MicroStrategy Announces Fourth Quarter 2009 Financial Results
44% Increase in Net Income Year-Over-Year
Diluted Earnings Per Share of $1.66
MCLEAN, Va., Feb. 3 /PRNewswire-FirstCall/ -- MicroStrategy® Incorporated (Nasdaq: MSTR), a leading worldwide provider of business intelligence software, today announced financial results for the three-month period ended December 31, 2009 (the fourth quarter of its 2009 fiscal year).
Fourth quarter 2009 revenues were $105.8 million versus $95.0 million for the fourth quarter of 2008, an 11% increase. Product licenses revenues for the fourth quarter of 2009 were $30.0 million versus $28.0 million for the fourth quarter of 2008, a 7% increase. Product support and other services revenues for MicroStrategy's core business intelligence (BI) business in the fourth quarter of 2009 were $71.5 million versus $64.0 million for the fourth quarter of 2008, a 12% increase.
Operating expenses for the fourth quarter of 2009 were $59.8 million versus $57.6 million for the fourth quarter of 2008, a 4% increase. During the fourth quarter of 2008, MicroStrategy capitalized $5.5 million in research and development costs associated with the development of its MicroStrategy 9™ software, while no software development costs have been capitalized since the general release of MicroStrategy 9 in March 2009.
Income from continuing operations before financing and other income and income taxes for the fourth quarter of 2009 was $26.6 million, or 25% of revenue, versus $21.3 million, or 22% of revenue, for the fourth quarter of 2008, a 25% increase. Net income for the fourth quarter of 2009 was $20.5 million, or $1.66 per share on a diluted basis, compared to $14.3 million, or $1.17 per share on a diluted basis, for the fourth quarter of 2008, a 44% increase.
For the fourth quarter of 2009, MicroStrategy's effective tax rate on income from continuing operations was 24% compared to 38% for the fourth quarter of 2008. The lower effective tax rate in the fourth quarter of 2009 was primarily attributable to increased research and development tax credits and stronger results outside the U.S.
As of December 31, 2009, MicroStrategy had cash and cash equivalents of approximately $224.8 million versus $122.9 million as of December 31, 2008, an increase of $101.9 million. As of December 31, 2009, MicroStrategy had 9,255,072 shares of class A common stock and 2,694,362 shares of class B common stock outstanding.
Announcement of MicroStrategy 9 Release 2:
MicroStrategy's latest software release was made generally available on January 22, 2010, and announced at the Company's annual user conference in Las Vegas on January 26, 2010.
MicroStrategy 9 Release 2 specifically supports the emerging and demanding needs of the new generation of Mobile Intelligence applications. Mobile Intelligence is being driven by the growth of the Mobile Internet and by the accelerating growth in mobile devices such as the Apple iPhone, iTouch, and iPad; RIM's BlackBerry; Motorola's Droid; and Google's Nexus One. Mobile Intelligence applications demand much faster performance and serve much larger user populations than traditional wired Internet applications.
"MicroStrategy is well positioned to support the escalating growth of Mobile Intelligence with our latest software release," said Michael Saylor, President and CEO of MicroStrategy. "We have focused on creating a world-class business intelligence architecture that is designed to provide the speed and performance our customers expect in the Mobile Internet era. Unlike various competitors, we have not been distracted by acquisitions and the need to refit technology into the product suite of a parent company."
High Performance at High Scale
MicroStrategy 9 Release 2 includes significant enhancements that make information flow much faster to business users, even at the highest scale of usage:
- MicroStrategy's enhanced in-memory BI technology can deliver up to four times the performance as MicroStrategy 9 Release 1.
- Testing done in MicroStrategy's High Performance Benchmark Laboratory has shown that MicroStrategy's enhanced technology can deliver better than 2-second average response times for Mobile Intelligence applications supporting 1 million users.
- Business users will see up to two times faster performance for their common report manipulations such as sorting, filtering, slicing, and calculations; and faster navigation, browsing, and searching.
- Dashboard users will experience faster dashboard load times and faster dashboard interactivity as a result of enhanced data compression algorithms and new rendering algorithms.
