EXHIBIT 99.01
Published on February 22, 2007
Exhibit 99.01
Contacts:
|
Investors | Media | ||
Bob Lawson | Diane Carlini | |||
Intuit Inc. | Intuit Inc. | |||
650-944-6165 | 650-944-6251 | |||
robert_lawson@intuit.com | diane_carlini@intuit.com |
Intuit Announces Second-Quarter Revenue of $763M In Line with
Expectations
Expectations
MOUNTAIN VIEW, Calif. Feb. 22, 2007 - Intuit Inc. (Nasdaq: INTU) today announced its
second-quarter 2007 revenue increased 3 percent year-over-year to $763 million, in line with
expectations. For the first six months of the fiscal year, the company reported revenue growth of 8
percent.
Growth in the quarter was driven by strong sales in Consumer Tax, which were up 18 percent
over the year-ago period, and Payroll and Payments segment, which was up 15 percent year-over-year.
This growth was offset partly by revenue shifts in QuickBooks and Pro Tax, which moved about $45
million in revenue from the second quarter to the first and third quarters, compared to last year.
We are pleased with the early results of TurboTax and the continued strength in our Payroll
and Payments segment, said Steve Bennett, Intuits president and chief executive officer. We are
also excited by the recent acquisition of Digital Insight, which will provide a third platform for
growth as we go forward.
Second-Quarter 2007 Financial Highlights
Intuit posted GAAP (Generally Accepted Accounting Principles) diluted net income of $145
million in the quarter versus diluted net income of $183 million in the second quarter of 2006.
This represents diluted net income of $0.40 per share versus diluted net income of $0.50 per share
in the year-ago quarter. Second quarter 2006 results
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included $28 million, or 7 cents per share, from discontinued operations. Intuit posted non-GAAP
diluted net income of $161 million, or $0.45 per share versus $174 million, or $0.48 per share in
the second quarter of 2006.
Second-Quarter 2007 Business Segment Results
| QuickBooks second quarter revenue was $164 million. The earlier launch of QuickBooks 2007 versus QuickBooks 2006 shifted about $20 million of revenue from the second quarter to the first quarter. Year-to-date QuickBooks revenue was up 5 percent. | ||
| Payroll and Payments revenue of $138 million was up 15 percent compared to the second quarter of 2006. | ||
| Consumer Tax revenue was $226 million, up 18 percent year-over-year. | ||
| Professional Tax revenue was $131 million, down 13 percent as a result of changes in product offerings, which deferred approximately $25 million to the third quarter. | ||
| Other Businesses revenue of $105 million was up 1 percent. |
Forward-looking Guidance
Forward-looking guidance has been adjusted to reflect the acquisition of Digital Insight, the
disposition of certain fully outsourced payroll assets, and a lower effective tax rate. For fiscal
2007 Intuit now expects:
| Revenue of $2.625 billion to $2.675 billion, representing annual growth of 12 to 14 percent. | ||
| GAAP operating income of $585 million to $611 million, and non-GAAP operating income of $725 million to $751 million. | ||
| GAAP diluted earnings per share, or EPS, of $1.10 to $1.14, and non-GAAP diluted EPS of $1.33 to $1.37. |
Intuit also adjusted its previously given third quarter, fourth quarter and full year fiscal
2007 guidance for revenue and earnings per share, details of which are available on Intuits Web
site at www.intuit.com/about_intuit/investors/earnings/2007.
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Webcast and Conference Call Information
A live audio webcast of Intuits second-quarter 2007 conference call is available at
www.intuit.com/about_intuit/investors/webcast_events.html. The call begins today at 1:30
p.m. PDT. The replay of the audio webcast will remain on Intuits Web site for one week after the
conference call. Intuit has also posted this press release, including the attached tables and
non-GAAP to GAAP reconciliations on its Web site and will post the conference call script shortly
after the conference call concludes. These documents may be found at
web.intuit.com/about_intuit/press_releases/2007/.
The conference call number is 866-206-6509 in the United States or 703-639-1108 from
international locations. No reservation or access code is needed. A replay of the call will be
available for one week by calling 888-266-2081, or 703-925-2533 from international locations. The
access code is 1035185.
-30-
Intuit, the Intuit logo, Quicken, QuickBooks and TurboTax, among others, are registered
trademarks and/or registered service marks of Intuit Inc. in the United States and other countries.
About Non-GAAP Financial Measures
This press release and the accompanying tables include non-GAAP financial measures. For a description of these non-GAAP financial measures, including the reasons management uses each measure, and reconciliations of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with Generally Accepted Accounting Principles, please see the section of the accompanying tables titled About Non-GAAP Financial Measures as well as the related Table B and Table E which follow it. A copy of the press release filed by Intuit on February 22, 2007 can be found on the investor relations page of Intuits Web site.
This press release and the accompanying tables include non-GAAP financial measures. For a description of these non-GAAP financial measures, including the reasons management uses each measure, and reconciliations of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with Generally Accepted Accounting Principles, please see the section of the accompanying tables titled About Non-GAAP Financial Measures as well as the related Table B and Table E which follow it. A copy of the press release filed by Intuit on February 22, 2007 can be found on the investor relations page of Intuits Web site.
