UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM 8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
|
Date of Report (Date of earliest event reported) |
July 28, 2010 |
FAIR
ISAAC CORPORATION
(Exact
name of registrant as specified in its charter)
|
Delaware |
1-11689 |
94-1499887 |
|
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
|
901 Marquette Avenue, Suite 3200 Minneapolis, Minnesota |
55402-3232 |
|
(Address of principal executive offices) |
(Zip Code) |
|
Registrant’s telephone number, including area code |
612-758-5200 |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
⃞ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
⃞ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
⃞ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
⃞ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
TABLE OF CONTENTS
| Item 2.02. Results of Operations and Financial Condition. |
| Item 9.01. Financial Statements and Exhibits. |
| Signature |
| Exhibit Index |
| Exhibit 99.1 |
| Item 2.02. | Results of Operations and Financial Condition. |
On July 28, 2010, Fair Isaac Corporation (the “Company”) reported its financial results for the quarter ended June 30, 2010. See the Company’s press release dated July 28, 2010, which is furnished as Exhibit 99.1 hereto and incorporated by reference in this Item 2.02.
| Item 9.01. | Financial Statements and Exhibits. |
|
(d) |
Exhibits. |
|
Exhibit |
Description |
| 99.1 | Press Release dated July 28, 2010 |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
FAIR ISAAC CORPORATION |
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By: |
/s/ THOMAS A. BRADLEY |
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Thomas A. Bradley |
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Executive Vice President and Chief Financial Officer |
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Date: |
July 28, 2010 |
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EXHIBIT INDEX
|
Exhibit No. |
Description |
Manner of Filing |
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|
99.1 |
Press Release dated July 28, 2010 |
Filed |
Exhibit 99.1
FICO Announces Earnings of $0.40 per Share for Fiscal Third Quarter 2010
Revenue of $155 million and bookings of $64 million
MINNEAPOLIS--(BUSINESS WIRE)--July 28, 2010--FICO (NYSE:FICO), the leading provider of analytics and decision management technology, today announced financial results for its third fiscal quarter ended June 30, 2010.
Third Quarter Fiscal 2010 Results
Net income for the quarter
totaled $17.9 million, or $0.40 per share. This compares with prior-year
period net income of $18.1 million, or $0.37 per share.
Third Quarter Fiscal 2010 Revenue
The company reported quarter
revenues of $155.3 million versus $156.0 million reported in the prior
year period. The prior year period included $5.0 million in revenue
associated with the telecom product lines, which have since been
divested.
“Performance was solid across all segments of our business, despite prevailing hesitation in the U.S. economy,” said Mark Greene, chief executive officer. “We continued to execute against our long-term growth strategy, releasing several new predictive analytic products, including FICO Debt Manager 8. We also made good progress in improving our sales execution.”
Revenues for third quarter fiscal 2010 across each of the company’s three operating segments were as follows:
- Applications revenues, which include the company’s preconfigured Decision Management applications and associated professional services, were $91.4 million in the third quarter compared to $94.6 million in the prior year quarter, a decrease of 3%, primarily due to the divestiture of $5.0 million of revenue associated with the telecom product lines. Excluding the divested product lines, revenue increased 2% due to an increase in revenue from fraud management solutions and Retail Action Manager, a component of Marketing Solutions.
- Scores revenues, which include the company’s business-to-business (B2B) scoring solutions and associated professional services, and the myFICO® business-to-consumer (B2C) service, were $46.5 million in the third quarter compared to $45.3 million in the prior year quarter, an increase of 3%, primarily due to an increase in revenues derived from the B2C service.
- Tools revenues, which include Blaze Advisor®, Xpress Optimization and related professional services, were $17.4 million in the third quarter compared to $16.1 million in the prior year quarter, an increase of 8%, primarily due to increases associated with a large license sale during the quarter.
Bookings
Bookings for the third quarter were $63.5 million
compared to $49.0 million in the same period last year. The company
defines a “new booking” as estimated future contractual revenues,
including agreements with perpetual, multi-year and annual terms.
Management regards new bookings as one indicator of future revenues, but
they are not comparable to, nor should they be substituted for, an
analysis of the company’s revenues.
