-- Recurring services revenue up 18% from comparable year-ago quarter -- Operating margin of 17% -- GAAP net income of $1.1 millioneGain Communications Corporation (
-- New hosting and license bookings for the second quarter of fiscal year 2010 were $4.2 million, a decrease of 7% from the comparable year-ago quarter. Of the total new hosting and license bookings in the second quarter of fiscal year 2010, 29% was from new hosting bookings and 71% was from new license bookings, compared to 15% from new hosting bookings and 85% from new license bookings in the comparable year-ago quarter. On a constant currency basis, using the exchange rates in effect on June 30, 2009, bookings for the second quarter of fiscal year 2010 would have been down approximately 9%, rather than down 7%, when compared to the comparable year-ago quarter. -- New hosting and license bookings for the six months ended December 31, 2009 were $8.4 million, a decrease of 8% from the same period last year. Of the total new hosting and license bookings in the six months ended December 31, 2009, 38% was from new hosting bookings and 62% was from new license bookings, compared to 25% from new hosting bookings and 75% from new license bookings in the same period last year. On a constant currency basis, using the exchange rates in effect on June 30, 2009, bookings for the six months ended December 31, 2009 would have been down approximately 4%, rather than down 8%, when compared to the comparable year-ago quarter.(1) We define New Hosting and License Bookings as new contractual commitments (excluding renewals) received by the company for the purchase of product licenses and hosting services. Such contracts are not cancelable for convenience but may be subject to termination by our customers for cause or breach of contract by us. Furthermore, because we offer a hybrid delivery model, the mix of new license and hosting business in a quarter could also have an impact on our revenue in a particular quarter. Due to effects that these trends have on our short-term revenue and profitability, we believe that it is useful to disclose New Hosting and License Bookings detail in this and future financial releases. We use this metric internally to focus management on the productivity of the sales team and period-to-period changes in our core business. Therefore, we believe that this information is meaningful and helpful in allowing individuals to better assess the ongoing nature of our core operations. About eGain Communications Corporation eGain (
eGain Communications Corporation Condensed Consolidated Balance Sheets (in thousands) (unaudited) December 31, June 30, 2009 2009 ------------ ------------ ASSETS Current assets: Cash and cash equivalents $ 5,970 $ 7,511 Restricted cash 13 13 Accounts receivable, net 4,688 4,308 Prepaid and other current assets 437 538 ------------ ------------ Total current assets 11,108 12,370 Property and equipment, net 968 995 Goodwill, net 4,880 4,880 Other assets 398 391 ------------ ------------ Total assets $ 17,354 $ 18,636 ============ ============ LIABILITIES AND STOCKHOLDERS' DEFICIT Current liabilities: Accounts payable $ 801 $ 979 Accrued compensation 1,787 2,429 Accrued liabilities 1,662 2,141 Current portion of deferred revenue 6,118 5,398 Current portion of capital lease obligation 177 181 Current portion of bank borrowings 125 3,125 ------------ ------------ Total current liabilities 10,670 14,253 Deferred revenue, net of current portion 223 133 Capital lease obligation, net of current portion 99 187 Related party notes payable 8,199 7,697 Bank borrowings, net of current portion 52 115 Other long term liabilities 338 344 ------------ ------------ Total liabilities 19,581 22,729 Stockholders' deficit: Common stock 22 22 Additional paid-in capital 323,644 323,550 Notes receivable from stockholders (78) (76) Accumulated other comprehensive loss (580) (506) Accumulated deficit (325,235) (327,083) ------------ ------------ Total stockholders' deficit (2,227) (4,093) ------------ ------------ Total liabilities and stockholders' deficit $ 17,354 $ 18,636 ============ ============ eGain Communications Corporation Condensed Consolidated Statements of Operations (in thousands, except per share amounts) (unaudited) Three Months Six Months Ended Ended December 31, December 31, ---------------- ---------------- 2009 2008 2009 2008 ------- ------- ------- ------- Revenue: License $ 2,516 $ 3,529 $ 4,470 $ 5,128 Recurring services 4,292 3,637 8,276 7,748 Professional services 1,504 2,423 3,541 4,852 ------- ------- ------- ------- Total revenue 8,312 9,589 16,287 17,728 Cost of license 83 19 151 38 Cost of recurring services 1,129 1,078 2,281 2,204 Cost of professional services 1,336 1,501 2,631 3,216 ------- ------- ------- ------- Gross profit 5,764 6,991 11,224 12,270 Operating costs and expenses: Research and development 1,285 1,400 2,455 2,925 Sales and marketing 2,350 2,851 4,784 5,633 General and administrative 731 873 1,517 1,920 ------- ------- ------- ------- Total operating costs and expenses 4,366 5,124 8,756 10,478 Income from operations 1,398 1,867 2,468 1,792 Interest expense, net (279) (335) (556) (820) Other income net 36 341 30 365 ------- ------- ------- ------- Income before income tax 1,155 1,873 1,942 1,337 Benefit / (provision) for income taxes (94) 96 (94) 110 ------- ------- ------- ------- Net Income $ 1,061 $ 1,969 $ 1,848 $ 1,447 ======= ======= ======= ======= Per share information: Basic net income per common share $ 0.05 $ 0.09 $ 0.08 $ 0.08 ======= ======= ======= ======= Diluted net income per common share $ 0.04 $ 0.09 $ 0.08 $ 0.08 ======= ======= ======= ======= Weighted average shares used in computing basic net income per common share 22,205 22,213 22,209 19,035 ======= ======= ======= ======= Weighted average shares used in computing diluted net income per common share 24,232 22,213 22,444 19,035 ======= ======= ======= ======= eGain Communications Corporation Supplemental Financial Information (in thousands) (unaudited) Three Months Ended December 31, --------------------------------- % Increase % Increase (Decrease) % of % of (Decrease) in Constant 2009 revenue 2008 revenue in US$ Currency (1) ------- ------- ------- ------- ---------- ------------ Total revenue $ 8,312 100% $ 9,589 100% -13% -14% Gross profit $ 5,764 69% $ 6,991 73% -18% -20% Total operating costs and expenses $ 4,366 53% $ 5,124 53% -15% -19% Income from operations $ 1,398 17% $ 1,867 19% -25% -24% Net Income $ 1,061 13% $ 1,969 21% -46% -33% Six Months Ended December 31, --------------------------------- % Increase % Increase (Decrease) % of % of (Decrease) in Constant 2009 revenue 2008 revenue in US$ Currency (1) ------- ------- ------- ------- ---------- ------------ Total revenue $16,287 100% $17,728 100% -8% -6% Gross profit $11,224 69% $12,270 69% -9% -9% Total operating costs and expenses $ 8,756 54% $10,478 59% -16% -17% Income from operations $ 2,468 15% $ 1,792 10% 38% 40% Net Income $ 1,848 11% $ 1,447 8% 28% 21% (1) We present constant currency information to provide a framework for assessing how our underlying business performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparable year-ago period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the exchange rate in effect June 30, 2009, which was the last day of our prior fiscal year, rather than the actual exchange rates in effect during the respective periods. NM - Not Meaningful
Contact Information: Company Contact: Jamie Abayan 650-230-7532 PR@eGain.com Investor Contact: IRegain@eGain.com