CommVault: Fiscal 4Q12 Financial Results
The storage software success story continues.
This is a Press Release edited by StorageNewsletter.com on May 10, 2012 at 2:59 pm| (in US$ million) | 4Q11 | 4Q12 | FY11 | FY12 |
| Revenues | 89.6 | 114.0 | 314.8 | 406.6 |
| Growth | 27% | 29% | ||
| Net income (loss) | 4.8 | 9.8 | 21.0 | 31.9 |
CommVault Systems, Inc. announced its financial results for the fourth quarter and fiscal year ended March 31, 2012.
N. Robert Hammer, CommVault’s chairman, president and CEO stated: "CommVault achieved excellent fourth quarter results. This was our seventh consecutive quarter of delivering record revenues and we continue to generate strong cash flows. Our fourth quarter was highlighted by continuing momentum in software revenues which increased 34% year-over-year and 14% sequentially. This growth in software revenue was driven by record enterprise software deals (transactions greater than $100,000) and strong demand across all geographies."
Hammer added: "Our fourth quarter results concluded a strong fiscal 2012 where we achieved substantial improvements in all aspect of our business. Our solid finish to fiscal 2012 reinforces the underlying strength of our business and we believe that we are entering fiscal 2013 with excellent momentum."
Total revenues for the fourth quarter of fiscal 2012 were $114.0 million, an increase of 27% over the fourth quarter of fiscal 2011 and an increase of 10% over the prior quarter. Software revenue in the fourth quarter of fiscal 2012 was $58.8 million, an increase of 34% year-over-year and 14% sequentially. Services revenue in the fourth quarter of fiscal 2012 was $55.3 million, an increase of 21% year-over-year and 6% sequentially.
For the full fiscal year, total revenues were $406.6 million, an increase of 29% over fiscal 2011. Software revenue for the full fiscal year was $201.8 million, an increase of 35% over fiscal 2011. Services revenue for the full fiscal year was $204.8 million, an increase of 24% over fiscal 2011.
Income from operations (EBIT) was $13.9 million for the fourth quarter, a 12% increase from $12.4 million in the same period of the prior year. Non-GAAP income from operations (EBIT) increased 22% to $21.1 million in the fourth quarter of fiscal 2012 compared to $17.4 million in the fourth quarter of the prior year. On a sequential basis, non-GAAP income from operations (EBIT) increased 8% in the fourth quarter of fiscal 2012.
Income from operations (EBIT) for the full fiscal year was $49.3 million, an increase of 38% over fiscal 2011. Non-GAAP income from operations (EBIT) increased 39% to $73.7 million in fiscal 2012 compared to $52.9 million in fiscal 2011.
For the fourth quarter of fiscal 2012, CommVault reported net income of $9.8 million, an increase of $5.0 million compared to the same period of the prior year. Non-GAAP net income for the quarter increased 18% to $13.7 million, or $0.29 per diluted share, from $11.6 million, or $0.25 per diluted share, in the same period of the prior year.
For the full fiscal year, CommVault reported net income of $31.9 million, an increase of $10.9 million compared to fiscal 2011. Non-GAAP net income for the full fiscal year increased 35% to $47.6 million, or $1.01 per diluted share, from $35.3 million, or $0.76 per diluted share, in fiscal 2011.
Operating cash flow totaled $30.1 million for the fourth quarter of fiscal 2012 compared to $19.0 million in the fourth quarter of fiscal 2011. For the full fiscal year, operating cash flow was $100.0 million, an increase of 91% compared to $52.4 million for fiscal 2011.
Total cash and short-term investments were $300.2 million as of March 31, 2012 compared to $218.3 million as of March 31, 2011. There were no share repurchases during the fourth quarter of fiscal 2012, which leaves $52.8 million remaining in the existing repurchase plan available through March 31, 2013.
Recent Business Highlights:
- On April 23, 2012, announced an expanded collaboration with Microsoft Corp. to offer a cloud storage capability that combines Simpana software with the benefits and flexibility of storing data on the Windows Azure cloud platform.
- On April 12, 2012, announced the opening of a product development center in Bangalore, which increases the company’s existing presence in Hyderabad, India, and accelerates ongoing product development efforts worldwide.
- On Tuesday April 10, 2012, announced that The Info-Tech Research Group has named CommVault a Champion in both Enterprise Backup and Email Archiving in a pair of recent reports: Info-Tech Research Group’s Enterprise Backup Software Vendor Landscape and Info-Tech Research Group’s Email Archiving Vendor Plus Landscape.