Balance Sheet and Cash Flow
Cash and cash equivalents, and
investments were $271.9 million at June 30, 2010, as compared to $390.3
million at September 30, 2009. Significant changes in cash and cash
equivalents from September 30, 2009 include $84.0 million of cash
provided by operations, which was negatively impacted due to $30.9
million in working capital changes, $137.5 million of cash used to
repurchase common stock, $50 million related to repayment of the
revolving line of credit, $12.7 million related to the purchase of
property and equipment and $2.8 million of dividends paid.
Outlook
The Company reiterates the previously issued guidance
of year-over-year GAAP earnings per share growth by a high single-digit
percentage in fiscal 2010 compared to fiscal 2009, mainly as a result of
previously completed stock repurchases and cost controls.
Company to Host Conference Call
The company will host a
webcast today at 5:00 p.m. Eastern Time (4:00 p.m. Central Time/2:00
p.m. Pacific Time) to report its third quarter fiscal 2010 results and
provide various strategic and operational updates. The call can be
accessed at FICO's Web site at www.FICO.com (follow the
instructions on the Investor Relations page). A replay of the webcast
will be available through August 28, 2010.
The webcast will also be distributed through the Thomson StreetEvents Network to both institutional and individual investors. Individual investors can listen to the call at www.fulldisclosure.com, Thomson/CCBN's individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson's password-protected event management site, StreetEvents (www.streetevents.com).
About FICO
FICO (NYSE:FICO; www.FICO.com) is the leader
in decision management, transforming business by making every decision
count. FICO combines trusted advice, world-class analytics, and
innovative applications to help businesses automate, improve, and
connect decisions over customer lifecycles and across the enterprise.
Clients in 80 countries work with FICO to increase customer loyalty and
profitability, reduce fraud losses, manage credit risk, meet regulatory
and competitive demands, and rapidly build market share. FICO also helps
millions of individuals manage their credit health through its consumer
website, www.myFICO.com.
Statement Concerning Forward-Looking Information
Except for
historical information contained herein, the statements contained in
this news release that relate to FICO or its business are
forward-looking statements within the meaning of the “safe harbor”
provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements are subject to risks and uncertainties
that may cause actual results to differ materially, including the
success of the Company’s Decision Management strategy and reengineering
initiative, the maintenance of its existing relationships and ability to
create new relationships with customers and key alliance partners, its
ability to continue to develop new and enhanced products and services,
its ability to recruit and retain key technical and managerial
personnel, competition, regulatory changes applicable to the use of
consumer credit and other data, the failure to realize the anticipated
benefits of any acquisitions, continuing material adverse developments
in global economic conditions, and other risks described from time to
time in FICO’s SEC reports, including its Annual Report on Form 10-K for
the year ended September 30, 2009 and its last quarterly report on Form
10-Q for the period ended March 31, 2010. If any of these risks or
uncertainties materializes, FICO’s results could differ materially from
its expectations. FICO disclaims any intent or obligation to update
these forward-looking statements.
FICO, myFICO and Blaze Advisor are all trademarks or registered trademarks of Fair Isaac Corporation in the United States and in other countries.
