TigerLogic Corporation Announces Fourth Quarter And Fiscal Year 2014 Results

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Jun 27, 2014, 04:42 ET

IRVINE, Calif., June 27, 2014 /PRNewswire/ -- TigerLogic Corporation (Nasdaq: TIGR) today announced financial results for the fourth quarter and fiscal year ended March 31, 2014. As previously announced, the Company closed the sale of its multidimensional database management system (the "MDMS Business") to Rocket Software, Inc., effective November 15, 2013. Accordingly, the consolidated financial statements have been revised for all periods presented to reflect the MDMS Business as discontinued operations, and unless noted otherwise, the consolidated financial statements included in this press release reflect results from continuing operations.

Net revenue from continuing operations for the fourth quarter of fiscal year 2014 was $1.2 million and for the full fiscal year 2014 was $5.5 million, as compared to $1.0 million and $3.8 million for the same respective periods in the prior fiscal year. Net loss from continuing operations for the fourth quarter ended March 31, 2014 was $2.5 million as compared to a net loss of $2.0 million for the same period in the prior fiscal year. Net loss from continuing operations for the fiscal year ended March 31, 2014 was $7.3 million as compared to a net loss of $6.3 million for the prior fiscal year. The higher net loss from continuing operations for fiscal year 2014 was primarily due to a one-time charge of $1.0 million related to a revenue sharing agreement with a former consultant, in which the consultant also reconfirmed the assignment to the Company of any and all rights related to Postano platform and associated inventions and intellectual property rights. In addition, higher professional advisory, legal, and accounting services expense relating to the sale of the MDMS Business contributed to the higher net loss in fiscal year 2014. Net loss per share from continuing operations was $0.08 and $0.07 for the quarters ended March 31, 2014 and March 31, 2013, respectively. Net loss per share from continuing operations was $0.24 for the fiscal year ended March 31, 2014, as compared to $0.22 for the prior fiscal year. Cash balance was $18.6 million at March 31, 2014 as compared to $6.5 million at March 31, 2013.

Adjusted earnings before interest, taxes, depreciation, amortization, other income (expense)-net, and non-cash stock-based compensation expense ("Adjusted EBITDA") presented below includes results from both continuing and discontinued operations. Adjusted EBITDA for the quarter and fiscal year ended March 31, 2014 was negative $3.5 million and negative $6.4 million, or (302.0%) and (117.4%) of net revenue, respectively, as compared to negative $0.9 million and negative $1.7 million, or (85.0%) and (44.4%) of net revenue, respectively, for the same periods in the prior fiscal year. The decrease in Adjusted EBITDA on a year-over-year basis was mainly due to the before-mentioned one-time charge of $1.0 million related to the revenue sharing agreement reached with a former consultant, and higher professional advisory, legal, and accounting services expense related to the sale of our MDMS Business. Additional headcount and increased marketing campaign expenses for the Company's Postano product line also contributed to the decrease in Adjusted EBITDA for fiscal year 2014. The Company computes Adjusted EBITDA, as reflected in the table appearing at the end of this press release, by adding depreciation, amortization, non-cash stock-based compensation expense, interest (income) expense, other (income) expense, and income tax provision (benefit) to its GAAP reported net income (loss).

Earnings Call

At 5:00 p.m. Eastern Time on Monday, June 30, 2014, TigerLogic's management will host a conference call to discuss the company's financial results for the fourth quarter and fiscal year 2014 and provide a general business update.

The call can be accessed by dialing 1-877-481-4996 (Domestic) or 1-518-444-5106 (International), and by providing the operator the conference ID number 61734764.

A taped rebroadcast of the call will be available approximately two hours after the call through July 7, 2014. To access the taped rebroadcast, dial 1-855-859-2056/1-800-585-8367 (Domestic) or 1-404-537-3406 (International), and enter security code 081213 and conference ID number 61734764.

The earnings call will also be archived for one year in the Earnings Releases section of TigerLogic's website at: http://www.tigerlogic.com/tigerlogic/company/press/earnings/index.jsp.

About TigerLogic Corporation

TigerLogic Corporation (Nasdaq: TIGR) is a global provider of application development solutions for enterprises that need to launch easy and cost-effective e-business initiatives. TigerLogic's offerings include cross-platform and mobile solutions for rapid application development, social media content aggregation and visualization platform, Internet search enhancement tools, and the design and development of mobile applications and digital publications. More information about TigerLogic and its products can be found at http://www.tigerlogic.com.

