þ
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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11-2617163
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Large accelerated filer
þ
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Accelerated filer
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¨
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Non-accelerated filer
¨
(Do not check if a smaller reporting company)
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Smaller reporting company
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¨
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Emerging growth company
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¨
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Second Quarter 2017 Form 10-Q
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1
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
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2
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Second Quarter 2017 Form 10-Q
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PART I. FINANCIAL INFORMATION
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Second Quarter 2017 Form 10-Q
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3
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4
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Second Quarter 2017 Form 10-Q
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Second Quarter 2017 Form 10-Q
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5
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6
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Second Quarter 2017 Form 10-Q
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1. Organization
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2. Basis of Presentation
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Second Quarter 2017 Form 10-Q
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7
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8
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Second Quarter 2017 Form 10-Q
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3. Business Combinations
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(in thousands)
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Purchase price allocation
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Net working capital, excluding deferred revenue
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$
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2,949
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Property and equipment
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290
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Finite-lived intangible assets
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30,900
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Deferred revenue
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(3,950
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)
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Deferred tax liability
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(12,350
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)
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Goodwill
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34,305
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Total purchase price
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$
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52,144
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Second Quarter 2017 Form 10-Q
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9
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Intangible assets acquired
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Weighted average amortization period
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AcademicWorks
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(in thousands)
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(in years)
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Acquired technology
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$
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22,500
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9
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Customer relationships
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8,000
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15
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Marketing assets
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320
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2
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Non-compete agreements
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80
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3
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Total intangible assets
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$
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30,900
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10
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4. Goodwill and Other Intangible Assets
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(dollars in thousands)
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EMG
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GMG
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IMG
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Total
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||||||||
Balance at December 31, 2016
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$
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241,334
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$
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192,238
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$
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4,668
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$
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438,240
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Additions related to current year business combination
(1)
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20,584
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|
13,722
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—
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34,306
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||||
Adjustments related to prior year business combination
(2)
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(29
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)
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(58
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)
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(1
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)
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(88
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)
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||||
Effect of foreign currency translation
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—
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—
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185
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|
185
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||||
Balance at June 30, 2017
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$
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261,889
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$
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205,902
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$
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4,852
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$
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472,643
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(1)
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See
Note 3
to these consolidated financial statements for details regarding our acquisition of AcademicWorks.
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(2)
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The change in goodwill was related to a post-closing working capital adjustment associated with the prior year acquisition of Good+Geek, Inc. ("Attentive.ly"), as well as an immaterial measurement period adjustment.
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10
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Second Quarter 2017 Form 10-Q
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5. Earnings Per Share
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Three months ended
June 30, |
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Six months ended
June 30, |
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||||||||
(dollars in thousands, except per share amounts)
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2017
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2016
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2017
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2016
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Numerator:
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||||||||
Net income
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$
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11,165
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$
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9,060
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$
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22,676
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$
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15,297
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Denominator:
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||||||||
Weighted average common shares
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46,662,481
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46,083,055
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46,584,263
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46,047,788
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Add effect of dilutive securities:
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||||||||
Stock-based awards
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1,028,859
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1,180,789
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1,002,630
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1,137,138
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Weighted average common shares assuming dilution
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47,691,340
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47,263,844
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47,586,893
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47,184,926
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||||
Earnings per share:
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||||||||
Basic
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$
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0.24
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$
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0.20
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$
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0.49
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$
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0.33
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Diluted
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$
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0.23
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$
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0.19
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$
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0.48
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$
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0.32
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||||||||
Anti-dilutive shares excluded from calculations of diluted earnings per share
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—
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—
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5,515
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44,134
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6. Fair Value Measurements
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•
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Level 1 - Quoted prices for identical assets or liabilities in active markets;
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•
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Level 2 - Quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and
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•
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Level 3 - Valuations derived from valuation techniques in which one or more significant inputs are unobservable.
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Second Quarter 2017 Form 10-Q
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11
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Fair value measurement using
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||||||||||||
(dollars in thousands)
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Level 1
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Level 2
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Level 3
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Total
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||||
Fair value as of June 30, 2017
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||||||||
Financial assets:
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||||||||
Derivative instruments
(1)(2)
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$
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—
|
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$
|
1,328
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|
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$
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—
|
|
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$
|
1,328
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Total financial assets
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$
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—
|
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$
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1,328
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|
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$
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—
|
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$
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1,328
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||||||||
Fair value as of December 31, 2016
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||||||||
Financial assets:
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||||||||
Derivative instruments
(1)
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$
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—
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$
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206
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|
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$
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—
|
|
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$
|
206
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Total financial assets
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$
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—
|
|
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$
|
206
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|
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$
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—
|
|
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$
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206
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Fair value as of December 31, 2016
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||||||||
Financial liabilities:
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||||||||
Derivative instruments
(1)
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$
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—
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$
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163
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|
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$
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—
|
|
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$
|
163
|
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Total financial liabilities
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$
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—
|
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$
|
163
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$
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—
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$
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163
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(1)
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The fair value of our interest rate swaps was based on model-driven valuations using LIBOR rates, which are observable at commonly quoted intervals. Accordingly, our interest rate swaps are classified within Level 2 of the fair value hierarchy.
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(2)
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Our foreign currency option contract is valued using a market approach based on observable quoted market prices including current spot rates and market implied volatilities. Accordingly, our foreign currency option contract is classified within Level 2 of the fair value hierarchy.
