Q4 2013 Earnings Release 8-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________________________________________________
FORM 8-K
_______________________________________________________________
CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): September 3, 2013
_______________________________________________________________
Guidewire Software, Inc.
(Exact name of registrant as specified in its charter)
_______________________________________________________________
 
 
 
 
 
Delaware
 
001-35394
 
36-4468504
(State or other jurisdiction of incorporation)
 
(Commission File Number)
 
(I.R.S. Employer Identification No.)

1001 East Hillsdale Blvd., Suite 800
Foster City, CA 94404
(Address of principal executive offices, including zip code)

(650) 357-9100
(Registrant’s telephone number, including area code)

Not applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))






Item 2.02     Results of Operations and Financial Condition.

On September 3, 2013, Guidewire Software, Inc. (the "Company") issued a press release announcing unaudited financial results for its fourth quarter and fiscal year ended July 31, 2013. A copy of the press release is attached as Exhibit 99.1.

In accordance with General Instruction B.2 on Form 8-K, certain of the information in this Current Report on Form 8-K, including Exhibit 99.1, is being furnished under Item 2.02 and shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 ("Exchange Act") or otherwise subject to the liability of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, regardless of the general incorporation language of such filing, except as shall be expressly set forth by specific reference in such filing.

Item 9.01    Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No.
 
Description of Exhibits
99.1
 
Press release dated September 3, 2013, titled "Guidewire Software Announces Fourth Quarter and Fiscal 2013 Financial Results"




SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: September 3, 2013
GUIDEWIRE SOFTWARE, INC.
 
 
By:
/s/ Karen Blasing
 
Karen Blasing
 
Chief Financial Officer




EXHIBIT INDEX
Exhibit No.
 
Description of Exhibits
99.1
 
Press release dated September 3, 2013, titled "Guidewire Software Announces Fourth Quarter and Fiscal 2013 Financial Results"



EX 99.1 Q4 2013 Earnings Release


Exhibit 99.1

Guidewire Software Announces Fourth Quarter and Fiscal 2013 Financial Results

Foster City, CA - September 3, 2013 - Guidewire Software, Inc. (NYSE: GWRE), a provider of software products for property and casualty insurers, today announced its financial results for the fiscal quarter and fiscal year ended July 31, 2013.

“Revenue and profitability exceeded our expectations in the fourth quarter, contributing to full year revenue growth of 30% and trailing twelve month recurring revenue growth of 44%,” said Marcus Ryu, Chief Executive Officer of Guidewire Software. “Investments in sales, delivery and new products helped us to advance our market leadership position in fiscal 2013 by expanding our customer base, including several key Tier 1 wins and our 50th PolicyCenter customer. We also achieved more multi-product and Suite transactions than last year and achieved the milestone of bringing our 100th customer into live production.”

Ryu added, “We believe it is still early days in the global P/C insurance industry's generational transition from decades-old legacy systems to flexible, upgradeable platforms for their core operations. We plan to continue to invest in expanding both our product and sale capabilities in fiscal 2014 to capitalize on this significant opportunity."

Fourth Quarter Fiscal 2013 Financial Highlights

Revenue
Total revenue for the fourth quarter of fiscal 2013 was $96.9 million, an increase of 43% from the comparable period in fiscal 2012.
Total license revenue, including term and perpetual licenses, for the fourth quarter of fiscal 2013 was $49.1 million, an increase of 70% from the comparable period in fiscal 2012. Recurring term license revenue was $44.9 million, a 64% increase from a year ago and revenue from perpetual licenses was $4.2 million compared with $1.6 million a year ago. Maintenance revenue was $9.9 million, up 26% from the comparable period in fiscal 2012, and services revenue was $38.0 million, up 23% from the comparable period in fiscal 2012.
Rolling four-quarter recurring term license and maintenance revenue was $150.4 million, an increase of 44% from the comparable period in fiscal 2012.

