updated 5/24/2011 4:16:01 PM ET 2011-05-24T20:16:01

  • Compuware Earns 48 Cents Per Share in FY '11, 16 Cents Per Share in Q4
  • FY '11 APM license and subscription fees skyrocket 91.7 percent year-over-year on a GAAP basis to $145.5 million; license and subscription fees up 34.1 percent on a pro forma basis*
  • FY '11 Covisint revenues leap 36.0 percent year-over-year to $55.0 million
  • Final Q4 results: APM license fees and subscriptions +54.0 percent, Covisint revenue +65.6 percent, Uniface license fees +76.7 percent, Changepoint license fees +14.3 percent year-over-year; Professional Services segment contribution margin over 15 percent
  • FY '12 guidance predicts ongoing revenue growth, increased EPS and strong cash flow

DETROIT, May 24, 2011 (GLOBE NEWSWIRE) -- Compuware Corporation (Nasdaq:CPWR), the technology performance company, today announced financial results for its fourth quarter and fiscal year ended March 31, 2011.

"Compuware and its growth drivers produced a strong fiscal year 2011," said Compuware President and COO Bob Paul. "Our unique abilities to solve key business problems in the application performance management and secure collaboration markets in particular have driven phenomenal growth, which we expect to continue. Combined with our laser focus on profitability in Mainframe Solutions, Professional Services and Uniface, we have positioned Compuware to deliver increases in revenues, earnings per share and operating cash flow for fiscal 2012."

Fiscal Year 2011 Results

During the fiscal year ended March 31, 2011, Compuware increased its total revenues, software license fees, maintenance and subscription fees, and professional services fees year-over-year. Maintenance and subscription fees were $487.0 million, up from $456.3 million in the previous year. Software license fees were $194.7 million compared to $194.5 million in the previous year. Professional services fees were $247.2 million, up from $241.3 million in the previous year.

Fiscal year 2011 revenues were $928.9 million, up from $892.2 million in the previous fiscal year. GAAP net income was $107.4 million in fiscal year 2011, compared to $140.8 million (GAAP) and $93.7 million (pro forma) in fiscal year 2010. GAAP earnings per share were 48 cents in FY '11 compared to 60 cents (GAAP) and 40 cents (pro forma) in FY '10, based upon 226.1 million and 234.6 million shares outstanding, respectively.

Fiscal year 2010 net income and earnings per share benefited from a non-recurring $52.4 million gain from the divestiture of certain product lines and $20.7 million in other income related to a legal settlement.

Fourth Quarter Fiscal Year 2011 Results

During the company's fourth quarter, software license fees were $55.7 million, up from $51.8 million in the fourth quarter last year. Maintenance and subscription fees were $124.0 million in the fourth quarter, up from $117.9 million in the fourth quarter last year. Revenue from professional services in the fourth quarter was $69.9 million, up from $60.3 million in the same quarter last year.

During the fourth quarter, total revenues were $249.6 million, up from $230.0 million in the fourth quarter last year. Net income was $34.8 million, compared to $37.4 million in the fourth quarter last year. Earnings per share were 16 cents compared to 16 cents last year, based upon 224.4 million and 228.7 million shares outstanding, respectively.

Fourth Quarter Fiscal Year 2011 Highlights

During the fourth quarter, Compuware:

  • Announced that Frederick A. "Fritz" Henderson – Chairman of Suncoke Energy and Senior Vice President of Sunoco, Inc. – joined its Board of Directors.
  • Partnered with Troy, Michigan-based HTC Global Services, Inc. to provide application performance management solutions to customers worldwide.
  • Announced a new e-book in partnership with SPI Research, a recognized authority and research firm focused on the professional services industry, to produce a complimentary offering titled "Building Lasting Value: Growth Strategies for Professional Services Organizations."
  • Together with Gigamon, a leading global provider of intelligent data access networking™, announced a strategic partnership to help IT organizations ease network data access and improve application performance. This partnership will help IT organizations optimize network service quality while empowering them to improve network and application performance issue diagnosis and reporting.
  • Released the Compuware Gomez Performance Satisfaction Index top Web and mobile performers for the 2010 online holiday shopping season.
  • Announced that Mark Hillman, V.P. of Strategy and Product Line Management and Matt Poepsel, V.P. of Performance Strategies, would present at the Fusion 2011 CEO-CIO Symposium.
  • Announced that CTO, Paul Czarnik would present a session titled: "Performance Testing: Putting Cloud Customers Back in the Driver's Seat" at the Software Test Professionals Conference 2011 in Nashville, TN.

