LivePerson Reports Fourth Quarter and Full Year 2009 Financial Results
- Fourth quarter revenue increased 26% from prior year and 11% sequentially
- Record EBITDA per share of $0.14 in fourth quarter
- Record EPS of $0.06 in fourth quarter
- Currently hosting over 1 billion visitor sessions per month across customer websites
NEW YORK, Feb. 10 /PRNewswire-FirstCall/ -- LivePerson, Inc. (Nasdaq: LPSN), a leading provider of online engagement solutions that facilitate real-time assistance and expert advice, today announced financial results for the fourth quarter and full year ended December 31, 2009.
Revenue
Revenue for the fourth quarter was $24.8 million, a 26% increase from the fourth quarter of 2008, and an 11% sequential increase as compared to the third quarter of 2009. Revenue from business operations for the fourth quarter was $21.4 million, a 24% increase as compared to the fourth quarter of 2008 and a 12% increase as compared to the third quarter of 2009. Revenue from consumer operations for the fourth quarter was $3.4 million, a 41% increase as compared to the fourth quarter of 2008, and a 9% increase as compared to the third quarter of 2009.
Revenue for the full year was $87.5 million, a 17% increase from $74.7 million in 2008. Revenue from business operations for the full year was $75.5 million, an 18% increase from $64.1 million in 2008. Revenue from consumer operations for the full year was $11.9 million, a 13% increase from $10.6 million in 2008.
"We had a great quarter, with all facets of the business contributing to top line growth," said LivePerson CEO Robert LoCascio. "Revenue and earnings for both the quarter and year have surpassed our expectations, driven by a balanced mix of geographic expansion, new account acquisition and existing account penetration. Our sound sales strategy coupled with strong cost management across the organization place us in a solid position to continue driving growth in 2010 and beyond."
Customer Expansion
LivePerson added 14 new large enterprise clients in the quarter, including:
- A major American sporting goods company
- Crate & Barrel
- One of the world's leading long-haul airlines
- A leading worldwide provider of IT services and solutions
- One of the leading US-based health and benefits providers
The Company also expanded business with
- Three new geographies for a leading global wireless provider
- A leading multinational entertainment and media enterprise
- AT&T Mobility
- Verizon
- The world leader in digital and analog technology
- Several US-based banks including PNC Bank, Chase and Charles Schwab
Net Income/(Loss)
Net income for the fourth quarter of 2009 was $3.1 million or $0.06 per share as compared to a net loss of $23.8 million or $0.50 per share in the fourth quarter of 2008, and net income of $2.3 million or $0.05 per share in the third quarter of 2009. Net income for the full year was $7.8 million or $0.16 per share, as compared to a net loss of $23.8 million or $0.50 per share in the prior year.
Financial results in the fourth quarter of 2008 and the full year 2008 included a goodwill impairment charge of $23.5 million or $0.50 per share related to the company's consumer operations. This charge was a non-cash item, and therefore had no impact on the company's cash flows.
Adjusted Net Income and EBITDA
LivePerson considers adjusted net income and earnings before other income/(expense), taxes, depreciation, amortization and stock-based compensation (EBITDA) to be important financial indicators of the company's operational strength and the performance of its business. These results should be considered in addition to results prepared in accordance with generally accepted accounting principles (GAAP), but should not be considered as a substitute for, or superior to, GAAP results.
A reconciliation of the differences between EBITDA and adjusted net income, and the most comparable financial measure calculated and presented in accordance with GAAP, is presented under the heading "Reconciliation of Non-GAAP Financial Information to GAAP" immediately following the Condensed Consolidated Statements of Operations included below.
The difference between EBITDA per share, a non-GAAP measure, and GAAP EPS, is interest, taxes, depreciation, amortization, stock-based compensation and other non-cash charges, if any. The difference between adjusted net income per share and GAAP EPS is amortization of intangible assets and stock-based compensation.
Adjusted net income for the fourth quarter of 2009 was $4.7 million or $0.09 per share, as compared to $1.3 million or $0.03 per share in the fourth quarter of 2008, and $3.9 million or $0.08 per share in the third quarter of 2009. Adjusted net income for the full year was $14.5 million or $0.30 per share, as compared to $6.6 million or $0.14 per share in the prior year.