Deliver More BI with Less Effort
MicroStrategy's latest release offers numerous enhancements that enable IT staff to deliver more information with less effort, resulting in a lower total cost of ownership:
- Companies can rapidly create new BI applications using MicroStrategy's Jump-Start Project™, which includes more than 30 pre-designed reports and dashboards that can be directly connected to existing databases, providing people with immediate use of their new BI application.
- The new Graphical Architect™ features auto-modeling heuristics that make project setup as much as eight times faster for new BI applications, reducing the time to create BI applications from days or weeks to hours.
- MicroStrategy Health Center™ automatically scans all MicroStrategy servers to anticipate and correct system problems, improving system performance and uptime.
- DashboardApps™, MicroStrategy's next generation dashboard application, delivers easy-to-use dashboards to thousands of business users every day. DashboardApps do not require any training or special software to install, and can contain an entire day's worth of information for BI users within a single dashboard.
MicroStrategy is planning to host a series of 50+ events to launch its latest software release. More information is available at http://www.microstrategy.com/Software/businessintelligence.
MicroStrategy World 2010:
MicroStrategy held its 13th annual user conference, MicroStrategy World 2010, January 25-28 in Las Vegas, Nevada.
CEO Michael Saylor delivered the keynote presentation on the first day of the conference and described MicroStrategy's drive to capitalize on the evolution toward Mobile Intelligence. Saylor said, "Computing is entering its fifth generation in which desktop Internet applications are giving way to a new generation of Mobile Internet applications. In the Mobile Internet age, applications which were mildly successful when used at one's desk, suddenly become incredibly effective and valuable when consumed on the go, anywhere and anytime business is being conducted. Mobile information access will likely eclipse desktop information access in the near future. This heightened level of usage, combined with the richness of the mobile interface, will change the way information is consumed and MicroStrategy intends to be at the forefront of this wave. MicroStrategy 9 is designed to outperform competitive BI architectures, and is well-suited to provide intelligence in the age of the Mobile Internet. Our goal is to enable our customers to deliver Mobile Intelligence ahead of their competition to their employees, their suppliers, and their customers."
The event featured more than 100 educational sessions, an exhibit hall showcasing MicroStrategy partners, and an update on the Company's latest technology advances. Executives from more than 25 world-class companies presented their success strategies and experiences using BI to enhance business performance. Some of the companies that presented at MicroStrategy World 2010 included 24 Hour Fitness, AARP, Allstate Insurance, AutoTrader.com, Barclays, Cabela's, Con-way Freight, eBay, Edmunds.com, GUESS?, Lowe's Companies, Pacific Sunwear, Payless ShoeSource, Ryder System, Travelers Insurance, and Yahoo!.
At the conference, MicroStrategy recognized Citigroup's Brian L. Fox as the recipient of the MicroStrategy Individual Excellence in Business Intelligence award. Fox was recognized for his use of information dashboards to deliver advanced program analytics to Citi's customers. MicroStrategy also recognized five companies for achieving outstanding business performance with their MicroStrategy-based business intelligence applications:
AmerisourceBergen: AmerisourceBergen was recognized in the Extranet Deployment category for its InSite system, powered by MicroStrategy technology. The InSite system supports AmerisourceBergen's community pharmacy clients across the U.S. with powerful dashboards and scorecards that provide rich analytics and tailored information. The extranet allows pharmacy owners to quickly identify suspect claims that may contribute to profit leakage, and uncover opportunities to expand their business and reduce unnecessary costs. AmerisourceBergen is one of the world's largest pharmaceutical services companies, with operations primarily in the United States and Canada.
Con-way Freight: Con-way Freight was the award recipient in the Advanced Analytics category. Approximately 1,200 knowledge workers at Con-way Freight spanning all departments rely on MicroStrategy to access the company's corporate data assets. Con-way Freight uses advanced regression models to anticipate customer behavior. To continually evaluate its freight network and reduce waste, Con-way Freight has created an optimization model to monitor and enhance the flow of freight. Con-way Freight is the industry's leading less-than-truckload (LTL) freight transportation company.
Yahoo!, Inc.: Yahoo!, Inc. was recognized in the Data Scalability category. A MicroStrategy customer since 2002, Yahoo! uses MicroStrategy's software to analyze petabytes of Web traffic and ecommerce data. Yahoo! analysts generate an array of dashboards and reports to optimize the company's Web sites. Yahoo! attracts hundreds of millions of users every month through its innovative technology and engaging content and services, making it one of the most trafficked Internet destinations.
