BURLINGTON, Mass., May 28, 2015 (GLOBE NEWSWIRE) -- Exa ® Corporation (Nasdaq:EXA), a global innovator of fluids simulation solutions for product engineering, today announced financial results for the first quarter of fiscal 2016, which ended April 30, 2015.

Revenue Summary
  1Q16 Revenue (in millions) 1Q15 Revenue (in millions) Growth Constant Currency Growth
Revenue $14.8 $13.8 7% 18%
License Revenue $12.2 $11.7 5% 16%
Project Revenue $2.5 $2.1 20% 33%

"We had a very strong start to fiscal 2016 with first quarter revenue increasing 18% year over year on a constant currency basis," said Stephen Remondi, President and Chief Executive Officer of Exa. "Constant currency license revenue growth of 16% was twice the rate from the first quarter of last year. This growth was driven by strong performances in both the automotive and heavy vehicle markets as a result of continued focus and investment on vehicle efficiency. In addition, Exa's strong product roadmap positions us to further our industry leadership. As a result of these industry and product trends, we are optimistic that we can continue to deliver strong constant currency growth in this fiscal year."

First Quarter Fiscal 2016 Financial Highlights

Revenue
  • Total revenue for the first quarter of fiscal 2016 was $14.8 million, an increase of 7% compared to $13.8 million in the comparable period in fiscal 2015. On a constant currency basis, total revenue also increased 18% when compared with the corresponding period in fiscal 2015.
  • License revenue was $12.2 million for the first quarter of fiscal 2016, compared to $11.7 million in the comparable period in fiscal 2015, representing an increase of 5%, or 16% on a constant currency basis.
  • Project revenue was $2.5 million for the first quarter of fiscal 2016, an increase of 20%, or 33% on a constant currency basis, compared to $2.1 million in the first quarter of fiscal 2015.

Profitability
  • GAAP loss from operations was $(1.8) million in the first quarter of fiscal 2016, compared to $(1.6) million in the comparable period in fiscal 2015.
  • Non-GAAP loss from operations was $(1.1) million in the first quarter of fiscal 2016, compared to $(1.2) million in the comparable period in fiscal 2015.
  • Adjusted EBITDA was a loss of $(0.4) million in the first quarter of fiscal 2016, compared to a loss of $(0.6) million in the comparable period in fiscal 2015.
  • GAAP net loss was $(1.9) million in the first quarter of fiscal 2016, compared to GAAP net loss of $(17.2) million for the comparable period in fiscal 2015. GAAP net loss per share was $(0.13), based on 14.3 million diluted weighted average shares outstanding, compared to GAAP net loss per share of $(1.28) for the comparable period in fiscal 2015, based on 13.5 million diluted weighted average shares outstanding.
  • Non-GAAP net loss was $(1.4) million, or $(0.10) per diluted share in the first quarter of fiscal 2016, compared to non-GAAP net loss of $(16.9) million, or $(1.25) per diluted share, in the comparable period in fiscal 2015.
  • Included in GAAP net loss and non-GAAP net loss for the first quarter last year is a $14.5 million non-cash charge to record a valuation allowance against net deferred tax assets in the United States, as well as a $0.7 million non-cash write-off of state deferred tax assets associated with a cumulative change in ownership for tax purposes.

Balance Sheet
  • The company had $39.8 million in cash and cash equivalents as of April 30, 2015, compared to $21.8 million as of January 31, 2015.

Business Outlook

Based on information available as of May 28, 2015, Exa is providing second quarter and fiscal 2016 guidance as indicated below.

Second Quarter Fiscal 2016:

  • Total revenue is expected to be in the range of $15.0 million to $15.8 million.
  • Adjusted EBITDA is expected to be in the range of $(0.4) million to $0.3 million.
  • GAAP net loss is expected to be in the range of $(2.1) million to $(1.3) million.
  • Non-GAAP net loss is expected to be in the range of $(1.7) million to $(1.0) million.
  • Basic share count for the second quarter is estimated to be 14.5 million shares.
  • Diluted share count for the second quarter is estimated to be 14.9 million shares.