Profitability
GAAP operating income was $16.2 million for the fourth quarter of fiscal 2013, compared to $5.3 million in the comparable period in fiscal 2012.
Non-GAAP operating income was $26.5 million for the fourth quarter of fiscal 2013, compared to $9.6 million in the comparable period in fiscal 2012.
Adjusted EBITDA was $27.8 million for the fourth quarter of fiscal 2013, compared to $10.4 million in the comparable period in fiscal 2012.
GAAP net income was $12.1 million for the fourth quarter of fiscal 2013, compared to $3.5 million for the comparable period in fiscal 2012. GAAP earnings per share was $0.19, based on diluted weighted average shares outstanding of 62.5 million, compared to $0.06 for the comparable period in fiscal 2012, based on diluted weighted average shares outstanding of 61.2 million.
Non-GAAP net income was $15.6 million for the fourth quarter of fiscal 2013, compared to $6.4 million in the comparable period in fiscal 2012. Non-GAAP net income per diluted share was $0.25, based on diluted weighted average shares outstanding of 62.5 million, compared to $0.10 for the fourth quarter of fiscal 2012, based on diluted weighted average shares outstanding of 61.2 million.


Fiscal 2013 Financial Highlights

Revenue
Total revenue for the fiscal year ended July 31, 2013 was $300.6 million, an increase of 30% from fiscal 2012.
License revenue for fiscal 2013 was $123.6 million, an increase of 27% from fiscal 2012. Recurring term license revenue was $112.9 million, a 51% increase from a year ago and revenue from perpetual licenses was $10.7 million compared with $22.3 million a year ago. Maintenance revenue was $37.6 million, an increase of 27% from the year ago period, and services revenue was $139.5 million, an increase of 32% from the year ago period.
In fiscal 2013, 57% of total revenue was in the United States, and 43% was generated outside the United States.






Profitability
GAAP operating income was $16.8 million for fiscal 2013, compared to $23.6 million in fiscal 2012.
Non-GAAP operating income was $55.6 million for fiscal 2013, an increase of 33% from fiscal 2012.
Adjusted EBITDA was $60.1 million for fiscal 2013, an increase of 34% from fiscal 2012.
GAAP net income was $15.4 million for fiscal 2013, compared to $15.2 million for fiscal 2012. GAAP earnings per diluted share was $0.25, based on diluted weighted average shares outstanding of 61.9 million, compared to $0.25 in fiscal 2012, based on diluted weighted average shares outstanding of 41.5 million.
Non-GAAP net income was $38.5 million in fiscal 2013, an increase of 42% from fiscal 2012. Non-GAAP earnings per diluted share was $0.62, based on diluted weighted average shares outstanding of 61.9 million, compared to $0.50 in fiscal 2012, based on pro forma diluted weighted average shares outstanding of 53.8 million.

Balance Sheet
The Company had $207.7 million in cash, cash equivalents and investments at July 31, 2013, compared to $203.6 million at April 30, 2013. The Company generated $24.4 million in cash flow from operations in the fourth quarter, compared to $19.1 million in the comparable period in fiscal 2012. The Company generated $32.5 million in cash flow from operations in fiscal 2013, compared to $17.1 million in the comparable period in fiscal 2012.

Conference Call Information
What:
Guidewire Software fourth quarter fiscal 2013 financial results conference call
When:        Tuesday, September 3, 2013
Time:        2:00 p.m. PT (5:00 p.m. ET)
Live Call:    (877) 852-6575, domestic
(719) 325-4816, international
Replay:        (877) 870-5176, passcode 3709788, domestic
(858) 384-5517, passcode 3709788, international
Webcast:    http://ir.guidewire.com (live and replay)

The webcast will be archived on Guidewire's website for a period of three months.
Non-GAAP Financial Measures
This press release contains the following non-GAAP financial measures: Non-GAAP operating income, Adjusted EBITDA, Non-GAAP net income and Non-GAAP earnings per share.
Guidewire believes that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to Guidewire's financial condition and results of operations. The Company's management uses these non-GAAP measures to compare the company's performance to that of prior periods for trend analyses, for purposes of determining executive and senior management incentive compensation and for budgeting and planning purposes. The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company's financial measures with other software companies, many of which present similar non-GAAP financial measures to investors.
Management of the Company does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company's financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. In order to compensate for these limitations, management presents non-GAAP financial measures in connection with GAAP results. Guidewire urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, including this press release, and not to rely on any single financial measure to evaluate the Company's business.
Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP financial measures used in this press release are included with the financial tables at the end of this release.
About Guidewire Software
Guidewire Software is a provider of software products for Property/Casualty insurers. Designed to be flexible and scalable, Guidewire products enable insurers to deliver excellent service, increase market share and lower operating costs. Guidewire products include Guidewire InsuranceSuite™, consisting of Guidewire PolicyCenter®, Guidewire ClaimCenter® and Guidewire BillingCenter® which span the core functional areas in insurance; Guidewire LiveSM, a cloud-based network