Cautions About Forward-Looking Statements
This press release contains forward-looking statements, including forecasts of Intuits expected financial results; its prospects for the business in fiscal 2007 and beyond; expectations of future growth, including growth of the Digital Insight business; and all of the statements under the heading Forward-Looking Guidance.
This press release contains forward-looking statements, including forecasts of Intuits expected financial results; its prospects for the business in fiscal 2007 and beyond; expectations of future growth, including growth of the Digital Insight business; and all of the statements under the heading Forward-Looking Guidance.
Because these forward-looking statements involve risks and uncertainties, there are important
factors that could cause our actual results to differ materially from the expectations expressed in
the forward-looking statements. These factors include, without limitation, the following: product
introductions and price competition from our competitors can have unpredictable negative effects on
our revenue, profitability and market position; governmental encroachment in our tax businesses or
other governmental activities regulating the filing of tax returns could negatively effect our
operating results and market position; we may not be able to successfully introduce new products
and services to meet our growth and profitability objectives, and current and future products and
services may not adequately address customer needs and may not achieve broad market acceptance,
which could harm our operating results and financial condition; any failure to maintain reliable
and responsive service levels for our offerings could cause us to lose customers and negatively
impact our revenues and profitability; any significant product quality problems or
delays in our products could harm our revenue, earnings and reputation; our participation in the
Free File Alliance may result in lost revenue opportunities and cannibalization of our traditional
paid franchise; any
Intuit Earnings Q207
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failure to properly use and protect personal customer information could harm
our revenue, earnings and reputation; our acquisition activities may be disruptive to Intuit and
may not result in expected benefits; our use of significant amounts of debt to finance acquisitions
or other activities could harm our financial condition and results of operations; our revenue and
earnings are highly seasonal and the timing of our revenue between quarters is difficult to
predict, which may cause significant quarterly fluctuations in our financial results; predicting
tax-related revenues is challenging due to the heavy concentration of activity in a short time
period; we have implemented, and are continuing to upgrade, new information systems and any
problems with these new systems could interfere with our ability to ship and deliver products and
gather information to effectively manage our business; our financial position may not make
repurchasing shares advisable or we may issue additional shares in an acquisition causing our
number of outstanding shares to grow; and litigation involving intellectual property, antitrust,
shareholder and other matters may increase our costs. More details about these and other risks
that may impact our business are included in our Form 10-K for fiscal 2006 and in our other SEC
filings. You can locate these reports through our website at
http://www.intuit.com/about_intuit/investors. Forward-looking statements are based on information
as of February 22, 2007, and we do not undertake any duty to update any forward-looking statement
or other information in these remarks.
Table A
INTUIT INC.
GAAP CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
INTUIT INC.
GAAP CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended | Six Months Ended | |||||||||||||||
January 31, | January 31, | January 31, | January 31, | |||||||||||||
2007 | 2006 | 2007 | 2006 | |||||||||||||
Net revenue: |
||||||||||||||||
Product |
$549,539 | $557,079 | $761,959 | $739,533 | ||||||||||||
Service and other |
213,768 | 185,625 | 363,419 | 307,242 | ||||||||||||
Total net revenue |
763,307 | 742,704 | 1,125,378 | 1,046,775 | ||||||||||||
Costs and expenses: |
||||||||||||||||
Cost of revenue: |
||||||||||||||||
Cost of product revenue |
68,253 | 71,739 | 105,596 | 104,170 | ||||||||||||
Cost of service and other revenue |
70,293 | 63,393 | 138,665 | 122,641 | ||||||||||||
Amortization of purchased intangible assets |
2,583 | 2,763 | 4,891 | 5,712 | ||||||||||||
Selling and marketing |
221,440 | 196,903 | 376,538 | 344,333 | ||||||||||||
Research and development |
115,474 | 100,084 | 235,688 | 197,364 | ||||||||||||
General and administrative |
68,606 | 65,297 | 145,994 | 128,892 | ||||||||||||
Acquisition-related charges |
2,334 | 3,553 | 5,176 | 7,312 | ||||||||||||
Total costs and expenses |
548,983 | 503,732 | 1,012,548 | 910,424 | ||||||||||||
Operating income from continuing operations |
214,324 | 238,972 | 112,830 | 136,351 | ||||||||||||
Interest and other income |
11,046 | 5,566 | 21,336 | 11,870 | ||||||||||||
Gains on marketable equity securities and other
investments, net |
| 3,027 | 1,221 | 7,294 | ||||||||||||
Income from continuing operations before
income taxes |
225,370 | 247,565 | 135,387 | 155,515 | ||||||||||||
Income tax provision [A] |
79,673 | 92,074 | 48,405 | 57,635 | ||||||||||||
Minority interest |
335 | 244 | 550 | 244 | ||||||||||||
Net income from continuing operations |
145,362 | 155,247 | 86,432 | 97,636 | ||||||||||||
Net income from discontinued operations [B] |
| 27,726 | | 39,533 | ||||||||||||
Net income |
$145,362 | $182,973 | $86,432 | $137,169 | ||||||||||||
Basic net income per share from
