SOURCE: Selectica

Selectica

February 05, 2014 18:11 ET

Selectica Announces Financial Results for the Third Quarter of Fiscal 2014

SAN MATEO, CA--(Marketwired - Feb 5, 2014) -  Selectica, Inc. (NASDAQ: SLTC), a leading provider of software that streamlines contract processes and accelerates sales cycles, today announced financial results for its fiscal third quarter ended December 31, 2013.

Selectica Chairman Michael Brodsky said, "Our principal efforts for the quarter were focused on significantly strengthening our service delivery organization and sales teams, which will seed our future achievements." Brodsky added, "Most importantly we added Blaine Mathieu, a seasoned enterprise SaaS executive, to the team in early December as CEO. I have tremendous confidence that his experience and expertise will position Selectica well for success."

President and CEO Blaine Mathieu commented, "While it is still early days, I've quickly come to fully appreciate the tremendous power and capabilities of Selectica's core technologies, the complex and unique needs of our industry-leading customers, and the significant market opportunity for our solutions. I look forward to working with management and the board to put the business on a strong and solid upward trajectory."

Financial Results:

Selectica delivered the following financial results for the third quarter of fiscal 2014:

  • Recurring revenue: Recurring revenue was $3.1 million in Q3 FY 2014 compared to $3.0 million in Q2 FY 2014 and $3.1 million in Q3 FY 2013.

  • Operating expenses: Operating expenses were $4.0 million in Q3 FY 2014 compared to $3.5 million in Q2 FY 2014 and $3.6 million in Q3 FY 2013. The increase in expenses from Q2 FY 2014 to Q3 FY 2014 was largely driven by increases in executive stock based compensation.

  • Billings: Billings were $3.9 million in Q3 FY 2014 compared to $3.3 million in Q2 FY 2014 and $4.2 million in Q3 FY 2013.

  • Deferred revenue: Deferred revenue was $6.1 million in Q3 FY 2014 compared to $6.1 million in Q2 FY 2014 and $5.8 million in Q3 FY 2013.

Complete financial results for Q3 FY2014 can be found in the financial tables below.

About Selectica, Inc.
Selectica, Inc. (NASDAQ: SLTC) is a leading provider of enterprise Contract Management and Configure Price Quote software solutions. Since 1996 Selectica has been helping our Global customers actively manage contracts throughout the sales, procurement and legal life cycle. Selectica's CPQ sales automation software accelerates sales opportunities with guided selling, dynamic pricing configuration and proposal quoting and approvals. Our patented technology, delivered through the cloud, helps our customers in industries like high-tech, telecommunications, manufacturing, healthcare and financial services to accelerate and streamline sales and contract management process.

For more information:

Browse the Selectica resource center to find guides and resources on how to improve sales and contracting processes (http://www.selectica.com/resources)

Non-GAAP financial measures
Selectica provides quarterly and annual financial statements that are prepared in accordance with generally accepted accounting principles (GAAP). To help understand the company's past financial performance and future results, the company is providing non-GAAP financial measures to supplement the financial results that it provides in accordance with GAAP. The method the company uses to produce non-GAAP financial results is not computed according to GAAP and may differ from the methods used by other companies.

Forward-looking statements
Certain statements in this release and elsewhere by Selectica are forward-looking statements within the meaning of the federal securities laws and the Private Securities Litigation Reform Act of 1995. Such statements may include, without limitation, statements regarding business outlook, assessment of market conditions, anticipated financial and operating results, strategies, product and channel development, future plans, contingencies and contemplated transactions of the company. Such forward-looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors which may cause or contribute to actual results of company operations, or the performance or achievements of the company or industry results, to differ materially from those expressed, or implied by the forward-looking statements. In addition to any such risks, uncertainties and other factors discussed elsewhere herein, risks, uncertainties and other factors that could cause or contribute to actual results differing materially from those expressed or implied for the forward-looking statements include, but are not limited to fluctuations in demand for Selectica's products and services, risks of losing key personnel or customers, protection of the company's intellectual property and government policies and regulations, including, but not limited to those affecting the company's industry. Selectica undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Additional risk factors concerning the company can be found in the company's most recent Form 10-K, as supplemented in the company's most recent Form 10-Q, each as filed by the company with the Securities and Exchange Commission.

   
SELECTICA, INC.  
Condensed Consolidated Statements of Operations  
(In thousands, except per share amounts)  
(Unaudited)  
                         
    Three Months Ended     Nine Months Ended  
    December 31,     December 31,     December 31,     December 31,  
    2013     2012     2013     2012  
                                 
Revenues:                                
  Recurring revenues   $ 3,091     $ 3,054     $ 9,277     $ 8,650  
  Non-recurring revenues     857       1,442       2,971       4,677  
    Total revenues     3,948       4,496       12,248       13,327  
                                 
Cost of revenues:                                
  Cost of recurring revenues     634       489       2,000       1,227  
  Cost of non-recurring revenues     1,497       1,485       3,989       4,059  
    Total cost of revenues     2,131       1,974       5,989       5,286  
                                 
Gross profit:                                
  Recurring gross profit     2,457       2,565       7,277       7,423  
  Non-recurring gross profit     (640 )     (43 )     (1,018 )     618  
    Total gross profit     1,817       2,522       6,259       8,041  
                                 