connecting peer insurers, core system data and expert tools through instant on apps; Guidewire DataHub™ and Guidewire InfoCenter™ which help insurers address their data management and business intelligence challenges. Guidewire is headquartered in Foster City, California, with offices in Beijing, Dublin, Hong Kong, London, Munich, Paris, Sydney, Tokyo, Toronto and Warsaw. For more information, please visit www.guidewire.com.
NOTE: Guidewire, Guidewire Software, Guidewire ClaimCenter, Guidewire PolicyCenter, Guidewire BillingCenter, Guidewire InsuranceSuite, Guidewire DataHub, Guidewire InfoCenter, Guidewire Live, Live Inside, Before & After, Claim Canvas, ViewPoint, Guidewire PartnerConnect, Guidewire SolutionConnect, Deliver Insurance Your Way, and the Guidewire logo are trademarks, service marks, or registered trademarks of Guidewire Software, Inc. in the United States and/or other countries.

Cautionary Language Concerning Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding our market positioning, future adoption of our products and future investments. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as "expect," "anticipate," "should," "believe," "hope," "target," "project," "goals," "estimate," "potential," "predict," "may," "will," "might," "could," "intend," variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Guidewire's control. Guidewire's actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, risks detailed in Guidewire's most recent Forms 10-K and 10-Q filed with the Securities and Exchange Commission as well as other documents that may be filed by the Company from time to time with the Securities and Exchange Commission. In particular, the following factors, among others, could cause results to differ materially from those expressed or implied by such forward-looking statements: the market for our software may develop more slowly than expected or than it has in the past; quarterly and annual operating results may fluctuate more than expected; seasonal and other variations related to our revenue recognition may cause significant fluctuations in our results of operations and cash flows; our reliance on sales to and renewals from a relatively small number of large customers for a substantial portion of our revenues; our services revenues produce lower gross margins than our license and maintenance revenues; assertions by third parties that we violate their intellectual property rights could substantially harm our business; we face intense competition in our market; weakened global economic conditions may adversely affect the P&C insurance industry including the rate of information technology spending; our product development and sales cycles are lengthy; the risk of losing key employees; changes in foreign exchange rates; general political or destabilizing events, including war, conflict or acts of terrorism; and other risks and uncertainties. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent Guidewire's views as of the date of this press release. The Company anticipates that subsequent events and developments will cause its views to change. Guidewire undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing Guidewire's views as of any date subsequent to the date of this press release.

Media Contact:
Diana Stott
Guidewire Software, Inc.
(650) 356-4941
dstott@guidewire.com

Investor Contact:
Garo Toomajanian
ICR
(650) 357-5282
ir@guidewire.com






GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
 
 
 
 
 
July 31,
2013
 
July 31,
2012
ASSETS
 
 
 
CURRENT ASSETS:
 
 
 
Cash and cash equivalents
$
79,767

 
$
205,718

Short-term investments
76,932

 

Restricted cash, current
167

 
3,726

Accounts receivable
40,885

 
32,313

Deferred tax assets, current
2,897

 
13,442

Prepaid expenses and other current assets
9,445

 
7,266

Total current assets
210,093

 
262,465

Long-term investments
51,040

 

Property and equipment, net
12,914

 
11,924

Intangible assets, net
6,879

 

Deferred tax assets, noncurrent
21,091

 
9,313

Goodwill
9,048

 

Other assets
1,205

 
545

TOTAL ASSETS
$
312,270

 
$
284,247

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
CURRENT LIABILITIES:
 
 
 
Accounts payable
$
6,517

 
$
9,781

Accrued employee compensation
26,302

 
26,502

Deferred revenues, current
37,351

 
52,947

Other current liabilities
4,614

 
3,957

Total current liabilities
74,784

 
93,187

Deferred revenues, noncurrent
3,845

 
2,569

Other liabilities
5,212

 
4,529

Total liabilities
83,841

 
100,285

STOCKHOLDERS’ EQUITY:
 
