-- Q4 Revenue up 3% from 2006 to $9.1 million, full year up 6% to $36.0
million
-- Adjusted EBITDA of $1.2 million in Q4, $5.6 million for full year
-- Net income of $284,000 in Q4, $598,000 for full year
-- Sixth consecutive quarter of positive operating income
-- $4.8 million in operating cash flow YTD vs. $3.4 million a year ago
-- License and services bookings up 39% in Q4 from 2006, 16% for full
year
-- Year-end backlog up 43% to $19.7 million
-- 10 new customer accounts in 2007 vs. 3 in 2006
-- $10.0 million debt refinancing strengthens balance sheet and cash flow
Evolving Systems, Inc. (
Consolidated Statements of Operations
(In thousands except per share data)
(Unaudited) Three months ended 12 months ended
December 31, December 31,
2007 2006 2007 2006
--------- -------- --------- --------
Revenue:
License fees and services $ 4,470 $ 4,029 $ 17,895 $ 15,883
Customer support 4,589 4,769 18,058 17,950
--------- -------- --------- --------
Total revenue 9,059 8,798 35,953 33,833
--------- -------- --------- --------
Costs of revenue and operating
expenses:
Costs of license fees and services,
excluding depreciation and
amortization 2,061 1,819 8,023 7,342
Costs of customer support,
excluding depreciation and
amortization 1,496 1,281 6,237 5,694
Sales and marketing 2,328 2,043 8,557 8,962
General and administrative 1,314 1,180 5,862 5,138
Product development 804 678 2,376 3,072
Depreciation 170 307 899 1,169
Amortization 389 386 1,565 2,511
Impairment of goodwill and
intangible assets - - - 16,516
Restructuring and other expense
(recovery) (3) 2 (4) (21)
--------- -------- --------- --------
Total costs of revenue and operating
expenses 8,559 7,696 33,515 50,383
--------- -------- --------- --------
Income (loss) from operations 500 1,102 2,438 (16,550)
--------- -------- --------- --------
Interest and other income
(expense), net (229) (416) (1,284) (1,837)
--------- -------- --------- --------
Income (loss) before income taxes 271 686 1,154 (18,387)
Income tax expense (benefit) (13) (326) 556 (1,604)
--------- -------- --------- --------
Net income (loss) $ 284 $ 1,012 $ 598 $(16,783)
========= ======== ========= ========
Basic income (loss) per common
share $ 0.01 $ 0.05 $ 0.03 $ (0.88)
========= ======== ========= ========
Diluted income (loss) per common
share $ 0.01 $ 0.05 $ 0.03 $ (0.88)
========= ======== ========= ========
Weighted average basic shares
outstanding 19,259 19,134 19,198 19,100
Weighted average diluted shares
outstanding 19,665 19,344 19,576 19,100
Reconciliation of Net Income (Loss) to Adjusted EBITDA
(In thousands)
(Unaudited)
Three months ended 12 months ended
December 31, December 31,
2007 2006 2007 2006
--------- -------- -------- --------
Net income (loss) $ 284 $ 1,012 $ 598 $(16,783)
Depreciation 170 307 899 1,169
Amortization 389 386 1,565 2,511
Impairment of goodwill & intangible
assets - - - 16,516
Stock-based compensation expense 167 183 710 808
Interest expense and other, net 229 416 1,284 1,837
Income tax expense (benefit) (13) (326) 556 (1,604)
--------- -------- -------- --------
Adjusted EBITDA $ 1,226 $ 1,978 $ 5,612 $ 4,454
========= ======== ======== ========
Evolving Systems reports its financial results in accordance with
accounting principles generally accepted in the U.S. (GAAP). In addition,
the Company is providing in this news release non-GAAP information in
the form of adjusted EBITDA (earnings before interest, taxes,
depreciation, amortization, impairment, stock compensation and gain/loss
on foreign exchange transaction.) Management believes adjusted EBITDA
is useful to investors and lenders in evaluating the overall financial
health of the Company in that it allows for greater transparency of
additional financial data routinely used by management to evaluate
performance. Adjusted EBITDA relates to a covenant contained in the
Company's loan agreements and therefore can be useful for lenders as an
indicator of earnings available to service debt. Readers of this adjusted
EBITDA information are reminded that adjusted EBITDA is not a recognized
term under GAAP and does not purport to be an alternative to income
(loss) from operations, an indicator of cash flow from operations or a
measure of liquidity. Not all companies calculate adjusted EBITDA
identically, so this presentation may not be comparable to similar
presentations of other companies.
Consolidated Balance Sheets
(In thousands)
(Unaudited)
December 31, December 31,
2007 2006
---------- ---------
ASSETS
Current Assets:
Cash and cash equivalents $ 7,271 $ 5,076
Current portion of restricted cash - 300
Contract receivables, net 10,959 9,206
Unbilled work-in-progress 922 1,064
Prepaid and other current assets 1,335 1,701
---------- ---------
Total current assets 20,487 17,347
Property and equipment, net 1,677 1,349
Amortizable intangible assets, net 4,687 6,155
Goodwill 26,417 26,027
Long-term restricted cash 100 -
Other long-term assets 359 460
---------- ---------
Total assets $ 53,727 $ 51,338
========== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt and capital
lease obligations $ 2,520 $ 2,037
Accounts payable and accrued liabilities 5,937 4,428
Unearned revenue 10,635 10,079
---------- ---------
Total current liabilities 19,092 16,544
Long-term liabilities:
Long-term debt and other obligations 10,242 12,153
Deferred foreign income taxes 878 1,202
---------- ---------
Total liabilities 30,212 29,899
Preferred stock 5,587 11,281
Stockholders' equity:
Common stock 18 16
Additional paid-in capital 75,317 68,825
Accumulated other comprehensive income 2,144 1,466
Accumulated deficit (59,551) (60,149)
---------- ---------
Total stockholders' equity 17,928 10,158
---------- ---------
Total liabilities and stockholders' equity $ 53,727 $ 51,338
========== =========
Contact Information: Investor Relations Jay Pfeiffer Pfeiffer High Investor Relations, Inc. 303.393.7044 Press Relations Sarah Hurp Marketing Communications Manager Evolving Systems +44 1225 478060