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WebSideStory Files Form 10-K With Audited Year End 2006 Financial Results
14 March 2007 WebSideStory, Inc. (Nasdaq: WSSI), a leading provider of real-time customer intelligence solutions, today announced that it has filed its 2006 Form 10-K with the Securities and Exchange Commission. The Form 10-K includes the Company's audited financial results for the year ended December 31, 2006. WebSideStory had previously released preliminary, unaudited financial results for the quarter and year ended December 31, 2006 on February 26, 2007. Changes from the preliminary, unaudited results issued on February 26, 2007 to the final quarter and year ended December 31, 2006 results included in the Form 10-K are highlighted below:
* Non-GAAP revenue of $19.4 million for the fourth quarter, compared to
previously issued results of $19.2 million, and GAAP revenue of $18.4
million, compared to previously issued results of $18.2 million. For
the year, non-GAAP revenue was $69.6 million, compared to previously
issued results of $69.4 million, and GAAP revenue was $64.5 million,
compared to previously issued results of $64.3 million. The Company
adjusted revenue and cost of goods sold primarily to record revenue and
costs related to customer reimbursable travel and entertainment.
* Non-GAAP earnings per share of $0.17 for the fourth quarter and $0.55
for the year remained unchanged. Non-GAAP earnings per share excludes
stock-based compensation expenses, amortization of intangibles and
other non-cash items described below. GAAP loss per share of $0.09 for
the quarter, compared to previously issued results of a loss of $0.07
per share, and GAAP loss per share of $0.41 for the year, compared with
previously issued results of a loss of $0.40 per share. The change in
GAAP loss was primarily the result of an increase in stock based
compensation expense. The Company recorded an additional charge
related to restricted stock grants issued in connection with the Visual
Sciences merger. The grant value and forfeiture rates were adjusted.
The restricted stock units fully vested in the first quarter of 2007
prior to the filing date.
Note on the Use of Non-GAAP Financial Measures
Some of the financial measures in this press release, including some of our financial guidance, are non-GAAP financial measures within the meaning of SEC Regulation G. WebSideStory believes that this presentation is useful to investors because it more accurately describes the operating performance of the company on a period-to-period basis, excluding specific costs and expenses that we believe are not indicative of our core operating results. Company management uses these non-GAAP measures as important indicators of the company's past performance and to plan and forecast performance in future periods. In addition, bonus payments to our officers and employees under our corporate bonus plan are based on the achievement of specified non-GAAP revenue and non-GAAP EPS targets. Investors should not consider non-GAAP financial measures in isolation from, or as a substitute for, financial information presented in compliance with GAAP.
About WebSideStory, Inc.
Founded in 1996, WebSideStory, Inc. (Nasdaq: WSSI) is a leading provider of real-time customer intelligence solutions. The services provided by WebSideStory and Visual Sciences deliver comprehensive insight into the lifetime of customer interactions across on-line and multi-channel businesses. More than 1,500 enterprises worldwide rely on the company for innovative solutions, enterprise-class services and a world-class network of partners to improve marketing, sales and operational performance. WebSideStory is headquartered in San Diego, California, and has European headquarters in Amsterdam, The Netherlands. For more information, contact WebSideStory. Voice: 858.546.0040. Fax: 858.546.0480. Address: 10182 Telesis Court, 6th Floor, San Diego, CA 92121. Web site: http://www.websidestory.com. WebSideStory is a registered trademark of WebSideStory, Inc. Visual Sciences is a registered trademark of Visual Sciences, LLC, which is a wholly owned subsidiary of WebSideStory, Inc.