 
 
Common stock
6

 
5

Additional paid-in capital
237,769

 
207,624

Accumulated other comprehensive loss
(1,558
)
 
(496
)
Accumulated deficit
(7,788
)
 
(23,171
)
Total stockholders’ equity
228,429

 
183,962

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$
312,270

 
$
284,247







GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(unaudited, in thousands except share and per share data)
 
 
 
 
 
 
 
 
 
Three Months Ended July 31,
 
Year Ended July 31,
 
2013
 
2012
 
2013
 
2012
Revenues:
 
 
 
 
 
 
 
License
$
49,078

 
$
28,930

 
$
123,560

 
$
97,136

Maintenance
9,871

 
7,858

 
37,561

 
29,538

Services
37,961

 
30,801

 
139,528

 
105,387

Total revenues
96,910

 
67,589

 
300,649

 
232,061

Cost of revenues: (1)
 
 
 
 
 
 
 
License
484

 
79

 
920

 
762

Maintenance
2,183

 
1,515

 
7,613

 
5,288

Services
34,139

 
25,612

 
123,210

 
85,360

Total cost of revenues
36,806

 
27,206

 
131,743

 
91,410

Gross profit:
 
 
 
 
 
 
 
License
48,594

 
28,851

 
122,640

 
96,374

Maintenance
7,688

 
6,343

 
29,948

 
24,250

Services
3,822

 
5,189

 
16,318

 
20,027

Total gross profit
60,104

 
40,383

 
168,906

 
140,651

Operating expenses: (1)
 
 
 
 
 
 
 
Research and development
18,843

 
14,355

 
66,346

 
50,462

Sales and marketing
16,621

 
13,286

 
53,301

 
38,254

General and administrative
8,452

 
7,474

 
32,414

 
28,336

Total operating expenses
43,916

 
35,115

 
152,061

 
117,052

Income from operations
16,188

 
5,268

 
16,845

 
23,599

Interest income, net
139

 
88

 
498

 
308

Other expense, net
(27
)
 
(257
)
 
(131
)
 
(728
)
Income before provision for income taxes
16,300

 
5,099

 
17,212

 
23,179

Provision for income taxes
4,195

 
1,551

 
1,829

 
7,979

Net income
$
12,105

 
$
3,548

 
$
15,383

 
$
15,200

Earnings per share:
 
 
 
 
 
 
 
Basic
$
0.21

 
$
0.07

 
$
0.27

 
$
0.29

Diluted
$
0.19

 
$
0.06

 
$
0.25

 
$
0.25

Shares used in computing earnings per share:
 
 
 
 
 
 
 
Basic
57,646,262

 
53,965,083

 
56,331,018

 
34,774,983

Diluted
62,492,753

 
61,172,597

 
61,943,087

 
41,509,185


(1) Amounts include stock-based compensation expense as follows:
 
Three Months Ended July 31,
 
Year Ended July 31,
 
2013
 
2012
 
2013
 
2012
 Stock-based compensation expenses:
 
 
 
 
 
Cost of maintenance revenues
$
303

 
$
108

 
$
1,217

 
$
379

 Cost of services revenues
3,288

 
1,093

 
12,493

 
3,741

 Research and development
2,587

 
820

 
9,131

 
3,759

 Marketing and sales
1,701

 
1,007

 
5,970

 
2,936

 General and administrative
2,090

 
1,352

 
9,588

 
7,443

 Total stock-based compensation expenses
$
9,969

 
$
4,380

 
$
38,399

 
$
18,258






GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
 
 
 
 
 
 
 
 
 
Three Months Ended July 31,
 
Year Ended July 31,
 
2013
 
2012
 
2013
 
2012
CASH FLOWS FROM OPERATING ACTIVITIES:
 
 
 
 
 
 
 
Net income
$
12,105

 
$
3,548

 
$
15,383

 
$
15,200

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
 
 
 
 
Depreciation and amortization
1,639

 
770

 
4,821

 
2,917

Stock-based compensation
9,969

 
4,380

 
38,399

 
18,258

Excess tax benefit from exercise of stock options and vesting of RSUs
(2,263
)
 
