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Siebel full year profits fall

26 January 2006  |  568 views  |  0 Source: Siebel Systems

Siebel Systems, Inc. (NASDAQ:SEBL), a leading provider of customer-facing solutions, today announced financial results for the fourth quarter and full year ended December 31, 2005.

The results reported today exceed preliminary financial results presented on January 12, 2006, original management guidance and analyst consensus expectations, and reflect strong sequential and year over year growth across all revenue and profit measures.

Fourth Quarter Results

Total revenues for the fourth quarter of 2005 were $469 million, consistent with preliminary results, above analyst consensus expectations by 29%, up 35% sequentially, and up 19% year over year. License revenues for the quarter were $215 million, consistent with preliminary results, above analyst consensus expectations by 73%, up 92% sequentially, and up 34% year over year. Maintenance revenues were $130 million, consistent with preliminary results, above analyst consensus expectations by 3%, up 4% sequentially, and up 6% year over year. Services and Other revenues were $124 million, consistent with preliminary results, above analyst consensus expectations by 9%, up 12% sequentially, and up 14% year over year. In addition, OnDemand total contract value for the fourth quarter of 2005 was $16 million, up 43% sequentially and 66% year over year.

Operating income was $116 million, $5 million or one percentage point over the high end of the preliminary results range, up $80 million or 220% sequentially and up $50 million or 77% year over year. Financial results for the fourth quarter of 2005 include the impact of $11 million in acquisition-related earnout and intangible asset impairment, merger-related legal, and other charges. Operating margin was 25%, up fifteen percentage points sequentially and up eight percentage points year over year. Net income was $89 million, up $54 million or 156% sequentially and up $35 million or 65% year over year. Net margin was 19%, up nine percentage points sequentially and up five percentage points year over year. Earnings per share for the quarter ended December 31, 2005 were $0.16, a ten cent or 167% increase sequentially and a six cent or 60% increase year over year. The effective tax rate was 33% in the fourth quarter.

Full Year Results

Total revenues for the year ended December 31, 2005 were $1.43 billion, a 7% increase from 2004. For the year, license revenues were $480 million, maintenance revenues were $500 million and services and other revenues were $449 million, representing a 1% decrease, 6% increase and 17% increase, respectively, from 2004.

Operating income and operating margin for the year ended December 31, 2005 were $59 million and 4%, respectively, a $70 million and six percentage point decrease compared with 2004. Financial results for the full year of 2005 include the impact of $111 million in restructuring, acquisition-related earnout, in process research and development and intangible asset impairment, merger-related legal and other charges. Net income and net margin for the year were $70 million and 5%, respectively, a $41 million and three percentage point decrease from 2004. Earnings per share for the year ended December 31, 2005 were $0.13, a seven cent per share decrease from 2004. The effective tax rate for 2005 was 43%.

Balance Sheet

The company's cash, cash equivalents and short term investments were $2.39 billion as of December 31, 2005, reflecting net cash generated during the fourth quarter of 2005 of $147 million. Deferred revenues were $411 million as of December 31, 2005, up $96 million over the third quarter. As of December 31, 2005, headcount was 4,686.

"Our fourth quarter and second half of 2005 results clearly affirm the market opportunity in customer facing solutions and business analytics, the improvements we have made to address this market, and customer confidence in the future of Siebel customer solutions and analytics following the proposed Oracle transaction," said George T. Shaheen, Chief Executive Officer of Siebel Systems. "I am particularly proud of our employee loyalty in serving our customers, addressing our investor commitments, and preserving and enhancing our franchise during this unsettling merger period. As we prepare to combine with Oracle, we remain committed to further improving our financial performance, sustaining and enhancing our product and technology leadership, and helping our loyal and strong network of partners and customers achieve continued success with Siebel customer facing solutions. Every employee can take great pride in a final quarter and transition to Oracle that reflect the professionalism, work ethic and values on which this company was founded."

The company will not conduct a conference call in conjunction with this earnings press release.» Download the document now 30.9 kb (Adobe Acrobat Document)

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