IntraLinks Announces First Quarter 2012 Results

NEW YORK, May 9, 2012 /PRNewswire/ -- IntraLinks Holdings, Inc. (NYSE: IL), a leading provider of critical information exchange solutions, today announced results for its first quarter of 2012.

"Our revenue was above the guidance range we provided and profitability was consistent with our investment plan," said Ron Hovsepian, IntraLinks' president and CEO. "We have seen increased awareness and concern from senior executives around information security and compliance due to the recent proliferation of new consumer and prosumer-based content sharing offerings. IntraLinks is a clear leader in inter-enterprise collaboration providing corporations with an easy to use, secure, and compliant platform for sharing and managing content between businesses and is well positioned to capitalize on this emerging opportunity."

First Quarter 2012

Total revenue was $50.8 million, compared to $52.4 million for the corresponding quarter last year.

• Enterprise revenue was $23.3 million, compared to $24.0 million for the corresponding quarter last year.
• M&A revenue was $20.0 million, compared to $20.4 million for the corresponding quarter last year.
• DCM revenue was $7.5 million, compared to $8.0 million for the corresponding quarter last year.

GAAP gross margin was 69.5%, compared to 74.0% for the corresponding quarter last year. Non-GAAP gross margin was 76.2%, compared to 80.5% for the corresponding quarter last year.

GAAP operating loss was ($5.7) million, compared to a GAAP operating income of $1.7 million for the corresponding quarter last year. Non-GAAP adjusted operating income was $2.8 million, compared to $10.8 million for the corresponding quarter last year.

GAAP net loss was ($5.6) million, compared to a GAAP net income of $0.5 million for the corresponding quarter last year. GAAP net loss per share for the first quarter was ($0.10) on the basis of 54,191,872 shares outstanding. In the prior year comparable period, diluted GAAP net income per share was $0.01 on the basis of 53,711,457 shares outstanding.

Non-GAAP adjusted net income was $1.1 million, compared to $6.1 million for the corresponding quarter last year. Non-GAAP adjusted net income per share was $0.02 on the basis of 54,717,422 shares outstanding. In the corresponding quarter for the prior year, non-GAAP net income per share was $0.10 on the basis of 53,711,457 shares outstanding.

Non-GAAP adjusted EBITDA was $7.1 million, compared to $15.8 million for the corresponding quarter last year.

Cash flow from operations was $1.5 million, compared to $5.3 million in the corresponding quarter last year.

Business Outlook:

Based on information available as of May 9, 2012, IntraLinks is providing guidance for the second quarter 2012 as follows:

Second Quarter 2012

Revenue: $47 million to $50 million
GAAP operating loss: ($6.0) million to ($8.0) million 
Non-GAAP operating income: $0.5 million to $2.5 million
Non-GAAP adjusted EBITDA: $5.5 million to $7.5 million
GAAP net loss per share: ($0.14) to ($0.16)
Non-GAAP net (loss) income per share: ($0.01) to $0.01

Full Year 2012

Revenue: $195 million to $205 million

Quarterly Conference Call

In conjunction with this announcement, IntraLinks will host a conference call on Wednesday, May 9, 2012, at 5:00 p.m. Eastern Time (ET) to discuss the company's financial results and its business outlook. To access this call, dial 866-524-3160 (domestic) or 412-317-6760 (international). A passcode is not required. The call will also be webcast live on the investor relations section on the IntraLinks website at www.intralinks.com/ir.

Following the conference call, a replay will be available until May 16, 2012, at 877-870-5176 (domestic) or 858-384-5517 (international). The passcode for the replay is 10012835. An archived webcast of the call will also be available on the investor relations section on the IntraLinks website at www.intralinks.com/ir.

About IntraLinks

IntraLinks (NYSE: IL) is a leading global provider of Software-as-a-Service solutions for securely managing content, exchanging critical business information and collaborating within and among organizations. More than 1 million professionals in industries including financial services, pharmaceutical, biotechnology, consumer, energy, industrial, legal, insurance, real estate and technology, as well as government agencies, have utilized IntraLinks' easy-to-use, cloud-based solutions. IntraLinks users can accelerate information-intensive business processes and workflows, meet regulatory and risk management requirements and collaborate with customers, partners and counterparties in a secure, auditable and compliant manner. Professionals at more than 800 of the Fortune 1000 companies have used IntraLinks' solutions. For more information, visit www.intralinks.com or http://blog.intralinks.com. You can also follow IntraLinks on Twitter at http://twitter.com/intralinks and Facebook at www.facebook.com/IntraLinks.

Non-GAAP Financial Measures

The press release includes information about certain financial measures that are not prepared in accordance with generally accepted accounting principles in the United States ("GAAP" or "U.S. GAAP"), including non-GAAP gross profit and gross margin, non-GAAP adjusted operating income and margin, non-GAAP adjusted net income, non-GAAP adjusted net income per share, and non-GAAP adjusted EBITDA. These non-GAAP measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies.