Forward-Looking Statements
Statements in this press release that are not a description of historical facts are forward-looking statements. You should not regard any forward- looking statement as a representation by WebSideStory that any of its plans will be achieved. Actual results may differ materially from those set forth in this release due to the risks and uncertainties inherent in WebSideStory's business, including, without limitation: WebSideStory's reliance on its web analytics services for the majority of its revenue; blocking or erasing of cookies or limitations on our ability to use cookies; WebSideStory's limited experience with customer intelligence applications beyond web analytics; the risks associated with integrating the operations and products of Avivo Corporation and Visual Sciences, LLC with those of WebSideStory; privacy concerns and laws or other domestic or foreign regulations that may subject WebSideStory to litigation or limit our ability to collect and use Internet user information; WebSideStory's ability to defend itself against claims of patent infringement alleged by NetRatings, Inc.; WebSideStory's ongoing ability to protect its own intellectual property rights and to avoid violating the intellectual property rights of third parties; the highly competitive markets in which we operate that could make it difficult for WebSideStory to acquire and retain customers; the risk that WebSideStory's customers fail to renew their agreements; the risks associated with the company's indebtedness, including the risk of non-compliance with the covenants in our credit facility; the risk that WebSideStory's services may become obsolete in a market with rapidly changing technology and industry standards; and other risks described in WebSideStory's Securities and Exchange Commission filings, including WebSideStory's annual report on Form 10-K for the year ended December 31, 2006 and quarterly reports on Form 10-Q. Do not place undue reliance on these forward-looking statements which speak only as of the date of this news release. All forward-looking statements are qualified in their entirety by this cautionary statement, and WebSideStory undertakes no obligation to revise or update this news release to reflect events or circumstances after the date of this news release.
WEBSIDESTORY, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(in thousands, except share data)
December 31, December 31,
2006 2005
Assets
Current assets
Cash and cash equivalents $19,713 $19,968
Investments 5,606 11,712
Accounts receivable, net 15,654 7,842
Deferred tax assets 708 507
Prepaid expenses and other current assets 3,943 2,304
Total current assets 45,624 42,333
Property and equipment, net 6,562 2,532
Investments -- 3,276
Goodwill 49,380 21,286
Intangible assets, net 19,732 6,901
Deferred tax assets 14,956 9,166
Other assets 1,314 2,249
$137,568 $87,743
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable $987 $877
Accrued liabilities 9,327 3,880
Deferred revenue 20,924 12,801
Capital lease short-term 38 83
Current maturities of notes payable 19,708 --
Total current liabilities 50,984 17,641
Capital lease long-term 50 90
Other liabilities 781 196
Total liabilities 51,815 17,927
Commitments and contingencies
Stockholders' equity
Preferred stock, $0.001 par value; 10,000,000
shares authorized and no shares issued and
outstanding at December 31, 2006 and
December 31, 2005 -- --
Common stock, $0.001 par value; 75,000,000 shares
authorized, 19,238,781 and 18,401,180 shares
issued and outstanding at December 31, 2006 and
December 31, 2005, respectively 19 18
Additional paid-in capital 137,862 114,934
Unearned stock-based compensation (22) (630)
Accumulated other comprehensive income 219 103
Accumulated deficit (52,325) (44,609)
Total stockholders' equity 85,753 69,816
$137,568 $87,743
WEBSIDESTORY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(in thousands, except share and per share data)
Three Months Ended Year Ended
December 31, December 31,
2006 2005 2006 2005
Revenues
Subscription, hosting and support $14,607 $10,689 $53,307 $36,732
License 1,497 -- 3,524 --
Professional services 1,744 389 5,319 996
Advertising 543 668 2,377 1,724
Total revenues 18,391 11,746 64,527 39,452
Cost of revenues*
Cost of revenue 4,838 1,955 16,283 6,574
Amortization of intangible assets 715 76 2,646 202
Total cost of revenues 5,553 2,031 18,929 6,776
Gross profit 12,838 9,715 45,598 32,676
Operating expenses*
Sales and marketing 6,712 4,169 26,450 14,654
Technology development 3,421 1,604 12,824 4,955