Use of Non-GAAP Financial Information

*Compuware acquired Gomez on November 9, 2009; only revenue following the acquisition date is included in the FY '11 GAAP comparisons of total APM license and subscription fees. The pro forma FY '11 comparison is presented as if the acquisition occurred as of the beginning of FY '10.

In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, the financial information included in and following this press release uses a non-GAAP measure for net income and earnings per share. Compuware management believes the non-GAAP financial information provided in this release is useful to investors' understanding and assessment of Compuware's ongoing core operations and prospects for the future. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Management uses both GAAP and non-GAAP information in operating and evaluating its business and as such has determined that it is important to provide this information to investors. A reconciliation of non-GAAP to GAAP information is contained in the financial statements following this press release.

Compuware Corporation

Compuware Corporation, the technology performance company, provides software, experts and best practices to ensure technology works well and delivers value. Compuware solutions make the world's most important technologies perform at their best for leading organizations worldwide, including 46 of the top 50 Fortune 500 companies and 12 of the top 20 most visited U.S. web sites. Learn more at: http://www.compuware.com .

The Compuware logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5950

Conference Call Information

Compuware will host a conference call to discuss these results at 5:00 p.m. Eastern time (21:00 GMT) today. To join the conference call, interested parties in the United States should call 800-230-1766. For international access, the conference call number is +1-612-332-0819. No password is required.

A conference call replay will also be available. The United States replay number will be 800-475-6701, and the international replay number will be +1-320-365-3844. The replay passcode will be 195564. Additionally, investors can listen to the conference call via webcast by visiting the Compuware Corporation Investor Relations web site at http://www.compuware.com .

Certain statements in this release that are not historical facts, including those regarding the Company's future plans, objectives and expected performance, are "forward-looking statements" within the meaning of the federal securities laws. These forward-looking statements represent our outlook only as of the date of this release. While we believe any forward-looking statements we have made are reasonable, actual results could differ materially since the statements are based on our current expectations and are subject to risks and uncertainties. These risks and uncertainties are discussed in the Company's reports filed with the Securities and Exchange Commission. Readers are cautioned to consider these factors when relying on such forward-looking information. The Company does not undertake, and expressly disclaims any obligation, to update or alter its forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.

COMPUWARE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
     
   AS OF MARCH 31, 
 ASSETS     
  2011 2010
 CURRENT ASSETS:     
 Cash and cash equivalents   $ 180,244  $ 149,897
 Accounts receivable, net   474,479  456,504
 Deferred tax asset, net   40,756  46,286
 Income taxes refundable   6,815  6,160
 Prepaid expenses and other current assets   40,446  46,434
 Total current assets   742,740  705,281
     
 PROPERTY AND EQUIPMENT, LESS ACCUMULATED     
 DEPRECIATION AND AMORTIZATION   333,166  341,696
     
 CAPITALIZED SOFTWARE AND OTHER     
 INTANGIBLE ASSETS, NET   83,001  84,755
     
 ACCOUNTS RECEIVABLE   206,887  222,344
 DEFERRED TAX ASSET, NET   35,754  38,969
 GOODWILL   607,765  591,870
 OTHER ASSETS   29,064  28,410
     
 TOTAL ASSETS   $ 2,038,377  $ 2,013,325
     
 LIABILITIES AND SHAREHOLDERS' EQUITY     
     
 CURRENT LIABILITIES:     
 Accounts payable   $ 18,931  $ 15,713
 Accrued expenses   105,242  110,732
 Income taxes payable   12,286  16,314
 Deferred revenue   462,376  469,834
 Total current liabilities   598,835  612,593
     