Full Year Fiscal 2016:
  • Total revenue is expected to be in the range of $64.7 million to $67.0 million.
  • Adjusted EBITDA is expected to be in the range of $1.8 million to $2.5 million.
  • GAAP net loss is expected to be in the range of $(5.9) million to $(5.2) million.
  • Non-GAAP net loss is expected to be in the range of $(4.3) million to $(3.6) million.
  • Basic share count for the full year is estimated to be 14.5 million shares.
  • Diluted share count for the full year is estimated to be 14.9 million shares.

The above guidance assumes an exchange rate of 1.13 US dollars per Euro and 118.0 Japanese yen per US dollar for fiscal year 2016.

An explanation and reconciliation of historical and forward-looking non-GAAP measures presented above, including revenue on a constant currency basis, adjusted EBITDA and non-GAAP net income/(loss), to the comparable GAAP measures is provided in the tables below.  

Conference Call Information
What: Exa's first quarter fiscal 2016 financial results conference call 
When: Thursday, May 28, 2015
Time: 5:00 p.m. ET
Webcast: http://investor.exa.com (live and replay)
Live Call: (877) 878-2664, Domestic
  (970) 315-0423, International
Replay: (855) 859-2056, Passcode 47528954, Domestic
  (404) 537-3406, Passcode 47528954, International

Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements, which are presented on a GAAP basis, we disclose revenue on a constant currency basis, non-GAAP income from operations, non-GAAP net income, non-GAAP net income per diluted share and Adjusted EBITDA. These non-GAAP measures are not in accordance with, or an alternative for, amounts determined in accordance with generally accepted accounting principles in the United States. The GAAP measure most comparable to revenue on a constant currency basis is GAAP revenue. The GAAP measure most comparable to non-GAAP income from operations is GAAP income from operations. The GAAP measure most comparable to Non-GAAP net income and Adjusted EBITDA is GAAP net income. The GAAP measure most comparable to Non-GAAP net income per diluted share is GAAP net income per diluted share. A reconciliation of these non-GAAP financial measures to the corresponding GAAP measure is included below.

We define revenue on a constant currency basis as GAAP revenue, adjusted to reverse the impact of changes in the average exchange rates of currencies in which our international operations generated revenue and incurred expenses.

We define Non-GAAP net income as net income, excluding the after tax impact of non-cash, stock-based compensation expense and the amortization of acquired intangibles. We define EBITDA as net income, excluding depreciation and amortization, interest expense, other income (expense), foreign exchange gain/(loss) and provision for income taxes, and we define Adjusted EBITDA as EBITDA, excluding non-cash, stock-based compensation expense.

Our management uses these non-GAAP measures when evaluating our operating performance and for internal planning and forecasting purposes. We believe that these measures help indicate underlying trends in our business, are important in comparing current results with prior period results, and are useful to investors and financial analysts in assessing our operating performance. For example, our international operations generate revenue and incur expenses that are denominated in foreign currencies. These amounts could be materially affected by currency fluctuations. Our principal exposures are to fluctuations in exchange rates for the United States dollar versus the Euro, British pound, Japanese yen, Chinese yuan and Korean won. Changes in currency exchange rates that are beyond our control can significantly affect our consolidated results of operations. We believe that disclosure of our revenue on a constant currency basis is useful as an indicator of demand for our solutions independent of the influence of currency exchange fluctuations. Management considers Adjusted EBITDA to be an important indicator of our operational strength and the performance of our business and a good measure of our historical operating trends. The non-GAAP financial information presented here should be considered in conjunction with, and not as a substitute for, or superior to, the financial information presented in accordance with GAAP and, in particular, should not be considered a measure of our liquidity. There are significant limitations associated with the use of non-GAAP financial measures. Further, these measures may differ from the non-GAAP information, even where similarly titled, used by other companies and therefore should not be used to compare our performance to that of other companies. Investors should carefully consider the attached reconciliation of these non-GAAP financial measures to the comparable GAAP financial measures.

