DUBLIN, CA--(Marketwire - May 5, 2011) - Taleo Corporation (NASDAQ: TLEO), the leading
provider of on-demand Talent Management solutions, today announced
record-setting results for its fiscal first quarter 2011.
"Our results consistently demonstrate what our customers already know --
we're redefining the talent management market and how businesses leverage
their largest asset, their people," said Michael Gregoire, Taleo's Chairman
and CEO. "Our momentum is based on a keen understanding of our customers --
from the small, emerging business to the global corporation. We're
innovating, executing and, where necessary, acquiring to make sure we have
the broadest, most comprehensive platform in the market. Our undisputed
leadership in talent management and the rapid growth of our customer base
are testaments to the success of our strategy."
Taleo delivered the following results for the first quarter 2011:
First Quarter Revenue: Total revenue for the first quarter was $71.5
million, an increase of 30% on a
year-over-year basis. Subscription revenue for the first quarter was $58.4
million, an increase of 23% on a
year-over-year basis. Professional services revenue for the first quarter
was $13.1 million, an increase of 75% on a year-over-year basis.
Total first quarter non-GAAP revenue was $74.3 million, an increase of 35%
on a year-over-year basis. Non-GAAP subscription revenue for the first
quarter was $60.1 million, an increase of 26% on a year-over-year basis.
Non-GAAP professional services revenues for the first quarter was $14.2
million, an increase of 90% on a year-over-year basis.
First Quarter Earnings / (Loss) per Share: First quarter net loss per share
was $(0.05), compared to net income per fully diluted share of $0.02 a year
ago.
Non-GAAP net income per fully diluted share was $0.23, compared to non-GAAP
net income per fully diluted share of $0.16 a year ago.
An explanation of the non-GAAP measures used in this press release is
included in the section below titled "Non-GAAP Financial Measures" and a
reconciliation of GAAP to the non-GAAP financial measures has been provided
in the tables included as part of this press release.
Customers: In the first quarter, over 240 new businesses chose Taleo's
Talent Management solutions for recruiting, performance, learning and/or
compensation management, including: Caterpillar, Inc., Phillips
International, IDEX Laboratories, Fairmont Raffles Hotels, Motorola
Mobility and Bentley Systems, Inc. A first quarter record 8 new contracts
were of $250,000 or larger in first year subscription revenue, underscoring
the market interest in larger, global deployments and in multiple component
suite solutions.
Cash: Cash generated from operations for the first quarter was $15.6
million, up 36% year-over year. Total cash and cash equivalents finished
the quarter at $145.8 million, a decrease of $90.9 million from the prior
year, which includes approximately $135.5 million in net outflow from the
company's acquisitions of Learn.com and Cytiva.
Quarterly Conference Call
Taleo will host a conference call to discuss its first quarter 2011 results
at 1:30 p.m. Pacific Time today. A live audio webcast of the conference
call, together with detailed financial information, can be accessed through
the company's Investor Relations Web site at http://www.taleo.com/ir.
Please join the conference call at least 10 minutes early to register. A
replay of the conference call will be available until midnight PT on May
10, 2011 at http://ir.taleo.com/events.cfm, or via dial-in at 800-642-1687
or 706-645-9291. The pass code for the replay is 55412677.
About Taleo
Taleo's (NASDAQ: TLEO) cloud-based talent management platform unites
products and an ecosystem to drive business performance through talent
intelligence. Approximately 5,000 customers use Taleo for talent
acquisition, performance and compensation management, including 47 of the
Fortune 100. Further, Taleo's Talent Grid cloud community harnesses the
expertise of Taleo customers, more than 200 million candidates to date, and
140 partners and industry experts.
Forward-looking Statements
This release contains forward-looking statements, including statements
regarding Taleo's future financial performance, market growth, the demand
for and benefits from the use of Taleo's solutions, and general business
conditions. Any forward-looking statements contained in this press release
are based upon Taleo's historical performance and its current plans,
estimates and expectations and are not a representation that such plans,
estimates, or expectations will be achieved. These forward-looking
statements represent Taleo's expectations as of the date of this press
announcement. Subsequent events may cause these expectations to change, and
Taleo disclaims any obligation to update the forward-looking statements in
the future. These forward-looking statements are subject to known and
unknown risks and uncertainties that may cause actual results to differ
materially. Further information on potential factors that could affect
actual results is included in Part I, Item 1A of Taleo's Annual Report on
Form 10K, as filed with the SEC on February 28, 2011, and in other reports
filed by Taleo with the SEC.