Lowe's Companies: Lowe's Companies was the award recipient in the User Scalability category. Lowe's is the second-largest home improvement retailer in the world, serving approximately 14 million customers per week. Lowe's currently has a number of MicroStrategy-based BI applications that support over 16,000 employees across a variety of business functions. Current MicroStrategy-based BI applications at Lowe's include DART (Data Access and Reporting Tool), which provides employees with greater insight into key performance metrics. Lowe's recently expanded its deployment of MicroStrategy to support a new business intelligence application for its store management, and relies on MicroStrategy 9 to provide store management teams with access to key reports and business metrics.
Ross Stores, Inc.: Ross Stores, Inc. was recognized in the Enterprise Deployment category. Across its enterprise, Ross Stores has deployed eight large-scale MicroStrategy applications, primarily focused on Merchandising, Store Operations, Store Scorecarding, Loss Prevention, and Supply Chain Efficiencies. In addition, Ross Stores relies on the MicroStrategy platform to provide labor management reporting. Ross Stores, Inc. is the nation's second largest off-price retailer with more than 1,000 stores in 27 states.
New Customers and New Deals with Existing Customers in Q4 2009 Included:
24 Hour Fitness; Aeropostale; AstraZeneca; Bank of America; Bayer HealthCare Pharmaceuticals; Bell Canada; Cabela's; Classic Residence by Hyatt; Comcast Entertainment Group; CompuCom Systems; Darden Restaurants; Dell Computer Corporation; Department of the Navy; Deutsche Bank Securities; Diageo North America; E. & J. Gallo Winery; eBay; Farmer Brothers Company; Fox Interactive Media; Freddie Mac; Fruit of the Loom; General Dynamics Advanced Information Systems; Marriott International; McDonald's Corporation; Meredith Corporation; Metropolitan Life Insurance Co.; Netflix; NV Energy; PepsiCo; Pfizer Global Manufacturing; QVC; Ryder System; Safeway; Sears Holdings Management Corporation; Starwood Hotels & Resorts Worldwide; The Cheesecake Factory; The Container Store; Thomson Reuters Markets; Wachovia Dealer Services; Yahoo!
Examples of Customer Deals from Q4 2009:
CompuCom
CompuCom, a leading IT outsourcing company, has chosen MicroStrategy as its BI platform to provide sales, services, and financial reporting capabilities. CompuCom plans to consolidate two disparate BI reporting tools and use MicroStrategy as its single business intelligence platform. With MicroStrategy, CompuCom end users, including Sales Analysts, Financial Analysts, and Customer Representatives, will have detailed insights into vital data related to their business areas. CompuCom personnel will be able to take advantage of MicroStrategy's intuitive "drill anywhere" feature, which enables users to rapidly generate reports by surfing through the data warehouse for new combinations of the data they need. By consolidating its reporting environment on MicroStrategy, CompuCom will be able to reduce the overall number of reports required, as well as reduce the time needed to maintain its BI infrastructure.
Farmer Brothers Company
Farmer Brothers Co. is the nation's largest direct-store delivery business for coffee and allied products. Farmer Brothers recently expanded its deployment of MicroStrategy for enhanced operational reporting and analytics. Farmer Brothers Co. employees will use MicroStrategy reports and information dashboards to uncover insight into financials, sales order processing, manufacturing, procurement, inventory, and human resources. MicroStrategy will also be used by Farmer Brothers' personnel across the organization, including the CEO, COO, CFO, Controller, VP Finance, VP Sales, and Sales staff, as well as by manufacturing, financial, HR, and operations users.
Starwood Hotels & Resorts Worldwide, Inc.
Starwood Hotels & Resorts Worldwide, Inc. is one of the world's leading hotel and leisure companies with approximately 991 properties in more than 100 countries and 145,000 employees at its owned and managed properties. Starwood has expanded its deployment of MicroStrategy for business intelligence reporting and analytics. Starwood relies on MicroStrategy to analyze reservation and guest information and uncover patterns and trends. More than 3,000 Starwood personnel use MicroStrategy's highly-visual information dashboards and content-rich reports for valuable insights into its key business areas, including revenue management, reservations, property management, and brand analysis. Starwood also relies on MicroStrategy for market performance analysis, owner relations, operations, strategic account management, and global sales analysis.