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12
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Second Quarter 2017 Form 10-Q
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7. Consolidated Financial Statement Details
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(dollars in thousands)
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June 30,
2017 |
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December 31,
2016 |
|
||
Accrued bonuses
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$
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12,021
|
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$
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19,217
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Accrued commissions and salaries
|
7,646
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|
9,352
|
|
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Lease incentive obligations
|
5,038
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5,604
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|
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Customer credit balances
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5,130
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|
5,148
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|
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Deferred rent liabilities
|
4,302
|
|
4,110
|
|
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Taxes payable
|
2,630
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|
3,452
|
|
||
Unrecognized tax benefit
|
3,452
|
|
3,295
|
|
||
Accrued subscriptions
|
3,959
|
|
2,840
|
|
||
Accrued vacation costs
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2,598
|
|
2,214
|
|
||
Accrued health care costs
|
2,822
|
|
1,495
|
|
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Other liabilities
|
4,482
|
|
6,002
|
|
||
Total accrued expenses and other liabilities
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54,080
|
|
62,729
|
|
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Less: Long-term portion
|
7,572
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|
8,533
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|
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Accrued expenses and other current liabilities
|
$
|
46,508
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$
|
54,196
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|
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Three months ended
June 30, |
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Six months ended
June 30, |
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||||||||
(dollars in thousands)
|
2017
|
|
2016
|
|
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2017
|
|
2016
|
|
||||
Components of Other Income (Expense), Net
|
|
|
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|
||||||||
Interest income
|
$
|
210
|
|
$
|
118
|
|
|
$
|
378
|
|
$
|
239
|
|
Gain on derivative instrument
|
475
|
|
—
|
|
|
475
|
|
—
|
|
||||
Loss on debt extinguishment
|
(162
|
)
|
—
|
|
|
(162
|
)
|
—
|
|
||||
Other income (expense), net
|
304
|
|
(183
|
)
|
|
422
|
|
(409
|
)
|
||||
Other income (expense), net
|
$
|
827
|
|
$
|
(65
|
)
|
|
$
|
1,113
|
|
$
|
(170
|
)
|
8. Debt
|
|
Debt balance at
|
|
|
Weighted average
effective interest rate at
|
|
||||||
(dollars in thousands)
|
June 30,
2017 |
|
December 31,
2016 |
|
|
June 30,
2017 |
|
December 31,
2016 |
|
||
Credit facility:
|
|
|
|
|
|
||||||
Revolving credit loans
|
$
|
90,400
|
|
$
|
180,900
|
|
|
2.93
|
%
|
2.36
|
%
|
Term loans
|
300,000
|
|
162,969
|
|
|
2.35
|
%
|
2.62
|
%
|
||
Total debt
|
390,400
|
|
343,869
|
|
|
2.48
|
%
|
2.48
|
%
|
||
Less: Unamortized discount and debt issuance costs
|
2,738
|
|
1,476
|
|
|
|
|
||||
Less: Debt, current portion
|
7,500
|
|
4,375
|
|
|
2.48
|
%
|
2.50
|
%
|
||
Debt, net of current portion
|
$
|
380,162
|
|
$
|
338,018
|
|
|
2.48
|
%
|
2.48
|
%
|
Second Quarter 2017 Form 10-Q
|
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13
|
14
|
|
Second Quarter 2017 Form 10-Q
|
Years ending December 31,
(dollars in thousands)
|
Annual maturities
|
|
|
2017 - remaining
|
$
|
3,750
|
|
2018
|
7,500
|
|
|
2019
|
7,500
|
|
|
2020
|
7,500
|
|
|
2021
|
7,500
|
|
|
Thereafter
|
356,650
|
|
|
Total required maturities
|
$
|
390,400
|
|
9. Derivative Instruments
|
Second Quarter 2017 Form 10-Q
|
|
15
|
|
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Asset Derivatives
|
|
|
Liability Derivatives
|
||||||||||
(dollars in thousands)
|
Balance sheet location
|
June 30,
2017 |
|
December 31,
2016 |
|
|
Balance sheet location
|
June 30,
2017 |
|
December 31,
2016 |
|
||||
Derivative instruments designated as hedging instruments:
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps, current portion
|
Prepaid expenses
and other current assets
|
$
|
336
|
|
$
|
—
|
|
|
Accrued expenses and other current liabilities
|
$
|
—
|
|
$
|
—
|
|
Interest rate swaps, long-term portion
|
Other assets
|
—
|
|
206
|
|
|
Other liabilities
|
—
|
|
163
|
|
||||
Total derivative instruments designated as hedging instruments
|
|
$
|
336
|
|
$
|
206
|
|
|
|
$
|
—
|
|
$
|
163
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative instruments
not
designated as hedging instruments:
|
|
|
|
|
|
|
|
||||||||
Foreign currency option contracts
|
Prepaid expenses
and other current assets |
$
|
992
|
|
$
|
—
|
|
|
Accrued expenses and other current liabilities
|
$
|
—
|
|
$
|
—
|
|
Total derivative instruments
not
designated as hedging instruments
|
|
$
|
992
|
|
$
|
—
|
|
|
|
$
|
—
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Total derivative instruments
|
|
$
|
1,328
|
|
$
|
206
|
|
|
|
$
|
—
|
|
$
|
163
|
|
|
Gain (loss) recognized
in accumulated other
comprehensive
loss as of
|
|
Location
of gain (loss)
reclassified from
accumulated other
comprehensive
loss into income
|
Gain (loss) reclassified from accumulated
other comprehensive loss into income
|
|
||||||
(dollars in thousands)
|
June 30,
2017 |
|
Three months ended
June 30, 2017 |
|
|
Six months ended
June 30, 2017 |
|
||||
Interest rate swaps
|
$
|
336
|
|
Interest expense
|
$
|
15
|
|
|
$
|
(104
|
)
|
|
|
|
|
|
|
||||||
|
June 30,
2016 |
|
|
Three months ended
June 30, 2016 |
|
|
Six months ended
June 30, 2016 |
|
|||
Interest rate swaps
|
$
|
(1,329
|
)
|
Interest expense
|
$
|
(302
|
)
|
|
$
|
(610
|
)
|
|
Location of gain (loss)
recognized in income on derivative
|
Gain (loss) recognized in income
|
|
|||||
(dollars in thousands)
|
Three months ended
June 30, 2017 |
|
|
Six months ended
June 30, 2017 |
|
|||
Foreign currency option contracts
|
Other income (expense), net
|
$
|
475
|
|
|
$
|
475
|
|
16
|
|
Second Quarter 2017 Form 10-Q
|
10. Commitments and Contingencies
|
Second Quarter 2017 Form 10-Q
|
|
17
|
11. Income Taxes
|
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||
(dollars in thousands)
|
2017
|
|
2016
(1)
|
|
|
2017
|
|
2016
(1)
|
|
||||
Income tax provision
|
$
|
3,194
|
|
$
|
1,778
|
|
|
$
|
171
|
|
$
|
3,373
|
|
Effective income tax rate
|
22.2
|
%
|
16.4
|
%
|
|
0.7
|
%
|
18.1
|
%
|
(1)
|
As discussed in Note 2 to these consolidated financial statements, we early adopted ASU 2016-09 relating to stock-based compensation during the three months ended September 30, 2016. Under ASU 2016-09, tax benefits in excess of compensation costs (windfalls) generated upon the exercise or settlement of stock awards are no longer recognized as additional paid-in capital but are instead recognized as a reduction to income tax expense. This change in accounting for income taxes was effective for us on a prospective basis as of the beginning of the 2016 fiscal year.
