☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
02-0433294
|
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
|
|
|
|
325 Corporate Drive
|
03801-6808
|
|
Portsmouth,
|
New Hampshire
|
|
(Address of principal executive offices)
|
(Zip Code)
|
Title of each class:
|
Trading Symbol(s):
|
Name of each exchange on which registered:
|
Common Stock, $.001 par value per share
|
EPAY
|
The Nasdaq Global Select Market
|
Large accelerated filer
|
☒
|
Accelerated filer
|
☐
|
|
|
|
|
Non-accelerated filer
|
☐
|
Smaller reporting company
|
☐
|
|
|
|
|
|
|
Emerging growth company
|
☐
|
BOTTOMLINE TECHNOLOGIES (de), INC.
|
||
|
||
FORM 10-Q
|
||
FOR THE FISCAL QUARTER ENDED DECEMBER 31, 2019
|
||
TABLE OF CONTENTS
|
||
|
|
|
PART I
|
Page
|
|
|
|
|
Item 1.
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
PART II
|
|
|
|
|
|
Item 1.
|
||
Item 1A.
|
||
Item 2.
|
||
Item 6.
|
||
|
Bottomline Technologies (de), Inc.
|
||||||||
Unaudited Condensed Consolidated Balance Sheets
|
||||||||
(in thousands)
|
||||||||
|
|
December 31,
|
|
June 30,
|
||||
|
|
2019
|
|
2019
|
||||
|
|
|
|
|
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
80,817
|
|
|
$
|
92,164
|
|
Cash held for customers
|
|
8,475
|
|
|
5,637
|
|
||
Marketable securities
|
|
10,153
|
|
|
7,541
|
|
||
Accounts receivable net of allowances for doubtful accounts of $893 at December 31, 2019 and $824 at June 30, 2019
|
|
67,946
|
|
|
77,285
|
|
||
Prepaid expenses and other current assets
|
|
29,451
|
|
|
30,434
|
|
||
Total current assets
|
|
196,842
|
|
|
213,061
|
|
||
Property and equipment, net
|
|
71,616
|
|
|
54,541
|
|
||
Operating lease right-of-use assets, net
|
|
24,294
|
|
|
—
|
|
||
Goodwill
|
|
208,836
|
|
|
206,101
|
|
||
Intangible assets, net
|
|
161,695
|
|
|
168,349
|
|
||
Other assets
|
|
31,648
|
|
|
27,177
|
|
||
Total assets
|
|
$
|
694,931
|
|
|
$
|
669,229
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
15,940
|
|
|
$
|
10,947
|
|
Accrued expenses and other current liabilities
|
|
42,739
|
|
|
33,945
|
|
||
Customer account liabilities
|
|
8,475
|
|
|
5,637
|
|
||
Deferred revenue
|
|
65,166
|
|
|
75,097
|
|
||
Total current liabilities
|
|
132,320
|
|
|
125,626
|
|
||
Borrowings under credit facility
|
|
100,000
|
|
|
110,000
|
|
||
Deferred revenue, non-current
|
|
13,286
|
|
|
17,062
|
|
||
Operating lease liabilities, non-current
|
|
20,988
|
|
|
—
|
|
||
Deferred income taxes
|
|
7,420
|
|
|
10,345
|
|
||
Other liabilities
|
|
24,983
|
|
|
26,819
|
|
||
Total liabilities
|
|
298,997
|
|
|
289,852
|
|
||
Stockholders' equity
|
|
|
|
|
||||
Preferred Stock, $.001 par value:
|
|
|
|
|
||||
Authorized shares-4,000; issued and outstanding shares-none
|
|
—
|
|
|
—
|
|
||
Common Stock, $.001 par value:
|
|
|
|
|
||||
Authorized shares-100,000; issued shares-47,645 at December 31, 2019 and 46,995 at June 30, 2019; outstanding shares-41,697 at December 31, 2019 and 41,315 at June 30, 2019
|
|
48
|
|
|
47
|
|
||
Additional paid-in-capital
|
|
744,359
|
|
|
721,438
|
|
||
Accumulated other comprehensive loss
|
|
(37,631
|
)
|
|
(43,593
|
)
|
||
Treasury stock: 5,948 shares at December 31, 2019 and 5,680 shares at June 30, 2019, at cost
|
|
(140,701
|
)
|
|
(127,095
|
)
|
||
Accumulated deficit
|
|
(170,141
|
)
|
|
(171,420
|
)
|
||
Total stockholders' equity
|
|
395,934
|
|
|
379,377
|
|
||
Total liabilities and stockholders' equity
|
|
$
|
694,931
|
|
|
$
|
669,229
|
|
Bottomline Technologies (de), Inc.
|
||||||||||||||||
Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss)
|
||||||||||||||||
(in thousands, except per share amounts)
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
Three Months Ended December 31,
|
|
Six Months Ended December 31,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Subscriptions
|
|
$
|
84,085
|
|
|
$
|
71,288
|
|
|
$
|
164,151
|
|
|
$
|
141,056
|
|
Software licenses
|
|
2,800
|
|
|
5,665
|
|
|
5,376
|
|
|
10,177
|
|
||||
Service and maintenance
|
|
24,061
|
|
|
26,786
|
|
|
48,886
|
|
|
54,191
|
|
||||
Other
|
|
745
|
|
|
1,107
|
|
|
1,454
|
|
|
1,859
|
|
||||
Total revenues
|
|
111,691
|
|
|
104,846
|
|
|
219,867
|
|
|
207,283
|
|
||||
Cost of revenues:
|
|
|
|
|
|
|
|
|
||||||||
Subscriptions
|
|
33,449
|
|
|
31,352
|
|
|
66,214
|
|
|
63,021
|
|
||||
Software licenses
|
|
157
|
|
|
210
|
|
|
318
|
|
|
441
|
|
||||
Service and maintenance
|
|
12,929
|
|
|
12,528
|
|
|
25,982
|
|
|
25,234
|
|
||||
Other
|
|
504
|
|
|
891
|
|
|
1,020
|
|
|
1,415
|
|
||||
Total cost of revenues
|
|
47,039
|
|
|
44,981
|
|
|
93,534
|
|
|
90,111
|
|
||||
Gross profit
|
|
64,652
|
|
|
59,865
|
|
|
126,333
|
|
|
117,172
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
|
||||||||
Sales and marketing
|
|
26,988
|
|
|
22,585
|
|
|
52,676
|
|
|
45,607
|
|
||||
Product development and engineering
|
|
18,279
|
|
|
16,815
|
|
|
36,628
|
|
|
33,380
|
|
||||
General and administrative
|
|
14,761
|
|
|
11,904
|
|
|
28,106
|
|
|
25,769
|
|
||||
Amortization of acquisition-related intangible assets
|
|
5,213
|
|
|
5,253
|
|
|
10,163
|
|
|
10,579
|
|
||||
Total operating expenses
|
|
65,241
|
|
|
56,557
|
|
|
127,573
|
|
|
115,335
|
|
||||
Income (loss) from operations
|
|
(589
|
)
|
|
3,308
|
|
|
(1,240
|
)
|
|
1,837
|
|
||||
Other expense, net
|
|
(582
|
)
|
|
(858
|
)
|
|
(1,295
|
)
|
|
(1,639
|
)
|
||||
Income (loss) before income taxes
|
|
(1,171
|
)
|
|
2,450
|
|
|
(2,535
|
)
|
|
198
|
|
||||
Benefit from income taxes
|
|
3,780
|
|
|
3,519
|
|
|
3,777
|
|
|
4,853
|
|
||||
Net income
|
|
$
|
2,609
|
|
|
$
|
5,969
|
|
|
$
|
1,242
|
|
|
$
|
5,051
|
|
Net income per share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
0.06
|
|
|
$
|
0.15
|
|
|
$
|
0.03
|
|
|
$
|
0.13
|
|
Diluted
|
|
$
|
0.06
|
|
|
$
|
0.14
|
|
|
$
|
0.03
|
|
|
$
|
0.12
|
|
Shares used in computing net income per share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
41,693
|
|
|
40,635
|
|
|
41,590
|
|
|
40,162
|
|
||||
Diluted
|
|
42,092
|
|
|
41,739
|
|
|
41,917
|
|
|
41,662
|
|
||||
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
||||||||
Unrealized gain (loss) on available for sale securities
|
|
—
|
|
|
8
|
|
|
(3
|
)
|
|
6
|
|
||||
Change in fair value on interest rate hedging instruments
|
|
569
|
|
|
(1,438
|
)
|
|
(108
|
)
|
|
(1,111
|
)
|
||||
Minimum pension liability adjustments
|
|
(172
|
)
|
|
(10
|
)
|
|
8
|
|
|
(56
|
)
|
||||
Foreign currency translation adjustments
|
|
11,944
|
|
|
(2,543
|
)
|
|
6,065
|
|
|
(3,910
|
)
|
||||
Other comprehensive income (loss), net of tax:
|
|
12,341
|
|
|
(3,983
|
)
|
|
5,962
|
|
|
(5,071
|
)
|
||||
Comprehensive income (loss)
|
|
$
|
14,950
|
|
|
$
|
1,986
|
|
|
$
|
7,204
|
|
|
$
|
(20
|
)
|
Bottomline Technologies (de), Inc.