Non-GAAP Financial Measures
Taleo has provided in this release financial information that has not been
prepared in accordance with accounting principles generally accepted in the
United States of America, or GAAP. This information includes non-GAAP
revenue and non-GAAP earnings per share. Taleo uses these non-GAAP
financial measures internally in analyzing its financial results and
believes they are useful to investors, as a supplement to GAAP measures, in
evaluating Taleo's ongoing operational performance. Taleo believes that the
use of these non-GAAP financial measures provides an additional tool for
investors to use in evaluating ongoing operating results and trends and in
comparing its financial measures with other companies in Taleo's industry,
many of which present similar non-GAAP financial measures to investors. The
non-GAAP measures include amounts excluded from GAAP revenue due to the
write down of the deferred revenue associated with purchase accounting for
the Worldwide Compensation and Learn.com acquisitions, and exclude costs
associated with acquisition-related transaction costs, stock-based
compensation expense, amortization of acquisition-related intangibles, the
gain on re-measurement of a previously held interest in Worldwide
Compensation, and income taxes associated with certain non-GAAP
adjustments. First quarter loss per share calculations are based on 40.6
million basic weighted average shares outstanding, while first quarter
non-GAAP EPS calculations are based on 43.8 million fully diluted weighted
average shares outstanding. The fully diluted weighted average shares
outstanding used to compute non-GAAP earnings per share have been
calculated without giving consideration to the treasury stock method.
Non-GAAP financial measures should not be considered in isolation from, or
as a substitute for, financial information prepared in accordance with
GAAP. Investors are encouraged to review the reconciliation of these
non-GAAP measures to their most directly comparable GAAP financial measure.
A reconciliation of GAAP to the non-GAAP financial measures has been
provided in the tables included as part of this press release.
A historical reconciliation of GAAP to non-GAAP financial measures for past
periods can be located on the investor relations section of www.taleo.com.
Taleo Corporation
Condensed Consolidated Statements of Operations
(All amounts in thousands except per share data)
(Unaudited)
Three Months Ended
March 31,
--------------------------
2011 2010
------------ ------------
Revenue:
Subscription and support $ 58,390 $ 47,564
Professional services 13,107 7,482
------------ ------------
Total revenue 71,497 55,046
------------ ------------
Cost of revenue (Note 1):
Subscription and support 12,547 10,362
Amortization of acquisition-related
intangibles 1,499 951
------------ ------------
Total cost of subscription and support
revenue 14,046 11,313
Professional services 10,236 6,485
------------ ------------
Total cost of revenue 24,282 17,798
------------ ------------
------------ ------------
Gross profit 47,215 37,248
------------ ------------
Operating expenses (Note 1):
Sales and marketing 20,709 14,937
Sales - amortization of acquisition-related
intangibles 2,777 2,123
Research and development 13,807 10,054
General and administrative 12,129 10,298
------------ ------------
Total operating expenses 49,422 37,412
------------ ------------
------------ ------------
Loss from operations (2,207) (164)
------------ ------------
Other income (expense):
Interest income 86 127
Interest expense (26) (34)
Gain on remeasurement of previously held
interest in Worldwide Compensation, Inc. - 885
Total other income, net 60 978
------------ ------------
Income (loss) before provision for (benefit
from) income taxes (2,147) 814
Provision for (benefit from) income taxes 23 (4)
------------ ------------
Income (loss) attributable to Class A common
stockholders $ (2,170) $ 818
============ ============
Income (loss) per share attributable to Class A
common stockholders - basic $ (0.05) $ 0.02
============ ============
Income (loss) per share attributable to Class A
common stockholders - diluted $ (0.05) $ 0.02
============ ============
Weighted average Class A common shares - basic 40,602 39,156
============ ============
Weighted average Class A common shares -
diluted 40,602 40,338
============ ============
NOTES
1. Includes stock-based compensation expense
Subscription and support cost of revenue $ 221 $ 176
Professional services cost of revenue $ 524 362
------------ ------------
Cost of revenue subtotal 745 538
Sales and marketing operating expense $ 1,161 884
Research and development operating
expense $ 786 464
General and administrative operating
expense $ 1,401 1,291
------------ ------------
Operating expense subtotal 3,348 2,639
------------ ------------
Total stock-based compensation expense $ 4,093 $ 3,177
============ ============
Taleo Corporation
Condensed Consolidated Statements of Operations (continued)
(All amounts in thousands except per share data)
(Unaudited)
Reconciliation of GAAP net income (loss) to non-GAAP net income:
Three Months Ended
March 31,
--------------------------