|
12. Stock-based Compensation
|
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||
(dollars in thousands)
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
||||
Included in cost of revenue:
|
|
|
|
|
|
||||||||
Cost of subscriptions
|
$
|
338
|
|
$
|
311
|
|
|
$
|
632
|
|
$
|
586
|
|
Cost of maintenance
|
105
|
|
136
|
|
|
191
|
|
254
|
|
||||
Cost of services and other
|
507
|
|
395
|
|
|
918
|
|
847
|
|
||||
Total included in cost of revenue
|
950
|
|
842
|
|
|
1,741
|
|
1,687
|
|
||||
Included in operating expenses:
|
|
|
|
|
|
||||||||
Sales, marketing and customer success
|
1,781
|
|
1,021
|
|
|
3,220
|
|
1,917
|
|
||||
Research and development
|
2,067
|
|
1,729
|
|
|
3,784
|
|
3,200
|
|
||||
General and administrative
|
6,037
|
|
4,852
|
|
|
11,384
|
|
9,383
|
|
||||
Total included in operating expenses
|
9,885
|
|
7,602
|
|
|
18,388
|
|
14,500
|
|
||||
Total stock-based compensation expense
|
$
|
10,835
|
|
$
|
8,444
|
|
|
$
|
20,129
|
|
$
|
16,187
|
|
18
|
|
Second Quarter 2017 Form 10-Q
|
13. Stockholders' Equity
|
Declaration Date
|
Dividend
per Share
|
|
Record Date
|
|
Payable Date
|
|
February 8, 2017
|
$
|
0.12
|
|
February 28
|
|
March 15
|
May 1, 2017
|
$
|
0.12
|
|
May 26
|
|
June 15
|
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||
(dollars in thousands)
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
||||
Accumulated other comprehensive loss, beginning of period
|
$
|
(175
|
)
|
$
|
(1,091
|
)
|
|
$
|
(457
|
)
|
$
|
(825
|
)
|
By component:
|
|
|
|
|
|
||||||||
Gains and losses on cash flow hedges:
|
|
|
|
|
|
||||||||
Accumulated other comprehensive income (loss) balance, beginning of period
|
$
|
207
|
|
$
|
(688
|
)
|
|
$
|
25
|
|
$
|
(19
|
)
|
Other comprehensive income (loss) before reclassifications, net of tax effects of $(3), $195, $(74) and $750
|
5
|
|
(301
|
)
|
|
115
|
|
(1,157
|
)
|
||||
Amounts reclassified from accumulated other comprehensive loss to interest expense
|
(15
|
)
|
302
|
|
|
104
|
|
610
|
|
||||
Tax benefit included in provision for income taxes
|
6
|
|
(119
|
)
|
|
(41
|
)
|
(240
|
)
|
||||
Total amounts reclassified from accumulated other comprehensive loss
|
(9
|
)
|
183
|
|
|
63
|
|
370
|
|
||||
Net current-period other comprehensive (loss) income
|
(4
|
)
|
(118
|
)
|
|
178
|
|
(787
|
)
|
||||
Accumulated other comprehensive income (loss) balance, end of period
|
$
|
203
|
|
$
|
(806
|
)
|
|
$
|
203
|
|
$
|
(806
|
)
|
Foreign currency translation adjustment:
|
|
|
|
|
|
||||||||
Accumulated other comprehensive loss balance, beginning of period
|
$
|
(382
|
)
|
$
|
(403
|
)
|
|
$
|
(482
|
)
|
$
|
(806
|
)
|
Translation adjustments
|
(379
|
)
|
(431
|
)
|
|
(279
|
)
|
(28
|
)
|
||||
Accumulated other comprehensive loss balance, end of period
|
(761
|
)
|
(834
|
)
|
|
(761
|
)
|
(834
|
)
|
||||
Accumulated other comprehensive income (loss), end of period
|
$
|
(558
|
)
|
$
|
(1,640
|
)
|
|
$
|
(558
|
)
|
$
|
(1,640
|
)
|
Second Quarter 2017 Form 10-Q
|
|
19
|
14. Segment Information
|
•
|
The GMG is generally focused on sales to all emerging and mid-sized prospects and customers in North America;
|
•
|
The EMG is generally focused on sales to all large and/or strategic prospects and customers in North America; and
|
•
|
The IMG is focused on marketing, sales, delivery and support to all prospects and customers outside of North America.
|
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||
(dollars in thousands)
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
||||
Revenue by segment:
|
|
|
|
|
|
||||||||
GMG
|
$
|
99,215
|
|
$
|
93,970
|
|
|
$
|
194,116
|
|
$
|
181,922
|
|
EMG
|
82,245
|
|
75,037
|
|
|
161,877
|
|
146,536
|
|
||||
IMG
|
10,730
|
|
11,138
|
|
|
19,786
|
|
20,896
|
|
||||
Other
(1)
|
5
|
|
46
|
|
|
37
|
|
93
|
|
||||
Total revenue
|
$
|
192,195
|
|
$
|
180,191
|
|
|
$
|
375,816
|
|
$
|
349,447
|
|
Segment operating income
(2)
:
|
|
|
|
|
|
||||||||
GMG
|
$
|
47,983
|
|
$
|
45,262
|
|
|
$
|
93,687
|
|
$
|
87,873
|
|
EMG
|
44,037
|
|
38,721
|
|
|
86,512
|
|
74,487
|
|
||||
IMG
|
2,947
|
|
1,065
|
|
|
4,196
|
|
2,061
|
|
||||
Other
(1)
|
(71
|
)
|
18
|
|
|
(55
|
)
|
48
|
|
||||
|
94,896
|
|
85,066
|
|
|
184,340
|
|
164,469
|
|
||||
Less:
|
|
|
|
|
|
||||||||
Corporate unallocated costs
(3)
|
(56,502
|
)
|
(52,363
|
)
|
|
(115,527
|
)
|
(102,778
|
)
|
||||
Stock-based compensation costs
|
(10,835
|
)
|
(8,444
|
)
|
|
(20,129
|
)
|
(16,187
|
)
|
||||
Amortization expense
|
(10,811
|
)
|
(10,635
|
)
|
|
(21,357
|
)
|
(21,268
|
)
|
||||
Interest expense
|
(3,216
|
)
|
(2,721
|
)
|
|
(5,593
|
)
|
(5,396
|
)
|
||||
Other income (expense), net
|
827
|
|
(65
|
)
|
|
1,113
|
|
(170
|
)
|
||||
Income before provision for income taxes
|
$
|
14,359
|
|
$
|
10,838
|
|
|
$
|
22,847
|
|
$
|
18,670
|
|
(1)
|
Other includes revenue and the related costs from the sale of solutions and services not directly attributable to a reportable segment.