|
|||||||||||||||
Unaudited Condensed Consolidated Statements of Stockholders' Equity
|
|||||||||||||||
(in thousands)
|
|||||||||||||||
Three Months Ended December 31, 2019
|
|||||||||||||||
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Treasury Stock
|
|
Accumulated Deficit
|
|
Total Stockholders' Equity
|
||||
Shares
|
|
Amount
|
Shares
|
|
Amount
|
||||||||||
Balance at September 30, 2019
|
47,385
|
|
$47
|
|
$733,312
|
|
$(49,972)
|
|
5,853
|
|
$(135,701)
|
|
$(172,750)
|
|
$374,936
|
Issuance of common stock for employee stock purchase plan and upon exercise of stock options
|
—
|
|
—
|
|
1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1
|
Vesting of restricted stock awards
|
260
|
|
1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1
|
Repurchase of common stock to be held in treasury
|
—
|
|
—
|
|
—
|
|
—
|
|
95
|
|
(5,000)
|
|
—
|
|
(5,000)
|
Stock compensation plan expense
|
—
|
|
—
|
|
11,046
|
|
—
|
|
—
|
|
—
|
|
—
|
|
11,046
|
Minimum pension liability adjustments, net of tax
|
—
|
|
—
|
|
—
|
|
(172)
|
|
—
|
|
—
|
|
—
|
|
(172)
|
Net income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
2,609
|
|
2,609
|
Change in fair value on interest rate hedging instruments
|
—
|
|
—
|
|
—
|
|
569
|
|
—
|
|
—
|
|
—
|
|
569
|
Foreign currency translation adjustment
|
—
|
|
—
|
|
—
|
|
11,944
|
|
—
|
|
—
|
|
—
|
|
11,944
|
Balance at December 31, 2019
|
47,645
|
|
$48
|
|
$744,359
|
|
$(37,631)
|
|
5,948
|
|
$(140,701)
|
|
$(170,141)
|
|
$395,934
|
Three Months Ended December 31, 2018
|
|||||||||||||||
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Treasury Stock
|
|
Accumulated Deficit
|
|
Total Stockholders' Equity
|
||||
Shares
|
|
Amount
|
Shares
|
|
Amount
|
||||||||||
Balance at September 30, 2018
|
46,136
|
|
$46
|
|
$690,925
|
|
$(31,721)
|
|
5,730
|
|
$(128,216)
|
|
$(181,770)
|
|
$349,264
|
Issuance of common stock for employee stock purchase plan and upon exercise of stock options
|
2
|
|
—
|
|
20
|
|
—
|
|
—
|
|
—
|
|
—
|
|
20
|
Vesting of restricted stock awards
|
293
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Stock compensation plan expense
|
—
|
|
—
|
|
9,575
|
|
—
|
|
—
|
|
—
|
|
—
|
|
9,575
|
Warrant settlements
|
37
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Minimum pension liability adjustments, net of tax
|
—
|
|
—
|
|
—
|
|
(10)
|
|
—
|
|
—
|
|
—
|
|
(10)
|
Net income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
5,969
|
|
5,969
|
Unrealized gain on available for sale securities, net of tax
|
—
|
|
—
|
|
—
|
|
8
|
|
—
|
|
—
|
|
—
|
|
8
|
Change in fair value on interest rate hedging instruments
|
—
|
|
—
|
|
—
|
|
(1,438)
|
|
—
|
|
—
|
|
—
|
|
(1,438)
|
Foreign currency translation adjustment
|
—
|
|
—
|
|
—
|
|
(2,543)
|
|
—
|
|
—
|
|
—
|
|
(2,543)
|
Balance at December 31, 2018
|
46,468
|
|
$46
|
|
$700,520
|
|
$(35,704)
|
|
5,730
|
|
$(128,216)
|
|
$(175,801)
|
|
$360,845
|
Six Months Ended December 31, 2019
|
|||||||||||||||
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Treasury Stock
|
|
Accumulated Deficit
|
|
Total Stockholders' Equity
|
||||
Shares
|
|
Amount
|
|
|
|
Shares
|
|
Amount
|
|
|
|||||
Balance at June 30, 2019
|
46,995
|
|
47
|
|
721,438
|
|
(43,593)
|
|
5,680
|
|
(127,095)
|
|
(171,420)
|
|
379,377
|
Issuance of common stock for employee stock purchase plan and upon exercise of stock options
|
13
|
|
—
|
|
776
|
|
—
|
|
(60)
|
|
1,399
|
|
—
|
|
2,175
|
Vesting of restricted stock awards
|
637
|
|
1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1
|
Repurchase of common stock to be held in treasury
|
—
|
|
—
|
|
—
|
|
—
|
|
328
|
|
(15,005)
|
|
—
|
|
(15,005)
|
Stock compensation plan expense
|
—
|
|
—
|
|
22,145
|
|
—
|
|
—
|
|
—
|
|
—
|
|
22,145
|
Minimum pension liability adjustments, net of tax
|
—
|
|
—
|
|
—
|
|
8
|
|
—
|
|
—
|
|
—
|
|
8
|
Net income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1,242
|
|
1,242
|
Cumulative effect of adoption of updated lease standard
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
37
|
|
37
|
Unrealized loss on available for sale securities, net of tax
|
—
|
|
—
|
|
—
|
|
(3)
|
|
—
|
|
—
|
|
—
|
|
(3)
|
Change in fair value on interest rate hedging instruments
|
—
|
|
—
|
|
—
|
|
(108)
|
|
—
|
|
—
|
|
—
|
|
(108)
|
Foreign currency translation adjustment
|
—
|
|
—
|
|
—
|
|
6,065
|
|
—
|
|
—
|
|
—
|
|
6,065
|
Balance at December 31, 2019
|
47,645
|
|
$48
|
|
$744,359
|
|
$(37,631)
|
|
5,948
|
|
$(140,701)
|
|
$(170,141)
|
|
$395,934
|
Six Months Ended December 31, 2018
|
|||||||||||||||
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Treasury Stock
|
|
Accumulated Deficit
|
|
Total Stockholders' Equity
|
||||
Shares
|
|
Amount
|
|
|
|
Shares
|
|
Amount
|
|
|
|||||
Balance at June 30, 2018
|
44,834
|
|
45
|
|
678,549
|
|
(30,633)
|
|
5,806
|
|
(129,914)
|
|
(207,115)
|
|
310,932
|
Issuance of common stock for employee stock purchase plan and upon exercise of stock options
|
19
|
|
—
|
|
40
|
|
—
|
|
(76)
|
|
1,698
|
|
—
|
|
1,738
|
Vesting of restricted stock awards
|
683
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Stock compensation plan expense
|
—
|
|
—
|
|
21,936
|
|
—
|
|
—
|
|
—
|
|
—
|
|
21,936
|
Warrant settlements
|
932
|
|
1
|
|
(5)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(4)
|
Minimum pension liability adjustments, net of tax
|
—
|
|
—
|
|
—
|
|
(56)
|
|
—
|
|
—
|
|
—
|
|
(56)
|
Net income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
5,051
|
|
5,051
|
Cumulative effect of adoption of updated revenue recognition standard
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
26,263
|
|
26,263
|
Unrealized loss on available for sale securities, net of tax
|
—
|
|
—
|
|
—
|
|
6
|
|
—
|
|
—
|
|
—
|
|
6
|
Change in fair value on interest rate hedging instruments
|
—
|
|
—
|
|
—
|
|
(1,111)
|
|
—
|
|
—
|
|
—
|
|
(1,111)
|
Foreign currency translation adjustment
|
—
|
|
—
|
|
—
|
|
(3,910)
|
|
—
|
|
—
|
|
—
|
|
(3,910)
|
Balance at December 31, 2018
|
46,468
|
|
$46
|
|
$700,520
|
|
$(35,704)
|
|
5,730
|
|
$(128,216)
|
|
$(175,801)
|
|
$360,845
|
Bottomline Technologies (de), Inc.