2011 2010
------------ ------------
GAAP net income (loss) reported above $ (2,170) $ 818
Add back:
Revenue
Non-GAAP subscription and support revenue 1,664 153
Non-GAAP professional services revenue 1,098 -
------------ ------------
Total Non-GAAP revenue 2,762 153
Expenses
Acquisition-related transaction costs 1,547 539
Stock-based compensation expense 4,093 3,177
Amortization of acquisition-related
intangibles 4,276 3,074
------------ ------------
9,916 6,790
Other income (expense)
Gain on remeasurement of previously held
interest in Worldwide Compensation, Inc. - (885)
------------ ------------
- (885)
Income taxes
Income taxes associated with certain
non-GAAP adjustments (528) -
------------ ------------
Non-GAAP net income $ 9,980 $ 6,876
============ ============
Non-GAAP net income per share
Basic $ 0.25 $ 0.18
============ ============
Diluted $ 0.23 $ 0.16
============ ============
Reconciliation of basic and fully diluted share
count:
------------ ------------
Basic 40,602 39,156
------------ ------------
Add:
Weighted Average options and unreleased
restricted stock, without consideration
for the treasury stock method 3,178 3,242
------------ ------------
Diluted 43,780 42,398
------------ ------------
Taleo Corporation
Condensed Consolidated Balance Sheets
(All amounts in thousands)
(Unaudited)
March 31, December 31,
2011 2010
------------ ------------
ASSETS
Current assets:
Cash and cash equivalents $ 145,781 $ 141,588
Accounts receivable, net 60,606 58,120
Prepaid expenses and other current assets 17,970 18,065
Investment credits receivable 6,206 6,034
------------ ------------
Total current assets 230,563 223,807
Property and equipment, net 24,436 26,552
Restricted cash 11,553 218
Goodwill 206,418 206,418
Other intangibles, net 55,311 59,478
Other assets 7,237 7,363
------------ ------------
Total assets $ 535,518 $ 523,836
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 37,240 $ 36,377
Deferred revenue - subscription and
support and customer deposits 86,524 79,704
Deferred revenue - professional services 18,523 19,692
Capital lease obligations, short-term 86 105
------------ ------------
Total current liabilities 142,373 135,878
Long-term deferred revenue - subscription and
support and customer deposits 1,778 150
Long-term deferred revenue - professional
services 8,491 10,006
Other liabilities 9,327 9,241
Capital lease obligations, long-term 33 46
------------ ------------
Total liabilities 162,002 155,321
------------ ------------
Stockholders' equity:
Capital stock 1 1
Additional paid-in capital 450,148 442,514
Accumulated deficit (78,779) (76,609)
Treasury stock (1,889) (776)
Accumulated other comprehensive income 4,035 3,385
------------ ------------
Total stockholders' equity 373,516 368,515
------------ ------------
Total liabilities and stockholders' equity $ 535,518 $ 523,836
============ ============
Taleo Corporation
Condensed Consolidated Statements of Cash Flows
(All amounts in thousands)
(Unaudited)
Three Months Ended
March 31,
--------------------------
2011 2010
------------ ------------
Cash flows from operating activities:
Net income (loss) $ (2,170) $ 818
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Depreciation and amortization 7,925 6,321
Loss on disposal of fixed assets - 58
Amortization of tenant inducements (48) (44)
Tenant inducements from landlord - 114
Stock-based compensation expense 4,093 3,177
Excess tax benefits on the exercise of stock
options (95) (16)
Director fees paid with stock in lieu of cash 64 60
Gain on remeasurement of previously held
interest in Worldwide Compensation, Inc. - (885)
Bad debt provision (reduction) 50 (93)
Changes in assets and liabilities, net of
effect of acquisitions:
Accounts receivable (2,477) 2,360
Prepaid expenses and other assets 509 (2,186)
Investment credits receivable - (714)
Accounts payable and accrued liabilities 2,117 2,001
Deferred revenues and customer deposits 5,599 438
------------ ------------
Net cash provided by operating
activities 15,567 11,409
------------ ------------
Cash flows from investing activities:
Purchases of property and equipment (2,344) (6,482)
Change in restricted cash (11,335) -
Acquisition of business, net of cash acquired - (13,381)
Cash advance to Cytiva Software Inc. (78) -
Acquisition of trademark intangible (150) -
------------ ------------
Net cash used in investing activities (13,907) (19,863)
------------ ------------
Cash flows from financing activities:
Principal payments on capital lease
obligations (282) (414)
Payments for expenses associated with 2009
equity offering - (678)
Excess tax benefits on the exercise of stock
options 95 16
Treasury stock acquired to settle employees
withholding liability (1,112) (474)
Proceeds from stock options exercised and ESPP
shares 3,382 2,307
------------ ------------
Net cash provided by financing
activities 2,083 757
------------ ------------
Effect of exchange rate changes on cash and
cash equivalents 450 169
------------ ------------
Increase (decrease) in cash and cash
equivalents 4,193 (7,528)
Cash and cash equivalents:
Beginning of period 141,588 244,229
------------ ------------
End of period $ 145,781 $ 236,701
============ ============