(486
)
 
(2,586
)
 
(486
)
Deferred taxes
3,523

 
(255
)
 
(1,256
)
 
5,362

Other noncash items affecting net income
282

 

 
554

 

Changes in operating assets and liabilities:
 
 
 
 
 
 
 
Accounts receivable
7,471

 
3,072

 
(8,478
)
 
(9,325
)
Prepaid expenses and other assets
(3,093
)
 
(937
)
 
(2,690
)
 
(2,442
)
Accounts payable
(345
)
 
1,583

 
355

 
1,059

Accrued employee compensation
5,213

 
8,274

 
164

 
8,246

Other liabilities
(30
)
 
4,754

 
1,929

 
(3,907
)
Deferred revenues
(10,036
)
 
(5,593
)
 
(14,048
)
 
(17,788
)
Net cash provided by operating activities
24,435

 
19,110

 
32,547

 
17,094

CASH FLOWS FROM INVESTING ACTIVITIES:
 
 
 
 
 
 
 
Purchases of available-for-sale securities
(41,522
)
 

 
(212,035
)
 

Sales and maturities of available-for-sale securities
26,311

 

 
83,567

 

Purchase of property and equipment
(2,167
)
 
(3,501
)
 
(9,228
)
 
(5,619
)
Acquisition, net of cash acquired
(14,749
)
 

 
(14,749
)
 

Decrease in restricted cash
12

 

 
3,532

 
2,323

Net cash used in investing activities
(32,115
)
 
(3,501
)
 
(148,913
)
 
(3,296
)
CASH FLOWS FROM FINANCING ACTIVITIES:
 
 
 
 
 
 
 
Proceeds from issuance of common stock upon exercise of stock options
1,159

 
1,391

 
9,123

 
5,067

Taxes remitted on RSU awards vested
(5,635
)
 
(12,430
)
 
(20,330
)
 
(12,430
)
Proceeds from issuance of common stock in connection with public offerings, net of underwriting discounts and commission

 

 

 
143,386

Costs paid in connection with public offerings

 
(920
)
 

 
(3,502
)
Excess tax benefit from exercise of stock options and vesting of RSUs
2,263

 
486

 
2,586

 
486

Net cash provided by (used in) financing activities
(2,213
)
 
(11,473
)
 
(8,621
)
 
133,007

Effect of foreign exchange rate changes on cash and cash equivalents
(870
)
 
(268
)
 
(964
)
 
(712
)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(10,763
)
 
3,868

 
(125,951
)
 
146,093

CASH AND CASH EQUIVALENTS—Beginning of period
90,530

 
201,850

 
205,718

 
59,625

CASH AND CASH EQUIVALENTS—End of period
$
79,767

 
$
205,718

 
$
79,767

 
$
205,718







GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Operating Results
(unaudited, in thousands)
 
 
 
 
 
 
 
 
 
 
 
 
The following tables reconcile the specific items excluded from GAAP in the calculation of non-GAAP operating results for the periods indicated below:
 
Three Months Ended July 31,
 
2013
 
2012
 
GAAP
 
Adjustments
 
Non-GAAP
 
GAAP
 
Adjustments
 
Non-GAAP
Total revenues
$
96,910

 
$

 
$
96,910

 
$
67,589

 
$

 
$
67,589

 
 
 
 
 

 
 
 
 
 

Total cost of revenues (1)
36,806

 
(3,912
)
 
32,894

 
27,206

 
(1,201
)
 
26,005

 
 
 
 
 

 
 
 
 
 

Total gross profit
60,104

 
3,912

 
64,016

 
40,383

 
1,201

 
41,584

 
 
 
 
 

 
 
 
 
 

Total operating expenses (1)
43,916

 
(6,378
)
 
37,538

 
35,115

 
(3,179
)
 
31,936

Income from operations
16,188

 
10,290

 
26,478

 
5,268

 
4,380

 
9,648

 
 
 
 
 
 
 
 
 
 
 
 
Income before provision for income taxes
16,300

 
10,290

 
26,590

 
5,099

 
4,380

 
9,479

Provision for income taxes (2)
4,195

 
6,837

 
11,032

 
1,551

 
1,533

 
3,084

Net income
$
12,105

 
$
3,453

 
$
15,558

 
$
3,548

 
$
2,847

 
$
6,395

(1) Adjustments relate to amortization of acquired intangibles and stock-based compensation recognized during the period for GAAP purposes.
(2) Adjustment reflects the tax benefit resulting from all non-GAAP adjustments.


