FRAMINGHAM, Mass.—(BUSINESS WIRE)—November 6, 2006—
Moldflow Corporation (NASDAQ:
MFLO) today announced the results
for its first quarter of the 2007 fiscal year.
-- Non-GAAP net income of $2.1 million, or $0.18 per diluted
share, was up 266% from our first fiscal quarter of 2006 and
16% sequentially; and net income as reported in accordance
with GAAP was $1.7 million, or $0.14 per share. Net income
includes a tax benefit of $562,000 related to a change in the
tax position of one of the Company's foreign subsidiaries.
-- Revenue of $15.3 million was flat from the corresponding
quarter of fiscal 2006 and represented an 11% sequential
decrease, consistent with usual seasonal trends.
-- Total product revenue of $8.0 million represented a decrease
of 9% over the same period of the prior year and 19%
sequentially.
-- Total services revenue of $7.3 million represented an increase
of 12% over the same period of the prior year and 1%
sequentially.
-- Revenue from Design Analysis Solutions totaled $11.6 million
or 76% of total revenue and represented a 2% increase when
compared to the same period last year and a 9% sequential
decrease.
-- Revenue from Manufacturing Solutions totaled $3.7 million or
24% of total revenue, and represented a 6% decrease when
compared to the same period last year and a 14% sequential
decrease.
-- Regionally, revenue in our Asia/Pacific region represented 36%
of total revenue, while the Americas represented 35% and the
European region represented 29% of total revenue,
respectively.
-- Share repurchase program returned 114,500 shares to treasury
at an average net price of $12.12 per share equating to
approximately $1.4 million in total cash payments.
-- Operations generated $1.2 million of cash.
Commenting on the first fiscal quarter, Roland Thomas, Moldflow
Corporation's president and CEO said, "We are pleased to report that
both of our business divisions are operating in-line with our
expectations. Overall, we demonstrated increased operational leverage
and corresponding improvements in net income and earnings per share in
our first fiscal quarter. Revenue for the first quarter in our Design
Analysis Solutions division showed slight growth year-over-year, which
is consistent with our expectations. We continued to hire new direct
sales representatives and establish new distributors to further our
geographic expansion objectives. Our Manufacturing Solutions division
produced expanded gross margins and operating profit despite lower
year-over-year revenues."
Business Outlook
The current business outlook is based on information as of
November 6, 2006 and is current as of that day only. We continue to
expect revenue for our full fiscal 2007 year to grow in the range of
5% to 7% when compared to fiscal 2006 and non-GAAP net income per
diluted share for full fiscal year 2007 to increase between 35% and
50% as compared to fiscal 2006, resulting in non-GAAP net income per
diluted share of approximately $0.68 to $0.75. Non-GAAP net income per
diluted share excludes charges for share-based compensation expenses
throughout the full fiscal year which are expected to be approximately
$1.9 million, net of related tax effects. GAAP net income per diluted
share is therefore expected to be between $0.53 and $0.60.
The Company has provided its fiscal 2007 net income and net income
per diluted share guidance above. This guidance is provided on a
non-GAAP basis. Non-GAAP net income and non-GAAP net income per
diluted share exclude estimated charges for share-based compensation
costs. Because there are significant limitations in estimating the
impact of share-based compensation costs, including but not limited
to, the number of incentive shares that will be exercised and/or
cancelled during the period, the fair market value of the Company's
share price on the exercise dates, and the number and type of
issuances that may be awarded in any year, the estimated charges and
tax benefits associated with share-based issuances are unpredictable.
For these reasons, the actual impact of share-based compensation on
GAAP net income and GAAP net income per diluted share may differ
materially from the estimated amounts included in the guidance above.
Use of Other Non-GAAP Financial Measures
Net income and net income per diluted share, excluding, as
applicable, share-based compensation expenses and restructuring
charges are supplemental non-GAAP financial measures. Moldflow is
presenting these measures because management uses this information in
evaluating the results of the Company's operations and for internal
planning and forecasting purposes and believes that this information
provides additional insight into our operating results, as well as
enables comparison of these results to prior periods. These measures
should not be considered an alternative to measurements required by
GAAP, such as net income and net income per diluted share, and should
not be considered a measure of our liquidity. In addition, these
non-GAAP financial measures may not be comparable to similar measures
reported by other companies. With respect to the non-GAAP financial
measures for the first quarter, the GAAP financial measures most
directly comparable to each non-GAAP financial measure used or
discussed in this press release and a reconciliation of the
differences between each non-GAAP financial measure and the comparable
GAAP financial measure are included in this press release and can be
found on the Investors page of the Moldflow Web site at
http://www.moldflow.com/stp/english/investors/index.htm.
