CommVault: Fiscal 4Q14 Financial Results

CommVault Systems, Inc. announced its financial results for the fourth quarter and fiscal year ended March 31, 2014.

“CommVault had another solid year in fiscal 2014 achieving record revenue, non-GAAP operating profit, non-GAAP EPS, and operating cash flows. Total revenues grew by 18% and software revenue grew by 17%. Non-GAAP EBIT grew 34% and we expanded non-GAAP EBIT margins by approximately 310 basis points. We also accomplished several key objectives, which validated our long-term strategy and strengthened our strategic position. In the quarter, we had mixed results. On the positive side, we had strong results in EMEA and good success in building out our cloud business. These positive results were offset by lower than forecasted results in the Americas, which negatively impacted our license revenue growth for the quarter. The results in the America’s were surprising given our large enterprise deal funnel and good outlook for the quarter as of our prior earnings call,” said N. Robert Hammer, CommVault’s chairman, president and CEO.

“As a result of our increased confidence in our strategic position, we will accelerate investments across the company in fiscal 2015. Additionally, we repurchased $50 million of our stock during the fourth quarter and our board of directors recently increased our share repurchase plan by $50 million so we now have $150 million remaining in our plan. Our objective is to deliver solid double digit revenue growth for fiscal 2015,” Hammer concluded.

Total revenues for the fourth quarter of fiscal 2014 were $156.8 million, an increase of 13% over the fourth quarter of fiscal 2013 and an increase of 2% sequentially. Software revenue in the fourth quarter of fiscal 2014 was $79.0 million, an increase of 10% year-over-year and flat sequentially. Services revenue in the fourth quarter of fiscal 2014 was $77.8 million, an increase of 18% year-over-year and 5% sequentially.

For the full fiscal year, total revenues were $586.3 million, an increase of 18% over fiscal 2013. Software revenue for the full fiscal year was $294.4 million, an increase of 17% over fiscal 2013. Services revenue for the full fiscal year was $291.9 million, an increase of 19% over fiscal 2013.

On a GAAP basis, income from operations (EBIT) was $24.9 million for the fourth quarter, a 14% increase from the $21.9 million in the same period of the prior year. Non-GAAP income from operations (EBIT) increased 27% to $40.3 million in the fourth quarter of fiscal 2014 compared to $31.8 million in the fourth quarter of the prior year. On a sequential basis, non-GAAP income from operations (EBIT) decreased 5% in the fourth quarter of fiscal 2014.

On a GAAP basis, income from operations (EBIT) for the full fiscal year was $100.4 million, an increase of 24% over fiscal 2013. Non-GAAP income from operations (EBIT) increased 34% to $151.9 million in fiscal 2014 compared to $113.1 million in fiscal 2013.

For the fourth quarter of fiscal 2014, CommVault reported net income of $15.7 million, a decrease of $1.3 million compared to the same period of the prior year. Non-GAAP net income for the quarter increased 26% to $25.5 million, or $0.52 per diluted share, from $20.2 million, or $0.41 per diluted share, in the same period of the prior year.

For the full fiscal year, CommVault reported net income of $64.1 million, an increase of $10.9 million compared to fiscal 2013. Non-GAAP net income for the full fiscal year increased 34% to $96.2 million, or $1.94 per diluted share, from $71.9 million, or $1.49 per diluted share, in fiscal 2013.

Operating cash flow totaled $39.9 million for the fourth quarter of fiscal 2014 which was a decrease of $3.0 million compared to the fourth quarter of fiscal 2013. For the full fiscal year, operating cash flow was $119.1 million, an increase of 6% compared to $112.7 million for fiscal 2013. Total cash and short-term investments were $482.7 million as of March 31, 2014 compared to $435.9 million as of March 31, 2013.

During the fourth quarter of fiscal 2014, CommVault repurchased $50.0 million of common stock (775,000 shares) under its share repurchase program bringing the cumulative repurchases under the current program to $167.2 million. On April 24, 2014, the company’s board of directors authorized a $50.0 million increase to the company’s existing stock repurchase program which expires on March 31, 2015. After these fourth quarter repurchases and the increase to the plan by the board of directors, $150.0 million remains under the current stock repurchase authorization.

Recent Business Highlights:

• On March 13, 2014, Simpana software platform has become the data protection platform of choice for more than 200 service providers. CommVault also unveiled a three-pronged cloud business strategy that builds on its leadership in software innovation and, through strategic relationships with service provider partners, delivers solutions to simplify and secure the transition of these services providers and their customers to cloud computing.
• On March 3, 2014, Simpana 10 software had achieved certified integration with the SAP HANA platform. SAP HANA is being used as an enterprise cornerstone providing streamlined analytics, planning, and predictive and sentiment assessments. Simpana 10 software delivers robust and comprehensive backup and recovery for environments running SAP HANA with the speed, ease of use and performance required in the fast-moving world of real-time, predictive analytics.