Management defines its non-GAAP financial measures as follows:

• Non-GAAP gross margin represents the corresponding GAAP measure adjusted to exclude (1) stock-based compensation expense and (2) amortization of intangible assets.
• Non-GAAP adjusted operating income represents the corresponding GAAP measure adjusted to exclude (1) stock-based compensation expense, (2) amortization of intangible assets, and (3) costs related to public stock offerings.
• Non-GAAP adjusted net income represents the corresponding GAAP measure adjusted to exclude (1) stock-based compensation expense, (2) amortization of intangible assets, and (3) costs related to public stock offerings. Non-GAAP adjusted net income is calculated using an estimated long-term effective tax rate.
• Non-GAAP net income per share represents non-GAAP adjusted net income defined above divided by shares outstanding.
• Non-GAAP adjusted EBITDA represents net (loss) income adjusted to exclude (1) interest expense, (2) income tax provision (benefit), (3) depreciation and amortization, (4) amortization of intangible assets, (5) stock-based compensation expense, (6) amortization of debt issuance costs, (7) other income, net and (8) costs related to public stock offerings.

Management believes that these non-GAAP financial measures, when viewed with our results under U.S. GAAP and the accompanying reconciliations, provide useful information about our period-over-period growth and provide additional information that is useful for evaluating our operating performance and manage the cash needs of our business. Additionally, management believes that these non-GAAP financial measures provide a more meaningful comparison of our operating results against those of other companies in our industry, as well as on a period to-period basis, because these measures exclude items that are not representative of our operating performance, such as amortization of intangible assets, interest expense and fair value adjustments to the interest rate swap. Management believes that including these costs in our results of operations results in a lack of comparability between our operating results and those of our peers in the industry, the majority of which are not highly leveraged and do not have comparable amortization costs related to intangible assets. However, non-GAAP gross margin, non-GAAP adjusted operating income, non-GAAP adjusted net income, non-GAAP adjusted net income per share and non-GAAP adjusted EBITDA are not measures of financial performance under U.S. GAAP and, accordingly, should not be considered as alternatives to gross margin, operating income, net income (loss), and cash flows provided by operations as indicators of operating performance.

A reconciliation of GAAP to Non-GAAP financial measures has been provided in the financial statement tables included in the press release.

Forward Looking Statements

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  This press release contains express or implied forward-looking statements that are not based on historical information relating to, among other things, expectations and assumptions concerning management's forecast of financial performance, future business growth, and management's plans, objectives, and strategies. These statements are neither promises nor guarantees, but are subject to a variety of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. In particular, the risks and uncertainties include, among other things:  the uncertainty of our future profitability; our ability to sustain positive cash flow; periodic fluctuations in our operating results; risks related to our substantial debt balances; our ability to maintain the security and integrity of our systems; our ability to increase our penetration in our principal existing markets and expand into additional markets; our dependence on the volume of financial and strategic business transactions; our dependence on customer referrals; our ability to maintain and expand our direct sales capabilities; our ability to develop and maintain strategic relationships to sell and deliver our solutions; customer renewal rates; our ability to maintain the compatibility of our services with third-party applications; competition and our ability to maintain our average sales prices; our ability to adapt to changing technologies; interruptions or delays in our service; international risks; our ability to protect our intellectual property; costs of being a public company; and risks related to changes in laws, regulations or governmental policy including tax regulations. Further information on these and other factors that could affect our financial results is contained in our public filings with the Securities and Exchange Commission (the "SEC") from time to time, including our Annual Report on Form 10-K for the year-ended December 31, 2011 and subsequent reports.  Existing and prospective investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.

IntraLinks undertakes no obligation to update or revise the information contained in this press release, whether as a result of new information, future events or circumstances or otherwise.

IntraLinks and the IntraLinks logo are registered trademarks of IntraLinks Holdings, Inc. All rights reserved.

IntraLinks Holdings, Inc.
Consolidated Balance Sheets
(In Thousands, Except Share and per Share Data)
(unaudited)
				March 31,			December 31,
				2012			2011
ASSETS
Current assets:
	Cash and cash equivalents		$	55,566		$	46,694
	Accounts receivable, net of allowances of  $2,417 and $2,149, respectively			39,148			38,895
	Investments			22,445			36,120
	Deferred taxes			12,711			12,711
	Prepaid expenses			6,647			4,238
	Other current assets			3,432			4,567
		Total current assets		139,949			143,225
Fixed assets, net				6,911			7,635
Capitalized software, net				32,902			30,287
Goodwill				215,478			215,478
Other intangibles, net				125,076			132,233
Other assets				1,310			1,483
		Total assets	$	521,626		$	530,341
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
	Accounts payable		$	4,795		$	4,934
	Accrued expenses and other current liabilities			20,350			19,846
	Deferred revenue			39,032			40,309
		Total current liabilities		64,177			65,089
Long term debt				90,808			91,164
Deferred taxes				35,437			39,384
Other long term liabilities				3,335			2,874
		Total liabilities		193,757			198,511
Stockholders' equity:
	Undesignated Preferred Stock, $0.001 par value; 10,000,000 shares authorized; 0 shares
		issued and outstanding as of March 31, 2012 and December 31, 2011		-			-
	Common stock, $0.001 par value; 300,000,000 shares authorized; 54,815,905 and 54,248,178
		shares issued and outstanding as of March 31, 2012 and December 31, 2011, respectively		55			54
	Additional paid-in capital			413,350			411,781
	Accumulated deficit			(85,640)			(80,056)
	Accumulated other comprehensive income			104			51
		Total stockholders' equity		327,869			331,830
		Total liabilities and stockholders' equity	$	521,626		$	530,341

  

SOURCE IntraLinks Holdings, Inc.