Except for the historical statements contained herein, the foregoing release may contain forward-looking information. Any forward-looking statements are subject to risks and uncertainties, and actual results could differ materially due to several factors, including but not limited to the success of the Company's research and development efforts to develop new products and to penetrate new markets, the market acceptance of the Company's new products and updates, technical risks related to such products and updates, the Company's ability to maintain market share for its existing products, the availability of adequate liquidity and other risks and uncertainties. Please consult the various reports and documents filed by the Company with the U.S. Securities and Exchange Commission, including but not limited to the Company's most recent reports on Form 10-K and Form 10-Q for factors potentially affecting the Company's future financial results. All forward-looking statements are made as of the date hereof and the Company disclaims any responsibility to update or revise any forward-looking statement provided in this news release. The Company's results for the quarter and fiscal year ended March 31, 2014 are not necessarily indicative of the Company's operating results for any future periods.

TigerLogic, Postano, yolink, Raining Data, mvDesigner, Omnis, Omnis Studio, and Storycode are trademarks of TigerLogic Corporation. All other trademarks and registered trademarks are properties of their respective owners.

TIGERLOGIC CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)

ASSETS	March 31,	March 31,
	2014	2013
Current assets:
Cash	$ 18,602	$ 6,465
Trade accounts receivable, less allowance for doubtful accounts of $43 in 2014
and $24 in 2013	934	575
Receivable from sale of MDMS business	2,200	—
Other current assets	553	561
Current assets of discontinued operations	—	411
Total current assets	22,289	8,012

Property, furniture and equipment, net	575	459
Goodwill	18,183	18,183
Intangible assets, net	510	593
Deferred tax assets	109	228
Other assets	73	111
Noncurrent assets of discontinued operations	—	13,565
Total assets	$ 41,739	$ 41,151

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Accounts payable	$ 349	388
Accrued liabilities	1,892	1,240
Deferred revenue	1,599	948
Current liabilities of discontinued operations	—	3,448
Total current liabilities	3,840	6,024

Other long-term liabilities	122	103
Other long-term liabilities of discontinued operations	—	34
Total liabilities	3,962	6,161

Commitments and contingencies

Stockholders' equity:
Series A convertible preferred stock: $1.00 par value; 5,000,000 shares authorized;
none issued or outstanding at March 31, 2014 and 2013	—	—
Common stock: $0.10 par value; 100,000,000 shares authorized; 30,117,234 and
and 29,931,248 issued and outstanding as of March 31, 2014 and 2013, respectively ..	3,012	2,993
Additional paid-in-capital	142,848	141,478
Accumulated other comprehensive income	2,360	2,257
Accumulated deficit	(110,443)	(111,738)
Total stockholders' equity	37,777	34,990

Total liabilities and stockholders' equity	$ 41,739	$ 41,151


TIGERLOGIC CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(In thousands, except per share data)

	Three Months Ended		Twelve Months Ended
	2014	2013	2014	2013

Net revenues
Licenses	$ 408	$ 672	$ 2,264	$ 2,090
Services	756	376	3,226	1,687
Total net revenues	1,164	1,048	5,490	3,777
Operating expenses
Cost of license revenues	(125)	17	19	5
Cost of license revenues - amortization of intangible assets	19	15	76	15
Cost of service revenues	215	107	638	355
Cost of service revenues - revenue sharing agreement	1,000	—	1,000	—
Selling and marketing	1,459	1,185	5,918	3,979
Research and development	1,174	1,083	4,441	3,698
General and administrative	1,151	904	4,350	3,728
Acquisition related costs	—	199	209	288
Total operating expenses	4,893	3,510	16,651	12,068
Operating loss from continuing operations	(3,729)	(2,462)	(11,161)	(8,291)
Other income (expense)
Interest expense-net	(3)	(2)	(6)	(6)
Other income (expense)-net	(19)	24	(62)	10
Total other income (expense) - net	(22)	22	(68)	4
Loss before income taxes from continuing operations	(3,751)	(2,440)	(11,229)	(8,287)
Income tax benefit	(1,287)	(436)	(3,965)	(2,012)
Net loss from continuing operations	(2,464)	(2,004)	(7,264)	(6,275)
Discontinued operations:
Income from discontinued operations, net of tax	(28)	749	2,641	3,333
Gain (loss) on sale of discontinued operations, net of tax	(195)	—	5,918	—
Income (loss) from discontinued operations	(223)	749	8,559	3,333
Net income (loss)	$ (2,687)	$ (1,255)	$ 1,295	$ (2,942)
Other comprehensive income (loss):
Foreign currency translation adjustments	27	(64)	103	(47)
Total comprehensive income (loss)	$ (2,660)	$ (1,319)	$ 1,398	$ (2,989)

Basic and diluted net loss per share
Loss from continuing operations	$ (0.08)	$ (0.07)	$ (0.24)	$ (0.22)
Income (loss) from discontinued operations	$ (0.01)	$ 0.03	$ 0.28	$ 0.12
Net income (loss)	$ (0.09)	$ (0.04)	$ 0.04	$ (0.10)

Shares used in computing net loss from continuing
operations per share, income (loss) from discontinued
operations per share, and net income (loss) per share	30,255	28,548	30,255	28,548