MicroStrategy Customers Delivered Impressive Sales Growth during Recession, According to Aberdeen Group Report:
Aberdeen Group published a report citing that MicroStrategy customers indicated strong sales growth between September 2008 and July 2009 as compared to the industry average. According to the report, customers using MicroStrategy software achieved a 6% increase in sales during the time period as compared to an industry average of a 4% decline in sales revenue. Among large BI vendors in the survey, only MicroStrategy customers experienced significant sales growth.
The report also found:
- MicroStrategy customers were 23% more likely than the industry average to have insight into their marketing spending and 29% more likely than the industry average to be able to connect the marketing investment to sales revenues.
- MicroStrategy customers exhibit a much stronger use of enterprise-wide BI (63%) than the industry average of 48%.
Aberdeen Group's report investigated different strategies and tactics that companies used to manage business performance during the recession. Elaborating on MicroStrategy's customers, the report states, "…not only do they know how and where they spend their marketing budget, but they can gauge the contribution of that expenditure to the success of the organization."
About MicroStrategy Incorporated
Founded in 1989, MicroStrategy is a global leader in business intelligence (BI) technology. MicroStrategy provides integrated reporting, analysis, and monitoring software that helps leading organizations worldwide make better business decisions every day. Companies choose MicroStrategy for its ease-of-use, sophisticated analytics, and superior data and user scalability. MicroStrategy offers free reporting software that can be downloaded from its website, http://www.microstrategy.com/freereportingsoftware. More information about MicroStrategy (Nasdaq: MSTR) is available at www.microstrategy.com.
MicroStrategy, MicroStrategy 9, MicroStrategy DashboardApps, MicroStrategy Health Center, MicroStrategy Graphical Architect and MicroStrategy Jump-Start Project are either trademarks or registered trademarks of MicroStrategy Incorporated in the United States and certain other countries. Other product and company names mentioned herein may be the trademarks of their respective owners.
This press release may include statements that may constitute "forward-looking statements," including estimates of future business prospects or financial results and statements containing the words "believe," "estimate," "project," "expect" or similar expressions. Forward-looking statements inherently involve risks and uncertainties that could cause actual results of MicroStrategy Incorporated and its subsidiaries (collectively, the "Company") to differ materially from the forward-looking statements. Factors that could contribute to such differences include: the Company's ability to recognize deferred revenue through delivery of products or satisfactory performance of services; continued acceptance of the Company's products in the marketplace; the timing of significant orders; delays in the Company's ability to develop or ship new products; market acceptance of new products; competitive factors; general economic conditions, including significant downturns in industries, including the financial services and retail industries, in which we have a significant number of customers; currency fluctuations; and other risks detailed in the Company's registration statements and periodic reports filed with the Securities and Exchange Commission. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release.
Contact:
MicroStrategy Incorporated
Investor Relations
[email protected]
(703) 848-8600
MSTR-F
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2009 2008 2009 2008
---- ---- ---- ----
(unaudited) (unaudited) (unaudited) (audited)
Revenues
Product licenses $29,959 $27,959 $101,856 $95,924
Product support and
other services 75,813 67,046 275,932 264,469
------ ------ ------- -------
Total revenues 105,772 95,005 377,788 360,393
------- ------ ------- -------
Cost of Revenues
Product licenses 2,084 434 6,607 1,877
Product support and
other services 17,382 15,631 59,996 61,529
------ ------ ------ ------
Total cost of revenues 19,466 16,065 66,603 63,406
------ ------ ------ ------
Gross profit 86,306 78,940 311,185 296,987
------ ------ ------- -------
Operating Expenses
Sales and marketing 35,096 37,624 128,472 137,683
Research and development 11,389 6,122 41,796 30,571
General and
administrative 13,265 13,878 54,613 60,933
------ ------ ------ ------
Total operating
expenses 59,750 57,624 224,881 229,187
------ ------ ------- -------
Income from continuing
