Stellent Reports Record Quarterly Revenues of $31.7 Million
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Total revenue up 15% year-over-year; non-GAAP operating margin percentage increases 41% over the second quarter; cash and marketable securities increases by $6 million from prior quarter
EDEN PRAIRIE, MN, Feb. 7, 2006 — Stellent, Inc. (Nasdaq: STEL), a global provider of content management solutions, announced today financial results for the third quarter ended Dec. 31, 2005.
Third quarter fiscal 2006 revenues were a record $31.7 million, an increase of 15% over the $27.7 million reported for the same period last year. Revenues for the nine-month period ended Dec. 31, 2005 were $90.4 million, a 15% increase over revenues of $78.3 million for the comparable period of fiscal 2005.
On a Generally Accepted Accounting Principles (GAAP) basis, net income for the quarter ended Dec. 31, 2005 was $2.2 million, or $0.07 per share on a diluted share basis, compared with net income of $0.2 million, or $0.01 per share on a basic and diluted share basis, for the quarter ended Dec. 31, 2004. GAAP net income for the nine months ended Dec. 31, 2005 was $3.9 million, or $0.13 per share on a diluted share basis, compared with a net loss of $(2.9) million, or $(0.11) per share on a basic and diluted share basis, for the same period of fiscal 2005.
Non-GAAP net income was $3.3 million, or $0.11 per share on a basic and diluted share basis, for the quarter ended Dec. 31, 2005, compared with non-GAAP net income of $1.0 million, or $0.04 per share on a basic and diluted share basis, for the quarter ended Dec. 31, 2004. Non-GAAP net income for the nine months ended Dec. 31, 2005 was $7.2 million, or $0.25 per share on a diluted share basis, compared with net income of $2.7 million, or $0.10 per share on a diluted share basis, for the same period of fiscal 2005.
Stellent believes the non-GAAP results better reflect its operating performance as they exclude the effects of non-cash or non-recurring charges primarily related to expenses such as acquisition-related sales, marketing and other costs; amortization of acquired intangible assets and unearned compensation; and restructuring charges.
"We are proud of the entire Stellent team for generating outstanding financial results for the third quarter,” said Robert Olson, president and chief executive officer for Stellent. "We achieved record quarterly revenues, and increased profitability on both a GAAP and non-GAAP basis compared to the second quarter. In addition, we expanded our non-GAAP operating margin percentage to 8.6 percent, an increase of 41 percent over the prior quarter; increased cash and marketable securities by $6 million, ending the quarter with approximately $76 million; and decreased DSOs by four days from the prior quarter.
"New customer adoption remained strong during the third quarter as we secured 64 new customers, with 19 percent sequential Stellent® Universal Content Management™ license revenue growth. First-time Universal Content Management customers include Orbitz, Crown Prosecution Service (the United Kingdom government department responsible for prosecuting all criminal cases investigated by the police in England and Wales), Marvel Entertainment, Commander - Navy Installations (CNI) Command, World Economic Forum, Brother, Sony Net Services, Experian and Shop NBC. Existing customers who continued to roll out their Universal Content Management implementations include Eaton, Moody’s Investors Service, Koch Industries, Cabela’s, Nissan Financial Services, Samsung, Ameren, HBO, UnumProvident, Jackson National Life and Oglethorpe. Also during the third quarter, our Content Components Division signed or renewed contracts with organizations such as Thompson Legal & Regulatory, FAST Search & Transfer, Endeca and Canon ImageWare.
"We continued to receive numerous accolades from industry analyst firms, highlighting our world-class enterprise content management (ECM) architecture; governance, risk and compliance (GRC) solutions; and multi-site Web content management (WCM) technology. For example, Gartner, Inc. named Stellent a ‘leader’ in its ‘Magic Quadrant for Enterprise Content Management, 2005’1* report. Stellent also garnered a ‘strong positive’ rating in Gartner’s ‘MarketScope for Web Content Management, 2005’2** report and a ‘positive’ rating in Gartner’s ‘MarketScope for Records Management, 2005’3** report.
