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May 22, 2012

Compuware Total Revenue Jumps Nearly 9 Percent Year-Over-Year to $1.01B as All Business Units Grow Revenue

  • Compuware APM total revenues increase 21 percent year-over-year in Q4 to $80.0 million; up 17 percent from full-year FY '11 total revenues to $270.4M
  • Compuware Covisint boosts revenues 34 percent year-over-year to $73.7M
  • Compuware Changepoint total revenues increase 21 percent year-over-year to $47.9M
  • Compuware Earns 40 Cents Per Share in FY '12, 12 Cents Per Share in Q4

DETROIT, May 22, 2012 (GLOBE NEWSWIRE) -- Compuware Corporation (Nasdaq:CPWR), the technology performance company, today announced financial results for its fourth quarter and fiscal year ended March 31, 2012.

"Compuware has aligned itself for growth, as every one of our business units produced year-over-year revenue expansion in FY '12," said Compuware CEO Bob Paul. "With nearly 40 percent of revenues now generated by our high-growth solutions — APM, Changepoint and Covisint — the company is positioned to deliver meaningful increases in revenue and earnings."

Fiscal Year 2012 Results

During the fiscal year ended March 31, 2012:

  • software license fees were $220.9 million, up 13 percent from FY '11
  • maintenance fees were $427.5 million, up 2 percent from FY '11
  • subscription fees were $78.4 million, up 16 percent from FY '11
  • professional services revenues were $209.2 million, up 9 percent from FY '11
  • application services fees were $73.7 million, up 34 percent from FY '11

During FY '12, total revenues were $1.01 billion, up 9 percent from last year. Net income was $88.4 million, compared to $107.4 million in the previous year. Earnings per share were 40 cents, compared to 48 cents in FY '11, based on 222.4 million and 226.1 million shares outstanding, respectively, as the company absorbed the financial impact of the dynaTrace acquisition and also made a number of targeted investments in its growth businesses.

Fourth Quarter Fiscal Year 2012 Results

During the company's fourth quarter:

  • software license fees were $67.9 million, up 22 percent from Q4 last year
  • maintenance fees were $104.6 million, compared to $105.1 million in Q4 last year
  • subscription fees were $20.3 million, up 7 percent from Q4 last year
  • professional services revenues were $51.8 million, compared to $52.6 million in Q4 last year
  • application services fees were $21.4 million, up 24 percent from Q4 last year

Total revenues were $266.0 million, up 7 percent from Q4 last year. Net income was $27.1 million compared to $34.8 million in Q4 last year. Earnings per share were 12 cents, compared to 16 cents in Q4 last year.

Fiscal 2013 Expectations

For fiscal 2013, Compuware expects total revenues of $1.07 to $1.08 billion and earnings of 45 to 49 cents per share. This represents growth of approximately 7 percent in revenue and 18 percent in earnings per share. The company expects cash flow from operations consistent with this year's.

Fourth Quarter Fiscal Year 2012 Highlights

During the fourth quarter, Compuware:

Compuware Corporation

Compuware Corporation, the technology performance company, provides software, experts and best practices to ensure technology works well and delivers value. Compuware solutions make the world's most important technologies perform at their best for leading organizations worldwide, including 46 of the top 50 Fortune 500 companies and 12 of the top 20 most visited U.S. web sites. Learn more at: http://www.compuware.com.

The Compuware logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5950

Conference Call Information

Compuware will today hold a conference call to discuss these results at 5 p.m. Eastern time (21:00 GMT). To join the conference call, interested parties in the United States should call 800-230-1059. For international access, the conference call number is +1-612-332-0337. No password is required.

A conference call replay will also be available. The United States replay number will be 800-475-6701, and the international replay number will be +1-320-365-3844. The replay passcode will be 241515. Additionally, investors can listen to the conference call via webcast by visiting the Compuware Corporation Investor Relations web site at http://www.compuware.com.

Certain statements in this release that are not historical facts, including those regarding the Company's future plans, objectives and expected performance, are "forward-looking statements" within the meaning of the federal securities laws. These forward-looking statements represent our outlook only as of the date of this release. While we believe any forward-looking statements we have made are reasonable, actual results could differ materially since the statements are based on our current expectations and are subject to risks and uncertainties. These risks and uncertainties are discussed in the Company's reports filed with the Securities and Exchange Commission. Readers are cautioned to consider these factors when relying on such forward-looking information. The Company does not undertake, and expressly disclaims any obligation, to update or alter its forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.

