CIMdata PLM Industry Summary Online Archive
6 February 2007
Financial News
Moldflow Reports Results for Its Second Fiscal Quarter of 2007
Moldflow Corporation announced the results for its second quarter of the 2007 fiscal year.
Non-GAAP net income of $2.2 million, or $0.19 per diluted share, was up 7% sequentially and 26% from our second fiscal quarter of 2006; net income as reported in accordance with GAAP was $1.8 million, or $0.15 per diluted share, including a charge of $451,000, net of related tax effects, for compensation expense as required under FAS 123®, compared to a net loss of $109,000 or ($0.01) per share in the same period of the prior fiscal year.
Revenue of $17.7 million was up 15% sequentially and 4% from the corresponding quarter of fiscal 2006.
Total product revenue of $10.4 million represented a 30% sequential increase and a 3% increase over the same period of the prior year.
Total services revenue of $7.2 million represented a sequential decrease of 1% and a 6% increase over the same period of the prior year.
Revenue from Design Analysis Solutions totaled $14.0 million or 79% of total revenue and represented a 21% sequential increase and a 10% increase when compared to the same period last year.
Revenue from Manufacturing Solutions totaled $3.6 million or 21% of total revenue, and was flat sequentially and represented a 13% decrease when compared to the same period last year.
Regionally, revenue in our Asia/Pacific region represented 38% of total revenue, while the European region represented 35% and the Americas represented 27% of total revenue, respectively.
Share repurchase program returned 40,000 shares to treasury at a cost of $13.00 per share equating to approximately $520,000 in total cash payments.
Operations generated $147,000 of cash during the quarter and $1.4 million during the first half of fiscal 2007.
Commenting on the second fiscal quarter, Roland Thomas, Moldflow Corporation's president and CEO said, "Our second quarter results, which continue to validate our fiscal 2007 business model, produced increased revenue, net income and earnings per share on both a sequential and year-over-year basis. During the quarter, we continued to see increased leverage coming out of our Design Analysis Solutions business. When compared to the same period of the prior fiscal year, Design Analysis Solutions product revenue grew 11% and total revenue grew 10%, representing another step in this division supporting our longer-term business model. As planned, our Manufacturing Solutions business continued to operate close to breakeven, with increased gross margins on slightly lower revenue during the second fiscal quarter."
Business Outlook
The current business outlook is based on information as of February 6, 2007 and is current as of that day only. We expect revenue for our fiscal 2007 year to grow in the range of 5% to 7% when compared to fiscal 2006 and non-GAAP net income per diluted share for fiscal year 2007 to increase between 35% and 50% as compared to fiscal 2006, resulting in non-GAAP net income per diluted share of approximately $0.68 to $0.75. Non-GAAP net income per diluted share excludes charges for share-based compensation expenses throughout the full fiscal year which are expected to be approximately $1.9 million, net of related tax effects. GAAP net income per diluted share for fiscal 2007 is therefore expected to be between $0.53 and $0.60.
The Company has provided its fiscal 2007 net income per diluted share guidance above. This guidance is provided on a non-GAAP basis. Non-GAAP net income per diluted share excludes estimated charges for share-based compensation costs. Because there are significant limitations in estimating the impact of share-based compensation costs, including but not limited to, the number of share-based awards that will be exercised and/or cancelled during the period, the fair market value of the Company's share price on the exercise dates, and the number and type of issuances that may be awarded in any year, the estimated charges and tax benefits associated with share-based issuances are unpredictable. For these reasons, the actual impact of share-based compensation on GAAP net income per diluted share may differ materially from the estimated amounts included in the guidance above.
Use of Other Non-GAAP Financial Measures
Net income and net income per diluted share, excluding, as applicable, share-based compensation expenses and restructuring charges, are supplemental non-GAAP financial measures. Moldflow is presenting these measures because management uses this information in evaluating the results of the Company's operations and for internal planning and forecasting purposes and believes that this information provides additional insight into our operating results, as well as enables comparison of these results to prior periods. These measures should not be considered an alternative to measurements required by GAAP, such as net income and net income per diluted share, and should not be considered a measure of our liquidity. In addition, these non-GAAP financial measures may not be comparable to similar measures reported by other companies. With respect to the non-GAAP financial measures for the second quarter, the GAAP financial measures most directly comparable to each non-GAAP financial measure used or discussed in this press release and a reconciliation of the differences between each non-GAAP financial measure and the comparable GAAP financial measure are included in this press release and can be found on the Investors page of the Moldflow Web site at http://www.moldflow.com/stp/english/investors/index.htm .
Information Dissemination
Moldflow will host a conference call to discuss the second quarter of fiscal 2007 results as well as future outlook at 11:00 a.m. US Eastern time, Tuesday, February 6, 2007. The conference call dial-in number is 877-314-4022, Conference ID #6302404. The call will be recorded with replay (dial-in # 800-642-1687, PIN# 6302404) which will be available until February 13, 2007. In addition, a live Webcast of the conference call, together with this press release and supplemental financial information, can be accessed through the Company's Website at http://www.moldflow.com in the Investors section. The call, press release and supplemental information will be archived and can be accessed through the same link.
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