|
||||||||
Unaudited Condensed Consolidated Statements of Cash Flows
|
||||||||
(in thousands)
|
||||||||
|
|
Six Months Ended December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
|
|
|
|
|
||||
Operating activities:
|
|
|
|
|
||||
Net income
|
|
$
|
1,242
|
|
|
$
|
5,051
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
||||
Amortization of acquisition-related intangible assets
|
|
10,163
|
|
|
10,579
|
|
||
Stock-based compensation plan expense
|
|
22,009
|
|
|
21,891
|
|
||
Depreciation and other amortization
|
|
12,652
|
|
|
11,191
|
|
||
Gain on sale of cost-method investment
|
|
—
|
|
|
(237
|
)
|
||
Deferred income tax benefit
|
|
(5,619
|
)
|
|
(6,177
|
)
|
||
Provision for allowances on accounts receivable
|
|
136
|
|
|
159
|
|
||
Amortization of debt issuance costs
|
|
207
|
|
|
208
|
|
||
Amortization of discount on investments
|
|
(45
|
)
|
|
(75
|
)
|
||
Loss on disposal of equipment
|
|
76
|
|
|
594
|
|
||
Loss on foreign exchange
|
|
266
|
|
|
326
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Accounts receivable
|
|
9,818
|
|
|
8,827
|
|
||
Prepaid expenses and other current assets
|
|
822
|
|
|
(1,982
|
)
|
||
Operating lease right-of-use asset, net
|
|
2,134
|
|
|
—
|
|
||
Other assets
|
|
(1,583
|
)
|
|
(1,643
|
)
|
||
Accounts payable
|
|
2,510
|
|
|
403
|
|
||
Accrued expenses
|
|
414
|
|
|
(4,858
|
)
|
||
Operating lease liabilities
|
|
(1,614
|
)
|
|
—
|
|
||
Customer account liabilities
|
|
2,485
|
|
|
2,761
|
|
||
Deferred revenue
|
|
(14,417
|
)
|
|
(13,491
|
)
|
||
Other liabilities
|
|
432
|
|
|
(278
|
)
|
||
Net cash provided by operating activities
|
|
42,088
|
|
|
33,249
|
|
||
Investing activities:
|
|
|
|
|
||||
Acquisition of businesses and assets, net of cash and restricted cash acquired
|
|
—
|
|
|
(8,895
|
)
|
||
Purchases of other investments
|
|
(144
|
)
|
|
—
|
|
||
Proceeds from sale of cost-method investment
|
|
—
|
|
|
237
|
|
||
Purchases of available-for-sale securities
|
|
(10,070
|
)
|
|
(7,588
|
)
|
||
Proceeds from sales of available-for-sale securities
|
|
7,500
|
|
|
9,200
|
|
||
Capital expenditures, including capitalization of software costs
|
|
(26,400
|
)
|
|
(17,028
|
)
|
||
Insurance proceeds received for damage to equipment
|
|
—
|
|
|
200
|
|
||
Net cash used in investing activities
|
|
(29,114
|
)
|
|
(23,874
|
)
|
||
Financing activities:
|
|
|
|
|
||||
Repurchase of common stock
|
|
(14,332
|
)
|
|
—
|
|
||
Repayment of amounts borrowed under revolving credit facility
|
|
(10,000
|
)
|
|
(40,000
|
)
|
||
Repayment of notes payable
|
|
(365
|
)
|
|
(183
|
)
|
||
Settlement of warrants
|
|
—
|
|
|
(4
|
)
|
||
Debt issuance costs related to credit facility
|
|
—
|
|
|
(597
|
)
|
||
Proceeds from exercise of stock options and employee stock purchase plan
|
|
2,175
|
|
|
1,740
|
|
||
Net cash used in financing activities
|
|
(22,522
|
)
|
|
(39,044
|
)
|
||
Effect of exchange rate changes on cash
|
|
1,039
|
|
|
(1,923
|
)
|
||
Decrease in cash, cash equivalents and restricted cash
|
|
(8,509
|
)
|
|
(31,592
|
)
|
||
Cash, cash equivalents and restricted cash at beginning of period
|
|
97,801
|
|
|
124,613
|
|
||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
89,292
|
|
|
$
|
93,021
|
|
|
|
|
|
|
||||
Cash and cash equivalents at end of period
|
|
$
|
80,817
|
|
|
$
|
87,639
|
|
Cash held for customers at end of period
|
|
8,475
|
|
|
5,382
|
|
||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
89,292
|
|
|
$
|
93,021
|
|
Supplemental disclosures of non-cash financing activities:
|
|
|
|
|
||||
Issuance of common stock upon settlement of the warrants
|
|
$
|
—
|
|
|
$
|
58,451
|
|
|
|
December 31,
|
|
June 30,
|
|
|
||||||
|
|
2019
|
|
2019
|
|
$ Change
|
||||||
|
|
(in thousands)
|
||||||||||
Accounts receivable
|
|
$
|
67,946
|
|
|
$
|
77,285
|
|
|
$
|
(9,339
|
)
|
Contract assets
|
|
2,939
|
|
|
5,135
|
|
|
(2,196
|
)
|
|||
Deferred revenue
|
|
78,452
|
|
|
92,159
|
|
|
(13,707
|
)
|
|
|
December 31, 2019
|
|
June 30, 2019
|
||||||||||||||||||||||||||||
|
|
Fair Value Measurements Using Input Types
|
|
|
|
Fair Value Measurements Using Input Types
|
|
|
||||||||||||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Money market funds (cash and cash equivalents)
|
|
$
|
292
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
292
|
|
|
$
|
2,807
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,807
|
|
Available for sale securities - Debt
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Government - U.S. treasury securities
|
|
—
|
|
|
10,091
|
|
|
—
|
|
|
10,091
|
|
|
—
|
|
|
7,479
|
|
|
—
|
|
|
7,479
|
|
||||||||
Total assets
|
|
$
|
292
|
|
|
$
|
10,091
|
|
|
$
|
—
|
|
|
$
|
10,383
|
|
|
$
|
2,807
|
|
|
$
|
7,479
|
|
|
$
|
—
|
|
|
$
|
10,286
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Short-term derivative interest rate swap
|
|
$
|
—
|
|
|
$
|
282
|
|
|
$
|
—
|
|
|
$
|
282
|
|
|
$
|
—
|
|
|
$
|
37
|
|
|
$
|
—
|
|
|
$
|
37
|
|
Long-term derivative interest rate swap
|
|
$
|
—
|
|
|
$
|
1,111
|
|
|
$
|
—
|
|
|
$
|
1,111
|
|
|
$
|
—
|
|
|
$
|
1,248
|
|
|
$
|
—
|
|
|
$
|
1,248
|
|
Total liabilities
|
|
$
|
—
|
|
|
$
|
1,393
|
|
|
$
|
—
|
|
|
$
|
1,393
|
|
|
$
|
—
|
|
|
$
|
1,285
|
|
|
$
|
—
|
|
|
$
|
1,285
|
|
•
|
Cash and cash equivalents, cash and cash equivalents held for customers, accounts receivable, accounts payable and customer account liabilities fair values approximates their carrying values, due to the short-term nature of these instruments.