 DEFERRED REVENUE   393,780  398,515
     
 ACCRUED EXPENSES   28,016  33,193
     
 DEFERRED TAX LIABILITY, NET   65,134  55,211
 Total liabilities   1,085,765  1,099,512
     
 SHAREHOLDERS' EQUITY:     
 Common stock   2,177  2,250
 Additional paid-in capital   654,109  606,484
 Retained earnings   297,067  305,441
 Accumulated other comprehensive loss   (741)  (362)
 Total shareholders' equity   952,612  913,813
     
 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $ 2,038,377  $ 2,013,325
 
COMPUWARE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Data)
         
  THREE MONTHS ENDED TWELVE MONTHS ENDED
  MARCH 31, MARCH 31,
         
  2011 2010 2011 2010
REVENUES:        
 Software license fees  $ 55,650  $ 51,825  $ 194,745  $ 194,504
 Maintenance and subscription fees 124,030 117,899  486,958  456,343
 Professional services fees 69,871 60,274  247,227  241,332
 Total revenues 249,551 229,998 928,930 892,179
         
OPERATING EXPENSES:        
 Cost of software license fees 3,788 3,535  14,216  15,430
 Cost of maintenance and subscription fees 16,123 14,263  57,949  42,555
 Cost of professional services 61,130 52,812  216,950  216,861
 Technology development and support 24,379 25,568  90,330  91,245
 Sales and marketing 67,123 59,574  243,771  222,447
 Administrative and general 39,423 42,975  155,400  164,633
 Restructuring costs   3,118    7,960
 Gain on divestiture of product lines        (52,351)
 Total operating expenses 211,966 201,845 778,616 708,780
         
INCOME FROM OPERATIONS 37,585 28,153 150,314 183,399
         
OTHER INCOME        
 Interest income 1,289 1,093  4,456  4,970
 Settlement   20,734    20,734
 Other 70 65  6  17
         
OTHER INCOME, NET 1,359 21,892 4,462 25,721
         
INCOME BEFORE INCOME TAXES 38,944 50,045 154,776 209,120
         
INCOME TAX PROVISION 4,139 12,684  47,335  68,314
         
NET INCOME   $ 34,805  $ 37,361  $ 107,441  $ 140,806
         
DILUTED EPS COMPUTATION        
Numerator: Net income   $ 34,805  $ 37,361  $ 107,441  $ 140,806
Denominator:        
 Weighted-average common shares outstanding 217,949 226,306  220,616  232,634
 Dilutive effect of stock options 6,476 2,428  5,479  1,931
 Total shares 224,425 228,734 226,095 234,565
Diluted EPS  $ 0.16  $ 0.16  $ 0.48  $ 0.60
 
COMPUWARE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
     
  TWELVE MONTHS ENDED
  MARCH 31,
  2011 2010
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:    
 Net income  $ 107,441  $ 140,806
 Adjustments to reconcile net income to cash provided     
 by operations:    
 Gain on divestiture of product lines   (52,351)
 Depreciation and amortization 50,332 44,997
 Asset impairment   1,567
 Stock award compensation 18,768 17,444
 Deferred income taxes 22,874 12,141
 Other 610 1,242
 Net change in assets and liabilities, net of effects from acquisitions,    
 the divestiture and currency fluctuations:    
 Accounts receivable 16,119 64,487
 Prepaid expenses and other current assets 5,280 (4,470)
 Other assets 2,656 (2,666)
 Accounts payable and accrued expenses (16,409) (1,040)
 Deferred revenue (36,569) 17,455
 Income taxes (11,066) (13,300)
 Net cash provided by operating activities 160,036 226,312
     
CASH FLOWS USED IN INVESTING ACTIVITIES:    
 Purchase of:    
 Business, net of cash acquired (18,165) (284,393)
 Property and equipment (19,073) (9,576)
 Capitalized software (15,531) (9,778)
 Net proceeds from divestiture of product lines   64,992
 Net cash used in investing activities (52,769) (238,755)
     