About Exa Corporation

Exa (Nasdaq:EXA) ( www.exa.com) Corporation's visualization and simulation software helps designers and engineers produce better vehicles and equipment. As a design evolves, Exa accurately predicts the performance of that design while providing actionable insight to optimize the performance of the product. With Exa, the need for costly physical prototypes and expensive late-stage changes is reduced. Now, designers and engineers are freed from the risk of producing compromised products that do not meet market and regulatory requirements. Some of the most successful product companies in the world use Exa, including BMW, Ford, Hyundai, Jaguar Land Rover, Kenworth, MAN, Nissan, Peterbilt, Renault, Scania, Toyota, Volkswagen and Volvo Trucks.

Safe Harbor Statement

This press release, including the section entitled "Business Outlook," contains forward-looking statements describing our expectations concerning future events and our future financial performance. These statements are only predictions and may be inaccurate. Actual events or results may differ materially. In evaluating these statements, you should specifically consider various factors, including the risks outlined under "Risk Factors" in our Annual Report on Form 10-K for the year ended January 31, 2015 and in our other SEC filings. These factors may cause our actual results to differ materially from those described in our forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, our future results, levels of activity, performance or achievements may differ from our expectations. Other than as required by law, we do not undertake a responsibility to update any of the forward-looking statements after the date of this press release, even though our situation may change in the future.
     
EXA CORPORATION
Consolidated Balance Sheets
(Unaudited)
(in thousands, except share and per share data)
     
  April 30, January 31,
  2015 2015
ASSETS    
Current assets:    
Cash and cash equivalents  $ 39,797  $ 21,785
Accounts receivable  6,456  27,462
Prepaid expenses and other current assets  4,584  3,098
 Total current assets  50,837  52,345
Property and equipment, net  6,421  6,961
Intangible assets, net  2,307  2,395
Deferred tax assets  262  260
Other assets  557  1,092
 Total assets  $ 60,384  $ 63,053
     
LIABILITIES AND STOCKHOLDERS' EQUITY     
Current liabilities:    
Accounts payable  $ 1,624  $ 1,620
Accrued expenses  8,571  10,585
Current portion of deferred revenue  27,606  26,863
Current portion of capital lease obligations  2,127  2,390
 Total current liabilities  39,928  41,458
Deferred revenue  26  38
Capital lease obligations  1,210  1,602
Deferred rent  422  472
Other long-term liabilities  498  592
 Total liabilities  42,084  44,162
     
Commitments and contingencies    
     
Stockholders' equity :    
Preferred stock, $0.001 par value; 5,000,000 shares authorized; no shares issued and outstanding  --   -- 
Common stock, $0.001 par value; 30,000,000 shares authorized; 14,513,265 and 13,874,744 shares issued, respectively; 14,480,763 and 13,842,242 shares outstanding, respectively  14  14
Additional paid-in capital  89,438  88,181
Accumulated deficit  (70,766)  (68,878)
Treasury stock (32,502 common shares, at cost) 0 0
Accumulated other comprehensive loss  (386)  (426)
 Total stockholders' equity   18,300  18,891
 Total liabilities and stockholders' equity   $ 60,384  $ 63,053
     
     
EXA CORPORATION
Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
(in thousands, except share and per share data)
     
  Three Months Ended April 30,
  2015 2014
     
Revenue:    
 License revenue  $ 12,242  $ 11,660
 Project revenue  2,526  2,110
Total revenues  14,768  13,770
Operating expenses (1):    
 Cost of revenues  4,643  4,596
 Sales and marketing  2,488  2,567
 Research and development  6,170  5,102
 General and administrative (2)  3,267  3,122
Total operating expenses  16,568  15,387
Loss from operations  (1,800)  (1,617)
Other (expense) income, net:    
 Foreign exchange loss  (52)  (44)
 Interest expense  (65)  (83)
 Interest income  3  4
Total other expense, net  (114)  (123)
Loss before income taxes  (1,914)  (1,740)
Benefit (provision) for income taxes  26  (15,480)
 Net loss   $ (1,888)  $ (17,220)
     