EBITDA for the fourth quarter of 2009 was $7.1 million or $0.14 per share, as compared to $3.5 million or $0.07 per share in the fourth quarter of 2008, and $6.2 million or $0.12 per share in the third quarter of 2009. EBITDA for the full year 2009 was $22.8 million or $0.47 per share, as compared to $9.9 million or $0.20 per share in the prior year.
Cash
The company's cash balance was $45.6 million at December 31, 2009 as compared to $36.5 million as of September 30, 2009, and $25.5 million at December 31, 2008. The company generated $8.2 million of cash from operations in the fourth quarter. Also during the fourth quarter, the company incurred planned capital expenditures related primarily to the purchase of servers and computer networking equipment, resulting in a cash outlay of approximately $1.4 million. For the full year, the company generated $21.0 million of cash from operations, and incurred planned capital expenditures related primarily to the purchase of servers and computer networking equipment, resulting in a cash outlay of approximately $5.4 million.
Financial Expectations
Following is the Company's current expectation for financial and operating performance:
First Quarter 2010
- Revenue of $25.0 - $25.2 million
- EBITDA of $0.11 - $0.12 per share
- Adjusted net income per share of $0.06 - $0.07
- GAAP EPS of $0.02 - $0.03
- Fully diluted share count of approximately 51 million
Full Year 2010
- Revenue of $105 - $107 million
- EBITDA of $0.50 - $0.52 per share
- Adjusted net income per share of $0.30 - $0.32
- GAAP EPS of $0.16 - $0.18
- Fully diluted share count of approximately 51.5 million
Other Full Year 2010 Assumptions
- Amortization of intangibles of approximately $1.5 million
- Stock-compensation expense of approximately $6 million
- Depreciation of approximately $6 million
- Effective tax rate of approximately 40%
- Cash tax rate of approximately 40%
- Capital expenditures of approximately $6.0 - $7.0 million
Stock-Based Compensation
Included in the accompanying financial results are expenses related to stock-based compensation, as follows (in thousands):
Q4 2009 FY 2009
------- -------
Cost of revenue $211 $790
Product development 372 1,402
Sales and marketing 376 1,337
General and administrative 276 1,197
--- -----
Total $1,235 $4,726
Amortization of Intangible Assets
Included in the accompanying financial results are expenses related to the amortization of intangible assets, as follows (in thousands):
Q4 2009 FY 2009
------- -------
Cost of revenue $307 $1,228
General and administrative 83 745
-- ---
Total $390 $1,973
Earnings Teleconference and Video Discussion Information
The company will discuss its fourth quarter and full year 2009 financial results during a teleconference today, February 10, 2010, at 5:00 p.m. ET. To participate, please call 877-507-3684 before 5:00 p.m. ET. International callers, please dial 706-634-9559. Please reference the conference ID "53817749."
If you are unable to participate, the teleconference will be available for replay at 6:00 p.m. ET on February 10, 2010 until May 10, 2010. To access the replay, please call 800-642-1687 (U.S. and Canada) or 706-645-9291 (international). Please reference the conference ID "53817749."
The company will post a video discussion of its fourth quarter 2009 results on YouTube. To view, click on the following link: http://www.youtube.com/user/myliveperson.
LivePerson, Inc.
Condensed Consolidated Statements of Operations
(In Thousands, Except Share and Per Share Data)
Unaudited
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2009 2008 2009 2008
---- ---- ---- ----
Revenue $24,768 $19,607 $87,490 $74,655
------- ------- ------- -------
Operating expenses:
Cost of revenue 6,068 4,961 21,076 20,307
Product development 3,163 3,023 12,111 12,899
Sales and marketing 7,408 7,259 27,355 26,124
General and
administrative 3,427 3,008 13,417 13,042
Amortization of
intangibles 83 273 745 1,407
Goodwill impairment - 23,501 - 23,501
--- ------ --- ------
Total operating
expenses 20,149 42,025 74,704 97,280
------ ------ ------ ------
Income (loss) from
operations 4,619 (22,418) 12,786 (22,625)
Other (expense)
income, net (35) (192) 14 (47)
--- ---- -- ---
Income (loss) before
provision for income
taxes 4,584 (22,610) 12,800 (22,672)
Provision for income
taxes 1,493 1,234 5,037 1,165
----- ----- ----- -----
Net income (loss) $3,091 $(23,844) $7,763 $(23,837)
====== ======== ====== ========
Basic net income
(loss) per common
share $0.06 $(0.50) $0.16 $(0.50)
===== ====== ===== ======
Diluted net income
(loss) per common
share $0.06 $(0.50) $0.16 $(0.50)
===== ====== ===== ======
Weighted average shares
outstanding used in
basic net income (loss)
per common share
calculation 48,786,986 47,411,354 47,962,688 47,428,251
========== ========== ========== ==========
Weighted average shares
outstanding used in
diluted net income
(loss) per common
share calculation 51,065,181 47,411,354 49,008,440 47,428,251
========== ========== ========== ==========
LivePerson, Inc.