CASH FLOWS USED IN FINANCING ACTIVITIES:    
 Proceeds from borrowings on credit facility   51,000
 Payments on credit facility   (51,000)
 Net proceeds from exercise of stock options including excess tax benefits 80,366 5,475
 Employee contribution to common stock purchase plans 2,504 2,215
 Repurchase of common stock (164,515) (132,941)
 Net cash used in financing activities (81,645) (125,251)
     
EFFECT OF EXCHANGE RATE CHANGES ON CASH 4,725 9,479
     
NET DECREASE IN CASH AND CASH EQUIVALENTS 30,347 (128,215)
     
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 149,897 278,112
     
CASH AND CASH EQUIVALENTS AT END OF PERIOD  $ 180,244  $ 149,897
 
COMPUWARE CORPORATION AND SUBSIDIARIES
OPERATIONAL HIGHLIGHTS
(Dollar Amounts In Thousands)
           
  QUARTER   QUARTER  
  ENDED   ENDED  
  MAR 31, YR - YR DEC 30, QTR - QTR
  2011 2010 % Chg 2010 % Chg
Products:          
Software License Fees:          
 Distributed License Fees:          
Vantage  $ 24,301  $ 16,988 43.0%  $ 21,059 15.4%
Changepoint  3,081  2,695 14.3%  1,545 99.4%
Uniface  4,793  2,713 76.7%  2,671 79.4%
Other  37  590 (93.7%)  155 (76.1%)
 Distributed License Fees  32,212  22,986 40.1%  25,430 26.7%
 Mainframe License Fees  23,438  28,839 (18.7%)  34,722 (32.5%)
Total Software License Fees  55,650  51,825 7.4%  60,152 (7.5%)
           
Maintenance and Subscription Fees:          
 Distributed Products  27,850  26,819 3.8%  28,879 (3.6%)
 Mainframe Products  77,231  79,993 (3.5%)  77,442 (0.3%)
 Subscription (Gomez)  18,949  11,087 70.9%  17,841 6.2%
Total Maintenance and Subscription Fees  124,030  117,899 5.2%  124,162 (0.1%)
           
Total Product Software Revenue:          
 Distributed Products  60,062  49,805 20.6%  54,309 10.6%
 Mainframe Products  100,669  108,832 (7.5%)  112,164 (10.2%)
 Subscription (Gomez)   18,949  11,087 70.9%  17,841 6.2%
Total Product Software Revenue   $ 179,680  $ 169,724 5.9%  $ 184,314 (2.5%)
           
Total Product Software Revenue by Geography          
North America  $ 95,541  $ 91,417 4.5%  $ 96,171 (0.7%)
International  $ 84,139  $ 78,307 7.4%  $ 88,143 (4.5%)
           
Total Cost of Product Software Revenue   $ 111,413  $ 102,940 8.2%  $ 103,973 7.2%
           
Deferred License Fees          
 Current  $ 41,725  $ 50,514 (17.4%)  $ 42,813 (2.5%)
 Long-term  $ 24,345  $ 43,350 (43.8%)  $ 28,650 (15.0%)
 Deferred During Quarter  $ 8,103  $ 7,729 4.8%  $ 9,188 (11.8%)
 Recognized During Quarter  $ 14,704  $ 18,342 (19.8%)  $ 15,620 (5.9%)
           
Professional Services:          
Professional Services Segment Fees  $ 52,626  $ 49,858 5.6%  $ 48,332 8.9%
Application Services Segment Fees  17,245  10,416 65.6%  14,379 19.9%
Total Professional Services Fees  $ 69,871  $ 60,274 15.9%  $ 62,711 11.4%
           
Professional Services Segment Contribution Margin  15.9% 14.7%   15.0%  
Application Services Segment Contribution Margin  2.3% 1.2%   11.5%  
Total Professional Services Fees Contribution Margin  12.5% 12.4%   14.2%  
           