|
(2)
|
Segment operating income includes direct, controllable costs related to the sale of solutions and services by the reportable segment.
|
(3)
|
Corporate unallocated costs include research and development, depreciation expense, and certain corporate sales, marketing, general and administrative expenses.
|
20
|
|
Second Quarter 2017 Form 10-Q
|
15. Subsequent Events
|
Second Quarter 2017 Form 10-Q
|
|
21
|
Executive Summary
|
1.
|
Deliver Integrated and Open Solutions in the Cloud
|
2.
|
Drive Sales Effectiveness
|
22
|
|
Second Quarter 2017 Form 10-Q
|
3.
|
Expand TAM into Near Adjacencies through Acquisitions and Product Investments
|
4.
|
Improve Operating Efficiency
|
Second Quarter 2017 Form 10-Q
|
|
23
|
Total revenue
|
|
|
|
|
|
|
|
||||||||||
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||||||
(dollars in millions)
|
2017
|
|
2016
|
|
Change
|
|
|
2017
|
|
2016
|
|
Change
|
|
||||
Total revenue
|
$
|
192.2
|
|
$
|
180.2
|
|
6.7
|
%
|
|
$
|
375.8
|
|
$
|
349.4
|
|
7.5
|
%
|
Income from operations
|
|
|
|
|
|
|
|
||||||||||
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||||||
(dollars in millions)
|
2017
|
|
2016
|
|
Change
|
|
|
2017
|
|
2016
|
|
Change
|
|
||||
Income from operations
|
$
|
16.7
|
|
$
|
13.6
|
|
22.9
|
%
|
|
$
|
27.3
|
|
$
|
24.2
|
|
12.8
|
%
|
24
|
|
Second Quarter 2017 Form 10-Q
|
Results of Operations
|
Revenue by segment
|
|
|
|
|
|
|
|||||||||||
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||||||
(dollars in millions)
|
2017
|
|
2016
|
|
Change
|
|
|
2017
|
|
2016
|
|
Change
|
|
||||
GMG
|
$
|
99.2
|
|
$
|
94.0
|
|
5.6
|
%
|
|
$
|
194.1
|
|
$
|
181.9
|
|
6.7
|
%
|
EMG
|
82.2
|
|
75.0
|
|
9.6
|
%
|
|
161.9
|
|
146.5
|
|
10.5
|
%
|
||||
IMG
|
10.7
|
|
11.1
|
|
(3.7
|
)%
|
|
19.8
|
|
20.9
|
|
(5.3
|
)%
|
||||
Total revenue
(1)
|
$
|
192.2
|
|
$
|
180.2
|
|
6.7
|
%
|
|
$
|
375.8
|
|
$
|
349.4
|
|
7.5
|
%
|
(1)
|
The individual amounts for each year may not sum to total revenue due to rounding.
|
Second Quarter 2017 Form 10-Q
|
|
25
|
GMG
|
|
|
|
|
|
|
|||||||||||
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||||||
(dollars in millions)
|
2017
|
|
2016
|
|
Change
|
|
|
2017
|
|
2016
|
|
Change
|
|
||||
GMG revenue
|
$
|
99.2
|
|
$
|
94.0
|
|
5.6
|
%
|
|
$
|
194.1
|
|
$
|
181.9
|
|
6.7
|
%
|
% of total revenue
|
51.6
|
%
|
52.2
|
%
|
|
|
51.7
|
%
|
52.1
|
%
|
|
26
|
|
Second Quarter 2017 Form 10-Q
|
Subscriptions
|
|
|
|
|
|
|
|||||||||||
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||||||
(dollars in millions)
|
2017
|
|
2016
|
|
Change
|
|
|
2017
|
|
2016
|
|
Change
|
|
||||
Subscriptions revenue
|
$
|
125.3
|
|
$
|
104.0
|
|
20.4
|
%
|
|
$
|
243.4
|
|
$
|
200.9
|
|
21.2
|
%
|
Cost of subscriptions
|
57.4
|
|
52.2
|
|
10.0
|
%
|
|
112.3
|
|
101.8
|
|
10.3
|
%
|
||||
Subscriptions gross profit
(1)
|
$
|
67.9
|
|
$
|
51.9
|
|
30.9
|
%
|
|
$
|
131.1
|
|
$
|
99.1
|
|
32.4
|
%
|
Subscriptions gross margin
|
54.2
|
%
|
49.9
|
%
|
|
|
53.9
|
%
|
49.3
|
%
|
|
(1)
|
The individual amounts for each year may not sum to subscriptions gross profit due to rounding.
|
Second Quarter 2017 Form 10-Q
|
|
27
|
Maintenance
|
|
|
|
|
|
|
|||||||||||
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||||||
(dollars in millions)
|
2017
|
|
2016
|
|
Change
|
|
|
2017
|
|
2016
|
|
Change
|
|
||||
Maintenance revenue
|
$
|
32.9
|
|
$
|
37.4
|
|
(12.1
|
)%
|
|
$
|
66.7
|
|
$
|
74.6
|
|
(10.6
|
)%
|
Cost of maintenance
|
5.9
|
|
5.7
|
|
3.0
|
%
|
|
11.9
|
|
11.0
|
|
7.6
|
%
|
||||
Maintenance gross profit
(1)
|
$
|
27.0
|
|
$
|
31.8
|
|
(14.8
|
)%
|
|
$
|
54.8
|
|
$
|
63.6
|
|
(13.8
|
)%
|
Maintenance gross margin
|
82.2
|
%
|
84.8
|
%
|
|
|
82.2
|
%
|
85.2
|
%
|
|
(1)
|
The individual amounts for each year may not sum to maintenance gross profit due to rounding.
