MELVILLE, N.Y., April 29, 2014 — FalconStor Software®, Inc. (NASDAQ: FALC), a market leader in data protection and migration, today announced financial results for its first quarter ended March 31, 2014.
“In the first quarter of 2014 the FalconStor team continued to achieve the internal goals that we set for ourselves last year. Virtually all of our metrics for bookings, deferred revenue, cash flow and expense control met the targets that we put in place in the previous quarter,” said Gary Quinn, President and CEO of FalconStor. “We continue to execute our business plan for 2014: To increase our total bookings, while being cost conscious and preserving our cash. We are gaining momentum and we remain optimistic for the future. Among the highlights of the quarter was the first delivery of our new unified technology platform-based approach to data management, on which we will continue to build.”
Financial and Business Highlights and Overview:
Total revenues for the first quarter of 2014 were $12.0 million compared with $15.3 million in the same period a year ago. GAAP loss from operations for the first quarter of 2014 was narrowed to $2.6 million, compared with an operating loss of $3.9 million for the first quarter of 2013. GAAP net loss for the quarter improved to $2.8 million compared with a net loss of $4.4 million for the same period a year ago. Net loss attributable to common stockholders for the quarter, which includes the effects of the accretion to redemption value of the Series A preferred stock and the accrual of preferred stock dividends, was $3.1 million, or $0.06 per share, compared with $4.4 million, or $0.09 per share, for the same period a year ago. Included in the operating results for the first quarter of 2014 and 2013 were expenses of $0.1 million of investigation, litigation and settlement related costs. In addition, included in net loss for the first quarter of 2014 was $0.2 million related to restructuring charges.
Non-GAAP loss from operations narrowed to $1.9 million for the first quarter of 2014, compared with non-GAAP loss from operations of $2.9 million for the same period a year ago. Non-GAAP net loss improved to $2.1 million, or $0.04 per share, in the first quarter of 2014, compared with a non-GAAP net loss of $3.4 million, or $0.07 per share, in the first quarter of 2013. Non-GAAP results exclude the effects of stock-based compensation, costs associated with the Company’s investigations, litigation and settlement related costs, restructuring costs and the effects of preferred stock.
The Company closed the quarter with $27.9 million in cash, cash equivalents and marketable securities. Cash flow from operations for the first quarter of 2014 was $0.3 million compared with cash used in operations of ($1.8) million during the same period in 2013. Deferred revenue at March 31, 2014 was $31.9 million, compared with $29.8 million at December 31, 2013.
The Company will host a conference call to discuss its financial results on Tuesday, April 29, 2014 at 4:30 p.m. EDT. To participate in the conference call, please dial:
Toll Free: 1-888-549-7880
To view the presentation, please copy and paste the following link into your browser and register for this meeting. Once you have registered for the meeting, you will receive an email message confirming your registration.
Meeting: FalconStor Q1 2014 Earnings
Meeting password: q1numbers14
Meeting Number: 760793298
If you are unable to register via the Internet, please contact Melissa Keir, Investor Relations at 631-773-4334 or firstname.lastname@example.org.
A conference call replay will be available beginning April 29 at 6:30 p.m. EDT through 11:59 p.m. EST on May 6. To listen to the replay of the call, dial toll free: 1-800-406-7325 or International: +1-303-590-3030, passcode: 4678966, or visit our website at www.falconstor.com/investors.
Non-GAAP Financial Measures
The non-GAAP financial measures used in this press release are not prepared in accordance with generally accepted accounting principles and may be different from non-GAAP financial measures used by other companies. The Company’s management refers to these non-GAAP financial measures in making operating decisions because they provide meaningful supplemental information regarding the Company’s operating performance. In addition, these non-GAAP financial measures facilitate management’s internal comparisons to the Company’s historical operating results and comparisons to competitors’ operating results. We include these non-GAAP financial measures (which should be viewed as a supplement to, and not a substitute for, their comparable GAAP measures) in this press release because we believe they are useful to investors in allowing for greater transparency into the supplemental information used by management in its financial and operational decision-making. The non-GAAP financial measures exclude (i) costs associated with the Company’s class action and derivative lawsuits, government investigations, and related legal fees, (ii) restructuring costs, (iii) effects of our Series A Preferred Stock and (iv) noncash stock-based compensation charges and any potential tax effects. For a reconciliation of our GAAP and non-GAAP financial results, please refer to our Non-GAAP Operating Data GAAP Reconciliation, presented in this release.
FalconStor Software, Inc. (NASDAQ: FALC) is transforming how enterprises move, store, protect and optimize data. Founded in 2000, FalconStor offers an award-winning platform for data migration, business continuity, disaster recovery, optimized backup and deduplication. FalconStor helps maximize data availability and system uptime to ensure nonstop business productivity, while simplifying data management to reduce operational costs. Our open, integrated software solutions reduce vendor lock-in and give enterprises the freedom to choose the applications and hardware components that make the best sense for their business. FalconStor solutions are available and supported by OEMs, as well as leading system integrators and resellers worldwide. FalconStor is headquartered in Melville, N.Y. with offices throughout Europe and the Asia Pacific region. For more information, visit www.falconstor.com or call 1-866-NOW-FALC (866-669-3252).
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This press release includes forward-looking statements that involve risk and uncertainties that could cause actual results to differ materially from the forward-looking statements. These risks and uncertainties include: delays in product development; market acceptance of FalconStor’s products and services; technological change in the data protection industry; competition in the data protection market; results and costs associated with governmental investigations; intellectual property issues; and other risk factors discussed in FalconStor’s reports on Forms 10-K, 10-Q and other reports filed with the Securities and Exchange Commission.
FalconStor and FalconStor Software are registered trademarks of FalconStor Software, Inc., in the U.S. and other countries. All other company and product names contained herein may be trademarks of their respective holders.
Links to websites or pages controlled by parties other than FalconStor are provided for the reader’s convenience and information only. FalconStor does not incorporate into this release the information found at those links nor does FalconStor represent or warrant that any information found at those links is complete or accurate. Use of information obtained by following these links is at the reader’s own risk.