|
•
|
Marketable securities classified as held to maturity, all of which mature within one year, are recorded at amortized cost, which at December 31, 2019 and June 30, 2019, approximated fair value.
|
•
|
Marketable debt securities classified as available for sale are recorded at fair value. Unrealized gains and losses are included as a component of other accumulated comprehensive income (loss) in stockholders’ equity, net of tax. We use the specific identification method to determine any realized gains or losses from the sale of our marketable debt securities classified as available for sale.
|
•
|
The fair value of our derivative interest rate swaps are based on the present value of projected cash flows that will occur over the life of the instruments, after considering certain contractual terms and counterparty credit risk.
|
•
|
The carrying value of assets related to deposits we have made to fund future requirements associated with Israeli severance arrangements was $1.1 million and $1.2 million at December 31, 2019 and June 30, 2019, respectively, which approximated their fair value.
|
•
|
We have certain other investments for which there is no readily determinable fair value. The carrying value of these investments was $0.9 million and $0.7 million at December 31, 2019 and June 30, 2019, respectively, and they are reported as a component of our other assets. These investments are recorded at cost, less impairment (if any), plus or minus adjustments for observable price changes.
|
•
|
We have borrowings of $100 million against our Credit Facility. The fair value of these borrowings, which are classified as Level 2, approximates their carrying value at December 31, 2019, as the instrument carries a variable rate of interest which reflects current market rates.
|
|
|
December 31, 2019
|
|
June 30, 2019
|
||||||||||||||||||||
|
|
Held to Maturity
|
|
Available for Sale
|
|
Total
|
|
Held to Maturity
|
|
Available for Sale
|
|
Total
|
||||||||||||
|
|
(in thousands)
|
||||||||||||||||||||||
Marketable securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Government and other debt securities
|
|
$
|
62
|
|
|
$
|
10,091
|
|
|
$
|
10,153
|
|
|
$
|
62
|
|
|
$
|
7,479
|
|
|
$
|
7,541
|
|
Total marketable securities
|
|
$
|
62
|
|
|
$
|
10,091
|
|
|
$
|
10,153
|
|
|
$
|
62
|
|
|
$
|
7,479
|
|
|
$
|
7,541
|
|
|
|
December 31, 2019
|
||
|
|
(in thousands)
|
||
Due within 1 year
|
|
$
|
10,091
|
|
Due in 1 year through 5 years
|
|
—
|
|
|
Total
|
|
$
|
10,091
|
|
|
|
At December 31, 2019
|
|
At June 30, 2019
|
||||||||||||
|
|
Less than 12 Months
|
||||||||||||||
|
|
Fair Value
|
|
Unrealized Loss
|
|
Fair Value
|
|
Unrealized Loss
|
||||||||
|
|
(in thousands)
|
||||||||||||||
Government - U.S. treasury securities
|
|
$
|
2,796
|
|
|
$
|
(1
|
)
|
|
$
|
800
|
|
|
$
|
(1
|
)
|
Total
|
|
$
|
2,796
|
|
|
$
|
(1
|
)
|
|
$
|
800
|
|
|
$
|
(1
|
)
|
|
|
Three Months Ended December 31,
|
|
Six Months Ended December 31,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(in thousands, except per share amounts)
|
||||||||||||||
Numerator - basic and diluted:
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
|
$
|
2,609
|
|
|
$
|
5,969
|
|
|
$
|
1,242
|
|
|
$
|
5,051
|
|
Denominator:
|
|
|
|
|
|
|
|
|
||||||||
Shares used in computing basic net income per share attributable to common stockholders
|
|
41,693
|
|
|
40,635
|
|
|
41,590
|
|
|
40,162
|
|
||||
Impact of dilutive securities
|
|
399
|
|
|
1,104
|
|
|
327
|
|
|
1,500
|
|
||||
Shares used in computing diluted net income per share attributable to common stockholders
|
|
42,092
|
|
|
41,739
|
|
|
41,917
|
|
|
41,662
|
|
||||
Basic net income per share attributable to common stockholders
|
|
$
|
0.06
|
|
|
$
|
0.15
|
|
|
$
|
0.03
|
|
|
$
|
0.13
|
|
Diluted net income per share attributable to common stockholders
|
|
$
|
0.06
|
|
|
$
|
0.14
|
|
|
$
|
0.03
|
|
|
$
|
0.12
|
|
|
|
Three Months Ended December 31,
|
|
Six Months Ended December 31,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(in thousands)
|
||||||||||||||
Segment revenue:
|
|
|
|
|
|
|
|
|
||||||||
Cloud Solutions
|
|
$
|
55,068
|
|
|
$
|
50,328
|
|
|
$
|
107,897
|
|
|
$
|
99,903
|
|
Banking Solutions
|
|
23,267
|
|
|
23,128
|
|
|
47,436
|
|
|
45,380
|
|
||||
Payments and Documents
|
|
28,787
|
|
|
25,943
|
|
|
55,558
|
|
|
52,177
|
|
||||
Other
|
|
4,569
|
|
|
5,447
|
|
|
8,976
|
|
|
9,823
|
|
||||
Total segment revenue
|
|
$
|
111,691
|
|
|
$
|
104,846
|
|
|
$
|
219,867
|
|
|
$
|
207,283
|
|
Segment measure of profit:
|
|
|
|
|
|
|
|
|
||||||||
Cloud Solutions
|
|
$
|
11,877
|
|
|
$
|
10,742
|
|
|
$
|
22,984
|
|
|
$
|
21,034
|
|
Banking Solutions
|
|
(376
|
)
|
|
1,953
|
|
|
159
|
|
|
4,015
|
|
||||
Payments and Documents
|
|
8,939
|
|
|
7,785
|
|
|
16,640
|
|
|
15,866
|
|
||||
Other
|
|
(2,196
|
)
|
|
(461
|
)
|
|
(4,062
|
)
|
|
(1,474
|
)
|
||||
Total measure of segment profit
|
|
$
|
18,244
|
|
|
$
|
20,019
|
|
|
$
|
35,721
|
|
|
$
|
39,441
|
|
|
|
Three Months Ended December 31,
|
|
Six Months Ended December 31,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(in thousands)
|
||||||||||||||
Total measure of segment profit
|
|
$
|
18,244
|
|
|
$
|
20,019
|
|
|
$
|
35,721
|
|
|
$
|
39,441
|
|
Less:
|
|
|
|
|
|
|
|
|
||||||||
Amortization of acquisition-related intangible assets
|
|
(5,213
|
)
|
|
(5,253
|
)
|
|
(10,163
|
)
|
|
