Saint Louis, MO – March 4, 2010 – Perficient, Inc. (NASDAQ: PRFT) a leading information technology consulting firm serving Global 2000 and other large enterprise customers throughout North America, today reported financial results for the quarter and year ended December 31, 2009.
Financial Highlights
For the fourth quarter ended December 31, 2009:
- Revenues decreased 16% to $47.4 million from $56.8 million during the fourth quarter of 2008;
- Services revenue increased 5% to $41.3 from $39.3 million during the third quarter of 2009, representing a return to sequential growth;
- Services revenue decreased 16% to $41.3 million from $49.2 million during the fourth quarter of 2008;
- Per share results on a fully diluted basis were $0.02 compared to $0.03 during the fourth quarter of 2008;
- Non-GAAP earnings per share (see attached schedule which reconciles to GAAP earnings per share) on a fully diluted basis decreased 23% to $0.10 from $0.13 during the fourth quarter of 2008;
- Net income decreased 17% to $629,000 from $759,000 during the fourth quarter of 2008; and
- EBITDAS (a non-GAAP measure; see attached schedule which reconciles to GAAP net income) decreased 25% to $5.2 million from $6.9 million during the fourth quarter of 2008.
For the year ended December 31, 2009:
- Revenue decreased 19% to $188.2 million from $231.5 million during 2008;
- Services revenue decreased 20% to $166.4 million from $207.5 million during 2008;
- Per share results on a fully diluted basis decreased 85% to $0.05 from $0.33 per share during 2008;
- Non-GAAP earnings per share (see attached schedule which reconciles to GAAP earnings per share) on a fully diluted basis decreased 45% to $0.36 from $0.66 per share during 2008;
- Net income decreased 85% to $1.5 million from $10.0 million during 2008;
- EBITDAS (a non-GAAP measure; see attached schedule which reconciles to GAAP net income) decreased 49% to $18.1 million from $35.2 million during 2008;
- The Company continued to generate strong operating cash flow during 2009 resulting in $28.0 million in cash, cash equivalents and investments at December 31, 2009, compared to $23.0 million at December 31, 2008; and
- The Company repurchased 2.7 million shares of its stock during the year at a cost of $18.4 million. Since the program’s inception, the Company has repurchased 4.5 million shares at a cost of $27.5 million.
“Perficient executed strongly in the fourth quarter, closing 2009 by delivering sequential revenue growth for the first time in six quarters,” said Jeffrey Davis, Perficient’s chief executive officer and president. “That revenue growth is even more impressive given that is was achieved in a quarter impacted by seasonality. While 2009 was a challenging year on several fronts, we continued to manage the business with a strict fiscal discipline – generating cash flow, maintaining a strong balance sheet and aggressively repurchasing shares.”
“As our full-year revenue and cash earnings per share guidance indicates, we expect 2010 to be the year Perficient is able to return to growth,” Davis said. “Our long-term plans to supplement organic growth with accretive acquisitions remain unchanged and we’re cautiously optimistic that we’re on the verge of again delivering the pattern of consistent revenue and earnings growth that marked Perficient’s deliberate march from a small startup to a proven industry leader.”
Other 2009 Highlights
Among other achievements, Perficient:
-- In the fourth quarter, added new customer relationships and follow-on projects with leading companies including: Affinia, Agilent, Amerisource Bergen, Avaya, Blue Cross Blue Shield Florida, Blue Cross Blue Shield Massachusetts, Cricket Communications, FordDirect, Janus, Lexmark, Matrix Medical Network, Nestle Purina, Owens Corning, Peerless Manufacturing, Zales and many others;
-- Expanded the size of its ongoing share repurchase program from $20 million to $40 million;
-- Announced the appointment of Jeffrey Davis to CEO and President and Kathy Henely to Chief Operating Officer. Mr. Davis had previously been President and Chief Operating Officer. Mrs. Henely had previously been Vice-President, Corporate Operations; and
-- Was honored as the sole recipient of IBM’s 2009 Information Agenda Outstanding Partner of the Year award and was recognized for its performance by organizations including Consumer Goods Technology, Healthcare Informatics and Forbes magazines.
Business Outlook
The following statements are based on current expectations. These statements are forward-looking and actual results may differ materially.
The Company expects its first quarter 2010 services and software revenue, including reimbursed expenses, to be in the range of $46.0 million to $49.1 million, comprised of $43.6 million to $46.0 million of revenue from services including reimbursed expenses and $2.4 million to $3.1 million of revenue from sales of software.
The Company is issuing a full-year revenue guidance range of $190 million to $210 million and 2010 cash earnings per share guidance range of $0.50 to $0.60.
Conference Call Details
Perficient will host a conference call regarding fourth quarter 2009 financial results today at 9:00 a.m. EST.
WHAT: Perficient Fourth Quarter 2009 Results
WHEN: Thursday, March 4, 2010, at 9:00 a.m. EST
CONFERENCE CALL NUMBERS: 888-713-4218 (U.S. and Canada) 617-213-4870 (International)
PARTICIPANT PASSCODE: 10628900
REPLAY TIMES: Thursday, March 4, 2010, at 11:00 a.m. EST, through Thursday, March 11, 2010
REPLAY NUMBER: 888-286-8010 (U.S. and Canada) 617-801-6888 (International)
REPLAY PASSCODE: 60701303
About Perficient
Perficient is a leading information technology consulting firm serving Global 2000 and enterprise customers throughout North America. Perficient’s professionals serve clients from a network of offices in 17 markets across North America and three offshore locations, in Eastern Europe, India and China. Perficient helps clients use Internet-based technologies to improve productivity and competitiveness, strengthen relationships with customers, suppliers and partners and reduce information technology costs. Perficient, traded on the Nasdaq Global Select Market(SM), is a member of the Russell 2000® index and the S&P SmallCap 600 index. Perficient is an award-winning "Premier Level" IBM business partner, a TeamTIBCO partner, a Microsoft National Systems Integrator and Gold Certified Partner, a Documentum Select Services Team Partner, and an Oracle Certified Partner. For more information, please visit www.perficient.com.