COMPUWARE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
     
   AS OF MARCH 31, 
 ASSETS     
  2012 2011
 CURRENT ASSETS:     
 Cash and cash equivalents   $ 99,180  $ 180,244
 Accounts receivable, net   455,427  474,479
 Deferred tax asset, net   37,665  40,756
 Income taxes refundable   14,807  6,815
 Prepaid expenses and other current assets   34,279  40,446
 Total current assets   641,358  742,740
     
 PROPERTY AND EQUIPMENT, LESS ACCUMULATED     
 DEPRECIATION AND AMORTIZATION   321,991  333,166
     
 CAPITALIZED SOFTWARE AND OTHER     
 INTANGIBLE ASSETS, NET   118,973  83,001
     
 ACCOUNTS RECEIVABLE   205,869  206,887
 DEFERRED TAX ASSET, NET   40,672  35,754
 GOODWILL   801,889  607,765
 OTHER ASSETS   36,786  29,064
     
 TOTAL ASSETS   $ 2,167,538  $ 2,038,377
     
 LIABILITIES AND SHAREHOLDERS' EQUITY     
     
 CURRENT LIABILITIES:     
 Accounts payable   $ 16,169  $ 18,931
 Accrued expenses   119,834  105,242
 Income taxes payable   3,919  12,286
 Deferred revenue   447,050  462,376
 Total current liabilities   586,972  598,835
     
 LONG TERM DEBT   45,000  --
     
 DEFERRED REVENUE   373,359  393,780
     
 ACCRUED EXPENSES   30,109  28,016
     
 DEFERRED TAX LIABILITY, NET   82,161  65,134
 Total liabilities   1,117,601  1,085,765
     
 SHAREHOLDERS' EQUITY:     
 Common stock   2,175  2,177
 Additional paid-in capital   685,904  654,109
 Retained earnings   372,408  297,067
 Accumulated other comprehensive income (loss)   (10,550)  (741)
 Total shareholders' equity   1,049,937  952,612
     
 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $ 2,167,538  $ 2,038,377
 
COMPUWARE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Data)
         
         
  THREE MONTHS ENDED TWELVE MONTHS ENDED
  MARCH 31, MARCH 31,
         
  2012 2011 2012 2011
REVENUES:        
Software license fees  $ 67,927  $ 55,650  $ 220,885  $ 194,745
Maintenance fees 104,626 105,081  427,534  419,240
Subscription fees 20,282 18,949  78,438  67,718
Professional services fees 51,781 52,626  209,184  192,202
Application services fees 21,429 17,245  73,731  55,025
Total revenues  266,045 249,551  1,009,772 928,930
         
OPERATING EXPENSES:      
Cost of software license fees 4,422 3,788  17,572  14,216
Cost of maintenance fees 9,763 9,133  38,670  32,975
Cost of subscription fees 7,477 6,990  29,669  24,974
Cost of professional services 46,129 44,278  182,625  165,939
Cost of application services 18,450 16,852  72,384  51,011
Technology development and support 26,262 24,379  104,968  90,330
Sales and marketing 76,265 67,123  273,520  243,771
Administrative and general 41,006 39,423  163,723  155,400
Total operating expenses  229,774 211,966  883,131 778,616
         
INCOME FROM OPERATIONS  36,271 37,585  126,641 150,314
         
OTHER INCOME (EXPENSE), NET 412 1,359 1,633 4,462
         
INCOME BEFORE INCOME TAXES  36,683 38,944  128,274 154,776
         
INCOME TAX PROVISION 9,564 4,139  39,903  47,335
         
NET INCOME   $ 27,119  $ 34,805  $ 88,371  $ 107,441
         
DILUTED EPS COMPUTATION      
Numerator: Net income   $ 27,119  $ 34,805  $ 88,371  $ 107,441
Denominator:        
Weighted-average common shares outstanding 218,095 217,949  218,344  220,616
Dilutive effect of stock options 3,660 6,476  4,034  5,479
Total shares  221,755 224,425  222,378 226,095
Diluted EPS  $ 0.12  $ 0.16  $ 0.40  $ 0.48
 
COMPUWARE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
     
  TWELVE MONTHS ENDED
  MARCH 31,
  2012 2011
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:    
Net income  $ 88,371  $ 107,441
Adjustments to reconcile net income to cash provided by operations:    
Depreciation and amortization 60,551 50,332
Stock award compensation 24,724 18,768
Deferred income taxes 25,531 22,874
Other 323 610
Net change in assets and liabilities, net of effects from currency fluctuations and acquisitions:    
Accounts receivable 18,852 16,119
Prepaid expenses and other current assets (862) 5,280
Other assets (2,969) 2,656
Accounts payable and accrued expenses 11,566 (16,409)
Deferred revenue (31,619) (36,569)
Income taxes (14,827) (11,066)
Net cash provided by operating activities  179,641 160,036
     