Reconciliation of Non-GAAP Financial Information to GAAP
(In Thousands, Except Share and Per Share Data)
Unaudited
Unaudited Supplemental Data
---------------------------
The following information is not a financial measure under generally
accepted accounting principles (GAAP). In addition, it should not be
construed as an alternative to any other measures of performance
determined in accordance with GAAP, or as an indicator of our operating
performance, liquidity or cash flows generated by operating, investing and
financing activities as there may be significant factors or trends that it
fails to address. We present this financial information because we believe
that it is helpful to some investors as one measure of our operations. We
caution investors that non-GAAP financial information, by its nature,
departs from traditional accounting conventions; accordingly, its use can
make it difficult to compare our results with our results from other
reporting periods and with the results of other companies.
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2009 2008 2009 2008
---- ---- ---- ----
Net income (loss) in
accordance with generally
accepted accounting
principles $3,091 $(23,844) $7,763 $(23,837)
Add/(less):
(a) Goodwill
impairment - 23,501 - 23,501
(b) Amortization
of intangibles 390 579 1,973 2,634
(c) Stock-based
compensation 1,235 1,088 4,726 4,266
(d) Depreciation 899 768 3,347 2,093
(e) Provision for
(benefit from)
income taxes 1,493 1,234 5,037 1,165
(f) Other (income)
expense, net 35 192 (14) 47
-- --- --- --
EBITDA (1) $7,143 $3,518 $22,832 $9,869
====== ====== ======= ======
Diluted EBITDA per
common share $0.14 $0.07 $0.47 $0.20
===== ===== ===== =====
Weighted average shares
used in diluted EBITDA
per common share 51,065,181 48,116,364 49,008,440 48,573,455
========== ========== ========== ==========
Net income (loss) in
accordance with generally
accepted accounting
principles $3,091 $(23,844) $7,763 $(23,837)
Add:
(a) Goodwill
impairment - 23,501 - 23,501
(b) Amortization
of intangibles 390 579 1,973 2,634
(c) Stock-based
compensation 1,235 1,088 4,726 4,266
----- ----- ----- -----
Adjusted net income $4,716 $1,324 $14,462 $6,564
====== ====== ======= ======
Diluted adjusted net
income per common
share $0.09 $0.03 $0.30 $0.14
===== ===== ===== =====
Weighted average shares
used in diluted adjusted
net income per
common share 51,065,181 48,116,364 49,008,440 48,573,455
========== ========== ========== ==========
EBITDA $7,143 $3,518 $22,832 $9,869
Add/(less):
(a) Changes in
operating assets
and liabilities 308 609 293 271
(b) Provision for
doubtful accounts 25 80 55 148
(c) (Provision
for) benefit from
income taxes (1,493) (1,234) (5,037) (1,165)
(d) Deferred
income taxes 2,229 (1,051) 2,865 (1,091)
(e) Other income
(expense), net (35) (192) 14 (47)
--- ---- -- ---
Net cash provided by
operating activities $8,177 $1,730 $21,022 $7,985
====== ====== ======= ======
(1) Earnings/(loss) before other income/(expense), taxes, depreciation,
amortization, stock-based compensation and other non-cash charges.
LivePerson, Inc.