(10,579
|
)
|
||||
Stock-based compensation plan expense
|
|
(10,965
|
)
|
|
(9,549
|
)
|
|
(22,009
|
)
|
|
(21,891
|
)
|
||||
Acquisition and integration-related expenses
|
|
(1,957
|
)
|
|
(710
|
)
|
|
(3,654
|
)
|
|
(1,593
|
)
|
||||
Restructuring expense
|
|
(234
|
)
|
|
(54
|
)
|
|
(209
|
)
|
|
(631
|
)
|
||||
Other non-core (expense) benefit
|
|
(4
|
)
|
|
—
|
|
|
10
|
|
|
—
|
|
||||
Global ERP system implementation and other costs
|
|
(200
|
)
|
|
(972
|
)
|
|
(424
|
)
|
|
(2,553
|
)
|
||||
Other expense, net of pension adjustments
|
|
(842
|
)
|
|
(1,031
|
)
|
|
(1,807
|
)
|
|
(1,996
|
)
|
||||
Profit (loss) before income taxes
|
|
$
|
(1,171
|
)
|
|
$
|
2,450
|
|
|
$
|
(2,535
|
)
|
|
$
|
198
|
|
|
|
Three Months Ended December 31,
|
|
Six Months Ended December 31,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(in thousands)
|
||||||||||||||
Depreciation and other amortization expense:
|
|
|
|
|
|
|
|
|
||||||||
Cloud Solutions
|
|
$
|
3,426
|
|
|
$
|
2,880
|
|
|
$
|
6,581
|
|
|
$
|
5,809
|
|
Banking Solutions
|
|
2,202
|
|
|
1,859
|
|
|
4,297
|
|
|
3,715
|
|
||||
Payments and Documents
|
|
726
|
|
|
725
|
|
|
1,385
|
|
|
1,483
|
|
||||
Other
|
|
206
|
|
|
87
|
|
|
389
|
|
|
184
|
|
||||
Total depreciation and other amortization expense
|
|
$
|
6,560
|
|
|
$
|
5,551
|
|
|
$
|
12,652
|
|
|
$
|
11,191
|
|
(in thousands)
|
|
Three Months Ended December 31, 2019
|
||||||||||||||
|
|
2019
|
|
2018
|
||||||||||||
|
|
Subscriptions Revenue
|
|
Total Revenue
|
|
Subscriptions Revenue
|
|
Total Revenue
|
||||||||
Payment Settlement Solutions (1)
|
|
$
|
37,615
|
|
|
$
|
42,522
|
|
|
$
|
31,592
|
|
|
$
|
37,971
|
|
Banking Solutions
|
|
18,307
|
|
|
23,267
|
|
|
15,925
|
|
|
23,128
|
|
||||
Legal Spend Management
|
|
21,413
|
|
|
21,413
|
|
|
19,149
|
|
|
19,149
|
|
||||
All other (2)
|
|
6,750
|
|
|
24,489
|
|
|
4,622
|
|
|
24,598
|
|
||||
Total revenues
|
|
$
|
84,085
|
|
|
$
|
111,691
|
|
|
$
|
71,288
|
|
|
$
|
104,846
|
|
(in thousands)
|
|
Six Months Ended December 31,
|
||||||||||||||
|
|
2019
|
|
2018
|
||||||||||||
|
|
Subscriptions Revenue
|
|
Total Revenue
|
|
Subscriptions Revenue
|
|
Total Revenue
|
||||||||
Payment Settlement Solutions (1)
|
|
$
|
72,370
|
|
|
$
|
82,500
|
|
|
$
|
62,214
|
|
|
$
|
75,530
|
|
Banking Solutions
|
|
36,680
|
|
|
47,436
|
|
|
31,591
|
|
|
45,380
|
|
||||
Legal Spend Management
|
|
41,987
|
|
|
41,987
|
|
|
37,545
|
|
|
37,545
|
|
||||
All other (2)
|
|
13,114
|
|
|
47,944
|
|
|
9,706
|
|
|
48,828
|
|
||||
Total revenues
|
|
$
|
164,151
|
|
|
$
|
219,867
|
|
|
$
|
141,056
|
|
|
$
|
207,283
|
|
|
|
Three Months Ended December 31,
|
|
Six Months Ended December 31,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(in thousands)
|
||||||||||||||
Revenues from unaffiliated customers:
|
|
|
|
|
|
|
|
|
||||||||
United States
|
|
$
|
69,382
|
|
|
$
|
65,024
|
|
|
$
|
138,402
|
|
|
$
|
127,905
|
|
United Kingdom
|
|
27,107
|
|
|
24,004
|
|
|
52,074
|
|
|
48,371
|
|
||||
Switzerland
|
|
9,759
|
|
|
9,614
|
|
|
19,519
|
|
|
19,607
|
|
||||
Other
|
|
5,443
|
|
|
6,204
|
|
|
9,872
|
|
|
11,400
|
|
||||
Total revenues from unaffiliated customers
|
|
$
|
111,691
|
|
|
$
|
104,846
|
|
|
$
|
219,867
|
|
|
$
|
207,283
|
|
|
|
At December 31,
|
|
At June 30,
|
||||
|
|
2019
|
|
2019
|
||||
|
|
(in thousands)
|
||||||
Long-lived assets:
|
|
|
|
|
||||
United States
|
|
$
|
63,354
|
|
|
$
|
44,357
|
|
United Kingdom
|
|
46,788
|
|
|
32,035
|
|
||
Other
|
|
14,662
|
|
|
5,326
|
|
||
Total long-lived assets
|
|
$
|
124,804
|
|
|
$
|
81,718
|
|
|
|
As of December 31, 2019
|
||||||||||||
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Value
|
|
Weighted Average Remaining Life
|
||||||
|
|
(in thousands)
|
(in years)
|
|||||||||||
Amortized intangible assets:
|
|
|
|
|
|
|
|
|
||||||
Customer related
|
|
$
|
223,302
|
|
|
$
|
(153,014
|
)
|
|
$
|
70,288
|
|
|
7.9
|
Core technology
|
|
133,742
|
|
|
(94,291
|
)
|
|
39,451
|
|
|
7.2
|
|||
Other intangible assets
|
|
22,119
|
|
|
(19,525
|
)
|
|
2,594
|
|
|
4.8
|
|||
Capitalized software development costs
|
|
24,750
|
|
|
(11,946
|
)
|
|
12,804
|
|
|
2.5
|
|||
Software (1)
|
|
76,766
|
|
|
(40,208
|
)
|
|
36,558
|
|
|
3.8
|
|||
Total
|
|
$
|
480,679
|
|
|
$
|
(318,984
|
)
|
|
$
|
161,695
|
|
|
|
Unamortized intangible assets:
|
|
|
|
|
|
|
|
|
||||||
Goodwill
|
|
|
|
|
|
208,836
|
|
|
|
|||||
Total intangible assets
|
|
|
|
|
|
$
|
370,531
|
|
|
|
|
|
As of June 30, 2019
|
||||||||||||
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Value
|
|
Weighted Average Remaining Life
|
||||||
|
|
(in thousands)
|
(in years)
|
|||||||||||
Amortized intangible assets:
|
|
|
|
|
|
|
|
|
||||||
Customer related
|
|
$
|
219,893
|
|
|
$
|
(145,144
|
)
|
|
$
|
74,749
|
|
|
8.5
|
Core technology
|
|
130,226
|
|
|
(90,017
|
)
|
|
40,209
|
|
|
7.4
|
|||
Other intangible assets
|
|
25,712
|
|
|
(19,030
|
)
|
|
6,682
|
|
|
5.0
|
|||
Capitalized software development costs
|
|
23,213
|
|
|
(10,006
|
)
|
|
13,207
|
|
|
3.0
|
|||
Software (1)
|
|
72,018
|
|
|
(38,516
|
)
|
|
33,502
|
|
|
4.2
|
|||
Total
|
|
$
|
471,062
|
|
|
$
|
(302,713
|
)
|
|
$
|
168,349
|
|
|
|
Unamortized intangible assets:
|
|
|
|
|
|
|
|
|
||||||
Goodwill
|
|
|
|
|
|
206,101
|
|
|
|
|||||
Total intangible assets
|
|
|
|
|
|
$
|
374,450
|
|
|
|
(1)
|
Software includes purchased software and software developed for internal use.
