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CommVault Announces Second Quarter Fiscal 2008 Financial Results
CommVault (NASDAQ:CVLT) today announced its financial results for the second fiscal quarter ended September 30, 2007.

N. Robert Hammer, CommVaults chairman, president and CEO, stated, CommVault had a very solid second quarter which was highlighted by record revenues and increased earnings. We continue to make significant progress in expanding our market positions in both our core backup and emerging products. The recent launch of CommVault Simpana 7.0 has improved the competitive differentiation of our current product lines which will enable us to continue to build our business around information management products and services.

Total revenues in the second quarter of fiscal 2008 were a record $47.4 million, an increase of 29% over the second quarter of fiscal 2007 and 8% over the prior quarter. Software revenue in the second quarter of fiscal 2008 was $26.6 million, up 31% year-over-year and 10% sequentially. Services revenue in the second quarter of fiscal 2008 was $20.9 million, up 27% year-over-year and 5% sequentially.

Non-GAAP income from operations (EBIT) increased 32% to $7.0 million in the second quarter of fiscal 2008 compared to $5.3 million in the second quarter of the prior year. EBIT determined in accordance with U.S. GAAP was $4.7 million for the second quarter, a 21% increase from $3.8 million in the same period of the prior year.

For the second quarter of fiscal 2008, non-GAAP net income increased 27% to $5.7 million, or $0.12 per diluted share, from $4.5 million or $0.12 per diluted share in the same period of the prior year. CommVault reported GAAP net income for the quarter of $3.4 million, a decrease of $1.0 million compared to the same period of the prior year. GAAP net income for the quarter ended September 30, 2007 includes an effective tax rate of 38% compared to an effective tax rate of 1% in the same period of the prior year.

Operating cash flow totaled $4.5 million for the second quarter of fiscal 2008. Total cash and cash equivalents as of September 30, 2007 were $79.2 million.

A reconciliation of GAAP to non-GAAP results has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below under the heading Use of Non-GAAP Financial Measures.

Fiscal 2008 Guidance

For the fiscal year ending March 31, 2008, CommVault currently expects:

  • Total revenues in the range of $194 million to $196 million.
  • Non-GAAP gross margins of 86.0% to 86.3%.
  • Non-GAAP operating income margins of 17.2% to 17.7%.
  • Non-GAAP diluted EPS in the range of $0.57 per share to $0.59 per share using an effective tax rate of approximately 28% and a weighted average diluted share count of approximately 45.6 million to 46.3 million.
  • An actual cash tax rate in the mid to high single digits range based on current assumptions.

The Non-GAAP diluted EPS guidance excludes approximately $0.13 per share to $0.15 per share of noncash stock-based compensation charges, net of non-GAAP income tax benefits of approximately $0.05 per share, and any additional FICA expense that will be incurred by CommVault when employees exercise in the money stock options.

Use of Non-GAAP Financial Measures

CommVault has provided in this press release selected financial information that has not been prepared in accordance with GAAP. CommVault uses these non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, when used as a supplement to GAAP measures, in evaluating CommVaults ongoing operational performance. CommVault believes that the use of these non-GAAP financial measures provide an additional tool for investors to use in evaluating ongoing operating results and trends, and in comparing its financial results with other companies in CommVaults industry, many of which present similar non-GAAP financial measures to the investment community.

The non-GAAP financial results discussed above excludes noncash stock-based compensation charges, additional FICA expense incurred by CommVault when employees exercise in the money stock options and accretion of preferred stock dividends. In addition, the non-GAAP financial results apply an effective tax rate of 28% in fiscal 2008 and 25% starting in the second quarter of fiscal 2007 which resulted in an estimated effective tax rate of approximately 20% for fiscal 2007.

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures, which are provided in Table IV included in this press release.

Conference Call Information

CommVault will host a conference call today, October 30, 2007, at 5:00 p.m. EDT to discuss its financial results. To access this call, dial 800-561-2731 (domestic) or 617-614-3528 (international). Additionally, a live web cast of the conference call will be hosted under Webcasts and Presentations located under the Investor Relations section on CommVaults Web site www.commvault.com.

An archived web cast of this conference call will also be available on the Investor Relations section of CommVaults Web site, www.commvault.com.

Second Quarter Fiscal 2008 Highlights Include:

  • Revenues of $47.4 million
  • Non-GAAP EBIT of $7.0 million and Non-GAAP EBIT Margins of 14.8%
  • GAAP EBIT of $4.7 million and GAAP EBIT Margins of 9.8%
  • Non-GAAP Diluted Earnings Per Share of $0.12
  • GAAP Diluted Earnings Per Share of $0.08
Published Wednesday, October 31, 2007 6:04 AM by David Marshall
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