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Guidewire Software Announces Fourth Quarter And Fiscal 2012 Financial Results

Guidewire Software, Inc. (NYSE: GWRE), a provider of core system software to property and casualty insurers, today announced its financial results for the quarter and fiscal year ended July 31, 2012.

“Our fourth quarter exceeded our expectations for both revenue and profitability, capping a year with total revenue growth of 35%, recurring revenue growth of 28%, and increasing market traction,” said Marcus Ryu, Chief Executive Officer of Guidewire Software. “Our strategy to focus on winning PolicyCenter and complete InsuranceSuite sales in fiscal 2012 — including at very large insurers — has been successful, and is validated by our results. These results included a 29% increase in the number of customers licensing at least one of our core system solutions, for a total of 130 insurers.”

Ryu added, “We believe the $1.2 trillion insurance industry is still in the early days of the inevitable replacement of its legacy core systems with flexible, upgradeable next-generation software. We also believe that Guidewire is well positioned to capture a disproportionate share of this major opportunity over time, and our investments across technology, sales, and services during 2013 are focused on extending our market leadership position and driving further market share gains.”

Fourth Quarter Fiscal 2012 Financial Highlights

Revenue

  • Total revenue for the fourth quarter of fiscal 2012 was $67.6 million, an increase of 33% from the comparable period in fiscal 2011.
  • License revenue for the fourth quarter of fiscal 2012 was $28.9 million, up 11% from the year ago period, maintenance revenue was $7.9 million, up 33% from the year ago period, and services revenue was $30.8 million, up 61% from the year ago period.
  • Rolling four-quarter recurring term license and maintenance revenue was $104.4 million, an increase of 28% from the same period a year ago.

Profitability

  • GAAP operating income was $5.3 million for the fourth quarter of fiscal 2012, compared to a loss of ($5.0) million in the comparable period in fiscal 2011.
  • Non-GAAP operating income was $9.6 million for the fourth quarter of fiscal 2012, an increase of 31% from the comparable period in fiscal 2011.
  • Adjusted EBITDA was $10.4 million for the fourth quarter of fiscal 2012, an increase of 22% from the comparable period in fiscal 2011.
  • GAAP net income was $3.5 million for the fourth quarter of fiscal 2012, compared to a loss of ($1.2) million for the comparable period in fiscal 2011. GAAP net income per share was $0.06, based on diluted weighted average shares outstanding of 61.2 million, compared to a GAAP net loss per share ($0.06) for the comparable period in fiscal 2011, based on diluted weighted average shares outstanding of 20.4 million.
  • Non-GAAP net income was $6.4 million for the fourth quarter of fiscal 2012, a decrease of 43% from the comparable period in fiscal 2011. Non-GAAP net income per diluted share was $0.10, based on diluted weighted average shares outstanding of 61.2 million, compared to $0.24 for the fourth quarter of fiscal 2011, based on pro forma diluted weighted average shares outstanding of 45.8 million.

Fiscal 2012 Financial Highlights

Revenue

  • Total revenue for the fiscal year ended July 31, 2012 was $232.1 million, an increase of 35% from fiscal 2011.
  • License revenue for fiscal 2012 was $97.1 million, up 31% from fiscal 2011, maintenance revenue was $29.6 million, up 39% from the year ago period, and services revenue was $105.4 million, up 36% from the year ago period.
  • In fiscal 2012, 55% of total revenue was in the United States, and 45% was generated outside the United States.

Profitability

  • GAAP operating income was $24.0 million for fiscal 2012, compared to $6.9 million in fiscal 2011.
  • Non-GAAP operating income was $41.9 million for fiscal 2012, an increase of 78% from fiscal 2011.
  • Adjusted EBITDA was $44.8 million in fiscal 2012, an increase of 74% from fiscal 2011.
  • GAAP net income was $15.2 million for fiscal 2012, compared to $35.6 million for fiscal 2011, with the decrease primarily attributable to an income tax benefit in 2011 due to the release of a significant portion of the Company’s tax valuation allowance. GAAP net income per diluted share was $0.25, based on diluted weighted average shares outstanding of 41.5 million, compared to $0.76 in fiscal 2011, based on diluted weighted average shares outstanding of 17.8 million.
  • Non-GAAP net income was $27.1 million in fiscal 2012, a decrease of 4% from fiscal 2011 resulting from a tax benefit in 2011 compared to a tax expense in 2012. Non-GAAP net income per diluted share was $0.50, based on pro forma diluted weighted average shares outstanding of 53.8 million, compared to $0.65 in fiscal 2011, based on pro forma diluted weighted average shares outstanding of 43.1 million.

Balance Sheet

  • The Company had $205.7 million in cash and cash equivalents at July 31, 2012, an increase from $201.9 million at April 30, 2012. The Company generated $19.1 million in cash flow from operations in the fourth quarter and $17.1 million in cash flow from operations in fiscal 2012.

Conference Call Information

What:           Guidewire Software fourth quarter and fiscal year 2012 financial results conference call
When: Tuesday, September 4, 2012
Time: 2:00 p.m. PT (5:00 p.m. ET)
Live Call: (800) 946-0706, domestic
(719) 457-2640, international
Replay: (877) 870-5176, passcode 7802574, domestic
(858) 384-5517, passcode 7802574, international
Webcast:

http://ir.guidewire.com (live and replay)

The webcast will be archived on Guidewire’s website for a period of three months.

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