|
|
|
Acquired Intangible Assets
|
|
Capitalized Software Development Costs
|
|
Software
|
||||||
|
|
(in thousands)
|
||||||||||
Remaining 2020
|
|
$
|
10,322
|
|
|
$
|
1,963
|
|
|
$
|
5,776
|
|
2021
|
|
19,234
|
|
|
3,927
|
|
|
8,356
|
|
|||
2022
|
|
17,132
|
|
|
3,927
|
|
|
6,499
|
|
|||
2023
|
|
15,723
|
|
|
1,083
|
|
|
4,600
|
|
|||
2024
|
|
13,934
|
|
|
405
|
|
|
3,100
|
|
|||
2025 and thereafter
|
|
35,988
|
|
|
—
|
|
|
1,776
|
|
|
|
Cloud Solutions
|
|
Banking Solutions
|
|
Payments and Documents
|
|
Other
|
|
Total
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
Balance at June 30, 2019 (1)
|
|
$
|
90,307
|
|
|
$
|
39,451
|
|
|
$
|
68,149
|
|
|
$
|
8,194
|
|
|
$
|
206,101
|
|
Measurement period adjustment (2)
|
|
—
|
|
|
65
|
|
|
—
|
|
|
—
|
|
|
65
|
|
|||||
Impact of foreign currency translation
|
|
885
|
|
|
—
|
|
|
1,785
|
|
|
—
|
|
|
2,670
|
|
|||||
Balance at December 31, 2019 (1)
|
|
$
|
91,192
|
|
|
$
|
39,516
|
|
|
$
|
69,934
|
|
|
$
|
8,194
|
|
|
$
|
208,836
|
|
(1)
|
Other goodwill balance is net of $7.5 million accumulated impairment losses, recorded previously.
|
(2)
|
The measurement period adjustment during the six months ended December 31, 2019 relates to our BankSight acquisition. See Note 5 Business and Asset Acquisitions.
|
Operating leases:
|
|
Three Months Ended December 31, 2019
|
|
Six Months Ended December 31, 2019
|
||||
|
|
(in thousands)
|
||||||
Operating lease cost
|
|
$
|
1,882
|
|
|
$
|
3,798
|
|
Short-term lease cost
|
|
135
|
|
|
347
|
|
||
Variable lease cost
|
|
548
|
|
|
1,043
|
|
||
Sublease income
|
|
(128
|
)
|
|
(252
|
)
|
||
Total lease cost
|
|
$
|
2,437
|
|
|
$
|
4,936
|
|
|
|
December 31, 2019
|
||
|
|
(in thousands)
|
||
Right-of-use assets, net
|
|
$
|
24,294
|
|
|
|
|
||
Operating lease liabilities, current (1)
|
|
$
|
6,501
|
|
Operating lease liabilities, non-current
|
|
20,988
|
|
|
Total operating lease liabilities
|
|
$
|
27,489
|
|
(1)
|
Included as a component of accrued expenses and other current liabilities.
|
|
|
Six Months Ended December 31, 2019
|
||
|
|
(in thousands)
|
||
Cash paid for amounts included in the measurement of lease liabilities
|
|
$
|
1,734
|
|
Right-of-use assets obtained in exchange for lease obligations
|
|
$
|
696
|
|
Description
|
Balance Sheet Location
|
|
December 31, 2019
|
|
June 30, 2019
|
||||
Derivative interest rate swaps
|
|
|
(in thousands)
|
||||||
Short-term derivative liability
|
Accrued expenses and other current liabilities
|
|
$
|
282
|
|
|
$
|
37
|
|
Long-term derivative liability
|
Other liabilities
|
|
$
|
1,111
|
|
|
$
|
1,248
|
|
|
Gain (Loss) in AOCI June 30, 2019
|
|
Amount of Gain (Loss) Recognized in OCI on Derivative Instruments (Effective Portion)
|
|
Amount of (Gain) Loss Reclassified from AOCI into Net Loss (Effective Portion) (1)
|
|
Gain (Loss) in AOCI December 31, 2019
|
||||||||
|
(in thousands)
|
||||||||||||||
Derivative interest rate swap
|
$
|
(1,285
|
)
|
|
$
|
(49
|
)
|
|
$
|
(59
|
)
|
|
$
|
(1,393
|
)
|
|
|
|
|
|
|
|
|
||||||||
|
Gain (Loss) in AOCI June 30, 2018
|
|
Amount of Gain (Loss) Recognized in OCI on Derivative Instruments (Effective Portion)
|
|
Amount of (Gain) Loss Reclassified from AOCI into Net Loss (Effective Portion) (1)
|
|
Gain (Loss) in AOCI December 31, 2018
|
||||||||
|
(in thousands)
|
||||||||||||||
Derivative interest rate swap
|
$
|
2,590
|
|
|
$
|
(974
|
)
|
|
$
|
(137
|
)
|
|
$
|
1,479
|
|
(1)
|
Recorded as interest income (expense) within other expense, net in our unaudited consolidated statements of comprehensive income (loss).
|
|
|
Three Months Ended December 31,
|
|
Six Months Ended December 31,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(in thousands)
|
|
|
|
|
||||||||||
Components of net periodic cost
|
|
|
|
|
|
|
|
|
||||||||
Service cost
|
|
$
|
729
|
|
|
$
|
630
|
|
|
$
|
1,453
|
|
|
$
|
1,275
|
|
Interest cost
|
|
56
|
|
|
114
|
|
|
112
|
|
|
230
|
|
||||
Prior service credit
|
|
(77
|
)
|
|
(77
|
)
|
|
(154
|
)
|
|
(155
|
)
|
||||
Net actuarial loss
|
|
119
|
|
|
54
|
|
|
237
|
|
|
110
|
|
||||
Expected return on plan assets
|
|
(309
|
)
|
|
(345
|
)
|
|
(616
|
)
|
|
(698
|
)
|
||||
Net periodic cost
|
|
$
|
518
|
|
|
$
|
376
|
|
|
$
|
1,032
|
|
|
$
|
762
|
|
|
|
Three Months Ended December 31,
|
|
Increase (Decrease)
Between Periods |
|
Six Months Ended December 31,
|
|
Increase (Decrease)
Between Periods |
||||||||||||||||||||||
|
|
2019
|
|
2018
|
|
$ Change Inc (Dec)
|
|
% Change Inc (Dec)
|
|
2019
|
|
2018
|
|
$ Change Inc (Dec)
|
|
% Change Inc (Dec)
|
||||||||||||||
|
|
(Dollars in thousands)
|
||||||||||||||||||||||||||||
Segment revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cloud Solutions
|
|
$
|
55,068
|
|
|
$
|
50,328
|
|
|
$
|
4,740
|
|
|
9.4
|
%
|
|
$
|
107,897
|
|
|
$
|
99,903
|
|
|
$
|
7,994
|
|
|
8.0
|
%
|
Banking Solutions
|
|
23,267
|
|
|
23,128
|
|
|
139
|
|
|
0.6
|
%
|
|
47,436
|
|
|
45,380
|
|
|
2,056
|
|
|
4.5
|
%
|
||||||
Payments and Documents
|
|
28,787
|
|
|
25,943
|
|
|
2,844
|
|
|
11.0
|
%
|
|
55,558
|
|
|
52,177
|
|
|
3,381
|
|
|
6.5
|
%
|
||||||
Other
|
|
4,569
|
|
|
5,447
|
|
|
(878
|
)
|
|
(16.1
|
)%
|
|
8,976
|
|
|
9,823
|
|
|
(847
|
)
|
|
(8.6
|
)%
|
||||||
Total segment revenue
|
|
$
|
111,691
|
|
|
$
|
104,846
|
|
|
$
|
6,845
|
|
|
6.5
|
%
|
|
$
|
219,867
|
|
|
$
|
207,283
|
|
|
$
|
12,584
|
|
|
6.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Segment measure of profit (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cloud Solutions
|
|
$
|
11,877
|
|
|
$
|
10,742
|
|
|
$
|
1,135
|
|
|
10.6
|
%
|
|
$
|
22,984
|
|
|
$
|
21,034
|
|
|
$
|
1,950
|
|
|
9.3