Net loss per share:    
 Basic  $ (0.13)  $ (1.28)
 Diluted  $ (0.13)  $ (1.28)
     
Weighted average shares outstanding used in computing net loss per share:
 Basic  14,301,709  13,499,919
 Diluted  14,301,709  13,499,919
     
Comprehensive loss:    
Net loss  $ (1,888)  $ (17,220)
Foreign currency translation adjustments  40  41
Comprehensive loss  $ (1,848)  $ (17,179)
     
(1) Includes stock-based compensation expense as follows:
     
  Three Months Ended April 30,
  2015 2014
     
 Cost of revenues  $ 69  $ 38
 Sales and marketing  115  75
 Research and development  241  156
 General and administrative  189  101
 Total  $ 614  $ 370
     
(2) Includes amortization expense related to intangible assets as follows:
     
  Three Months Ended April 30,
  2015 2014
     
 General and administrative  $ 88  $ 87
     
     
EXA CORPORATION
 Consolidated Statements of Cash Flows
(Unaudited)
(in thousands)
     
  Three Months Ended April 30,
  2015 2014
Cash flows provided by operating activities:    
Net loss  $ (1,888)  $ (17,220)
Adjustments to reconcile net loss to net cash provided by operating activities:    
 Depreciation and amortization  750  663
 Stock-based compensation expense  614  370
 Deferred rent expense  (101)  (114)
 Deferred income taxes  (6)  15,222
Net change in operating assets and liabilities:    
 Accounts receivable  21,097  13,352
 Prepaid expenses and other current assets  (1,476)  (346)
 Other assets  537  (45)
 Accounts payable  4  (782)
 Accrued expenses  (1,959)  (3,742)
 Other liabilities  (94)  12
 Deferred revenue  734  (2,695)
Net cash provided by operating activities  18,212  4,675
     
Cash flows used in investing activities:    
 Purchases of property and equipment  (141)  (366)
Net cash used in investing activities  (141)  (366)
     
Cash flows used in financing activities:    
 Proceeds from stock option exercises  648  314
 Payments of capital lease obligations  (650)  (855)
Net cash used in financing activities  (2)  (541)
     
Effect of exchange rate changes on cash   (57)  71
     
Net increase in cash and cash equivalents  18,012  3,839
     
Cash and cash equivalents, beginning of period  21,785  28,753
Cash and cash equivalents, end of period  $ 39,797  $ 32,592
     
Supplemental cash flow disclosures:    
 Cash paid for interest  $ 65  $ 83
 Cash paid for income taxes  $ 958  $ 171
     
     
EXA CORPORATION
Reconciliation of historical Non-GAAP to GAAP measures
(Unaudited)
(in thousands, except per share data)
     
Adjusted EBITDA:    
  Three Months Ended
  April 30,
  2015 2014
     
Net loss  $ (1,888)  $ (17,220)
 Add back:    
Depreciation and amortization  750  663
Interest expense, net  62  79
Foreign exchange loss  52  44
(Benefit) provision for income taxes  (26)  15,480
EBITDA  (1,050)  (954)
Stock-based compensation expense  614  370
Adjusted EBITDA  $ (436)  $ (584)
     
Non-GAAP operating loss:    
  Three Months Ended
  April 30,
  2015 2014
     
Operating loss  $ (1,800)  $ (1,617)
 Add back:    
Stock-based compensation expense  614  370
Amortization of acquired intangible assets  88  87
Non-GAAP operating loss  $ (1,098)  $ (1,160)
     