operations before
financing and other
income and income taxes 26,556 21,316 86,304 67,800
------ ------ ------ ------
Financing and Other Income
(Expense)
Interest income, net 438 185 955 2,266
Other income (expense), net 167 974 (1,459) 705
--- --- ------ ---
Total financing and
other income
(expense) 605 1,159 (504) 2,971
--- ----- ---- -----
Income from continuing
operations before income
taxes 27,161 22,475 85,800 70,771
Provision for income
taxes 6,620 8,638 25,293 29,003
----- ----- ------ ------
Income from continuing
operations 20,541 13,837 60,507 41,768
Discontinued operations:
Gain from sale of
discontinued operations,
net of tax provision
($0 and $11,190,
respectively) - - 14,437 -
Income (loss) from
discontinued operations,
net of tax provision
(benefit) ($0 and $358,
for the three months ended,
respectively, and ($54)
and $534 for the twelve
months ended,
respectively) - 448 (107) 65
--- --- ---- --
Discontinued operations,
net of tax - 448 14,330 65
------- ------- ------- -------
Net Income $20,541 $14,285 $74,837 $41,833
------- ------- ------- -------
Basic earnings per share (1):
From continuing
operations $1.72 $1.16 $5.08 $3.51
From discontinued
operations $- $0.04 $1.20 $0.01
-- ----- ----- -----
Basic earnings per
share $1.72 $1.20 $6.28 $3.52
----- ----- ----- -----
Weighted average shares
outstanding used in
computing basic earnings
per share 11,929 11,889 11,906 11,886
------ ------ ------ ------
Diluted earnings per share (1):
From continuing
operations $1.66 $1.13 $4.92 $3.39
From discontinued
operations $- $0.04 $1.17 $0.01
-- ----- ----- -----
Diluted earnings per
share $1.66 $1.17 $6.09 $3.40
----- ----- ----- -----
Weighted average shares
outstanding used in
computing diluted
earnings per share 12,350 12,226 12,284 12,303
------ ------ ------ ------
(1) Basic and fully diluted earnings per share for class A and class B
common stock are the same
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Core BI
Business Angel.com Consolidated
-------- --------- ------------
Three Months Three Months Three Months
Ended Ended Ended
December 31, December 31, December 31,
------------- ------------- -------------
2009 2008 2009 2008 2009 2008
---- ---- ---- ---- ---- ----
Revenues
Product licenses $29,959 $27,959 $- $- $29,959 $27,959
Product support
and other
services 71,507 64,030 - - 71,507 64,030
Angel.com
services - - 4,306 3,016 4,306 3,016
--- --- ----- ----- ----- -----
Total revenues 101,466 91,989 4,306 3,016 105,772 95,005
------- ------ ----- ----- ------- ------
Cost of Revenues
Product licenses 2,084 434 - - 2,084 434
Product support
and other
services 15,845 14,729 - - 15,845 14,729
Angel.com
services - - 1,537 902 1,537 902
--- --- ----- --- ----- ---
Total cost of
revenues 17,929 15,163 1,537 902 19,466 16,065
------ ------ ----- --- ------ ------
Gross profit 83,537 76,826 2,769 2,114 86,306 78,940
------ ------ ----- ----- ------ ------
Operating Expenses
Sales and
marketing 33,679 35,759 1,417 1,865 35,096 37,624
Research and
development 10,460 5,318 929 804 11,389 6,122
General and
administrative 12,664 13,811 601 67 (a) 13,265 13,878
------ ------ --- -- ------ ------
Total operating
expenses 56,803 54,888 2,947 2,736 59,750 57,624
------ ------ ----- ----- ------ ------
Income (loss) from
continuing
operations before
financing and
other income and
income taxes 26,734 21,938 (178) (622) 26,556 21,316
------ ------ ---- ---- ------ ------
Financing and
Other Income
Interest income,
net 438 185 - - 438 185
Other income, net 164 974 3 - 167 974
--- --- --- --- --- ---
Total financing
and other
income 602 1,159 3 - 605 1,159
--- ----- --- --- --- -----
Income (loss)
from continuing
operations
before income
taxes $27,336 $23,097 $(175) $(622) $27,161 $22,475
Provision for
income taxes 6,620 8,638
----- -----
Income from
continuing
operations 20,541 13,837
Discontinued
operations:
Income from
discontinued
operations,
net of tax - 448
--- ---
Discontinued
operations,
net of tax - 448
------- -------
Net income $20,541 $14,285
======= =======
Basic earnings
per share:
From
continuing
operations $1.72 $1.16
From
discontinued
operations $- $0.04
-- -----
Basic
earnings
per share $1.72 $1.20
----- -----
Diluted earnings
per share:
From
continuing
operations $1.66 $1.13
From
discontinued
operations $- $0.04
-- -----
Diluted
earnings
per share $1.66 $1.17
----- -----
Basic weighted
average shares
outstanding 11,929 11,889
====== ======
Diluted weighted
average shares
outstanding 12,350 12,226
====== ======
(a) An insignificant amount of general and administrative services was
provided to the Angel.com business unit by MicroStrategy's core
business operations during the three months ended December 31, 2008.