CASH FLOWS USED IN INVESTING ACTIVITIES:    
Purchase of:    
Business, net of cash acquired (249,337) (18,165)
Property and equipment (19,266) (19,073)
Capitalized software (27,436) (15,531)
Other (900)  --
Net cash used in investing activities  (296,939) (52,769)
     
CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES:    
Proceeds from borrowings 180,200 --
Payments on borrowings (135,200) --
Net proceeds from exercise of stock awards including excess tax benefits 11,151 80,366
Employee contribution to common stock purchase plans 2,824 2,504
Repurchase of common stock (20,554) (164,515)
Net cash provided by (used in) financing activities  38,421 (81,645)
     
EFFECT OF EXCHANGE RATE CHANGES ON CASH (2,187) 4,725
     
NET CHANGE IN CASH AND CASH EQUIVALENTS  (81,064) 30,347
     
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 180,244 149,897
     
CASH AND CASH EQUIVALENTS AT END OF PERIOD  $ 99,180  $ 180,244
 
COMPUWARE CORPORATION AND SUBSIDIARIES
OPERATIONAL HIGHLIGHTS
(Dollar Amounts In Thousands)
           
 QUARTER  QUARTER  
 ENDED  ENDED  
 MAR 31,YR - YRDEC 31,QTR - QTR
 20122011% Chg2011% Chg
Total Product Software Revenue by Geography          
North America  $ 100,634  $ 95,523 5.4%  $ 98,068 2.6%
International  92,201  84,157 9.6%  85,827 7.4%
           
Deferred License Fees          
Current  $ 22,168  $ 41,725 (46.9%)  $ 26,952 (17.8%)
Long-term  10,735  24,345 (55.9%)  12,270 (12.5%)
           
Deferred Maintenance          
Current  $ 333,297  $ 336,786 (1.0%)  $ 323,485 3.0%
Long-Term  322,399  331,247 (2.7%)  305,549 5.5%
           
Deferred Subscription          
Current  $ 51,579  $ 49,416 4.4%  $ 50,444 2.3%
Long-Term  13,367  15,685 (14.8%)  13,265 0.8%
           
Deferred Professional Services  $ 24,814  $ 21,448 15.7%  $ 20,361 21.9%
           
Deferred Application Services  $ 42,050  $ 35,504 18.4%  $ 39,586 6.2%
           
           
Other:          
Total Company Headcount  4,564  4,329 5.4%  4,722 (3.3%)
           
Total DSO (Billed)   78.6  79.8    88.0  
Total DSO  154.1  171.1    167.4  
           
           
Stock-based compensation Expense          
           
Cost of license fees  $ 4  $ -- N/A   N/A
Cost of maintenance fees  208  150 39.1%  202 3.0%
Cost of subscription fees   31  29 6.9%  (68) (145.6%)
Cost of professional services   62  57 8.8%  54 14.8%
Cost of application services   427  1,987 (78.5%)  254 68.1%
Technology development and support   550  404 36.0%  575 (4.3%)
Sales and marketing   1,733  1,352 28.2%  1,493 16.1%
Administrative and general   4,154  1,402 196.3%  3,062 35.7%
                 
Total stock-based compensation expense before income taxes   $ 7,169  $ 5,381 33.2%  $ 5,572 28.7%
 
COMPUWARE CORPORATION AND SUBSIDIARIES
BUSINESS UNIT RESULTS OF OPERATIONS
(In Thousands)
                 
            Covisint    
          Professional Application Unallocated  
Quarter Ended: APM Changepoint Mainframe Uniface Services Services Expenses (1) Total
                 
March 31, 2012                
                 
Software license fees  $ 31,320  $ 6,172  $ 26,415  $ 4,020  --  --  --  $ 67,927
Maintenance fees  20,326  3,904  72,863  7,533  --  --  --  104,626
Subscription fees  19,607  675  --  --  --  --  --  20,282
Professional services fees  8,760  3,822  1,429  1,315  $ 36,455  --  --  51,781
Application services fees  --  --  --  --  --  $ 21,429  --  21,429
Total revenues  80,013  14,573  100,707  12,868  36,455  21,429  --  266,045
                 
Operating expenses  86,132  11,038  26,384  6,145  32,133  18,783  $ 49,159  229,774
                 
Income (loss) from operations  $ (6,119)  $ 3,535  $ 74,323  $ 6,723  $ 4,322  $ 2,646  $ (49,159)  $ 36,271
Contribution margin % (7.6%) 24.3% 73.8% 52.2% 11.9% 12.3%   13.6%
                 