Non-GAAP net loss:    
  Three Months Ended
  April 30,
  2015 2014
     
Net loss  $ (1,888)  $ (17,220)
 Add back:    
Stock-based compensation expense  614  370
Amortization of acquired intangible assets  88  87
Income tax effect (1)  (246)  (160)
Non-GAAP net loss  $ (1,432)  $ (16,923)
     
Non-GAAP net loss per diluted share:    
  Three Months Ended
  April 30,
  2015 2014
     
Net loss per diluted share (2)  $ (0.13)  $ (1.28)
 Add back:    
Stock-based compensation expense  0.04  0.03
Amortization of acquired intangible assets  0.01  0.01
Income tax effect (1)  (0.02)  (0.01)
Non-GAAP net loss, per diluted share (2)(3):  $ (0.10)  $ (1.25)
     
     
(1) The tax effect of non-cash stock-based compensation expense and non-cash amortization of acquired intangibles is estimated using a blended rate equivalent to our annual estimated United States federal tax rate and our state tax rate, exclusive of any net federal benefit or charge. This rate is based on our estimated annual GAAP income tax rate forecast. Our estimated tax rate on non-GAAP income is determined annually and may be adjusted during the year to take into account events or trends that we believe materially impact the estimated annual rate including, but not limited to, significant changes resulting from tax legislation, revenues and expenses and other significant events. Due to the differences in the tax treatment of items excluded from non-GAAP earnings, as well as the methodology applied to our estimated annual tax rates as described above, our estimated tax rate on non-GAAP income may differ from our GAAP tax rate and from our actual tax liabilities.
 
(2) Share amounts utilized on a fully diluted basis were approximately 14.3 million and 13.5 million for the three months ended April 30, 2015 and 2014, respectively.
 
(3) Due to rounding, totals may not equal the sum of line items in the table above.
     
     
EXA CORPORATION
Reconciliation of forward looking Non-GAAP to GAAP measures
     
EBITDA and Adjusted EBITDA:    
 (in millions) Three Months Ended July 31, 2015 Year Ended January 31, 2016
     
Net loss $ (2.1) - (1.3) $ (5.9) - (5.2)
 Add back:    
Depreciation and amortization  0.9  3.8
Interest expense, net  0.1  0.3
Provision for income taxes 0.2 - 0.1 1.6
EBITDA (0.9) - (0.2) (0.2) - 0.5
Stock-based compensation expense 0.5 2.0
Adjusted EBITDA $ (0.4) - 0.3 $ 1.8 - 2.5
     
     
Non-GAAP net loss:    
 (in millions) Three Months Ended July 31, 2015 Year Ended January 31, 2016
     
Net loss $ (2.1) - (1.3) $ (5.9) - (5.2)
 Add back:    
Stock-based compensation expense 0.5 2.0
Amortization of acquired intangibles 0.1  0.4
Income tax effect (1) (0.2) - (0.3) (0.8)
Non-GAAP net loss $ (1.7) - (1.0) $ (4.3) - (3.6)
     
(1)  Non-GAAP financial information for the quarter is adjusted using a blended tax rate equivalent to our annual estimated United States federal tax rate and our state tax rate, exclusive of any net federal benefit or charge. This rate is based on our estimated annual GAAP income tax rate forecast. Our estimated tax rate on non-GAAP income is determined annually and may be adjusted during the year to take into account events or trends that we believe materially impact the estimated annual rate including, but not limited to, significant changes resulting from tax legislation, material changes in the geographic mix of revenues and expenses and other significant events. Due to the differences in the tax treatment of items excluded from non-GAAP earnings, as well as the methodology applied to our estimated annual tax rates as described above, our estimated tax rate on non-GAAP income may differ from our GAAP tax rate and from our actual tax liabilities. 
CONTACT: Media Contact:         Michelle Murray-Ross, Exa Corporation         +1 (781) 564-0251         michelle@exa.com                  Investor Relations Contact:         Garo Toomajanian, ICR         +1 (781) 564-0337         investor@exa.com

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