Safe Harbor Statement
Some of the statements contained in this news release that are not purely historical statements discuss future expectations or state other forward-looking information related to financial results and business outlook for 2010. Those statements are subject to known and unknown risks, uncertainties and other factors that could cause the actual results to differ materially from those contemplated by the statements. The “forward-looking” information is based on management’s current intent, belief, expectations, estimates and projections regarding our company and our industry. You should be aware that those statements only reflect our predictions. Actual events or results may differ substantially. Important factors that could cause our actual results to be materially different from the forward-looking statements are disclosed under the heading “Risk Factors” in our annual report on Form 10-K for the year ended December 31, 2009. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. This cautionary statement is provided pursuant to Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The forward-looking statements in this release are made only as of the date hereof and we undertake no obligation to update publicly any forward-looking statement for any reason, even if new information becomes available or other events occur in the future.
About Non-GAAP Financial Information
This press release includes non-GAAP financial measures. For a description of these non-GAAP financial measures, including the reasons management uses each measure, and reconciliations of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with Generally Accepted Accounting Principles (GAAP), please see the section entitled
About Non-GAAP Financial Measures” and the accompanying tables entitled “Reconciliation of GAAP to Non-GAAP Measures.”
Consolidated Statements of Operations and Consolidated Balance Sheets
About Non-GAAP Financial Measures
Perficient, Inc. (“Perficient”) provides non-GAAP measures for EBITDAS (earnings before interest, income taxes, depreciation, amortization, and stock compensation), net income and net income per share data as supplemental information regarding Perficient’s business performance. Perficient believes that these non-GAAP financial measures are useful to investors because they provide investors with a better understanding of Perficient’s past financial performance and future results. Perficient’s management uses these non-GAAP financial measures when it internally evaluates the performance of Perficient’s business and makes operating decisions, including internal operating budgeting, performance measurement, and the calculation of bonuses and discretionary compensation. Management excludes stock-based compensation related to employee stock options and restricted stock awards, the amortization of intangible assets, acquisition costs, and income tax effects of the foregoing, when making operational decisions.
Perficient believes that providing the non-GAAP measures that management uses to its investors is useful because it allows investors to evaluate Perficient’s performance using the same methodology and information that is used by Perficient’s management. Specifically, non-GAAP net income is used by management primarily to review business performance and determine performance based incentive compensation for executives and other employees. Management uses EBITDAS to measure operating profitability, evaluate trends, and make strategic business decisions.
Non-GAAP measures are subject to inherent limitations because they do not include all of the expenses included under GAAP and because they involve the exercise of judgment of which charges are excluded from the non-GAAP financial measure. However, Perficient’s management compensates for these limitations by providing the relevant disclosure of the items excluded in the calculation of EBITDAS, non-GAAP net income and non-GAAP net income per share. In addition, some items that are excluded from non-GAAP net income and non-GAAP earnings per share can have a material impact on cash. Management compensates for these limitations by evaluating the non-GAAP measure together with the most directly comparable GAAP measure. Perficient has historically provided non-GAAP measures to the investment community as a supplement to its GAAP results to enable investors to evaluate Perficient’s business performance in the way that management does. Perficient’s definition may be different from similar non-GAAP measures used by other companies and/or analysts.
The non-GAAP adjustments, and the basis for excluding them, are outlined below:
Stock-based Compensation
Perficient incurs stock-based compensation expense under Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation – Stock Compensation. Perficient excludes this item for the purposes of calculating EBITDAS, non-GAAP net income and non-GAAP net income per share because it is a non-cash expense that Perficient believes is not reflective of its business performance. The nature of the stock-based compensation expense also makes it very difficult to estimate prospectively, since the expense will vary with changes in the stock price and market conditions at the time of new grants, varying valuation methodologies, subjective assumptions, and different award types, making the comparison of current results with forward looking guidance potentially difficult for investors to interpret. The tax effects of stock-based compensation expenses may also vary significantly from period to period, without any change in underlying operational performance, thereby obscuring the underlying profitability of operations relative to prior periods. Perficient believes that non-GAAP measures of profitability that exclude stock-based compensation are widely used by analysts and investors.
Amortization of Intangible Assets
Perficient has incurred amortization of intangible assets, included in its GAAP financial statements, primarily related to various acquisitions Perficient has made. Management excludes these items for the purpose of calculating EBITDAS, non-GAAP net income and non-GAAP net income per share. Perficient believes that eliminating this expense from its non-GAAP measures is useful to investors because the amortization of intangible assets can be inconsistent in amount and frequency and is significantly impacted by the timing and magnitude of Perficient’s acquisition transactions, which also vary substantially in frequency from period to period.
Impairment of Intangible Assets
During the fourth quarter 2008, Perficient recorded a non-cash charge of $1.6 million to impair certain intangible assets. Perficient has excluded this charge from its calculation of non-GAAP measures presented herein. Perficient believes that eliminating this expense from its non-GAAP measures is useful to investors because the impairment charge is a non-recurring expense that comparison of current and historical financial results difficult.
Write-off of Deferred Offering Costs
During the third quarter 2008, Perficient incurred a non-cash charge to write off deferred offering costs associated with a shelf registration statement. Perficient management determined there was no intent to use the shelf registration to complete an offering in the near term as a result, these costs were required to be expensed. Perficient has excluded this charge from its calculation of non-GAAP net income and non-GAAP net income per share.