"During the third quarter, many Stellent Universal Content Management customer implementations were recognized by leading industry publications and organizations, continuing a trend we’ve enjoyed for several consecutive quarters. Our customers Reliant Energy and Emerson Process Management received Enterprise All-Star Awards from Network World for their exceptional use of Stellent technology to further business objectives. Similarly, Scott County won a Process Innovation Award from Kinetic Information LLC for its enterprise-wide Universal Content Management deployment.
"We also are pleased with the resounding success of Stellent Crescendo™ 2006, our third annual global user conference held last week. In addition to showcasing our suite of products and notable customer implementations, the event provided an opportunity to highlight our work with partners, which was particularly significant during the third quarter. We signed a worldwide strategic alliance agreement with Accenture and are already gaining significant traction with them. In fact, Accenture’s global practice lead for portals and content management presented during the opening session at Crescendo and was well-received by attendees. We also continue to experience growing traction with Protiviti, our primary GRC partner.
"Our momentum as evidenced by Stellent’s continued strong customer wins, industry recognitions and productive partner relationships gives us confidence in our financial goals for fiscal 2006. These objectives include solidifying our leadership position in the ECM and GRC markets, growing revenue and earnings per share, expanding operating margins, and increasing market share and shareholder value.”
Other Recent Highlights
Customers
- 4,638 customers — comprised of 3,459 corporate content management customers; 525 OEM customers; and 654 corporate customers for desktop viewing and conversion technology — have selected Stellent solutions to power their content-centric business applications.
- Reliant Energy, an electricity and energy services provider, and Emerson Process Management, a global supplier of process improvement solutions, received Enterprise All-Star Awards from Network World for their exceptional use of Stellent technology to further business objectives.
- Scott County, one of the fastest growing counties in Minnesota and the United States, received a Process Innovation Award from Kinetic Information LLC for its enterprise-wide Stellent Universal Content Management deployment. This award honors superior technology applications for their business effectiveness.
QAS won a 2005 Information Management award for "Best Knowledge Management” application for its Stellent-powered intranet.
- Stellent announced the City of Ottawa, the capital of and fourth-largest city in Canada, plans to deploy Stellent Universal Content Management across its organization to support a variety of content management-based applications.
Stellent announced Bayerngas GmbH is using Stellent technology to power its company-wide intranet document management system.
- Stellent announced San Mateo County’s Human Services Agency is improving client service, reducing operational costs and maintaining compliance with government regulations using Stellent Universal Content Management. The California county agency provides economic, employment and health care coverage services to its residents.
Corporate news
- EContent magazine recognized Stellent for the fifth time as one of the most important companies in the digital content arena. Specifically, Stellent is included in the "Content Management” category of the annual "EContent 100” list of companies that matter most in the digital content industry.
Products
- Stellent was listed in the "leaders” quadrant in Gartner, Inc.’s "Magic Quadrant for Enterprise Content Management, 2005” report.
- Stellent was among the select companies Forrester invited to participate in its Oct. 7, 2005 report, "The Forrester Wave™: Enterprise Content Management Suites, Q3 2005.”4 In this evaluation, Stellent was cited as a strong performer in ECM and garnered the top ranking in the "Current Offering” category.
Stellent was positioned in the "visionaries” quadrant in Gartner, Inc.’s "Magic Quadrant for Financial Compliance Process Management Software, 2005”5* report.
- Stellent garnered a "strong positive” rating in Gartner, Inc.’s "MarketScope for Web Content Management, 2005” report.
Stellent received a "positive” rating in Gartner, Inc.’s "MarketScope for Records Management, 2005” report.
Partners
- Stellent signed a worldwide strategic alliance agreement with Accenture, a global management consulting, technology services and outsourcing company.
Stellent signed one new reseller partner during its third quarter: MSI System Integrators, Inc. of Omaha, Neb.
13.02.2006, Stellent GmbH