Billable Professional Services Segment Headcount  1,312 1,218 7.7%  1,265 3.7%
Application Services Segment Headcount  300 305 (1.6%)  277 8.3%
           
Other:          
Total Company Headcount  4,396 4,336 1.4%  4,329 1.5%
           
Total DSO (Billed)   79.8  75.4    95.4  
Total DSO  171.1  178.6    188.6  
 
COMPUWARE CORPORATION AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP INFORMATION
(In Thousands, Except Per Share Data)
     
  TWELVE MONTHS ENDED
  MARCH 31,
     
Net income reconciliation: 2011 2010
     
GAAP net income  $ 107,441  $ 140,806
     
Gain on divestiture of product lines (a)  --   (33,850)
     
Settlement (b)  --   (13,270)
     
Net income as adjusted  $ 107,441  $ 93,686
     
EPS reconciliation:    
     
GAAP diluted EPS  $ 0.48  $ 0.60
     
Gain on divestiture of product lines (a)  --   (0.14)
     
Settlement (b)  --   (0.06)
     
Diluted EPS as adjusted  $ 0.48  $ 0.40
     
(a) Compuware divested its Quality and DevPartner product lines during the first quarter of fiscal 2010. For comparison purposes, the gain recorded as a result of this divestiture is being excluded from the twelve months ended March 31, 2010 period.
     
(b) Settlement relates to our settlement with IBM in March 2005 whereby IBM was committed to purchase software licenses and maintenance from the Company totaling $140 million over five years ending in fiscal 2010. The amount of the annual commitment not used to purchase software licenses and maintenance was recorded to other income. For comparison purposes, the portion of the settlement recorded to other income is being excluded from the twelve months ended March 31, 2010 period.
 
COMPUWARE CORPORATION AND SUBSIDIARIES
PRODUCT COMMITMENTS 
(In Thousands)
         
  QUARTER ENDED TWELVE MONTHS ENDED
  MARCH 31, MARCH 31, MARCH 31, MARCH 31,
  2011 2010 2011 2010
         
License fees  $ 55,650  $ 51,825  $ 194,745  $ 194,504
         
License fees - divested products (a)  --   --   --   (8,724)
         
License fees excluding divested products  55,650  51,825  194,745  185,780
         
Change in deferred license fees excluding divested products (a)  (6,601)  (10,613)  (31,269)  (17,929)
         
License contracts entered into during period excluding divested products  49,049  41,212  163,476  167,851
         
Maintenance and subscription fees   124,030  117,899  486,958  456,343
         
Maintenance fees - divested products (a)  --   --   --   (4,839)
         
Maintenance and subscription fees excluding divested products  124,030  117,899  486,958  451,504
         
Change in deferred maintenance and subscription fees excluding divested products (a)  45,778  28,324  (18,325)  19,351
         
Maintenance and subscription contracts & renewals entered into during period excluding      
divested products  169,808  146,223  468,633  470,855
         
Total products commitments during period excluding divested products  $ 218,857  $ 187,435  $ 632,109  $ 638,706
         
(a) Compuware divested its Quality and DevPartner product lines during the first quarter of fiscal 2010. For comparison purposes, the Products Commitments schedule excludes Quality and DevPartner license revenue, maintenance revenue and product commitments from the twelve months ended March 31, 2010 period.
         
As Compuware continues to emphasize solution selling, deals are becoming more complex, increasing the likelihood that software transactions will be recognized ratably over the maintenance term. Therefore to understand the health of Compuware's software business, we believe it is important to also consider the amount of product commitments during the reported periods.
CONTACT: Press Contact
         Lisa Elkin
         Vice President, Communications and Investor Relations
         +1-313-227-7345

© Copyright 2012, GlobeNewswire, Inc. All Rights Reserved

Discuss:

Discussion comments

,

Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 5.03%
$30K home equity loan FICO 5.68%
$75K home equity loan FICO 4.87%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 13.42%
13.42%
Cash Back Cards 17.94%
17.94%
Rewards Cards 17.15%
17.15%
Source: Bankrate.com