|
28
|
|
Second Quarter 2017 Form 10-Q
|
Services and other
|
|
|
|
|
|
|
|||||||||||
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||||||
(dollars in millions)
|
2017
|
|
2016
|
|
Change
|
|
|
2017
|
|
2016
|
|
Change
|
|
||||
Services and other revenue
|
$
|
34.0
|
|
$
|
38.7
|
|
(12.1
|
)%
|
|
$
|
65.7
|
|
$
|
73.9
|
|
(11.2
|
)%
|
Cost of services and other
|
23.8
|
|
25.8
|
|
(7.7
|
)%
|
|
48.3
|
|
50.7
|
|
(4.6
|
)%
|
||||
Services and other gross profit
(1)
|
$
|
10.3
|
|
$
|
13.0
|
|
(20.7
|
)%
|
|
$
|
17.4
|
|
$
|
23.3
|
|
(25.5
|
)%
|
Services and other gross margin
|
30.2
|
%
|
33.5
|
%
|
|
|
26.4
|
%
|
31.5
|
%
|
|
(1)
|
The individual amounts for each year may not sum to services and other gross profit due to rounding.
|
Second Quarter 2017 Form 10-Q
|
|
29
|
Sales, marketing and customer success
|
|
|
|
|
|
|
|||||||||||
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||||||
(dollars in millions)
|
2017
|
|
2016
|
|
Change
|
|
|
2017
|
|
2016
|
|
Change
|
|
||||
Sales, marketing and customer success expense
|
$
|
43.0
|
|
$
|
39.4
|
|
9.0
|
%
|
|
$
|
85.2
|
|
$
|
75.0
|
|
13.6
|
%
|
% of total revenue
|
22.4
|
%
|
21.9
|
%
|
|
|
22.7
|
%
|
21.5
|
%
|
|
Research and development
|
|
|
|
|
|
|
|||||||||||
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||||||
(dollars in millions)
|
2017
(1)
|
|
2016
(1)
|
|
Change
|
|
|
2017
(2)
|
|
2016
(2)
|
|
Change
|
|
||||
Research and development expense
|
$
|
22.9
|
|
$
|
22.7
|
|
0.5
|
%
|
|
$
|
45.6
|
|
$
|
45.5
|
|
0.2
|
%
|
% of total revenue
|
11.9
|
%
|
12.6
|
%
|
|
|
12.1
|
%
|
13.0
|
%
|
|
(1)
|
Not included in research and development expense for the three months ended
June 30, 2017
and
2016
were $7.0 million and $6.4 million, respectively, of qualifying costs associated with development activities that are required to be capitalized under the internal-use software accounting guidance such as those related to development of our next generation cloud-based solutions. Qualifying capitalized software development costs associated with our cloud-based solutions are subsequently amortized to cost of subscriptions revenue over the related asset's estimated useful life, which generally range from three to seven years.
|
(2)
|
Not included in research and development expense for the six months ended
June 30, 2017
and
2016
were $13.6 million and $12.0 million, respectively, of qualifying costs associated with development activities that are required to be capitalized under the internal-use software accounting guidance.
|
30
|
|
Second Quarter 2017 Form 10-Q
|
General and administrative
|
|
|
|
|
|
|
|||||||||||
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||||||
(dollars in millions)
|
2017
|
|
2016
|
|
Change
|
|
|
2017
|
|
2016
|
|
Change
|
|
||||
General and administrative expense
|
$
|
21.9
|
|
$
|
20.1
|
|
8.9
|
%
|
|
$
|
43.8
|
|
$
|
39.8
|
|
10.1
|
%
|
% of total revenue
|
11.4
|
%
|
11.1
|
%
|
|
|
11.7
|
%
|
11.4
|
%
|
|
Second Quarter 2017 Form 10-Q
|
|
31
|
(dollars in millions)
|
Timing of recognition
|
June 30,
2017 |
|
Change
|
|
|
December 31,
2016 |
|
||
Subscriptions
|
Over the period billed in advance, generally one year
|
$
|
177.6
|
|
22.8
|
%
|
|
$
|
144.6
|
|
Maintenance
|
Over the period billed in advance, generally one year
|
75.2
|
|
(2.1
|
)%
|
|
76.8
|
|
||
Services and other
|
As services are delivered
|
34.1
|
|
15.4
|
%
|
|
29.5
|
|
||
Total deferred revenue
(1)
|
|
286.9
|
|
14.3
|
%
|
|
250.9
|
|
||
Less: Long-term portion
|
|
6.1
|
|
(5.8
|
)%
|
|
6.4
|
|
||
Current portion
(1)
|
|
$
|
280.8
|
|
14.9
|
%
|
|
$
|
244.5
|
|
(1)
|
The individual amounts for each year may not sum to total deferred revenue or current portion of deferred revenue due to rounding.
|
(1)
|
As discussed in Note 2 of our consolidated financial statements in this report, we early adopted ASU 2016-09 relating to stock-based compensation during the three months ended September 30, 2016. Under ASU 2016-09, tax benefits in excess of compensation costs (windfalls) generated upon the exercise or settlement of stock awards are no longer recognized as additional paid-in capital but are instead recognized as a reduction to income tax expense. This change in accounting for income taxes was effective for us on a prospective basis as of the beginning of the 2016 fiscal year.