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Core BI
Business Angel.com Consolidated
-------- --------- ------------
Twelve Months Twelve Months Twelve Months
Ended Ended Ended
December 31, December 31, December 31,
------------- ------------- -------------
2009 2008 2009 2008 2009 2008
---- ---- ---- ---- ---- ----
Revenues
Product licenses $101,856 $95,924 $- $- $101,856 $95,924
Product support
and other
services 261,956 253,660 - - 261,956 253,660
Angel.com
services - - 13,976 10,809 13,976 10,809
--- --- ------ ------ ------ ------
Total revenues 363,812 349,584 13,976 10,809 377,788 360,393
------- ------- ------ ------ ------- -------
Cost of Revenues
Product licenses 6,607 1,877 - - 6,607 1,877
Product support
and services
revenues 54,625 59,331 - - 54,625 59,331
Angel.com
services - - 5,371 2,198 5,371 2,198
--- --- ----- ----- ----- -----
Total cost of
revenues 61,232 61,208 5,371 2,198 66,603 63,406
------ ------ ----- ----- ------ ------
Gross profit 302,580 288,376 8,605 8,611 311,185 296,987
------- ------- ----- ----- ------- -------
Operating Expenses
Sales and
marketing 123,690 129,721 4,782 7,962 128,472 137,683
Research and
development 38,042 27,546 3,754 3,025 41,796 30,571
General and
administrative 52,741 60,651 1,872 282 (a) 54,613 60,933
------ ------ ----- --- ------ ------
Total operating
expenses 214,473 217,918 10,408 11,269 224,881 229,187
------- ------- ------ ------ ------- -------
Income (loss) from
continuing
operations before
financing and
other income and
income taxes 88,107 70,458 (1,803) (2,658) 86,304 67,800
------ ------ ------ ------ ------ ------
Financing and Other
(Expense) Income
Interest income,
net 955 2,266 - - 955 2,266
Other (expense)
income, net (1,462) 705 3 - (1,459) 705
------ --- --- --- ------ ---
Total financing
and other
(expense)
income (507) 2,971 3 - (504) 2,971
---- ----- --- --- ---- -----
Income (loss)
from continuing
operations
before income
taxes $87,600 $73,429 $(1,800) $(2,658) $85,800 $70,771
Provision for
income taxes 25,293 29,003
------ ------
Income from
continuing
operations 60,507 41,768
Discontinued
operations:
Gain from sale of
discontinued
operations,
net of tax 14,437 -
(Loss) income from
discontinued
operations,
net of tax (107) 65
---- --
Discontinued
operations,
net of tax 14,330 65
------- -------
Net income $74,837 $41,833
======= =======
Basic earnings
per share:
From
continuing
operations $5.08 $3.51
From
discontinued
operations $1.20 $0.01
----- -----
Basic
earnings
per share $6.28 $3.52
----- -----
Diluted earnings
per share:
From
continuing
operations $4.92 $3.39
From
discontinued
operations $1.17 $0.01
----- -----
Diluted
earnings
per share $6.09 $3.40
----- -----
Basic weighted
average shares
outstanding 11,906 11,886
====== ======
Diluted weighted
average shares
outstanding 12,284 12,303
====== ======
(a) An insignificant amount of general and administrative services was
provided to the Angel.com business unit by MicroStrategy's core
business operations during the twelve months ended December 31, 2008.