| FAIR ISAAC CORPORATION | |||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||||
| For the Quarters and Nine Months Ended June 30, 2010 and 2009 | |||||||||||||||||
| (In thousands, except per share data) | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| Quarter Ended | Nine Months Ended | ||||||||||||||||
| June 30, | June 30, | ||||||||||||||||
| 2010 | 2009 | 2010 | 2009 | ||||||||||||||
| Revenues: | |||||||||||||||||
| Transactional and maintenance | $ | 115,902 | $ | 119,534 | $ | 344,709 | $ | 362,646 | |||||||||
| Professional services | 25,541 | 28,400 | 75,704 | 87,792 | |||||||||||||
| License | 13,886 | 8,084 | 30,132 | 28,375 | |||||||||||||
| Total revenues | 155,329 | 156,018 | 450,545 | 478,813 | |||||||||||||
| Operating expenses: | |||||||||||||||||
| Cost of revenues | 45,316 | 48,160 | 132,476 | 160,655 | |||||||||||||
| Research and development | 19,176 | 18,364 | 57,403 | 55,409 | |||||||||||||
| Selling, general and administrative | 57,077 | 50,290 | 165,977 | 157,519 | |||||||||||||
| Amortization of intangible assets | 2,683 | 3,219 | 8,918 | 9,622 | |||||||||||||
| Restructuring | - | (237 | ) | - | 8,711 | ||||||||||||
| Loss on sale of product line assets | - | 2,993 | - | 2,993 | |||||||||||||
| Total operating expenses | 124,252 | 122,789 | 364,774 | 394,909 | |||||||||||||
| Operating income | 31,077 | 33,229 | 85,771 | 83,904 | |||||||||||||
| Other expense, net | (4,368 | ) | (4,647 | ) | (13,507 | ) | (14,284 | ) | |||||||||
| Income from operations before income taxes | 26,709 | 28,582 | 72,264 | 69,620 | |||||||||||||
| Provision for income taxes | 8,771 | 10,443 | 23,648 | 21,263 | |||||||||||||
| Income from continuing operations | 17,938 | 18,139 | 48,616 | 48,357 | |||||||||||||
| Loss from discontinued operations | - | - | - | (363 | ) | ||||||||||||
| Net income | $ | 17,938 | $ | 18,139 | $ | 48,616 | $ | 47,994 | |||||||||
| Basic earnings per share: | |||||||||||||||||
| Continuing operations | $ | 0.40 | $ | 0.37 | $ | 1.05 | $ | 0.99 | |||||||||
| Discontinued operations | - | - | - | - | |||||||||||||
| Total | $ | 0.40 | $ | 0.37 | $ | 1.05 | $ | 0.99 | |||||||||
| Diluted earnings (loss) per share: | |||||||||||||||||
| Continuing operations | $ | 0.40 | $ | 0.37 | $ | 1.04 | $ | 0.99 | |||||||||
| Discontinued operations | - | - | - | (0.01 | ) | ||||||||||||
| Total | $ | 0.40 | $ | 0.37 | $ | 1.04 | $ | 0.98 | |||||||||
| Shares used in computing earnings (loss) per share: | |||||||||||||||||
| Basic | 44,446 | 48,835 | 46,171 | 48,707 | |||||||||||||
| Diluted | 44,885 | 48,986 | 46,561 | 48,777 | |||||||||||||
| FAIR ISAAC CORPORATION | |||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
| June 30, 2010 and September 30, 2009 | |||||||
| (In thousands) | |||||||
| (Unaudited) | |||||||
| June 30, | September 30, | ||||||
| 2010 | 2009 | ||||||
| ASSETS: | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 112,612 | $ | 178,157 | |||
| Marketable securities | 129,173 | 139,673 | |||||
| Accounts receivable, net | 107,804 | 101,742 | |||||
| Prepaid expenses and other current assets | 22,223 | 22,986 | |||||
| Total current assets | 371,812 | 442,558 | |||||
| Marketable securities and investments | 30,089 | 72,445 | |||||
| Property and equipment, net | 31,421 | 34,340 | |||||
| Goodwill and intangible assets, net | 689,854 | 705,895 | |||||
| Other assets | 39,221 | 48,650 | |||||
| $ | 1,162,397 | $ | 1,303,888 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY: | |||||||
| Current liabilities: | |||||||
| Accounts payable and other accrued liabilities | $ | 43,979 | $ | 46,776 | |||
| Accrued compensation and employee benefits | 31,421 | 28,139 | |||||
| Deferred revenue | 45,234 | 39,673 | |||||
| Current maturities on long-term debt | 8,000 | - | |||||
| Total current liabilities | 128,634 | 114,588 | |||||
| Revolving line of credit | 245,000 | 295,000 | |||||
