[December 07, 2007] |
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Optio Software Reports Fiscal 2008 Q3 Financial Results
ALPHARETTA, Ga. --(Business Wire)-- Optio(R) Software (OTCBB:OPTO), a leading provider of software solutions dedicated to helping customers optimize, manage and control the complete lifecycle of document-intensive processes, today reported its financial results for the fiscal 2008 third quarter and nine-month period ended October 31, 2007.
Revenue
Total revenue for the third quarter of 2007 decreased 10 percent to $6.8 million from $7.6 million in the prior fiscal year quarter. Software license revenues decreased twelve percent to $1.9 million in the three months ended October 31, 2007 from $2.2 million in the three months ended October 31, 2006. Services and maintenance revenues declined to $4.2 million in the three months ended October 31, 2007 from $4.8 million in the three months ended October 31, 2006.
Optio's subscription licensing contracts contributed $652,000 of revenue to the quarter ended October 31, 2007, up from $597,000 of revenue from the quarter ended October 31, 2006.
"Optio's Q3 license revenue has increased 26 percent over this fiscal year's previous quarter and Optio is encouraged by these results as evidence of the market's acceptance of our next generation data capture solution, ProCentra Intelligent Document Capture (IDC)," said C. Wayne Cape, Optio's President and Chief Executive Officer. "In addition, several significant purchases of our document automation solutions by major customers in the discrete and process manufacturing sectors contributed to the rise in sequential quarterly revenues," he added.
"In response to current market trends and our customers' ongoing needs, we have recently announced our ProCentra(TM) Content Center solution, which is Optio's newly updated online document, storage and retrieval solution. This solution enables customers to store and retrieve a much wider variety of content related to their transactional documents, it also features extended support for the Oracle database and simplified management tools. ProCentra Content Center enables organizations to reduce costs and resources surrounding document-intensive business processes," said Cape. "Optio's modular ProCentra solution suite helps our customers improve business processes and achieve current technology goals with the flexibility to expand as their IT needs evolve."
Cost of Revenue
For the third quarter, total cost of revenue remained constant at $1.9 million, as was reported during the same quarter in the prior fiscal year.
Operating Expenses
Total operating expenses increased to $5.1 million in the three months ended October 31, 2007 from $4.6 million in the three months ended October 31, 2006. Operating expenses in the prior year's quarterly period included a one time $0.9 million gain on the reversal of the valuation reserve of the M2 promissory note. Operating expenses for the three months ended October 31, 2007 are $0.4 million below those for the quarter ended October 31, 2006 if the one time adjustment is not considered.
Net Income (Loss)
Net loss for the third quarter of fiscal 2008 was $160,000 and diluted loss per share (EPS) was $(0.01), a decrease from net income of $1,088,000 and diluted EPS of $0.05 in the prior-year's quarter.
Nine Months Ended October 31, 2007
Total revenue for the nine months ended October 31, 2007 was $19.7 million, compared with $21.2 million in the nine months ended October 31, 2006. Software license revenues were $4.8 million in the nine months ended October 31, 2007, compared to $5.7 million in the nine months ended October 31, 2006. Optio's subscription licensing revenue increased to $1.9 million in the nine months ended October 31, 2007 from $1.7 million in the nine months ended October 31, 2006. Services and maintenance revenues decreased to $13.1 million in the nine months ended October 31, 2007 from $13.8 million in the nine months ended October 31, 2006. Total cost of revenue remained constant at $5.5 million in the nine months ended October 31, 2007 in comparison to the same period in 2006.
Operating expenses for the nine months ended October 31, 2007 were $16.9 million versus $15.3 million for the nine months ended October 31, 2006, which included the $900,000 gain on the reversal of the valuation reserve of the M2 Systems note.
For the nine months ended October 31, 2007, net loss was $(2,475,000) or $(0.11) diluted EPS, a decrease from a net income of $585,000 and diluted EPS of $0.02 in the nine months ended October 31, 2006.
Third Quarter Highlights and Business Metrics
Several significant software license transactions were closed during the quarter, including a $300,000 software deal with a large international cosmetics company, and sales in excess of $75,000 each of Optio's new ProCentra Intelligent Document Capture solution to Mueller Supply, Inc. and NACA Logistics USA, Inc.
Optio closed the quarter with $9.5 million in cash and cash equivalents, below the $11.9 million in cash as of Jan. 31, 2006. The company had no outstanding balance on its line of credit as of October 31, 2007. Additionally, Days' Sales Outstanding (DSO) increased from 46 days to 51 days in comparison to the previous quarter.
Share Repurchase Program
As of December 6, 2007, Optio has repurchased 1,305,250 shares of Optio's common stock at an average price per share of $1.31. Optio can still purchase up to approximately $291,000 of common shares under the share repurchase plan.
About Optio Software, Inc.
Optio Software, with 25 years of experience and more than 5,500 clients, worldwide, provides software solutions dedicated to optimizing, managing and improving the complete lifecycle of document-intensive processes, while extending the value of their Enterprise Resource Planning (ERP) and Hospital Information Systems. More than 5,500 organizations rely on Optio Software for innovative business process improvement solutions that allow them to reduce transactional activities and focus on core responsibilities. Headquartered in Alpharetta, Ga., Optio Software maintains European, Middle Eastern and Africa (E.M.E.A.) headquarters in the United Kingdom and sales offices in the United States, France, Germany and the Netherlands. For more information about Optio Software or to contact a local Optio sales consultant, reach us at 770.576.3500 or visit our website at www.optio.com.