Condensed Consolidated Balance Sheets
(In Thousands)
Unaudited
December 31, 2009 December 31, 2008
----------------- -----------------
ASSETS
Current assets:
Cash and cash equivalents $45,572 $25,500
Accounts receivable, net 10,265 7,574
Prepaid expenses and other
current assets 3,661 1,706
Deferred tax assets, net 1,460 1,772
----- -----
Total current assets 60,958 36,552
Property and equipment, net 9,551 7,473
Intangibles, net 2,821 4,319
Goodwill 23,920 24,388
Deferred tax assets, net 4,777 7,330
Deferred implementation costs 136 147
Security deposits 326 349
Other assets 1,792 1,390
----- -----
Total assets $104,281 $81,948
======== =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $5,375 $3,555
Accrued expenses 10,895 9,088
Deferred revenue 4,692 3,985
----- -----
Total current liabilities 20,962 16,628
Deferred revenue, net of current 506 347
Other liabilities 1,676 1,390
----- -----
Total liabilities 23,144 18,365
------ ------
Commitments and contingencies
Total stockholders' equity 81,137 63,583
------ ------
Total liabilities and
stockholders' equity $104,281 $81,948
======== =======
About LivePerson
LivePerson is a leading provider of online engagement solutions that facilitate real-time assistance and expert advice. Connecting businesses and experts with consumers seeking help on the Web, LivePerson's hosted software platform creates more relevant, compelling and personalized online experiences. Every month, LivePerson's intelligent platform helps millions of people succeed online; more than 8,000 companies, including EarthLink, Hewlett-Packard, Microsoft, Qwest, and Verizon, rely on LivePerson to maximize the impact of the online channel. LivePerson is headquartered in New York City.
Non-GAAP Financial Disclosure
Investors are cautioned that the EBITDA, or earnings/(loss) before other income/(expense), taxes, depreciation, amortization and stock-based compensation, and adjusted net income, or net income excluding amortization of intangible assets and stock-based compensation, information contained in this press release are not financial measures under generally accepted accounting principles. In addition, they should not be construed as alternatives to any other measures of performance determined in accordance with generally accepted accounting principles, or as indicators of our operating performance, liquidity or cash flows generated by operating, investing and financing activities, as there may be significant factors or trends that they fail to address. We present this financial information because we believe that it is helpful to some investors as a measure of our performance. We caution investors that non-GAAP financial information, by its nature, departs from traditional accounting conventions; accordingly, its use can make it difficult to compare our current results with our results from other reporting periods and with the results of other companies.
Safe Harbor Provision
Statements in this press release regarding LivePerson that are not historical facts are forward-looking statements and are subject to risks and uncertainties that could cause actual future events or results to differ materially from such statements. Any such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. It is routine for our internal projections and expectations to change as the quarter and year progresses, and therefore it should be clearly understood that the internal projections and beliefs upon which we base our expectations may change. Although these expectations may change, we are under no obligation to inform you if they do. Actual events or results may differ materially from those contained in the projections or forward-looking statements. Some of the factors that could cause actual results to differ materially from the forward-looking statements contained herein include, without limitation: risks related to the operational integration of acquisitions; risks related to our increased operations in the direct-to-consumer market; risks related to our international operations, particularly our operations in Israel, and the civil and political unrest in that region; volatility of the value of certain currencies in relation to the US dollar, particularly the New Israeli Shekel, U.K. pound and Euro; our history of losses; potential fluctuations in our quarterly and annual results; impairments to goodwill that result in significant charges to earnings; responding to rapid technological change and changing client preferences; competition in the real-time sales, marketing, customer service and online engagement solutions market; continued use by our clients of the LivePerson services and their purchase of additional services; technology systems beyond our control and technology-related defects that could disrupt the LivePerson services; risks related to adverse business conditions experienced by our clients; our dependence on key employees; competition for qualified personnel; the impact of new accounting rules, including the requirement to expense stock options; the possible unavailability of financing as and if needed; risks related to protecting our intellectual property rights or potential infringement of the intellectual property rights of third parties; our dependence on the continued use of the Internet as a medium for commerce and the viability of the infrastructure of the Internet; and risks related to the regulation or possible misappropriation of personal information. This list is intended to identify only certain of the principal factors that could cause actual results to differ from those discussed in the forward-looking statements. Readers are referred to the reports and documents filed from time to time by us with the Securities and Exchange Commission for a discussion of these and other important risk factors that could cause actual results to differ from those discussed in forward-looking statements.
SOURCE LivePerson, Inc.
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