| Senior notes | 267,000 | 275,000 | |||||
| Other liabilities | 14,647 | 19,031 | |||||
| Total liabilities | 655,281 | 703,619 | |||||
| Stockholders’ equity | 507,116 | 600,269 | |||||
| $ | 1,162,397 | $ | 1,303,888 | ||||
| FAIR ISAAC CORPORATION | |||||||||||||
| REVENUE BY SEGMENT | |||||||||||||
| For the Quarters and Nine Months Ended June 30, 2010 and 2009 | |||||||||||||
| (In thousands) | |||||||||||||
| (Unaudited) | |||||||||||||
| Quarter Ended | Nine Months Ended | ||||||||||||
| June 30, | June 30, | ||||||||||||
| 2010 | 2009 | 2010 | 2009 | ||||||||||
| Applications revenues: | |||||||||||||
| Transactional and maintenance | $ | 62,939 | $ | 67,991 | $ | 194,376 | $ | 206,683 | |||||
| Professional services | 21,500 | 24,077 | 62,583 | 70,697 | |||||||||
| License | 6,991 | 2,491 | 14,239 | 11,164 | |||||||||
| Total applications revenues | $ | 91,430 | $ | 94,559 | $ | 271,198 | $ | 288,544 | |||||
| Scores revenues: | |||||||||||||
| Transactional and maintenance | $ | 46,153 | $ | 44,832 | $ | 129,181 | $ | 136,262 | |||||
| Professional services | 352 | 472 | 1,411 | 1,229 | |||||||||
| License | - | - | - | - | |||||||||
| Total scores revenues | $ | 46,505 | $ | 45,304 | $ | 130,592 | $ | 137,491 | |||||
| Tools revenues: | |||||||||||||
| Transactional and maintenance | $ | 6,810 | $ | 6,711 | $ | 21,152 | $ | 19,701 | |||||
| Professional services | 3,689 | 3,851 | 11,710 | 15,866 | |||||||||
| License | 6,895 | 5,593 | 15,893 | 17,211 | |||||||||
| Total tools revenues | $ | 17,394 | $ | 16,155 | $ | 48,755 | $ | 52,778 | |||||
| Total revenues: | |||||||||||||
| Transactional and maintenance | $ | 115,902 | $ | 119,534 | $ | 344,709 | $ | 362,646 | |||||
| Professional services | 25,541 | 28,400 | 75,704 | 87,792 | |||||||||
| License | 13,886 | 8,084 | 30,132 | 28,375 | |||||||||
| Total revenues | $ | 155,329 | $ | 156,018 | $ | 450,545 | $ | 478,813 | |||||
| FAIR ISAAC CORPORATION | |||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||
| For the Nine Months Ended June 30, 2010 and 2009 | |||||||||
| (In thousands) | |||||||||
| (Unaudited) | |||||||||
| Nine Months Ended | |||||||||
| June 30, | |||||||||
| 2010 | 2009 | ||||||||
| Cash flows from operating activities: | |||||||||
| Net income | $ | 48,616 | $ | 47,994 | |||||
| Adjustments to reconcile net income to net cash provided by | |||||||||
| operating activities: | |||||||||
| Depreciation and amortization | 23,762 | 29,052 | |||||||
| Share-based compensation | 13,235 | 15,342 | |||||||
| Changes in operating assets and liabilities net of disposition effects | 649 | 31,520 | |||||||
| Other, net | (2,237 | ) | 438 | ||||||
| Net cash provided by operating activities | 84,025 | 124,346 | |||||||
| Cash flows from investing activities: | |||||||||
| Purchases of property and equipment | (12,746 | ) | (11,283 | ) | |||||
| Cash proceeds from divestitures | 2,182 | 1,000 | |||||||
| Net activity from marketable securities | 50,824 | (3,228 | ) | ||||||
| Other, net | 50 | 1,300 | |||||||
|
Net cash provided by (used in) investing activities |
40,310 | (12,211 | ) | ||||||
| Cash flows from financing activities: | |||||||||
| Payments on revolving line of credit | (50,000 | ) | - | ||||||
| Proceeds from issuances of common stock | 1,981 | 2,822 | |||||||
| Repurchases of common stock | (137,497 | ) | - | ||||||
| Other, net | (1,720 | ) | (2,802 | ) | |||||
| Net cash provided by (used in) financing activities | (187,236 | ) | 20 | ||||||
| Effect of exchange rate changes on cash | (2,644 | ) | (1,487 | ) | |||||
| Increase (decrease) in cash and cash equivalents | (65,545 | ) | 110,668 | ||||||
| Cash and cash equivalents, beginning of period | 178,157 | 129,678 | |||||||
| Cash and cash equivalents, end of period | $ | 112,612 | $ | 240,346 | |||||
CONTACT:
FICO
Investors/Analysts:
Michael Pung,
800-213-5542
investor@fico.com
or
Media:
Steve
Astle, 415-446-6204
stephenastle@fico.com