General and administrative 4,280 1,493 14,277 6,162
Amortization of intangible assets 830 430 3,202 1,147
Total operating expenses 15,243 7,696 56,753 26,918
(Loss) income from operations (2,405) 2,019 (11,155) 5,758
Interest expense (491) (8) (1,765) (34)
Interest income 242 272 696 905
Other expense 2 11 4 (43)
Total other income (247) 275 (1,065) 828
(Loss) income before provision for
income taxes (2,652) 2,294 (12,220) 6,586
(Benefit from) income taxes (937) (3,278) (4,491) (3,073)
(Loss) income before cumulative effect
of change in accounting principle (1,715) 5,572 (7,729) 9,659
Cumulative effect of change in
accounting principle (net of tax) -- -- 13 --
Net (loss) income $(1,715) $5,572 $(7,716) $9,659
Basic net (loss) income per common
share:
(Loss) income before cumulative
effect of change in accounting
principle $(0.09) $0.31 $(0.41) $0.56
Cumulative effect of change in
accounting principle -- -- -- --
Basic net (loss) income per common
share $(0.09) $0.31 $(0.41) $0.56
Diluted net (loss) income per common
share:
(Loss) income before cumulative
effect of change in accounting
principle $(0.09) $0.28 $(0.41) $0.51
Cumulative effect of change in
accounting principle -- -- -- --
Diluted net (loss) income per common
share $(0.09) $0.28 $(0.41) $0.51
WEBSIDESTORY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - Continued
(UNAUDITED)
(in thousands, except share and per share data)
Three Months Ended Year Ended
December 31, December 31,
2006 2005 2006 2005
Shares used in per share
calculations:
Basic 19,086,837 18,242,596 18,678,099 17,231,411
Diluted 19,086,837 19,883,932 18,678,099 18,774,978
(*) Stock-based compensation:
Cost of revenues $783 $13 $2,359 $58
Sales and marketing 1031 42 3,791 183
Technology development 636 113 2,555 334
General and administrative 901 92 2,719 423
WEBSIDESTORY, INC. (UNAUDITED) (in thousands, except share and per share data)
Three Months Ended Year Ended
December 31, December 31,
2006 2005 2006 2005
Reconciliation of GAAP net
(loss) income to Non-GAAP
net income
Net (loss) income $(1,715) $5,572 $(7,716) $9,659
Amortization of intangibles 1,545 506 5,848 1,349
Stock-based compensation 3,351 260 11,424 998
Deferred revenue related to
Visual Sciences merger* 968 -- 5,112 --
Non-cash tax (benefit)/
Recovery of NOL valuation
reserve (972) (3,417) (4,701) (3,417)
Non-cash interest expense 276 -- 968 --
Other non-recurring expenses -- 209 -- 209
Cumulative effect of change
in accounting principle -- -- (13) --
Non-GAAP net income $3,453 $3,130 $10,922 $8,798
Reconciliation of GAAP net
(loss) income per common
share to Non-GAAP income
per common share
GAAP net (loss) income per
common share:
Basic $(0.09) $0.31 $(0.41) $0.56
Diluted $(0.09) $0.28 $(0.41) $0.51
Amortization of intangibles 0.08 0.03 0.29 0.07
Stock-based compensation 0.16 0.01 0.57 0.05
Deferred revenue related to
Visual Sciences merger 0.05 -- 0.26 --
Non-cash tax benefit/Recovery
of NOL valuation reserve (0.05) (0.17) (0.24) (0.18)
Non-cash interest expense 0.01 -- 0.05 --
Other non-recurring expenses -- 0.01 -- 0.01
Effect of using non-GAAP
dilutive shares 0.01 -- 0.03 --
Cumulative effect of change in
accounting principle -- -- -- --
Non-GAAP net income per
common share:
Diluted $0.17 $0.16 $0.55 $0.46
GAAP weighted-average
shares used in per share
calculations:
Basic 19,086,837 18,242,596 18,678,099 17,231,411
Diluted 19,086,837 19,883,932 18,678,099 18,774,978
Non-GAAP weighted-average
shares used in per share
calculations:
Basic 19,086,837 18,242,596 18,678,099 17,231,411
Diluted 20,387,831 19,883,932 19,963,868 18,774,978
WEBSIDESTORY, INC. (UNAUDITED) (in thousands)
Three Months Ended Year Ended
December 31, December 31,
2006 2005 2006 2005
Reconciliation of GAAP revenue to
Non-GAAP revenue
GAAP revenue $18,391 $11,746 $64,527 $39,452
Deferred revenue related to Visual
Sciences merger* 968 -- 5,112 --
Non-GAAP revenue $19,359 $11,746 $69,639 $39,452
* In accordance with Statement of Financial Accounting Standards No. 141
"Business Combinations," the deferred revenue obligation on the ending
balance sheet of Visual Sciences was reduced to fair value when
recorded on the beginning balance sheet within WebSideStory. This fair
value adjustment resulted in a write-down of $5.4 million of deferred
revenue which would otherwise have been recognized as revenue by Visual
Sciences on a stand-alone basis in periods subsequent to the merger
date.
Source: prnewswire
All trademarks and copyrighted information contained herein are the property of their respective owners.
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