                 
March 31, 2011                
                 
Software license fees  $ 24,301  $ 3,081  $ 23,475  $ 4,793  --  --  --  $ 55,650
Maintenance fees  16,371  3,643  77,500  7,567  --  --  --  105,081
Subscription fees  18,949  --  --  --  --  --  --  18,949
Professional services fees  6,771  4,161  1,629  1,596  $ 38,469  --  --  52,626
Application services fees  --  --  --  --  --  $ 17,245  --  17,245
Total revenues  66,392  10,885  102,604  13,956  38,469  17,245  --  249,551
                 
Operating expenses  68,685  13,144  26,068  5,918  31,189  16,852  $ 50,110  211,966
                 
Income (loss) from operations  $ (2,293)  $ (2,259)  $ 76,536  $ 8,038  $ 7,280  $ 393  $ (50,110)  $ 37,585
Contribution margin % (3.5%) (20.8%) 74.6% 57.6% 18.9% 2.3%   15.1%
                 
                 
December 31, 2011                
                 
Software license fees  $ 24,360  $ 3,513  $ 26,720  $ 2,528  --  --  --  $ 57,121
Maintenance fees  19,441  3,895  75,782  7,725  --  --  --  106,843
Subscription fees  19,379  552  --  --  --  --  --  19,931
Professional services fees  8,893  4,517  558  981  $ 35,626  --  --  50,575
Application services fees  --  --  --  --  --  $ 18,587  --  18,587
Total revenues  72,073  12,477  103,060  11,234  35,626  18,587  --  253,057
                 
Operating expenses  82,118  11,683  24,721  5,044  31,794  17,265  $ 47,839  220,464
                 
Income (loss) from operations  $ (10,045)  $ 794  $ 78,339  $ 6,190  $ 3,832  $ 1,322  $ (47,839)  $ 32,593
Contribution margin % (13.9%) 6.4% 76.0% 55.1% 10.8% 7.1%   12.9%
                 
                 
(1) Unallocated expenses include costs associated with finance, human resources, legal, administration, internal technology and other corporate expenses.    
 
COMPUWARE CORPORATION AND SUBSIDIARIES
BUSINESS UNIT RESULTS OF OPERATIONS
(In Thousands)
                 
            Covisint    
          Professional Application Unallocated  
Twelve Months Ended: APM Changepoint Mainframe Uniface Services Services Expenses (1) Total
                 
March 31, 2012                
                 
Software license fees  $ 85,462  $ 13,815  $ 110,289  $ 11,319  --  --  --  $ 220,885
Maintenance fees  77,329  15,551  303,639  31,015  --  --  --  427,534
Subscription fees  76,246  2,192  --  --  --  --  --  78,438
Professional services fees  31,406  16,309  5,389  4,574  $ 151,506  --  --  209,184
Application services fees  --  --  --  --  --  $ 73,731  --  73,731
Total revenues  270,443  47,867  419,317  46,908  151,506  73,731  --  1,009,772
                 
Operating expenses  317,621  45,027  99,310  21,740  127,178  72,717  $ 199,538  883,131
                 
Income (loss) from operations  $ (47,178)  $ 2,840  $ 320,007  $ 25,168  $ 24,328  $ 1,014  $ (199,538)  $ 126,641
Contribution margin % (17.4%) 5.9% 76.3% 53.7% 16.1% 1.4%   12.5%
                 
March 31, 2011                
                 
Software license fees  $ 77,823  $ 9,226  $ 95,820  $ 11,876  --  --  --  $ 194,745
Maintenance fees  64,283  14,547  310,965  29,445  --  --  --  419,240
Subscription fees  67,718  --  --  --  --  --  --  67,718
Professional services fees  22,175  15,650  6,547  4,986  $ 142,844  --  --  192,202
Application services fees  --  --  --  --  --  $ 55,025  --  55,025
Total revenues  231,999  39,423  413,332  46,307  142,844  55,025  --  928,930
                 
Operating expenses  246,212  47,514  99,659  20,149  118,937  51,011  $ 195,134  778,616
                 
Income (loss) from operations  $ (14,213)  $ (8,091)  $ 313,673  $ 26,158  $ 23,907  $ 4,014  $ (195,134)  $ 150,314
Contribution margin % (6.1%) (20.5%) 75.9% 56.5% 16.7% 7.3%   16.2%
                 
(1) Unallocated expenses include costs associated with finance, human resources, legal, administration, internal technology and other corporate expenses.
CONTACT: Press Contact

         Lisa Elkin, Senior Vice President, Marketing, Communications 

         and Investor Relations, +1-313-227-7345


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