 
Year Ended July 31,
 
2013
 
2012
 
GAAP
 
Adjustments
 
Non-GAAP
 
GAAP
 
Adjustments
 
Non-GAAP
Total revenues
$
300,649

 
$

 
$
300,649

 
$
232,061

 
$

 
$
232,061

 
 
 

 

 
 
 
 
 

Total cost of revenues (1)
131,743

 
(14,031
)
 
117,712

 
91,410

 
(4,120
)
 
87,290

 
 
 
 
 

 
 
 
 
 

Total gross profit
168,906

 
14,031

 
182,937

 
140,651

 
4,120

 
144,771

 
 
 
 
 

 
 
 
 
 

Total operating expenses (1)
152,061

 
(24,689
)
 
127,372

 
117,052

 
(14,138
)
 
102,914

Income from operations
16,845

 
38,720

 
55,565

 
23,599

 
18,258

 
41,857

 
 
 
 
 
 
 
 
 
 
 
 
Income before provision for income taxes
17,212

 
38,720

 
55,932

 
23,179

 
18,258

 
41,437

Provision for income taxes (2)
1,829

 
15,650

 
17,479

 
7,979

 
6,390

 
14,369

Net income
$
15,383

 
$
23,070

 
$
38,453

 
$
15,200

 
$
11,868

 
$
27,068

(1) Adjustments relate to amortization of acquired intangibles and stock-based compensation recognized during the period for GAAP purposes.
(2) Adjustment reflects the tax benefit resulting from all non-GAAP adjustments.






GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Operating Results
(unaudited, in thousands except share and per share data)
 
 
 
 
 
 
 
 
The following tables reconcile the specific items excluded from GAAP in the calculation of non-GAAP operating results for the periods indicated below:
 
Three Months Ended July 31,
 
Year Ended July 31,
 
2013
 
2012
 
2013
 
2012
Earnings per share reconciliation:
 
 
 
 
 
 
 
GAAP earnings per share - Diluted
$
0.19

 
$
0.06

 
$
0.25

 
$
0.25

Amortization of intangibles acquired in business combinations
0.01

 

 
0.01

 

Stock-based compensation
0.16

 
0.07

 
0.62

 
0.43

Less tax benefit of non GAAP items
(0.11
)
 
(0.03
)
 
(0.26
)
 
(0.15
)
Pro forma conversion of preferred shares

 

 

 
(0.03
)
Non-GAAP earnings per share - Diluted
$
0.25

 
$
0.10


$
0.62


$
0.50

 
 
 
 
 
 
 
 
 
Three Months Ended July 31,
 
Year Ended July 31,
 
2013
 
2012
 
2013
 
2012
Shares used in computing non-GAAP per share amounts:
 
 
 
 
 
 
 
Weighted average shares - Diluted
62,492,753

 
61,172,597

 
61,943,087

 
41,509,185

Pro forma conversion of preferred shares

 

 

 
12,332,443

Pro forma weighted average shares - Diluted
62,492,753

 
61,172,597

 
61,943,087

 
53,841,628

 
 
 
 
 
Three Months Ended July 31,
 
Year Ended July 31,
 
2013
 
2012
 
2013
 
2012
Adjusted EBITDA reconciliation:
 
 
 
 
 
 
 
GAAP net income
$
12,105

 
$
3,548

 
$
15,383

 
$
15,200

Non-GAAP adjustments:
 
 
 
 
 
 
 
Provision for income taxes
4,195

 
1,551

 
1,829

 
7,979

Other expense, net
27

 
257

 
131

 
728

Interest income, net
(139
)
 
(88
)
 
(498
)
 
(308
)
Depreciation and amortization
1,639

 
770

 
4,821

 
2,917

Stock-based compensation
9,969

 
4,380

 
38,399

 
18,258

Adjusted EBITDA
$
27,796

 
$
10,418

 
$
60,065

 
$
44,774