- On March 21, 2012, announced the results of the company’s technical support survey in which CommVault achieved a 94% customer satisfaction rating. This benchmark raises the bar for excellence in delivering technical support and services that top industry averages for customer satisfaction, loyalty and retention.
CommVault anticipates that in any given quarter its non-GAAP tax rate may be either higher or lower than the GAAP tax rate as evidenced by historical fluctuations. The GAAP tax rate for the fourth quarter of fiscal 2012 was 30% and the GAAP tax rate for the fourth quarter of fiscal 2011 was 62%. On an annual basis, the GAAP tax rate over the past six fiscal years was 36% for fiscal 2012, 42% for fiscal 2011, 43% for fiscal 2010, 44% for fiscal 2009, 23% for fiscal 2008 and (241%) for fiscal 2007. In addition, CommVault’s cash tax rate has been significantly lower than its GAAP tax rate in recent fiscal years. The cash tax rate for fiscal 2012 is estimated to be approximately 14% and the cash tax rate over the prior three fiscal years is estimated to be approximately 11% for fiscal 2011, approximately 10% for fiscal 2010 and approximately 13% for fiscal 2009. CommVault expects that its cash tax rate will remain lower than its GAAP tax rate through fiscal 2013 and into fiscal 2014. CommVault defines its cash tax rate as the total amount of cash income taxes payable for the fiscal year divided by consolidated GAAP pre-tax income.
CommVault measured itself to non-GAAP tax rates of 34% in fiscal 2011 and 36% in fiscal 2012 and anticipates that it will measure itself to a non-GAAP tax rate of 37% in fiscal 2013. It believes that the use of a non-GAAP tax rate is a useful measure as it allows management and investors to compare its operating results on a more consistent basis over the multiple periods presented in its earnings release without the impact of significant variations in the tax rate as more fully described above. It is also more reflective of the increase in the cash tax rate as it approaches the GAAP tax rate over the next one to two fiscal years. Non-GAAP EPS is derived from non-GAAP net income divided by the weighted average shares outstanding on a fully diluted basis.
Comments
CommVault continues to grow, and rapidly, with this seventh consecutive quarter and twelfth successive year of record revenues and eight years of non stop profitability.
It's the most growing storage software firm since several years if you include only the big ones. A lot storage companies registered decreasing sales from the December 2011 to the March 2012 quarters due to Thai flood. Not CommVault having revenues increasing, but with a modest 10%.
For its most recent three-month period, it even beats expectations.
Another impressive figure is the percentage of the revenues coming from highly profitable services and software only sales: around 50%. Per comparison, its only 36% for software company FalconStor.
It's really a huge success for Bob Hammer, 69, chairman, president and CEO since March 1998, when management first decided to change the company's strategy, and now with an annual salary approaching $1 million.
CommVault is an old story that started back in 1988 as a development group within Bell Labs, only to become, a few years later, AT&T Network Systems' strategic business unit. After an MBO in May 1996, it continued to sell software products integrated with third party hardware, primarily Unix servers and optical and magnetic tape libraries marketed as ABARS, or Automated Backup and Recovery Solution, through 1997, when it was renamed Vault 98.
In April 1998, a new management team headed by Hammer changed the company's direction, recognizing that its legacy Vault 98 technology was too limited to address the broader data management market opportunity. This vision resulted in a two-year development project that culminated in the introduction of Galaxy data protection software in February 2000 and then in 2002 the launch its current flagship product, Simpana, now in version 9, an all-in-one single-platform architecture doing it all: analyzing, replicating, protecting, archiving and searching data with innovative technologies for snapshots, data reduction and cloud storage integration. CommVault developed itself all its modules and never acquired any company.
The start-up became public in 2006 following a $161 million successful IPO after raising a total of $74.8 million of financial funding from investors including Microsoft.
It has two strong reliable OEMs since many years, HDS and mainly Dell representing around one fourth of its revenues, and excellent relationship with Microsoft.
Recently there was some rumors of acquisition by big storage companies, notably Dell. But this latter finally preferred to buy the small and remarkable start-up AppAssure Software at an unknown price rather than to invest a huge sum to get CommVault with a current market cap of $2.4 billion. It could progressively lose revenues from Dell as a result of this acquisition.
The value of CommVault is now so high that we don't see any storage giant putting so much money to get it except maybe EMC or NetApp, and probably neither HDS, which was always reluctant to put a lot of money in software acquisitions, nor IBM having its own Tivoli software solutions.
Main competitors are CA, EMC, HP, IBM and Symantec.
CommVault's Financial Results Since 2001
* Other revenues than software and services: 0.1 in 2003,
1.4 in 2002 and 5.2 in 2001
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