Subscription Revenue Increased 7% Year-Over-Year to $14.9 Million – First Quarter Total Revenues of $26.8 Million, Up 4% Year-Over-Year
HRchitect featured Saba in our May 2008 release of The Suite Life of Integrated Talent Management and also includes them in our list of top Talent Management Systems and top Learning Management Systems vendors that businesses should consider. Saba participated in the Learning Management Systems panel on June 10, 2009 as part of theHRshow. A.G. Lambert, the VP of Marketing with Saba appeared on the HRchitect WebMingle on August 14, 2009.
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Saba, the premier provider of people systems, today reported financial results for its first fiscal quarter ended August 31, 2010.
“The first quarter increase in total revenues reflects solid growth in our subscription and professional services revenues,” said Bobby Yazdani, Chairman and CEO of Saba. “Customers’ buying preferences in the quarter validated their enthusiasm for our advanced SaaS offerings and yielded an approximately three-fold increase in the annual contract value of new SaaS bookings over the same period last year.”
First Fiscal Quarter 2011 Results
Revenue. For the first quarter ended August 31, 2010, total revenues increased 3.9% to $26.8 million from $25.8 million in the same period of the prior year. Subscription revenue was $14.9 million, an increase of 6.6% on a year-over-year basis. License revenue was $4.5 million, a decline of 22.1% on a year-over-year basis. Professional services revenue was $7.5 million, an increase of 22.0% on a year-over-year basis.
Gross Margin. Gross margin was 63.1% in the first quarter compared to 64.7% in the same period of the prior year. The gross margin reflects higher levels of subscription revenue and professional service revenue relative to license revenue.
Earnings per Share. First quarter GAAP net loss per share of $0.06 compares to fully diluted earnings per share of $0.03 in the same period of the prior year. Non-GAAP diluted earnings in the first quarter of breakeven compares to $0.07 per share in the first quarter of the prior year.
Non-GAAP results are computed by adjusting GAAP results to exclude the impact of certain items including (i) non-cash amortization of intangibles, (ii) non-cash charges related to share-based compensation expenses, and (iii) restructuring costs. A reconciliation of GAAP to non-GAAP results is included in the financial statements accompanying this press release.
Cash. Cash generated from operations in the first quarter increased to $1.4 million from $0.7 million in the same period of the prior year. Total cash and cash equivalents at the end of the first quarter were $33.2 million, an increase of 53.8% from the end of the first quarter of the prior fiscal year.
Deferred Revenue. Deferred revenue at the end of the first fiscal quarter was $34.4 million, an increase of 11.6% from the end of the first quarter in the prior fiscal year.
Customers. Saba added 30 new customers during the first quarter of fiscal 2011.
Share Repurchase Program. In March 2010, Saba announced that its Board of Directors authorized the use of up to $5.0 million in the aggregate for the repurchase of shares of the company’s common stock. Under the share repurchase program, Saba repurchased 150,000 shares during the fiscal quarter ended August 31, 2010 and had $4.2 million available for future repurchases.
First Quarter Highlights
During the first quarter, Saba signed 30 new customers worldwide, including Cummins, Halliburton, France Telecome Espana Sa, Isuzu Australia, ITC Hotels, New Balance Athletic Shoe and Sony Pictures Entertainment. Saba also expanded existing relationships with a number of organizations worldwide, including: Baker Hughes, Bank of Tokyo, Hartford Financial Services, Mitsubishi Research Institute, Sydney Water, Six Continents Hotels, Saudi Aramco, and Solutia.
In addition, key announcements by Saba since the beginning of the first quarter include:
– Saba announced the general availability of Saba Live, its next-generation cloud-based enterprise business networking solution. Saba Live includes powerful Web 2.0 social tools integrated with Saba Centra Web Conferencing for real time collaboration. Saba Live provides users with rich personal profiles, competency-driven expertise, blended learning, secure groups and workplace analytics to deliver an unprecedented collaboration experience. Saba Live is another proof point that Saba is reinventing the collaborative Learning space.
– Saba announced its inclusion in Forbes Magazine’s ranking of “Most Trustworthy Companies” for 2010. Saba has been determined to exhibit transparent accounting and prudent management by Audit Integrity, an independent financial analytics company. The ranking is based upon more than 100 factors used to assess corporate accounting and management practices.
– Saba also announced People 2010 — Saba Global Summit. The annual meeting of Saba’s customers, partners and thought leaders will be held November 1st — 4th at the Westin Boston Waterfront. The event will feature seven conference tracks and over 70 interactive sessions, including 20 hands on workshops, and keynote speakers, including Gary Hamel, author of Leading the Revolution and Competing for the Future, professor at London Business School and “the world’s most influential business thinker” according to the Wall Street Journal. People 2010 — Saba Global Summit will be an opportunity for hundreds of participants to share best practices and coming developments in people systems.
The following statements are based on current expectations as of the date of this release. These statements are forward-looking, and actual results may differ materially. Saba does not undertake to update these forward-looking statements in any way or for any reason.
For fiscal 2011, ending May 31, 2011, we confirm our prior guidance of total revenues between $121 million and $124 million, GAAP net earnings of $0.15 to $0.19 per share on a fully diluted basis and non-GAAP net earnings of $0.34 to $0.38 per share on a fully diluted basis. Due to customers’ seasonal spending patterns, Saba continues to expect that revenues, earnings and cash flows will be weighted more heavily towards the second half of the fiscal year.
The fiscal year 2011 non-GAAP outlook excludes non-cash amortization of intangibles and charges related to stock-based compensation expenses.