Q1 Fiscal 2008 Financials

Feb 08, 2008    

Quinn Murphy        

Bridgeline Software Reports Record Revenues For The First Quarter of Fiscal 2008          

BURLINGTON, Mass., Feb. 8, 2008 (GLOBE NEWSWIRE) -- Bridgeline Digital, Inc. (NASDAQ: BLIN), a provider in cloud-based Web Content Management, eCommerce and Marketing Automation software, announced record results for its fiscal quarter ending December 31, 2007.

Highlights from the first quarter of fiscal 2008 results include:

• Achieved record revenues of $4,203,000 for the quarter ended December 31, 2007 representing an 82% increase over Bridgeline Software’s revenues of $2,309,000 for the same quarter one year earlier.
• The Company’s customer base as of December 31, 2007 has increased to 334 customers, which is a 161% increase from 128 customers a year ago. Of the Company’s 334 customers, 258 of them or 77% pay Bridgeline Software a monthly subscription fee or a monthly managed service fee.
• Net income for the quarter ended December 31, 2007 was $37,000, versus a net loss of $630,000 from the same three month period one year earlier.
• EBITDA before stock compensation for the quarter ending December 31, 2007 was $314,000, versus an EBITDA loss of $114,000 from the same three month period one year earlier.
• Balance sheet remains strong with a current ratio of 2.9:1, over $26 million in total assets, and $3.1 million in total liabilities.
• Thomas Massie, Chairman and Chief Executive Officer of Bridgeline Software commented, “We are very pleased with our first quarter results, and are executing as planned. Over the past seven months we have expanded into the Atlanta, Chicago, Cleveland, and Minneapolis markets doubling Bridgeline’s revenues. We have expanded with prudent diligence, continuing to generate positive EBITDA, while maintaining a strong balance sheet.”
• Results of Operations for the three-months ended December 31, 2007
• Bridgeline Software recorded revenue of $4.2 million in the quarter ended December 31, 2007, an increase of $1.9 million, or 82% compared to the same period of the prior year. The Company posted operating income for the quarter ended December 31, 2007, of $9,000 compared to an operating loss of $285,000 in same quarter of the prior year. The Company posted net income for the quarter ended December 31, 2007 of $37,000 or less than one cent ($0.00) per diluted share versus a net loss of $630,000 or ($0.15) per diluted share in the same quarter of the previous year.

Non-GAAP Financial Measures

This press release contains the following non-GAAP financial measures: non-GAAP adjusted net income, non-GAAP adjusted earnings per diluted share, Adjusted EBITDA and Adjusted EBITDA per diluted share.

Non-GAAP adjusted net income and non-GAAP adjusted earnings per diluted share are calculated as net income or net income per share on a diluted basis, excluding, where applicable, impairment charges, amortization of intangible assets, stock-based compensation and the related tax effects.

Adjusted EBITDA and Adjusted EBITDA per diluted share are defined as earnings before interest, taxes, depreciation and amortization and before stock compensation and impairment charges. Bridgeline uses Adjusted EBITDA as a supplemental measure of our performance that is not required by, or presented in accordance with, accounting principles generally accepted in the United States (“GAAP”). Bridgeline’s management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company's financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. In order to compensate for these limitations, Bridgeline management presents non-GAAP financial measures in connection with GAAP results. Bridgeline urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which is included in this press release, and not to rely on any single financial measure to evaluate Bridgeline's business.

Our definitions of non-GAAP adjusted net income and Adjusted EBITDA may differ from and therefore may not be comparable with similarly titled measures used by other companies, thereby limiting their usefulness as comparative measure. Because of the limitations that non-GAAP adjusted net income and Adjusted EBITDA have as an analytical tool, investors should not consider them in isolation, or as a substitute for analysis of our operating results as reported under GAAP.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

All statements included in this press release, other than statements or characterizations of historical fact, are forward-looking statements. These forward-looking statements are based on our current expectations, estimates and projections about our industry, management's beliefs, and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," similar expressions, and variations or negatives of these words. These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions, including, but not limited to, the impact of the weakness in the U.S. and international economies on our business, our inability to manage our future growth effectively or profitably, fluctuations in our revenue and quarterly results, our license renewal rate, the impact of competition and our ability to maintain margins or market share, the limited market for our common stock, the volatility of the market price of our common stock, the performance of our products, our ability to respond to rapidly evolving technology and customer requirements, our ability to protect our proprietary technology, the security of our software, our dependence on our management team and key personnel, our ability to hire and retain future key personnel, our ability to maintain an effective system of internal controls, or risks associated with our contracts with the U.S. federal government, as well as other risks described in our filings with the Securities and Exchange Commission. Any of such risks could cause our actual results to differ materially and adversely from those expressed in any forward-looking statement. We expressly disclaim any obligation to update any forward-looking statement. Bridgeline Software, Inc.