|
%
|
Banking Solutions
|
|
(376
|
)
|
|
1,953
|
|
|
(2,329
|
)
|
|
(119.3
|
)%
|
|
159
|
|
|
4,015
|
|
|
(3,856
|
)
|
|
(96.0
|
)%
|
||||||
Payments and Documents
|
|
8,939
|
|
|
7,785
|
|
|
1,154
|
|
|
14.8
|
%
|
|
16,640
|
|
|
15,866
|
|
|
774
|
|
|
4.9
|
%
|
||||||
Other
|
|
(2,196
|
)
|
|
(461
|
)
|
|
(1,735
|
)
|
|
(376.4
|
)%
|
|
(4,062
|
)
|
|
(1,474
|
)
|
|
(2,588
|
)
|
|
(175.6
|
)%
|
||||||
Total measure of segment profit
|
|
$
|
18,244
|
|
|
$
|
20,019
|
|
|
$
|
(1,775
|
)
|
|
(8.9
|
)%
|
|
$
|
35,721
|
|
|
$
|
39,441
|
|
|
$
|
(3,720
|
)
|
|
(9.4
|
)%
|
|
|
Three Months Ended December 31,
|
|
Six Months Ended December 31,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(in thousands)
|
||||||||||||||
Total measure of segment profit
|
|
$
|
18,244
|
|
|
$
|
20,019
|
|
|
$
|
35,721
|
|
|
$
|
39,441
|
|
Less:
|
|
|
|
|
|
|
|
|
||||||||
Amortization of acquisition-related intangible assets
|
|
(5,213
|
)
|
|
(5,253
|
)
|
|
(10,163
|
)
|
|
(10,579
|
)
|
||||
Stock-based compensation plan expense
|
|
(10,965
|
)
|
|
(9,549
|
)
|
|
(22,009
|
)
|
|
(21,891
|
)
|
||||
Acquisition and integration-related expenses
|
|
(1,957
|
)
|
|
(710
|
)
|
|
(3,654
|
)
|
|
(1,593
|
)
|
||||
Restructuring expense
|
|
(234
|
)
|
|
(54
|
)
|
|
(209
|
)
|
|
(631
|
)
|
||||
Other non-core (expense) benefit
|
|
(4
|
)
|
|
—
|
|
|
10
|
|
|
—
|
|
||||
Global ERP system implementation and other costs
|
|
(200
|
)
|
|
(972
|
)
|
|
(424
|
)
|
|
(2,553
|
)
|
||||
Other expense, net of pension adjustments
|
|
(842
|
)
|
|
(1,031
|
)
|
|
(1,807
|
)
|
|
(1,996
|
)
|
||||
Profit (loss) before income taxes
|
|
$
|
(1,171
|
)
|
|
$
|
2,450
|
|
|
$
|
(2,535
|
)
|
|
$
|
198
|
|
|
|
Three Months Ended December 31,
|
|
Increase (Decrease)
Between Periods |
|
Six Months Ended December 31,
|
|
Increase (Decrease)
Between Periods |
||||||||||||||||||||||
|
|
2019
|
|
2018
|
|
$ Change Inc (Dec)
|
|
% Change Inc (Dec)
|
|
2019
|
|
2018
|
|
$ Change Inc (Dec)
|
|
% Change Inc (Dec)
|
||||||||||||||
|
|
(Dollars in thousands)
|
||||||||||||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Subscriptions
|
|
$
|
84,085
|
|
|
$
|
71,288
|
|
|
$
|
12,797
|
|
|
18.0
|
%
|
|
$
|
164,151
|
|
|
$
|
141,056
|
|
|
$
|
23,095
|
|
|
16.4
|
%
|
Software licenses
|
|
2,800
|
|
|
5,665
|
|
|
(2,865
|
)
|
|
(50.6
|
)%
|
|
5,376
|
|
|
10,177
|
|
|
(4,801
|
)
|
|
(47.2
|
)%
|
||||||
Service and maintenance
|
|
24,061
|
|
|
26,786
|
|
|
(2,725
|
)
|
|
(10.2
|
)%
|
|
48,886
|
|
|
54,191
|
|
|
(5,305
|
)
|
|
(9.8
|
)%
|
||||||
Other
|
|
745
|
|
|
1,107
|
|
|
(362
|
)
|
|
(32.7
|
)%
|
|
1,454
|
|
|
1,859
|
|
|
(405
|
)
|
|
(21.8
|
)%
|
||||||
Total revenues
|
|
$
|
111,691
|
|
|
$
|
104,846
|
|
|
$
|
6,845
|
|
|
6.5
|
%
|
|
$
|
219,867
|
|
|
$
|
207,283
|
|
|
$
|
12,584
|
|
|
6.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
As % of total revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Subscriptions
|
|
75.3
|
%
|
|
68.0
|
%
|
|
|
|
|
|
74.7
|
%
|
|
68.1
|
%
|
|
|
|
|
||||||||||
Software licenses
|
|
2.5
|
%
|
|
5.4
|
%
|
|
|
|
|
|
2.4
|
%
|
|
4.9
|
%
|
|
|
|
|
||||||||||
Service and maintenance
|
|
21.5
|
%
|
|
25.5
|
%
|
|
|
|
|
|
22.2
|
%
|
|
26.1
|
%
|
|
|
|
|
||||||||||
Other
|
|
0.7
|
%
|
|
1.1
|
%
|
|
|
|
|
|
0.7
|
%
|
|
0.9
|
%
|
|
|
|
|
||||||||||
Total revenues
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
|
Three Months Ended December 31,
|
|
Increase (Decrease)
Between Periods |
|
Six Months Ended December 31,
|
|
Increase (Decrease)
Between Periods |
||||||||||||||||||||||
|
|
2019
|
|
2018
|
|
$ Change Inc (Dec)
|
|
% Change Inc (Dec)
|
|
2019
|
|
2018
|
|
$ Change Inc (Dec)
|
|
% Change Inc (Dec)
|
||||||||||||||
|
|
(Dollars in thousands)
|
||||||||||||||||||||||||||||
Cost of revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Subscriptions
|
|
$
|
33,449
|
|
|
$
|
31,352
|
|
|
$
|
2,097
|
|
|
6.7
|
%
|
|
$
|
66,214
|
|
|
$
|
63,021
|
|
|
$
|
3,193
|
|
|
5.1
|
%
|
Software licenses
|
|
157
|
|
|
210
|
|
|
(53
|
)
|
|
(25.2
|
)%
|
|
318
|
|
|
441
|
|
|
(123
|
)
|
|
(27.9
|
)%
|
||||||
Service and maintenance
|
|
12,929
|
|
|
12,528
|
|
|
401
|
|
|
3.2
|
%
|
|
25,982
|
|
|
25,234
|
|
|
748
|
|
|
3.0
|
%
|
||||||
Other
|
|
504
|
|
|
891
|
|
|
(387
|
)
|
|
(43.4
|
)%
|
|
1,020
|
|
|
1,415
|
|
|
(395
|
)
|
|
(27.9
|
)%
|
||||||
Total cost of revenues
|
|
$
|
47,039
|
|
|
$
|
44,981
|
|
|
$
|
2,058
|
|
|
4.6
|
%
|
|
$
|
93,534
|
|
|
$
|
90,111
|
|
|
$
|
3,423
|
|
|
3.8
|
%
|
Gross Profit ($)
|
|
$
|
64,652
|
|
|
$
|
59,865
|
|
|
$
|
4,787
|
|
|
8.0
|
%
|
|
$
|
126,333
|
|
|
$
|
117,172
|
|
|
$
|
9,161
|
|
|
7.8
|
%
|
Gross Profit (%)
|
|
57.9
|
%
|
|
57.1
|
%
|
|
|
|
|
|
57.5
|
%
|
|
56.5
|
%
|
|
|
|
|
|
|
Three Months Ended December 31,
|
|
Increase (Decrease)
Between Periods |
|
Six Months Ended December 31,
|
|
Increase (Decrease)
Between Periods |
||||||||||||||||||||||
|
|
2019
|
|
2018
|
|
$ Change Inc (Dec)
|
|
% Change Inc (Dec)
|
|
2019
|
|
2018
|
|
$ Change Inc (Dec)
|
|
% Change Inc (Dec)
|
||||||||||||||
|
|
(Dollars in thousands)
|
||||||||||||||||||||||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Sales and marketing
|
|
$
|
26,988
|
|
|
$
|
22,585
|
|
|
$
|
4,403
|
|
|
19.5
|
%
|
|
$
|
52,676
|
|
|
$
|
45,607
|
|
|
$
|
7,069
|
|
|
15.5
|
%
|
Product development and engineering
|
|
18,279
|
|
|
16,815
|
|
|
1,464
|
|
|
8.7
|
%
|
|
36,628
|
|
|
33,380
|
|
|
3,248
|
|
|
9.7
|
%
|
||||||
General and administrative
|
|
14,761
|
|
|
11,904
|
|
|
2,857
|
|
|
24.0
|
%
|
|
28,106
|
|
|
25,769
|
|
|
2,337
|
|
|
9.1
|
%
|
||||||
Amortization of acquisition-related intangible assets
|
|
5,213
|
|
|
