software, Inc . announced results for the fourth quarter and fiscal year ending January 31, 2007.
Total revenue was $76.5 million in the fourth quarter of fiscal year 2007 and represented a 9% increase over total revenue in the fourth quarter of fiscal year 2006. Software license revenue was $30.5 million, maintenance revenue was $37.0 million and service revenue was $9.0 million for the fourth quarter of fiscal year 2007. For fiscal year 2007, total revenue was $255.3 million, software license revenue was $86.5 million, maintenance revenue was $134.6 million, and service revenue was $34.2 million. Excluded from revenue is $1.5 million and $12.5 million of maintenance revenue written down in the purchase accounting for our merger with Spyglass Merger Corporation, an affiliate of Silver Lake Partners, for the fourth quarter and full fiscal year of 2007, respectively.
Net (loss) income computed in accordance with generally accepted accounting principles ("GAAP") for fiscal year 2007 was $(57.2) million compared to $35.3 million in fiscal year 2006. Included in the fiscal year 2007 results were $43.8 million of transaction costs related to the merger transaction involving Silver Lake Partners.
Adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA") for the fourth quarter of fiscal year 2007 increased 32% to $34.5 million from $26.0 million in the fourth quarter of fiscal year 2006. Adjusted EBITDA for fiscal year 2007 increased 12% to $103.3 million from $92.0 million for fiscal year 2006.
Adjusted EBITDA excludes amortization of intangible assets and charges relating to the purchase accounting adjustments for the merger transaction involving Silver Lake Partners, stock-based compensation, depreciation, amortization of acquired technology and other intangible assets, restructuring, acquisition and other charges, and acquired in-process research and development. Adjusted EBITDA also excludes the revenue impact of the deferred maintenance write-down to fair value. A reconciliation of Adjusted EBITDA to GAAP financial results is included in this press release.
Total cash and equivalents as of January 31, 2007 was $68.5 million and total deferred revenue was $78.4 million.
Serena also announced today that it expects to amend its existing credit agreement in order to reduce the interest rate on the term loan. The amendment will require the approval of certain term loan lenders in accordance with the terms of the credit agreement.
NON-GAAP FINANCIAL INFORMATION: Serena's management evaluates and makes operating decisions using various operating measures, including earnings before interest, taxes and amortization (EBITA). Serena's management uses EBITA as a supplemental financial measure in evaluating the performance of Serena's business, making forecasting, budgeting and operating decisions and establishing operating targets, budgets and performance-based compensation arrangements. In addition, our lenders use similar operating measures to evaluate our operating performance and compliance with certain financial covenants. One such measure used by our lenders is Adjusted EBITDA, which is calculated in accordance with the debt covenants under our credit agreement. Adjusted EBITDA differs from GAAP operating income in that it excludes amortization of acquired technology and intangible assets, writedown of maintenance revenue and acquired in-process research and development and other charges relating to purchase accounting adjustments from our merger with Spyglass Merger Corporation and our acquisition of Pacific Edge Software, Inc.; restructuring, acquisition and other charges; stock based compensation under SFAS 123R; and depreciation. Adjusted EBITDA is not an alternative to operating income as calculated in accordance with GAAP. Lenders and investors should not rely on the use of Adjusted EBITDA as a substitute for any GAAP financial measure. In addition, our calculation of Adjusted EBITDA may or may not be consistent with that of other companies. Lenders and investors are encouraged to review the reconciliations to the comparable GAAP financial measures that are included below and not to rely on any single financial measure to evaluate our business.
For financial tables, please visit http://www.serenainternational.com/News/PR/sPR_03222007.asp .
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