Kofax Reports Financial Results for the Third Quarter and Nine Months Ended March 31, 2013

Kofax Reports Financial Results for the Third Quarter and Nine Months Ended March 31, 2013

IRVINE, Calif.--(BUSINESS WIRE)-- Kofax® plc (ISE: KFX) , a leading provider of smart process applications for the business critical First Mile™ of customer interactions, today reported its unaudited financial results for the quarter and nine months ended March 31, 2013.

Third Quarter Financial Highlights:

  • Software license revenue increased 20.5% to $26.4 million (Prior Year: $21.9 million) or 20.9% in constant currency (CC)
  • Total revenues increased 9.6% to $64.3 million (Prior Year: $58.7 million) and 10.0% in CC
  • Income from operations for the quarter increased to $3.5 million (Prior Year: a loss of $1.1 million)
  • Adjusted income from operations1 (adjusted EBITDA) increased 76.5% to $8.4 million (Prior Year: $4.7 million), or a 13.0% margin (Prior Year: 8.1%)
  • Adjusted diluted EPS2 for the quarter was $0.06 (Prior Year: $0.03)
  • Adjusted cash generated from operations for the quarter was $16.3 million (Prior Year: $23.8 million)
  • Quarter end cash increased to $86.8 million (Prior Year: $82.0 million)

Third Quarter Operating Highlights:

  • Received a $4.8 million order from a national government agency in Western Europe for software and maintenance services relating to a large scale, nationwide capture project - one of the largest sales in the history of the Company
  • Acquired Altosoft, Inc., a leading developer of business intelligence and analytics software, to extend Kofax's product portfolio and provide more actionable information to customers sooner
  • Launched six new software products and releases, including:
    • Kofax Customer Onboarding™, a smart process application that lets users submit data and images of new customer enrollment documents from any source - including mobile devices, internet portals, desktop scanners and multifunction peripherals (MFPs) - and then ensures that the onboarding process is completed in a timely, accurate and cost effective manner while optimizing the customer experience
    • Kofax Mailroom Automation, the first smart process application for digital mailrooms to combine capture, process management and analytics capabilities, and thereby offer comprehensive document processing services
    • Kofax Mobile CaptureTM for Driver Licenses, a smart mobile app that lets mobile device users capture images and data contained in U.S. driver licenses
    • Kofax Mobile CaptureTM Auto Claims App, a smart mobile app for First Notice of Loss (FNOL) auto accident claims that lets policyholders use mobile devices to capture images, documents and pictures at the scene of an accident, and initiate a claim with their insurer
    • Kofax MarkView® for Accounts Payable 8.0, which adds mobile capabilities to this accounts payable automation solution for SAP and Oracle ERP users
    • Kofax Transformation Modules™ 6.0, which now automatically classifies, separates and extracts content from unstructured in addition to semi-structured and structured documents
  • Held Transform 2013, the Company's annual global end user customer and channel partner conference in San Diego, CA with almost 600 attendees from over 25 countries
  • Received U.S. patent number 8,345,981, which covers technology used to ensure the validity of data extracted from documents by reverse matching that data with information contained in an organization's systems of record

A summary of Kofax's revenue and adjusted EBITDA for the third quarter and nine months ended March 31, 2013 compared to the prior year periods is as follows:

QuarterNine Months
Unaudited     Y/Y     In     Y/Y     In




Software Licenses 26.420.5%20.9% 73.6-7.4%-6.1%
Maintenance Services30.06.7%6.8%90.76.5%8.4%
Professional Services 7.9 -8.7%-7.6% 23.9 5.8%7.2%
Total Revenues64.39.6%10.0%188.20.5%2.1%

Adjusted EBITDA


Adjusted EBITDA Margin


The foregoing financial highlights and summary of Kofax's revenue and adjusted EBITDA include Altosoft's results since March 1, 2013.

Commenting on these results, Reynolds C. Bish, Chief Executive Officer, said: "We had a very productive third quarter from an operational perspective, and were pleased with the progress made in strengthening our sales organization across all geographies and product lines as well as the number of new product offerings launched into the faster growing segments of our target markets. We were also pleased with our financial results as software license revenue and total revenues were higher than they've been in the third quarter of the last two fiscal years. We returned to reporting year over year growth in all revenue categories except professional services, which - as expected - were impacted by the mix of our software license revenue and relatively more indirect than direct sales, with our channel partners often providing these services. Our adjusted EBITDA, adjusted cash generated from operations and quarter end cash were all as we would have expected given our second and third quarter financial results and the acquisition of Altosoft."

Bish continued: "Despite our strong third quarter results we remain aware of the unsettled global macroeconomic conditions and recessionary environments in many Western European countries. As a result, we are reaffirming our guidance for all of fiscal year 2013 for no to low single digit growth in total revenue on a constant currency basis and an adjusted EBITDA of approximately 10% less than that reported in fiscal year 2012."

Conference Call

Reynolds C. Bish and Chief Financial Officer Jamie Arnold will review the results and conduct a question and answer session via teleconference on May 1 at 8:00 am UK time / 3:00 am Eastern Time in the U.S. A telephonic replay of the teleconference will be available by 1:00 pm UK time on May 1. These can be accessed as follows:

Live CallReplayAccess Code
U.K.+44 (0)20 3450 9987+44 (0)20 3427 05987432822#
U.S.+1 (646) 254-3360+1 (347) 366-95657432822#

A transcript and MP3 recording of the call will be available in the investor relations section of the Company's website by 4:00 p.m. UK time / 11:00 a.m. Eastern Time in the U.S. on May 1. These can be accessed at http://www.kofax.com/investors/presentations.php.

About Kofax

Kofax plc (ISE: KFX) is a leading provider of innovative smart capture and process automation software and solutions for the business critical First Mile of customer interactions. These begin with an organization's systems of engagement, which generate real time, information intensive communications from customers, and provide an essential connection to their systems of record, which are typically large scale, rigid enterprise applications and repositories not easily adapted to more contemporary technology. Success in the First Mile can dramatically improve an organization's customer experience and greatly reduce operating costs, thus driving increased competitiveness, growth and profitability. Kofax software and solutions provide a rapid return on investment to more than 20,000 customers in financial services, insurance, government, healthcare, business process outsourcing and other markets. Kofax delivers these through its own sales and service organization, and a global network of more than 800 authorized partners in more than 75 countries throughout the Americas, EMEA and Asia Pacific. For more information, visit kofax.com.

1. Adjusted income from operations (Adjusted EBITDA) is IFRS based income from operations excluding the effects of share-based payment expense, depreciation expense, amortization of acquired intangible assets, acquisition related costs, restructuring costs and other operating expense, net.

2. Adjusted diluted EPS is calculated using adjusted income from operations (Adjusted EBITDA) reduced by depreciation and income taxes and the fully diluted shares outstanding.

© 2013 Kofax, plc. "Kofax" and "MarkView" are registered trademarks, and "First Mile", "Kofax Mobile Capture" and "Kofax Transformation Modules" are trademarks of Kofax, plc. All other trademarksare the property of their respective owners.

Media Contact:
Kofax plc
Peter Hargittay
Director of Corporate Communications
+1 (949) 783-1549
Investor Contacts:
MKR Group Inc.
Todd Kehrli
+1 (323) 468-2300
FTI Consulting
Sophie McMillan
+44 (0) 20 7831 3113

KEYWORDS:   United Kingdom  United States  Europe  North America  California


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