5,253
|
|
|
(40
|
)
|
|
(0.8
|
)%
|
|
10,163
|
|
|
10,579
|
|
|
(416
|
)
|
|
(3.9
|
)%
|
||||||
Total operating expenses
|
|
$
|
65,241
|
|
|
$
|
56,557
|
|
|
$
|
8,684
|
|
|
15.4
|
%
|
|
$
|
127,573
|
|
|
$
|
115,335
|
|
|
$
|
12,238
|
|
|
10.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
As % of total revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Sales and marketing
|
|
24.2
|
%
|
|
21.5
|
%
|
|
|
|
|
|
24.0
|
%
|
|
22.0
|
%
|
|
|
|
|
||||||||||
Product development and engineering
|
|
16.4
|
%
|
|
16.0
|
%
|
|
|
|
|
|
16.7
|
%
|
|
16.1
|
%
|
|
|
|
|
||||||||||
General and administrative
|
|
13.2
|
%
|
|
11.4
|
%
|
|
|
|
|
|
12.8
|
%
|
|
12.4
|
%
|
|
|
|
|
||||||||||
Amortization of acquisition-related intangible assets
|
|
4.7
|
%
|
|
5.0
|
%
|
|
|
|
|
|
4.6
|
%
|
|
5.1
|
%
|
|
|
|
|
||||||||||
Total operating expenses
|
|
58.5
|
%
|
|
53.9
|
%
|
|
|
|
|
|
58.1
|
%
|
|
55.6
|
%
|
|
|
|
|
|
|
Three Months Ended December 31,
|
|
Increase (Decrease)
Between Periods |
|
Six Months Ended December 31,
|
|
Increase (Decrease)
Between Periods |
||||||||||||||||||||||
|
|
2019
|
|
2018
|
|
$ Change Inc (Dec)
|
|
% Change Inc (Dec)
|
|
2019
|
|
2018
|
|
$ Change Inc (Dec)
|
|
% Change Inc (Dec)
|
||||||||||||||
|
|
(Dollars in thousands)
|
||||||||||||||||||||||||||||
Interest income
|
|
$
|
168
|
|
|
$
|
144
|
|
|
$
|
24
|
|
|
16.7
|
%
|
|
$
|
391
|
|
|
$
|
278
|
|
|
$
|
113
|
|
|
40.6
|
%
|
Interest expense
|
|
(727
|
)
|
|
(934
|
)
|
|
207
|
|
|
22.2
|
%
|
|
(1,477
|
)
|
|
(2,055
|
)
|
|
578
|
|
|
28.1
|
%
|
||||||
Other (expense) income, net
|
|
(23
|
)
|
|
(68
|
)
|
|
45
|
|
|
(66.2
|
)%
|
|
(209
|
)
|
|
138
|
|
|
(347
|
)
|
|
(251.4
|
)%
|
||||||
Other expense, net
|
|
$
|
(582
|
)
|
|
$
|
(858
|
)
|
|
$
|
276
|
|
|
32.2
|
%
|
|
$
|
(1,295
|
)
|
|
$
|
(1,639
|
)
|
|
$
|
344
|
|
|
21.0
|
%
|
|
|
December 31,
|
|
June 30,
|
||||
|
|
2019
|
|
2019
|
||||
|
|
(in thousands)
|
||||||
Cash and cash equivalents
|
|
$
|
80,817
|
|
|
$
|
92,164
|
|
Marketable securities
|
|
10,153
|
|
|
7,541
|
|
||
Borrowings under credit facility
|
|
100,000
|
|
|
110,000
|
|
|
|
Six Months Ended December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
|
|
(in thousands)
|
||||||
Cash provided by operating activities
|
|
$
|
42,088
|
|
|
$
|
33,249
|
|
Cash used in investing activities
|
|
(29,114
|
)
|
|
(23,874
|
)
|
||
Cash used in financing activities
|
|
(22,522
|
)
|
|
(39,044
|
)
|
||
Effect of exchange rates on cash
|
|
1,039
|
|
|
(1,923
|
)
|
Period
|
|
Total Number of Shares Purchased
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)
|
|
Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs
|
||||||
October 1, 2019 - October 31, 2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
November 1, 2019 - November 30, 2019
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
December 1, 2019 - December 31, 2019
|
|
95,258
|
|
|
52.49
|
|
|
95,258
|
|
|
35,000,000
|
|
||
Total
|
|
95,258
|
|
|
$
|
52.49
|
|
|
95,258
|
|
|
|
(1)
|
On August 5, 2019, we announced that our board of directors authorized a repurchase program of our common stock for an aggregate repurchase price not to exceed $50 million. This program expires on August 5, 2021.
|
|
|
Incorporated by Reference
|
||||
Exhibit Number
|
Description
|
Form
|
File No.
|
Exhibit
|
Filing Date
|
Filed Herewith
|
|
|
|
|
|
|
|
10.1
|
8-K
|
000-25259
|
99.1
|
11/25/19
|
|
|
|
|
|
|
|
|
|
10.2
|
8-K
|
000-25259
|
99.1
|
11/25/19
|
|
|
|
|
|
|
|
|
|
10.3
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
31.1
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
31.2
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
32.1
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
32.2
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
101.INS
|
Inline XBRL Instance Document- the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
|
|
|
|
|
|
|
|
|
|
|
|
101.SCH**
|
Inline XBRL Taxonomy Extension Schema Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.CAL**
|
Inline XBRL Taxonomy Calculation Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.DEF**
|
Inline XBRL Taxonomy Definition Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.LAB**
|
Inline XBRL Taxonomy Label Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.PRE**
|
Inline XBRL Taxonomy Presentation Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
104
|
Cover Page Interactive Data File (formatted as inline XBRL with applicable taxonomy extension information contained in Exhibits 101)
|
|
|
|
|
|
**
|
submitted electronically herewith
|
Date:
|
February 7, 2020
|
By:
|
/s/ RICHARD D. BOOTH
|
|
|
|
Richard D. Booth
|
|
|
|
Chief Financial Officer and Treasurer
|
|
|
|
(Principal Financial and Accounting Officer)
|
By
|
|
|
/s/ Jennifer M. Gray
|
|
/s/ Joseph L. Mullen
|
Jennifer M. Gray, Chair
|
|
Joseph L. Mullen
|
By
|
|
|
/s/ Jeffrey C. Leathe
|
|
/s/ Peter Gibson
|
Jeffrey C. Leathe
|
|
Peter Gibson
|
Date:
|
February 7, 2020
|
By:
|
/s/ ROBERT A. EBERLE
|
|
|
|
Robert A. Eberle
|
|
|
|
President and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
Date:
|
February 7, 2020
|
By:
|
/s/ RICHARD D. BOOTH
|
|
|
|
Richard D. Booth
|
|
|
|
Chief Financial Officer and Treasurer
|
|
|
|
(Principal Financial and Accounting Officer)
|
Date:
|
February 7, 2020
|
By:
|
/s/ ROBERT A. EBERLE
|
|
|
|
Robert A. Eberle
|
|
|
|
President and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
Date:
|
February 7, 2020
|
By:
|
/s/ RICHARD D. BOOTH
|
|
|
|
Richard D. Booth
|
|
|
|
Chief Financial Officer and Treasurer
|
|
|
|
(Principal Financial and Accounting Officer)
|