Condensed Consolidated Statements of Operations (Dollars in thousands except per share data)                              

Three Months Ended December 31, 2007

December 31, 2006

Revenue

• $4,203
• $2,309

Cost of revenue

• $2,022
• $1,141

Gross profit

• $2,181
• $1,168

Operating expenses:    

Sales & marketing

• 1,067
• 789  

General & administrative

• 745
• 461  

Research & development

• 166
• 155  

Depreciation & amortization

• 194
• 48

Total operating expenses

• 2,172
• 1,453

Income / (loss) from operations

• 9
• (285)

Interest income (expense)

• 28
• (345)

Income / (loss) before income taxes

• 37
• (630)

Income taxes - -Net income / (loss)

• 37
• (630)    

Net income / (loss) per share:  

Basic and diluted

• $0.00
• $(0.15)    

Number of weighted average shares:    

Basic and diluted

• 8,676,408
• 4,273,833

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EBITDA results (Note 1)

Add:  Interest expense

• 18
• 345    

Depreciation and amortization

• 204
• 80    

Stock-based compensation

• 55
• 91

EBITDA before stock compensation and other non-recurring charges  

• 314
• (114)

EBITDA per share

• 0.04
• (0.03)    

Note 1: EBITDA before stock compensation is a Non-GAAP Financial Measurement. We use earnings before interest, taxes, depreciation and amortization (“EBITDA”) as a supplemental measure of our performance that is not required by, or presented in accordance with, accounting principles generally accepted in the United States (“GAAP”). We define EBITDA before stock compensation as net income before interest, taxes, depreciation, amortization and stock-based compensation. We present EBITDA before stock compensation because we consider it an important supplemental measure of our performance by adjusting net income or loss primarily for non-cash and other non-recurring charges. Because the use of EBITDA before stock compensation facilitates comparisons of our historical operating performance on a more consistent basis, we use this measure for business planning and analysis purposes, in assessing acquisition opportunities and in determining how potential external financing sources are likely to evaluate our business. In addition, we believe this measure provides the investor with an accurate measure of our ability to meet our future cash flow requirements. Bridgeline Software, Inc.

Condensed Consolidated Balance Sheets (in thousands) December 31, 2007

September 30, 2007

Assets

Current assets:    

Cash and cash equivalents

• 4,768
• 5,219    

Accounts receivables and other current assets

• 3,891
• 3,439

Total current assets

• 8,659
• 8,658

Other assets

• 1,400
• 1,234

Intangible assets, net

• 1,355
• 1,441

Goodwill

• 14,725
• 14,426

Total assets

• $26,139
• $25,759    

Liabilities and stockholders’ equity

Current liabilities:    

Current liabilities and accrued expenses

• $2,980
• $2,719

Total current liabilities

• 2,980
• 2,719

Other liabilities

• 143
• 165

Total liabilities

• 3,123
• 2,884

Stockholders’ equity:

• Preferred stock - $0.001 par value; 1,000,000 shares authorized; none issued and outstanding
• Common stock - $.001 par value; 20,000,000 shares authorized, 8,797,117 and 8,648,950 shares issued and outstanding, respectively 9 9

Additional paid-in capital

• 29,009
• 28,908

Accumulated other comprehensive income

• 21
• 18

Accumulated deficit

• (6,023)
• (6,060)

Total stockholders’ equity

• 23,016
• 22,875

Total liabilities and stockholders’ equity

• $26,139
• $25,759    

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About Bridgeline Digital

Bridgeline Digital, The Digital Engagement Company™, helps customers maximize the performance of their full digital experience - from websites and intranets to online stores and campaigns. Bridgeline's Unbound (formerly iAPPS®) platform deeply integrates Web Content Management, eCommerce, eMarketing, Social Media management, and Web Analytics to help marketers deliver digital experiences that attract, engage, nurture and convert their customers across all channels. Headquartered in Burlington, Mass., Bridgeline has thousands of quality customers that range from small- and medium-sized organizations to Fortune 1000 companies. To learn more, please visit www.bridgeline.com or call (800) 603-9936.