TIGERLOGIC CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
	For the Years Ended March 31
	2014	2013

Cash flows from operating activities:
Net income (loss)	$ 1,295	$ (2,942)
Gain on sale of discontinued operations	(9,926)	—
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization of long-lived assets	191	144
Provision for (recovery from) bad debt	133	(7)
Stock-based compensation expense	1,293	1,049
Change in deferred tax assets	120	89
Foreign currency exchange (gain) loss .	(46)	(3)
Change in operating assets and liabilities, net of discontinued operations:
Trade accounts receivable	(970)	76
Other current assets	138	(72)
Accounts payable	(98)	(108)
Accrued liabilities	(633)	(197)
Deferred revenue	941	77
Net cash used in operating activities	(7,562)	(1,894)

Cash flows from investing activities:
Business acquistion, net of cash received	—	(490)
Purchases of property, plant and equipment	(183)	(81)
Proceeds from sale of discontinued operations	19,800	—
Net cash provided by (used in) investing activities	19,617	(571)

Cash flows from financing activities:
Proceeds from exercise of stock options	59	24
Proceeds from issuance of common stock	37	47
Net cash provided by financing activities	96	71

Effect of exchange rate changes on cash	(14)	(59)

Net increase (decrease) in cash	12,137	(2,453)
Cash at beginning of the period	6,465	8,918
Cash at end of the period	$ 18,602	$ 6,465

Supplemental disclosures:
Cash paid for income taxes	$ 488	$ 148
Non-cash investing activities:
Issuance of common stock and stock options assumed in business acquistion	—	$ 5,095

Non-GAAP Financial Information

EBITDA or Adjusted EBITDA (each as defined below) should not be construed as a substitute for net income (loss) or as a better measure of liquidity than cash flow from operating activities determined in accordance with U.S. GAAP. EBITDA and Adjusted EBITDA exclude components that are significant in understanding and assessing our results of operations and cash flows. EBITDA or Adjusted EBITDA do not represent funds available for management's discretionary use and are not intended to represent cash flow from operations. In addition, EBITDA and Adjusted EBITDA are not terms defined by GAAP and as a result our measure of EBITDA and Adjusted EBITDA might not be comparable to similarly titled measures used by other companies.

However, EBITDA and Adjusted EBITDA are used by management to evaluate, assess and benchmark our operational results and the Company believes that EBITDA and Adjusted EBITDA are relevant and useful information widely used by analysts, investors and other interested parties in our industry. Accordingly, the Company is disclosing this information to permit a more comprehensive analysis of its operating performance, to provide an additional measure of performance and liquidity and to provide additional information with respect to the Company's ability to meet future capital expenditure and working capital requirements.

EBITDA is defined as net income (loss) with adjustments for depreciation and amortization, interest income (expense)-net, and income tax provision (benefit). Adjusted EBITDA used by the Company is defined as EBITDA plus adjustments for other income (expense)-net, and non-cash stock-based compensation expense.

Adjusted EBITDA presented below includes results from both continuing and discontinued operations. The Company's Adjusted EBITDA financial information is comparable to net income (loss). The table below reconciles Adjusted EBITDA to the Company's GAAP reported net loss:

TIGERLOGIC CORPORATION AND SUBSIDIARIES
RECONCILIATION OF ADJUSTED EBITDA TO NET INCOME (LOSS)
(In thousands)

	For the Three Months Ended March 31,		For the Years Ended March 31,
	2014	2013	2014	2013

Reported net income (loss)	$ (2,687)	(1,255)	$ 1,295	$ (2,942)
Depreciation and amortization	48	47	191	144
Stock-based compensation	164	305	1,293	1,049
Interest expense-net	3	1	6	6
Other (income) expense-net	18	(18)	62	(10)
Income tax provision (benefit)	(1,064)	30	633	77
Gain on sale of discontinued operations			(9,926)	—
Adjusted EBITDA	$ (3,518)	$ (890)	$ (6,446)	$ (1,676)

Our Adjusted EBITDA financial information can also be reconciled to net cash used in operating activities as follows:

TIGERLOGIC CORPORATION AND SUBSIDIARIES
RECONCILIATION OF ADJUSTED EBITDA TO NET CASH USED IN
OPERATING ACTIVITES
(In thousands)
	For the Year Ended March 31,
	2014	2013

Net cash used in operating activities	$ (7,562)	$ (1,894)
Interest expense-net	6	6
Other (income) expense-net	62	(10)
Income tax provision	633	77
Change in trade accounts receivable	970	(76)
Change in other current and non-current assets	(258)	(17)
Change in accounts payable	98	108
Change in accrued liabilities	633	197
Change in deferred revenue	(941)	(77)
Foreign currency exchange gain	46	3
Provision for (recovery from) bad debt	(133)	7
Adjusted EBITDA	$ (6,446)	$ (1,676)