MICROSTRATEGY INCORPORATED
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
December 31, December 31,
2009 2008
---- ----
Assets (unaudited) (audited)
Current assets
Cash and cash equivalents $224,769 $122,915
Restricted cash and investments 549 619
Accounts receivable, net 56,399 49,670
Prepaid expenses and other current assets 10,861 9,518
Deferred tax assets, net 12,642 26,743
Assets held-for-sale - 4,964
----- -----
Total current assets 305,220 214,429
Property and equipment, net 54,906 8,978
Capitalized software development cost, net 13,431 14,823
Deposits and other assets 3,283 36,804
Deferred tax assets, net 6,490 17,105
----- ------
Total Assets $383,330 $292,139
-------- --------
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable and accrued expenses $28,460 $27,697
Accrued compensation and employee benefits 46,277 42,634
Deferred revenue and advance payments 77,783 66,495
Deferred tax liabilities 115 -
Liabilities held-for-sale - 6,325
----- -----
Total current liabilities 152,635 143,151
Deferred revenue and advance payments 3,845 1,679
Other long-term liabilities 12,622 9,268
------ -----
Total Liabilities 169,102 154,098
------- -------
Stockholders' Equity
Preferred stock undesignated,
$0.001 par value; 5,000 shares authorized;
no shares issued or outstanding - -
Class A common stock, $0.001 par value;
330,000 shares authorized; 14,302 shares
issued and 9,255 shares outstanding, and
14,167 shares issued and 9,120 shares
outstanding, respectively 14 14
Class B common stock, $0.001 par value;
165,000 shares authorized; 2,694 and 2,770
shares issued and outstanding, respectively 3 3
Additional paid-in capital 453,170 450,953
Treasury stock, at cost; 5,047 shares (366,191) (366,191)
Accumulated other comprehensive income 604 1,471
Retained earnings 126,628 51,791
------- ------
Total Stockholders' Equity 214,228 138,041
------- -------
Total Liabilities and Stockholders' Equity $383,330 $292,139
-------- --------
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Twelve Months Ended
December 31,
------------
2009 2008
---- ----
(unaudited) (audited)
Operating activities:
Net income $74,837 $41,833
Less: Income from discontinued operations,
net (14,330) (65)
------- ---
Income from continuing operations 60,507 41,768
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 10,631 6,399
Bad debt expense 1,863 2,029
Deferred taxes 16,146 20,925
Stock-based compensation - 46
Excess tax benefits from stock-based
payment arrangements (907) (422)
Other, net 10 72
Changes in operating assets and liabilities:
Accounts receivable (9,264) (3,862)
Prepaid expenses and other current assets (1,168) 1,643
Deposits and other assets 553 157
Accounts payable and accrued expenses 1,076 5,102
Accrued compensation and employee benefits 2,041 5,574
Deferred revenue and advance payments 12,108 5,278
Other long-term liabilities 3,319 190
----- ---
Net cash provided by operating activities
from continuing operations 96,915 84,899
Net cash (used in) provided by operating
activities from discontinued operations (472) 4,019
---- -----
Net cash provided by operating
activities 96,443 88,918
------ ------
Investing activities:
Advance deposits on purchases of property and
equipment - (25,000)
Purchases of property and equipment (18,265) (5,167)
Capitalized software development costs (4,218) (13,575)
Decrease in restricted cash and investments 575 1,100
--- -----
Net cash used in investing activities
from continuing operations (21,908) (42,642)
Net cash provided by (used in) investing
activities from discontinued operations 24,546 (160)
------ ----
Net cash provided by (used in) investing
activities 2,638 (42,802)
----- -------
Financing activities:
Proceeds from sale of class A common stock
under exercise of employee stock options 1,216 2,104
Excess tax benefits from stock-based payment
arrangements 907 422
Purchases of treasury stock - (8,387)
Distribution to Alarm.com minority
shareholders (60) -
--- ---
Net cash provided by (used in) financing
activities from continuing operations 2,063 (5,861)
Net cash provided by financing activities
from discontinued operations - -
--- ---
Net cash provided by (used in)
financing activities 2,063 (5,861)
Effect of foreign exchange rate changes
on cash and cash equivalents 710 (2,534)
--- ------
Net increase in cash and cash equivalents 101,854 37,721
Cash and cash equivalents, beginning of period 122,915 85,194
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Cash and cash equivalents, end of period $224,769 $122,915
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SOURCE MicroStrategy Incorporated
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