Carbonite: Fiscal 4Q12 Financial Results

(in US$ million)	4Q11	4Q12	FY11	FY12
Revenues	17.3	23.7	60.5	84.0
*Growth*		37%		*39%*
Net income (loss)	(6.1)	(2.2)	(23.7)	(18.9)

Carbonite, Inc. announced financial results for the fourth quarter and year ended December 31, 2012.

"During the fourth quarter, we achieved record revenue, realized ongoing operating leverage, and generated significant free cash flow, even after accelerating the payment of our annual cash bonuses into the quarter," said David Friend, chairman and CEO of Carbonite. "As we enter 2013, the company will further invest in the small business market where our recent acquisition of Zmanda has bolstered our offerings with comprehensive backup and database archiving. While we continue to enhance our consumer value proposition, our small business offerings are experiencing faster growth, higher margins, and better retention and will be the key drivers of our growth going forward."

Financial and Operating Metrics
for the Fourth Quarter Ended December 31, 2012

Bookings for the fourth quarter of 2012 were $27.5 million, an increase of 19% from $23.2 million in the fourth quarter of 2011.
Revenue for the fourth quarter of 2012 was $23.7 million, an increase of 37% from $17.3 million in the fourth quarter of 2011.
Gross margin for the fourth quarter of 2012 was 65.9%, compared to 60.9% in the fourth quarter of 2011.
Net loss for the fourth quarter of 2012 was ($2.2) million, compared to ($6.1) million in the fourth quarter of 2011.
Net loss attributable to common stockholders for the fourth quarter of 2012 was ($0.09) per share (basic and diluted), compared to a net loss of ($0.24) per share (basic and diluted) in the fourth quarter of 2011.
Non-GAAP net loss for the fourth quarter of 2012, which excludes amortization expense on intangible assets, stock-based compensation expense, and patent litigation expense was ($0.3) million, compared to ($5.3) million in the fourth quarter of 2011.
Non-GAAP net loss per common share for the fourth quarter of 2012 was ($0.01), compared to a non-GAAP net loss per common share of ($0.21) in the fourth quarter of 2011.
Cash flow from operations for the fourth quarter of 2012 was $5.3 million, compared to $4.9 million in the fourth quarter of 2011.
Non-GAAP free cash flow for the fourth quarter of 2012 was $2.1 million, compared to $0.9 million in the fourth quarter of 2011. Both cash flow from operations and free cash flow for the fourth quarter of 2012 include $1.7 million in 2012 annual bonus payments historically paid out in the first quarter and CFO transition costs.
Cash, cash equivalents, and marketable securities were $55.3 million as of December 31, 2012, compared to $66.3 million as of September 30, 2012. The decline was primarily due to the acquisition of Zmanda Inc. for $13.4 million in net cash which closed on October 31, 2012.
Quarterly retention rate was in the 96% to 97% range, consistent with prior quarters since 2009.

Financial and Operating Metrics for the Full Year 2012

Bookings for the full year 2012 were $98.5 million, an increase of 22% from $80.9 million in 2011.
Revenue for the full year 2012 was $84.0 million, an increase of 39% from $60.5 million in 2011.
Gross margin for the full year 2012 was 65.4%, compared to 61.7% in 2011.
Net loss for the full year 2012 was ($18.9) million, compared to ($23.5) million in 2011.
Net loss attributable to common stockholders for the full year 2012 was ($0.74) per share (basic and diluted), compared to a net loss of ($1.84) per share (basic and diluted) in 2011.
Non-GAAP net loss for the full year 2012, which excludes amortization expense on intangible assets, stock-based compensation expense, patent litigation expense, and a lease exit charge was ($11.7) million, compared to ($21.0) million in 2011.
Non-GAAP net loss per common share for the full year 2012 was ($0.46), compared to a non-GAAP net loss per common share of ($0.84) in 2011.
Cash flow from operations for the full year 2012 was $9.2 million, compared to $7.6 million in 2011. Non-GAAP free cash flow for the full year 2012 was ($4.1) million, compared to ($6.0) million in 2011. Both cash flow from operations and free cash flow for the full year 2012 include $1.7 million in 2012 annual bonus payments historically paid out in the first quarter and CFO transition costs.
Cash, cash equivalents, and marketable securities were $55.3 million as of December 31, 2012, compared to $72.5 million as of December 31, 2011. The decline in cash was primarily due to the acquisition of Zmanda Inc. for $13.4 million in net cash which closed on October 31, 2012.

Recent Business Highlights

Completed the acquisition of Zmanda, Inc., provider of open source and cloud backup solutions. This acquisition will enhance offerings for small businesses with the ability to backup databases and file systems to the cloud, and will enable small businesses and resellers to obtain the backup solutions they need from one vendor.
Announced the appointment of Anthony Folger to the position of CFO and treasurer. He will be responsible for financial strategy and operations. This appointment further strengthens management team as the company moves forward with its strategic growth initiatives.
Added new features to the Carbonite Business suite to better meet the backup needs of the higher education market. Based on feedback from current education customers, the new Groups and Search features will provide an institution with easier management for the cloud backups of their users and devices.
Ranked No. 51 on Deloitte’s Technology Fast 500, a ranking of the 500 fastest growing technology, media, telecommunications, life sciences, and clean technology companies in North America.

Business Outlook

First Quarter 2013: The company expects total revenue for the first quarter to be in the range of $24.3 million to $24.6 million
Full Year 2013: The company expects 2013 total revenue to be in the range of $104.0 million to $106.0 million and non-GAAP net loss per common share to be in the range of ($0.40) to ($0.44). Expectations of non-GAAP net loss per common share for the full year excludes amortization expense on intangible assets, stock-based compensation expense, and patent litigation expense and assumes a tax rate of 0% and weighted average shares outstanding of approximately 25.9 million.

Full Year 2013: The company expects 2013 total revenue to be in the range of $104.0 million to $106.0 million and non-GAAP net loss per common share to be in the range of ($0.40) to ($0.44). Expectations of non-GAAP net loss per common share for the full year excludes amortization expense on intangible assets, stock-based compensation expense, and patent litigation expense and assumes a tax rate of 0% and weighted average shares outstanding of approximately 25.9 million.