Operating expenses:                                
  Research and development     586       950       2,139       2,742  
  Sales and marketing     2,051       1,642       6,254       4,887  
  General and administrative     1,349       985       3,636       2,554  
  Restructuring costs     -       -       227       -  
  Fees related to comprehensive settlement agreement     -       -       -       500  
    Total operating expenses     3,986       3,577       12,256       10,683  
Loss from operations     (2,169 )     (1,055 )     (5,997 )     (2,642 )
                                 
Decrease in fair value of warrant liability     -       -       982       -  
Interest and other income (expense), net     45       (3 )     4       (14 )
Net loss     (2,124 )     (1,058 )     (5,011 )     (2,656 )
Series C redeemable preferred stock accretion             -       1,621       -  
Net loss applicable to common stockholders   $ (2,124 )   $ (1,058 )   $ (6,632 )   $ (2,656 )
                                 
Basic and diluted net loss per common share applicable to common stockholders   $ (0.55 )   $ (0.37 )   $ (1.88 )   $ (0.94 )
                                 
Reconciliation to non-GAAP net loss:                                
Net loss   $ (2,124 )   $ (1,058 )   $ (5,011 )   $ (2,656 )
Decrease in fair value of warrant liability     -       -       (982 )     -  
Stock-based compensation expense     466       338       921       699  
Restructuring costs     -       -       227       -  
Fees related to comprehensive settlement agreement     -       -       -       500  
Non-GAAP net loss   $ (1,658 )   $ (720 )   $ (4,845 )   $ (1,457 )
                                 
Non-GAAP basic and diluted net loss per share   $ (0.43 )   $ (0.25 )   $ (1.38 )   $ (0.52 )
                                 
Weighted average shares outstanding for basic and diluted net loss per share applicable to common stockholders     3,877       2,830       3,522       2,818  
                                 
         
         
SELECTICA, INC.
Condensed Consolidated Balance Sheets
(In thousands)
         
    December 31,   March 31,
    2013   2013
    (unaudited)    
ASSETS            
Current assets            
  Cash and cash equivalents   $ 9,721   $ 12,098
  Accounts receivable, net     4,040     3,455
  Prepaid expenses and other current assets     538     853
    Total current assets     14,299     16,406
             
Property and equipment, net     317     407
Capitalized software     661     -
Other assets     40     39
    Total assets   $ 15,317   $ 16,852
             
LIABILITIES AND STOCKHOLDERS' EQUITY            
Current liabilities            
  Credit facility   $ 6,234   $ 6,000
  Accounts payable     1,002     1,010
  Accrued payroll and related liabilities     413     982
  Accrued restructuring costs     49     232
  Other accrued liabilities     291     163
  Deferred revenue     5,275     6,153
    Total current liabilities     13,264     14,540
  Long-term deferred revenue     816     1,772
  Other long-term liabilities     -     20
    Total liabilities     14,080     16,332
             
Stockholders' equity     1,237     520
    Total liabilities and stockholders' equity   $ 15,317   $ 16,852
             
             
             
SELECTICA, INC.  
Condensed Consolidated Statements of Cash Flows  
(In thousands)  
(Unaudited)  
             
             
    Nine Months Ended  
    December 31,     December 31,  
    2013     2012  
                 
Operating activities                
Net loss   $ (5,011 )   $ (2,656 )
Adjustments to reconcile net loss to net cash used in operating activities:                
Depreciation     146       156  
Loss on disposition of property and equipment     23       -  
Stock-based compensation expense     902       699  
Decrease in warrant liability     (982 )     -  
Changes in assets and liabilities:                
  Accounts receivable (net)     (585 )     (2,145 )
  Prepaid expenses and other current assets     35       (91 )
  Other assets     (1 )     -  
  Accounts payable     (10 )     356  
  Restructuring liability     (183 )     -  
  Accrued payroll and related liabilities     (569 )     (951 )
  Other accrued liabilities and long term liabilities     108       (12 )
  Deferred revenue     (1,835 )     (1,216 )
Net cash used in operating activities     (7,962 )     (5,860 )
                 
Investing activities                
  Purchase of property and equipment     (79 )     (193 )
  Capitalized software     (382 )     -  
  Proceeds from maturities of short-term investments     -       199  
Net cash (used in) provided by investing activities     (461 )     6  
                 
Financing activities                
  Credit facility borrowings, net     234       (106 )
  Employee taxes paid in exchange for stock awards forfeited     (232 )     -  
  Issuance of common stock under employee stock plan     207       -  
  Proceeds from sale of common stock, preferred stock and warrants, net of issuance costs     5,837       -  
  Repurchase of common stock, net of issuance cost     -       (111 )
Net cash provided by (used in) financing activities     6,046       (217 )
                 
Net decrease in cash and cash equivalents     (2,377 )     (6,071 )
Cash and cash equivalents at beginning of the period     12,098       15,877  
Cash and cash equivalents at end of the period   $ 9,721     $ 9,806  
                 
                 
                         
SELECTICA, INC.  
Billings Reconciliation  
(In thousands)  
(Unaudited)  
                         
    Three Months Ended     Nine Months Ended  
    December 31,     December 31,     December 31,     December 31,  
    2013     2012     2013     2012  
                                 
Total revenues   $ 3,948     $ 4,496     $ 12,248     $ 13,327  
Deferred revenue:                                
End of period     6,090       5,504       6,090       5,504  
Beginning of period     6,133       5,775       7,925       6,721  
Change in deferred revenue     (43 )     (271 )     (1,835 )     (1,217 )
Total billings (total revenues plus the change in deferred revenue)   $ 3,905     $ 4,225     $ 10,413     $ 12,110