|
32
|
|
Second Quarter 2017 Form 10-Q
|
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||||||
(dollars in millions)
|
2017
|
|
2016
|
|
Change
|
|
|
2017
|
|
2016
|
|
Change
|
|
||||
GAAP Revenue
|
$
|
192.2
|
|
$
|
180.2
|
|
6.7
|
%
|
|
$
|
375.8
|
|
$
|
349.4
|
|
7.5
|
%
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
||||||||||
Add: Acquisition-related deferred revenue write-down
|
0.3
|
|
1.9
|
|
(81.2
|
)%
|
|
0.3
|
|
3.6
|
|
(90.4
|
)%
|
||||
Non-GAAP revenue
(1)
|
$
|
192.5
|
|
$
|
182.0
|
|
5.8
|
%
|
|
$
|
376.2
|
|
$
|
353.1
|
|
6.5
|
%
|
|
|
|
|
|
|
|
|
||||||||||
GAAP gross profit
|
$
|
105.2
|
|
$
|
96.6
|
|
8.9
|
%
|
|
$
|
203.3
|
|
$
|
185.9
|
|
9.4
|
%
|
GAAP gross margin
|
54.7
|
%
|
53.6
|
%
|
|
|
54.1
|
%
|
53.2
|
%
|
|
||||||
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
||||||||||
Add: Acquisition-related deferred revenue write-down
|
0.3
|
|
1.9
|
|
(81.2
|
)%
|
|
0.3
|
|
3.6
|
|
(90.4
|
)%
|
||||
Add: Stock-based compensation expense
|
1.0
|
|
0.8
|
|
12.8
|
%
|
|
1.7
|
|
1.7
|
|
3.2
|
%
|
||||
Add: Amortization of intangibles from business combinations
|
10.1
|
|
9.9
|
|
1.5
|
%
|
|
19.9
|
|
19.8
|
|
0.6
|
%
|
||||
Add: Employee severance
|
—
|
|
0.1
|
|
(73.1
|
)%
|
|
1.0
|
|
0.1
|
|
585.2
|
%
|
||||
Add: Acquisition-related integration costs
|
—
|
|
—
|
|
—
|
%
|
|
0.1
|
|
—
|
|
100.0
|
%
|
||||
Subtotal
(1)
|
11.4
|
|
12.7
|
|
(10.3
|
)%
|
|
23.1
|
|
25.3
|
|
(8.7
|
)%
|
||||
Non-GAAP gross profit
(1)
|
$
|
116.6
|
|
$
|
109.3
|
|
6.7
|
%
|
|
$
|
226.4
|
|
$
|
211.2
|
|
7.2
|
%
|
Non-GAAP gross margin
|
60.6
|
%
|
60.0
|
%
|
|
|
60.2
|
%
|
59.8
|
%
|
|
(1)
|
The individual amounts for each year may not sum to non-GAAP revenue, subtotal or non-GAAP gross profit due to rounding.
|
Second Quarter 2017 Form 10-Q
|
|
33
|
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||||||
(dollars in millions, except per share amounts)
|
2017
|
|
2016
|
|
Change
|
|
|
2017
|
|
2016
|
|
Change
|
|
||||
GAAP income from operations
|
$
|
16.7
|
|
$
|
13.6
|
|
22.9
|
%
|
|
$
|
27.3
|
|
$
|
24.2
|
|
12.8
|
%
|
GAAP operating margin
|
8.7
|
%
|
7.6
|
%
|
|
|
7.3
|
%
|
6.9
|
%
|
|
||||||
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
||||||||||
Add: Acquisition-related deferred revenue write-down
|
0.3
|
|
1.9
|
|
(81.2
|
)%
|
|
0.3
|
|
3.6
|
|
(90.4
|
)%
|
||||
Add: Stock-based compensation expense
|
10.8
|
|
8.4
|
|
28.3
|
%
|
|
20.1
|
|
16.2
|
|
24.4
|
%
|
||||
Add: Amortization of intangibles from business combinations
|
10.8
|
|
10.6
|
|
1.7
|
%
|
|
21.4
|
|
21.3
|
|
0.4
|
%
|
||||
Add: Employee severance
|
0.1
|
|
0.1
|
|
6.2
|
%
|
|
2.9
|
|
0.4
|
|
614.7
|
%
|
||||
Add: Acquisition-related integration costs
|
—
|
|
0.1
|
|
(100.0
|
)%
|
|
0.2
|
|
0.5
|
|
(54.2
|
)%
|
||||
Add: Acquisition-related expenses
|
1.8
|
|
—
|
|
100.0
|
%
|
|
2.3
|
|
0.1
|
|
1,963.7
|
%
|
||||
Subtotal
(1)
|
23.9
|
|
21.2
|
|
12.8
|
%
|
|
47.3
|
|
42.1
|
|
12.2
|
%
|
||||
Non-GAAP income from operations
(1)
|
$
|
40.6
|
|
$
|
34.8
|
|
16.8
|
%
|
|
$
|
74.6
|
|
$
|
66.3
|
|
12.4
|
%
|
Non-GAAP operating margin
|
21.1
|
%
|
19.1
|
%
|
|
|
19.8
|
%
|
18.8
|
%
|
|
||||||
|
|
|
|
|
|
|
|
||||||||||
GAAP net income
|
$
|
11.2
|
|
$
|
9.1
|
|
23.2
|
%
|
|
$
|
22.7
|
|
$
|
15.3
|
|
48.2
|
%
|
Shares used in computing GAAP diluted earnings per share
|
47,691,340
|
|
47,263,844
|
|
0.9
|
%
|
|
47,586,893
|
|
47,184,926
|
|
0.9
|
%
|
||||
GAAP diluted earnings per share
|
$
|
0.23
|
|
$
|
0.19
|
|
21.1
|
%
|
|
$
|
0.48
|
|
$
|
0.32
|
|
50.0
|
%
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
||||||||||
Add: Total Non-GAAP adjustments affecting income from operations
|
23.9
|
|
21.2
|
|
12.8
|
%
|
|
47.3
|
|
42.1
|
|
12.2
|
%
|
||||
Less: Gain on derivative instrument
|
(0.5
|
)
|
—
|
|
100.0
|
%
|
|
(0.5
|
)
|
—
|
|
100.0
|
%
|
||||
Add: Loss on debt extinguishment
|
0.2
|
|
—
|
|
100.0
|
%
|
|
0.2
|
|
—
|
|
100.0
|
%
|
||||
Less: Tax impact related to Non-GAAP adjustments
(2)
|
(8.9
|
)
|
(8.5
|
)
|
5.6
|
%
|
|
(22.2
|
)
|
(16.1
|
)
|
37.9
|
%
|
||||
Non-GAAP net income
(1)
|
$
|
25.8
|
|
$
|
21.8
|
|
18.5
|
%
|
|
$
|
47.5
|
|
$
|
41.3
|
|
14.8
|
%
|
|
|
|
|
|
|
|
|
||||||||||
Shares used in computing Non-GAAP diluted earnings per share
|
47,691,340
|
|
47,263,844
|
|
0.9
|
%
|
|
47,586,893
|
|
47,184,926
|
|
0.9
|
%
|
||||
Non-GAAP diluted earnings per share
|
$
|
0.54
|
|
$
|
0.46
|
|
17.4
|
%
|
|
$
|
1.00
|
|
$
|
0.88
|
|
13.6
|
%
|
(1)
|
The individual amounts for each year may not sum to subtotal, non-GAAP income from operations or non-GAAP net income due to rounding.
|
(2)
|
We apply a non-GAAP effective tax rate of 32.0% in our determination of non-GAAP net income, which represents the GAAP effective tax rate, excluding the discrete tax effect of stock-based compensation.