Financial Results
The unaudited condensed consolidated financial statements for the
first quarter of fiscal 2007 follow.
Information Dissemination
Moldflow will host a conference call to discuss the first quarter
of fiscal 2007 results as well as future outlook at 11:00 a.m. US
Eastern time, Monday, November 6, 2006. The conference call dial-in
number is 877-314-4022, Conference ID #9602966. The call will be
recorded with replay (dial-in # 800-642-1687, PIN# 9602966) which will
be available until November 13, 2006. In addition, a live Webcast of
the conference call, together with this press release and supplemental
financial information, can be accessed through the Company's Website
at www.moldflow.com in the Investors section. The call, press release
and supplemental information will be archived and can be accessed
through the same link.
About Moldflow Corporation
Moldflow (NASDAQ:
MFLO) is the leading global provider of design
through manufacturing solutions for the plastics injection molding
industry. Moldflow's products and services allow companies to address
part and mold design issues at the earliest stage and maximize
productivity and profitability on the manufacturing floor. Visit
www.moldflow.com for more information.
Note to editors: Moldflow is a registered trademark of Moldflow
Corporation or its subsidiaries worldwide. All other trademarks are
properties of their respective holders.
Cautionary Statement Regarding Forward-Looking Information
Pursuant to the safe harbor provisions of the United States
Private Securities Litigation Reform Act of 1995, the Company notes
that any statements contained in this press release that are not
historical facts are forward-looking statements. Such forward-looking
statements include, but are not limited to, statements by Moldflow's
President and CEO, statements under Business Outlook and those
regarding Moldflow's or management's intentions, hopes, beliefs,
expectations, projections, plans for the future, estimates and
statements regarding any potential operating leverage and cost savings
during the 2007 fiscal year and the expected performance of our Design
Analysis Solutions and Manufacturing Solutions divisions.
Forward-looking statements involve risks and uncertainties that could
cause actual results to differ materially from those projected. These
risks and uncertainties include the risks that a weak world economy
will slow capital spending by the Company's prospective customers,
that the Company may not be able to recognize the revenue derived from
orders received, that the sales cycle may lengthen, that our
restructuring activities, particularly with respect to our
Manufacturing Solutions business, will result in the disruption of our
sales cycles and research and development activities, that foreign
currency fluctuations may adversely affect our financial results, that
our distribution partners will not achieve their revenue objectives,
that the overall mix of revenue differs materially from that
projected, that share-based compensation expense will continue to have
a negative impact on our GAAP operating profit, net income and
earnings per share calculations, that changes in US or foreign tax
legislation, or on-going tax inquiries and the on-going tax audits of
our subsidiary companies, including Australia, may result in a higher
level of income tax expense than that projected, that our hiring plans
may not be fully executed and as a result we may not be able to meet
sales demand and with respect to the potential operating leverage and
cost savings during the 2007 fiscal year, the risk that the Company
will not realize the anticipated cost savings from our restructuring
plans during the expected time frame, or, even if the anticipated cost
savings are achieved, that the Manufacturing Solutions business unit
may remain unprofitable and its business may suffer. Other risks and
uncertainties are detailed from time to time in reports filed by
Moldflow with the Securities and Exchange Commission, including the
Company's Annual Report on Form 10-K for the year ended June 30, 2006
as well as its subsequent quarterly and annual filings. Revenue and
net income guidance offered by senior management today represents a
point-in-time estimate and is based on information as of the date of
this press release. Senior management has made numerous assumptions in
providing this guidance which, while believed to be reasonable, may
not prove to be accurate. In addition, as noted above, there are
numerous factors that may cause actual results to differ materially
from the guidance provided. The Company expressly disclaims any
current intention or obligation to update the guidance provided or any
other forward-looking statement in this press release to reflect
future events or changes in facts assumed for purposes of providing
this guidance or otherwise affecting the forward-looking statements
contained in this press release.