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ClickSoftware Technologies Ltd. (CKSW)

Q4 2012 Earnings Call

February 04, 2013 09:00 am ET


Moshe BenBassat – Chairman and Chief Executive Officer

Shmuel Arvatz – Chief Financial Officer


Daniel Meron – RBC Capital Markets

Nathan Schneiderman – Roth Capital Partners

Nick Farwell – The Arbor Group



Ladies and gentlemen, thank you for standing by. Welcome to the ClickSoftware Technologies Limited Fourth Quarter and Year-End 2012 Financial Results Conference Call. All participants are present in a listen-only mode. Following management’s formal presentation, instructions will be given for the question-and-answer session. (Operator Instructions) As a reminder this conference is being recorded February 4, 2013. With us on line today are Dr. Moshe BenBassat, CEO and Chairman of the Board; and Mr. Shmuel Arvatz, CFO.

Before I turn the call over to Dr. BenBassat, I would like to remind you that during the course of this conference call, the company will be making express or implied forward-looking statements within the meaning of the Private Securities Litigation Act of 1995, and other U.S. federal securities laws.

These forward-looking statements include, but are not limited to, those statements regarding future results of operations, including our outlook for full year 2013 revenues, and non-GAAP earnings per share, visibility into future periods and pipeline, winning new business, expected growth in mobility solutions and cloud services and demand for those offerings, expected expansion into new territories and new markets, growth and future rates of growth and expectations of future cash flows and dividends, market demand, and the results of our increased investment to address such market demand, license revenues as a percentage of total revenues, cash flows, expected effective tax rates, and expectations regarding operating profit and margins, future closing of contracts, future product offerings, receipt of orders, and recognition of revenues and deferred revenues.

Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results or performance to differ materially from those projected. Achievements of these results by ClickSoftware may be affected by many factors including, but not limited to, risks and uncertainties regarding the general economic outlook, more attractive investments than dividends that may become available, the length of or changes in ClickSoftware’s sales cycle, ClickSoftware’s ability to close sales to potential customers in a timely manner and maintain or strengthen relationships with strategic partners, the timing of revenue recognition, foreign currency exchange rate fluctuations, and ClickSoftware’s ability to maintain or increase its sales pipeline.

The forward-looking statements discussed in this call are subject to other risks and uncertainties, including those discussed in the "Risk Factors" section and elsewhere in ClickSoftware’s annual report on Form 20-F for the year ended December 31st, 2011 and in subsequent filings with the Securities and Exchange Commission. Except as otherwise required by law, ClickSoftware is under no obligation to and expressly disclaims any such obligation to update or alter its forward-looking statements whether as a result of new information, future events or otherwise.

Also I would like to remind you that ClickSoftware reported net income, and net earnings per share on both a GAAP basis and on in adjusted non-GAAP basis. Today’s press release includes a reconciliation of non-GAAP information to the most directly comparable GAAP information, and is posted in the Investor’s Section of the company’s website at

Dr. BenBassat, would you like to begin?

Moshe BenBassat

Thank you, [Nessi]. Good morning everyone, and thank you for joining ClickSoftware’s earnings call for the fourth quarter of the year-end and year-end of 2012. Today, I like to focus my comments on a high level strategic overview of the business, and a brief coverage of operational results for the fourth quarter.

Shmuel Arvatz our CFO will then proceed with details regarding the fourth quarter and full year 2012 financial results, and provide an outlook for 2013. I will then return for a closing statement, and open the call up for questions.

2012 was a monumental year for ClickSoftware, and we are very pleased with our results and accomplishments. The goal of crossing the $100 million revenue mark in 2012 was set a few years ago, and reaching this milestone was a result of strong execution of our plans. Our eyes are now set on the future with a plan to ensure continued profitable growth.

Leveraging the investments made in 2012, the strategic plan calls for accelerated growth in 2013 and beyond that exceeds 20% annual growth rate. This strategy is focused on three major initiatives: new territories, enterprise mobility, and cloud-based offerings. Let me describe each of these in some more details.

Regarding new territories, while building local presence in Latin America and Eastern Europe to support acceleration of sales in this territory, and are increasing brand awareness. This initiative capitalizes on early successes in this emerging market and the company’s global leadership position in the utility, telecommunications, and oil and gas industry, all of which are experiencing rapid growth in these markets.

Winning Oi in Brazil and Sberbank in Russia are two examples of early successes in these territories. Oi is one of Brazil’s largest telecommunication companies, and Sberbank is one of Russia’s biggest banks.

Regarding enterprise mobility, we have embarked on new initiative to accelerate sales to prospects who prefer to start with mobility solutions as opposed to our traditional optimization solutions. This will significantly expand ClickSoftware’s addressable market for the following reason. While in today’s world, just about every service company equips its field-force with mobile devices. Presently however, the use of these devices is fairly limited to voice communication or SMS or basic apps.

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