|
34
|
|
Second Quarter 2017 Form 10-Q
|
(dollars in millions)
|
Three months ended
June 30, |
|
|
Six months ended
June 30, |
|
||||||||
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
|||||
GAAP revenue
|
$
|
192.2
|
|
$
|
180.2
|
|
|
$
|
375.8
|
|
$
|
349.4
|
|
GAAP revenue growth
|
6.7
|
%
|
|
|
7.5
|
%
|
|
||||||
(Less) Add: Non-GAAP acquisition-related revenue
(1)
|
(1.9
|
)
|
1.9
|
|
|
(1.9
|
)
|
3.6
|
|
||||
Total Non-GAAP adjustments
|
(1.9
|
)
|
1.9
|
|
|
(1.9
|
)
|
3.6
|
|
||||
Non-GAAP revenue
|
$
|
190.3
|
|
$
|
182.0
|
|
|
$
|
373.9
|
|
$
|
353.1
|
|
Non-GAAP organic revenue growth
|
4.5
|
%
|
|
|
5.9
|
%
|
|
||||||
|
|
|
|
|
|
||||||||
Non-GAAP revenue
(2)
|
$
|
190.3
|
|
$
|
182.0
|
|
|
$
|
373.9
|
|
$
|
353.1
|
|
Foreign currency impact on Non-GAAP organic revenue
(3)
|
1.1
|
|
—
|
|
|
1.3
|
|
—
|
|
||||
Non-GAAP revenue on constant currency basis
(3)
|
$
|
191.4
|
|
$
|
182.0
|
|
|
$
|
375.2
|
|
$
|
353.1
|
|
Non-GAAP organic revenue growth on constant currency basis
|
5.1
|
%
|
|
|
6.3
|
%
|
|
||||||
|
|
|
|
|
|
||||||||
GAAP subscriptions revenue
|
$
|
125.3
|
|
$
|
104.0
|
|
|
$
|
243.4
|
|
$
|
200.9
|
|
GAAP subscriptions revenue growth
|
20.4
|
%
|
|
|
21.2
|
%
|
|
||||||
(Less) Add: Non-GAAP acquisition-related revenue
(1)
|
(1.8
|
)
|
1.8
|
|
|
(1.8
|
)
|
3.5
|
|
||||
Total Non-GAAP adjustments
|
(1.8
|
)
|
1.8
|
|
|
(1.8
|
)
|
3.5
|
|
||||
Non-GAAP organic subscriptions revenue
|
$
|
123.5
|
|
$
|
105.8
|
|
|
$
|
241.7
|
|
$
|
204.4
|
|
Non-GAAP organic subscriptions revenue growth
|
16.7
|
%
|
|
|
18.2
|
%
|
|
||||||
|
|
|
|
|
|
||||||||
GAAP subscriptions revenue
|
$
|
125.3
|
|
$
|
104.0
|
|
|
$
|
243.4
|
|
$
|
200.9
|
|
GAAP maintenance revenue
|
$
|
32.9
|
|
$
|
37.4
|
|
|
66.7
|
|
74.6
|
|
||
GAAP recurring revenue
|
$
|
158.2
|
|
$
|
141.5
|
|
|
310.1
|
|
275.5
|
|
||
GAAP recurring revenue growth
|
11.8
|
%
|
|
|
12.6
|
%
|
|
||||||
(Less) Add: Non-GAAP acquisition-related revenue
(1)
|
(1.8
|
)
|
1.8
|
|
|
(1.8
|
)
|
3.6
|
|
||||
Total Non-GAAP adjustments
|
(1.8
|
)
|
1.8
|
|
|
(1.8
|
)
|
3.6
|
|
||||
Non-GAAP recurring revenue
|
$
|
156.4
|
|
$
|
143.3
|
|
|
$
|
308.4
|
|
$
|
279.1
|
|
Non-GAAP organic recurring revenue growth
|
9.1
|
%
|
|
|
10.5
|
%
|
|
(1)
|
Non-GAAP acquisition-related revenue excludes incremental acquisition-related revenue calculated in accordance with GAAP that is attributable to companies acquired in the current fiscal year. For companies, if any, acquired in the immediately preceding fiscal year, non-GAAP acquisition-related revenue reflects presentation of full-year incremental non-GAAP revenue derived from such companies, as if they were combined throughout the prior period, and it includes the non-GAAP revenue from the acquisition-related deferred revenue write-down attributable to those companies.
|
(2)
|
Non-GAAP revenue for the prior year periods presented herein may not agree to non-GAAP revenue presented in the respective prior period quarterly financial information solely due to the manner in which non-GAAP organic revenue growth is calculated.
|
(3)
|
To determine non-GAAP organic revenue growth on a constant currency basis, revenues from entities reporting in foreign currencies were translated to U.S. Dollars using the comparable prior period's quarterly weighted average foreign currency exchange rates. The primary foreign currencies creating the impact are the Canadian Dollar, EURO, British Pound and Australian Dollar.
