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Accelrys, Inc. (ACCL)
F4Q10 (Qtr End 03/31/10) Earnings Call Transcript
May 20, 2010 5:00 pm ET
Todd Kehrli – IR, MKR Group
Max Carnecchia – President & CEO
Michael Piraino – SVP & CFO
Chad Bennett – Northland Securities
Ragh Sarathy – Dougherty & Company
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Thank you, operator, and welcome everyone. Thank you for joining Accelrys’s fiscal 2010 fourth quarter and year-end earnings conference call. A press release was issued this afternoon detailing our financial results and may be accessed on the company’s website at accelrys.com under the Investor Relations section of the site.
On the call today to comment on the fourth quarter and year-end results will be Accelrys’s CEO, Max Carnecchia, and CFO, Michael Piraino. Before I turn the call over to Max, I’d like to remind you that the company’s comments today which are not statements of historical fact are forward-looking statements.
Such statements include the company’s expectations regarding the time, anticipated completion of the merger with Symyx Technologies and the benefits and synergies resulting therefrom, as well as projections or forecasts of future financial results whether as a result of the merger with Symyx or otherwise, including statements regarding future order intake, revenue, operating income and cash flow.
These forward-looking statements are subject to a number of risks and uncertainties, including the risk that the merger will not be completed as expected due to among other potential events, litigation or failure to obtain the approval, or that synergy that’s from the merger will not allow due to a number of factors, including adverse reaction in the company’s relationship with customers, failure to effectively (inaudible) the combined companies, expected costs or (inaudible) resulting from the merger.
Also the company’s financial projections or expectations may not be real due to the factors discussed above, as well as macroeconomic conditions, lack of demand for the company’s products, failure to timely develop our products, or complete our services or inability to complete and recognize revenue from service engagements. Because of these risks and uncertainties, actual results may differ materially from these forward-looking statements.
Additional factors that could cause actual results to differ materially from these forward-looking statements are set forth in the company’s quarter report on Form 10-Q for the quarter ended December 31, 2009 and the quarter report on Form 10-Q for Symyx for the quarter ended March 31, 2010, and in subsequent reports on forms 10-K, 10-Q and 8-K and other filings made with the SEC by both Accelrys and Symyx. These forward-looking statements speak as of the day they are made and the company undertakes no obligation to update or revise these statements, whether as a result of new information, future events or otherwise.
In addition, the information provided on this call does not constitute an offer to sell or the solicitation of an offer to buy any securities or solicitation of any vote or approval. In connection with the merger, the company and Symyx have filed relevant materials with the SEC, including a joint proxy statement. Investors are strongly urged to read the joint proxy statement because it contains important information about the company, Symyx and the proposed merger.
In the press release issued earlier today, references were made to both GAAP and non-GAAP financial measures relating to operating income, net income, and earnings per share. The GAAP income statement includes in the listed [ph] expenses, costs related to restructuring, amortization of purchased tangibles, and stock compensation expense, which are excluded from the non-GAAP financial measures. As a result, we have provided in the press release and in the Investor Relations section of the company’s website a complete reconciliation of these non-GAAP financial measures to the applicable GAAP measures.
Although not a substitute for a GAAP presentation, we feel that the non-GAAP information allows for meaningful year-over-year comparison and fairly identifies the actual operating results of the company. That is this non-GAAP information that we use internally to monitor our financial performance. As a result, references will be made to non-GAAP financial measures for the rest of this call.
I will now hand the call over to Max.
Todd, that was a mouthful. I’m pleased with our financial performance, both in this quarter and for our full 2010 fiscal year. We have increased revenue by 2% over our prior year and did even better in our fourth quarter, increasing revenue by 4% from the fourth quarter of prior fiscal year.
We also increased our non-GAAP operating income by 24% from our prior year and improved our rock solid balance sheet by increasing cash approximately 20%. We now have $93 million in cash and no debt. We delivered these results in a fiscal year in which the economic environment remained extremely challenging while entering into a merger of equals with Symyx Technologies and while making significant changes to our executive leadership team. In short, I am proud of our financial performance.
Michael will provide you with more color regarding our financial performance later. I will now provide you with highlights of our operating performance with which I’m also extremely pleased. From an order intake standpoint, we had our second consecutive solid quarter, as orders for software and services increased from the prior fiscal year’s fourth quarter order level.