(C) Copyright 2007, Optio Software, Inc. All Rights Reserved. Optio is a registered trademark of Optio Software, Inc. Other companies and products mentioned in this document are the property of their respective owners.
Forward-Looking Statements
This press release includes statements and other matters that could be considered to be forward-looking and subject to a number of risks and uncertainties that could cause actual results to differ materially from expectations. Such forward-looking statements are made pursuant to the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995 and are made based on management's current expectations or beliefs as well as assumptions made by, and information currently available to, management. Optio's actual results may differ significantly from those projected in the forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, risks associated with Optio's reliance on strategic marketing and reseller relationships, the collectibility of Optio's accounts receivable, fluctuations in operating results due to acquisitions or dispositions, failure to integrate new products and newly acquired companies, diversion of management resources relating to acquisitions or divestitures, reduction in cash reserves relating to acquisitions or the share repurchase program, challenges relating to acquisitions or divestitures and the possibility that this may cause Optio to no longer be profitable, the negative effect on Optio's earnings relating to the amortization or potential write-down of acquired assets or goodwill, failure to retain the business relationships with existing customers of acquisitions, changes in competition, changes in economic conditions in the U.S. and in other countries in which Optio currently does business (both general and relative to the technology industry), delays or inability to develop new or unique software, market acceptance of new products, the failure of new products to operate as anticipated, expectation of achieving and sustaining operating profits and earnings, including the timing of such cash flow and company performance, disputes regarding Optio's intellectual property, risks relating to the delisting of our stock, possible adverse results of pending or future litigation, or risks associated with Optio's international operations. These and additional factors are set forth in "Item 1.A. Risk Factors" included in Optio's most recent Annual Report on Form 10-K. You should carefully review these risks and additional risks described in other documents Optio files from time to time with the Securities and Exchange Commission, including the Quarterly Report of Form 10-Q that Optio will file on or before December 14, 2007.
OPTIO SOFTWARE, INC.
Consolidated Statements of Operations
(in thousands, except per share data)
Three Months Ended Nine Months Ended
October 31, October 31,
------------------------- -------------------------
2007 2006 2007 2006
------------ ------------ ------------ ------------
Revenue:
License fees $ 1,932 $ 2,201 $ 4,751 $ 5,742
Subscription fees 652 597 1,895 1,712
Services,
maintenance, and
other 4,244 4,776 13,063 13,750
------------ ------------ ------------ ------------
6,828 7,574 19,709 21,204
Cost of revenue:
License fees 202 112 428 390
Services,
maintenance, and
other 1,730 1,830 5,112 5,151
------------ ------------ ------------ ------------
1,932 1,942 5,540 5,541
------------ ------------ ------------ ------------
4,896 5,632 14,169 15,663
Operating expenses:
Sales and
marketing 2,469 2,619 8,108 7,701
Research and
development 1,026 1,385 3,856 4,082
General and
administrative 1,395 1,272 4,151 3,794
Gain on reversal
of impairment of
M2 Note - (900) - (900)
Depreciation and
amortization 257 266 793 650
------------ ------------ ------------ ------------
5,147 4,642 16,908 15,327
------------ ------------ ------------ ------------
Income (loss) from
operations (251) 990 (2,739) 336
Other income
(expense):
Interest income 97 119 324 327
Interest expense (6) (2) (18) (4)
Other 2 - 2 (3)
------------ ------------ ------------ ------------
93 117 308 320
------------ ------------ ------------ ------------
Income (loss)
before income
taxes (158) 1,107 (2,431) 656
Income tax expense 2 19 44 71
------------ ------------ ------------ ------------
Net income (loss) $ (160) $ 1,088 $ (2,475) $ 585
============ ============ ============ ============
Net income (loss)
per share - basic $ (0.01) $ 0.05 $ (0.11) $ 0.03
============ ============ ============ ============
Net income (loss)
per share -
diluted $ (0.01) $ 0.04 $ (0.11) $ 0.02
============ ============ ============ ============
Weighted average
shares outstanding
- basic 22,065,515 22,301,466 22,291,367 22,149,422
============ ============ ============ ============
Weighted average
shares outstanding
- diluted 22,065,515 24,662,565 22,291,367 24,731,182
============ ============ ============ ============
OPTIO SOFTWARE, INC.
Condensed Consolidated Balance Sheets
(in thousands)
October 31, January 31,
2007 2007
------------ ------------
ASSETS
Current Assets:
Cash, cash
equivalents and
marketable
securities $ 9,467 $ 11,948
Accounts
receivable, net 4,113 3,903
Other current
assets 878 728
------------ ------------
Total current
assets 14,458 16,579
Property and
equipment, net 2,564 2,714
Goodwill and other
intangible assets,
net 3,329 3,552
Other assets 100 92
------------ ------------
Total Assets $ 20,451 $ 22,937
============ ============
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Current
liabili ties:
Accounts payable $ 933 $ 1,088
Other accrued
liabilities 1,606 1,755
Deferred revenue 7,698 7,439
Current portion of
accrued lease
incentive
liability 122 122
Current portion of
debt and capital
lease obligations 97 78
------------ ------------
Total current
liabilities 10,456 10,482
Long-term portion
of capital lease
obligations 315 300
Long-term accrued
expenses 138 103
Long-term accrued
rent payable 740 526
Long-term portion
of accrued lease
incentive
liability 714 806
Shareholders'
equity 8,088 10,720
------------ ------------
Total liabilities
and shareholders'
equity $ 20,451 $ 22,937
============ ============
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