|
Second Quarter 2017 Form 10-Q
|
|
35
|
Liquidity and Capital Resources
|
(dollars in millions)
|
June 30,
2017 |
|
Change
|
|
|
December 31,
2016 |
|
||
Cash and cash equivalents
|
$
|
17.3
|
|
2.2
|
%
|
|
$
|
16.9
|
|
Property and equipment, net
|
45.7
|
|
(9.1
|
)%
|
|
50.3
|
|
||
Software development costs, net
|
45.0
|
|
19.6
|
%
|
|
37.6
|
|
||
Total carrying value of debt
|
387.7
|
|
13.2
|
%
|
|
342.4
|
|
||
Working capital
|
(154.0
|
)
|
10.5
|
%
|
|
(172.2
|
)
|
||
Working capital excluding deferred revenue
|
126.8
|
|
75.3
|
%
|
|
72.3
|
|
36
|
|
Second Quarter 2017 Form 10-Q
|
Financial Covenant
|
Requirement
|
Ratio as of June 30, 2017
|
Net Leverage Ratio
|
≤ 3.50 to 1.00
|
2.17 to 1.00
|
Interest Coverage Ratio
|
≥ 2.50 to 1.00
|
16.16 to 1.00
|
Second Quarter 2017 Form 10-Q
|
|
37
|
|
Payments due by period
|
||||||||||||||
(in millions)
|
Total
|
|
Less than 1 year
|
|
1-3 years
|
|
3-5 years
|
|
More than 5 years
|
|
|||||
Recorded contractual obligations:
|
|
|
|
|
|
||||||||||
Debt
(1)
|
$
|
390.4
|
|
$
|
7.5
|
|
$
|
15.0
|
|
$
|
367.9
|
|
$
|
—
|
|
|
|
|
|
|
|
||||||||||
Unrecorded contractual obligations:
|
|
|
|
|
|
||||||||||
Operating leases
(2)
|
195.3
|
|
19.1
|
|
39.8
|
|
34.7
|
|
101.7
|
|
|||||
Interest payments on debt
(3)
|
47.7
|
|
9.9
|
|
19.6
|
|
18.2
|
|
—
|
|
|||||
Purchase obligations
(4)
|
55.5
|
|
23.2
|
|
32.3
|
|
—
|
|
—
|
|
|||||
Total contractual obligations
|
$
|
688.9
|
|
$
|
59.7
|
|
$
|
106.7
|
|
$
|
420.8
|
|
$
|
101.7
|
|
(1)
|
Represents principal payments only, under the following assumptions: (i) that the amounts outstanding under the
2017 Credit Facility
at
June 30, 2017
will remain outstanding until maturity, with minimum payments occurring as currently scheduled, and (ii) that there are no assumed future borrowings on the 2017 Revolving Facility for the purposes of determining minimum commitment amounts.
|
(2)
|
Our commitments related to operating leases have not been reduced by incentive payments and reimbursement of leasehold improvements.
|
(3)
|
The actual interest expense recognized in our consolidated statements of comprehensive income will depend on the amount of debt, the length of time the debt is outstanding and the interest rate, which could be different from our assumptions described in (1) above.
|
(4)
|
We have contractual obligations for third-party technology used in our solutions and for other services we purchase as part of our normal operations. In certain cases, these arrangements require a minimum annual purchase commitment by us.
|
Off-Balance Sheet Arrangements
|
38
|
|
Second Quarter 2017 Form 10-Q
|
Foreign Currency Exchange Rates
|
Inflation
|
Critical Accounting Policies and Estimates
|
Recently Issued Accounting Pronouncements
|
Second Quarter 2017 Form 10-Q
|
|
39
|
Interest Rate Risk
|
Foreign Currency Risk
|
Evaluation of Disclosure Controls and Procedures
|
Changes in Internal Control Over Financial Reporting
|
40
|
|
Second Quarter 2017 Form 10-Q
|
|
|
PART II. OTHER INFORMATION
|
Issuer Purchases of Equity Securities
|
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
(in thousands)
|
|
||
Beginning balance, April 1, 2017
|
|
|
|
|
|
|
$
|
50,000
|
|
||||
April 1, 2017 through April 30, 2017
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
50,000
|
|
|
May 1, 2017 through May 31, 2017
|
22,511
|
|
|
80.68
|
|
|
—
|
|
|
50,000
|
|
||
June 1, 2017 through June 30, 2017
|
—
|
|
|
—
|
|
|
—
|
|
|
50,000
|
|
||
Total
|
22,511
|
|
|
$
|
80.68
|
|
|
—
|
|
|
$
|
50,000
|
|
(1)
|
In August 2010, our Board of Directors approved a stock repurchase program that authorized us to purchase up to $50.0 million of our outstanding shares of common stock. We have not made any repurchases under the program to date, and the program does not have an expiration date.
|
Second Quarter 2017 Form 10-Q
|
|
41
|
•
|
Pay the employee 1.5 times the employee’s annual base salary within 60 days following the employee’s termination date;
|
•
|
Accelerate and fully vest any equity compensation awards, such as stock options or restricted stock; and
|
•
|
Reimburse COBRA premiums for the lesser of (i) 12 months following the termination date or (ii) until the employee becomes eligible for insurance benefits from another employer.
|
Second Quarter 2017 Form 10-Q
|
|
42
|
|
|
|
|
Filed In
|
||||||
Exhibit Number
|
|
Description of Document
|
|
Filed Herewith
|
|
Form
|
|
Exhibit Number
|
|
Filing Date
|
|
|
|
|
8-K
|
|
10.90
|
|
6/5/2017
|
||
|
|
|
|
8-K
|
|
10.91
|
|
6/5/2017
|
||
|
|
X
|
|
|
|
|
|
|
||
|
|
X
|
|
|
|
|
|
|
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X
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X
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X
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101.INS*
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XBRL Instance Document.
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X
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101.SCH*
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XBRL Taxonomy Extension Schema Document.
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X
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101.CAL*
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XBRL Taxonomy Extension Calculation Linkbase Document.
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X
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101.DEF*
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XBRL Taxonomy Extension Definition Linkbase Document.
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X
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101.LAB*
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XBRL Taxonomy Extension Label Linkbase Document.
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X
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101.PRE*
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XBRL Taxonomy Extension Presentation Linkbase Document.
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X
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Second Quarter 2017 Form 10-Q
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43
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SIGNATURES
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BLACKBAUD, INC.
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Date:
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August 4, 2017
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By:
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/s/ Michael P. Gianoni
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Michael P. Gianoni
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President and Chief Executive Officer
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(Principal Executive Officer)
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Date:
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August 4, 2017
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By:
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/s/ Anthony W. Boor
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Anthony W. Boor
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Executive Vice President and Chief Financial Officer
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(Principal Financial and Accounting Officer)
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44
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Second Quarter 2017 Form 10-Q
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1.
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I have reviewed this quarterly report on Form 10-Q of Blackbaud, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
August 4, 2017
|
By:
|
|
/s/ Michael P. Gianoni
|
|
|
|
|
Michael P. Gianoni
|
|
|
|
|
President and Chief Executive Officer
|
|
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Blackbaud, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
August 4, 2017
|
By:
|
|
/s/ Anthony W. Boor
|
|
|
|
|
Anthony W. Boor
|
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
(Principal Financial and Accounting Officer)
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
August 4, 2017
|
By:
|
|
/s/ Michael P. Gianoni
|
|
|
|
|
Michael P. Gianoni
|
|
|
|
|
President and Chief Executive Officer
|
|
|
|
|
(Principal Executive Officer)
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
August 4, 2017
|
By:
|
|
/s/ Anthony W. Boor
|
|
|
|
|
Anthony W. Boor
|
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
(Principal Financial and Accounting Officer)
|