continuing operations |
$0.42 | $0.44 | $0.25 | $0.28 | ||||||||||||
Basic net income per share from
discontinued operations |
| 0.08 | | 0.11 | ||||||||||||
Basic net income per share [C] |
$0.42 | $0.52 | $0.25 | $0.39 | ||||||||||||
Shares used in basic per share amounts [C] |
347,185 | 350,292 | 346,700 | 352,552 | ||||||||||||
Diluted net income per share from
continuing operations |
$0.40 | $0.43 | $0.24 | $0.27 | ||||||||||||
Diluted net income per share from
discontinued operations |
| 0.07 | | 0.11 | ||||||||||||
Diluted net income per share [C] |
$0.40 | $0.50 | $0.24 | $0.38 | ||||||||||||
Shares used in diluted per share amounts [C] |
360,573 | 363,582 | 360,654 | 365,200 | ||||||||||||
Total share-based compensation expense
in continuing operations: |
||||||||||||||||
Cost of product revenue |
$262 | $245 | $480 | $533 | ||||||||||||
Cost of service and other revenue |
644 | 496 | 1,261 | 1,133 | ||||||||||||
Selling and marketing |
5,759 | 5,250 | 11,497 | 11,557 | ||||||||||||
Research and development |
5,560 | 4,684 | 10,862 | 10,294 | ||||||||||||
General and administrative |
7,087 | 7,074 | 14,071 | 14,656 | ||||||||||||
Total |
$19,312 | $17,749 | $38,171 | $38,173 | ||||||||||||
See accompanying Notes.
INTUIT INC.
NOTES TO TABLE A
NOTES TO TABLE A
[A] | Our effective tax rate for the three months ended January 31, 2007 was approximately 35% and did not differ significantly from the federal statutory rate. Our effective tax rate for the six months ended January 31, 2007 was approximately 36% and differed from the federal statutory rate primarily due to state income taxes, which were partially offset by the benefit we received from federal and state research and experimental credits and tax exempt interest income. In addition, we benefited from the retroactive extension of the federal research and experimental credit. Our effective tax rates for the three and six months ended January 31, 2006 were approximately 37% and differed from the federal statutory rate primarily due to state income taxes, which were partially offset by the benefit we received from federal and state research and experimental credits and tax exempt interest income. | |
[B] | In December 2005 we sold our Intuit Information Technology Solutions (ITS) business for approximately $200 million in cash. In accordance with the provisions of Statement of Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of Long-lived Assets, we accounted for the sale of ITS as discontinued operations. Consequently, we have segregated the operating results and cash flows of ITS from continuing operations in our financial statements for all periods prior to the sale. Revenue for ITS was $5.8 million and $20.2 million for the three and six months ended January 31, 2006. Net income from ITS operations was $1.9 million and $5.2 million for the same periods. We recorded a net gain on the disposal of ITS of $34.3 million in the six months ended January 31, 2006. | |
[C] | Our Board of Directors authorized a two-for-one stock split which was effected in the form of a 100% stock dividend on July 6, 2006. All share and per share figures in these tables retroactively reflect this stock split. |
INTUIT INC.
ABOUT NON-GAAP FINANCIAL MEASURES
ABOUT NON-GAAP FINANCIAL MEASURES
The accompanying press release dated February 22, 2007 contains non-GAAP financial measures.
Tables B and E reconcile the non-GAAP financial measures in that press release to the most
directly comparable financial measures prepared in accordance with Generally Accepted Accounting
Principles (GAAP). These non-GAAP financial measures include non-GAAP operating income (loss) and
related operating margin as a percentage of revenue, non-GAAP net income (loss) and non-GAAP net
income (loss) per share.
Non-GAAP financial measures should not be considered as a substitute for, or superior to,
measures of financial performance prepared in accordance with GAAP. These non-GAAP financial
measures do not reflect a comprehensive system of accounting, differ from GAAP measures with the
same names and may differ from non-GAAP financial measures with the same or similar names that
are used by other companies.
We believe that these non-GAAP financial measures provide meaningful supplemental information
regarding Intuits operating results primarily because they exclude amounts that we do not
consider part of ongoing operating results when assessing the performance of the organization,
our operating segments or our senior management. Segment managers are not held accountable for
share-based compensation expenses, acquisition-related costs, or the other excluded items that
may impact their business units operating income (loss) and, accordingly, we exclude these
amounts from our measures of segment performance. We also exclude these amounts from our budget
and planning process. We believe that our non-GAAP financial measures also facilitate the
comparison of results for current periods and guidance for future periods with results for past
periods. We exclude the following items from our non-GAAP financial measures:
| Share-based compensation expenses. Our non-GAAP financial measures exclude share-based compensation expenses, which consist of expenses for stock options, restricted stock, restricted stock units and purchases of common stock under our Employee Stock Purchase Plan. Segment managers are not held accountable for share-based compensation expenses impacting their business units operating income (loss) and, accordingly, we exclude share-based compensation expenses from our measures of segment performance. While share-based compensation is a significant expense affecting our results of operations, management excludes share-based compensation from our budget and planning process. We exclude share-based compensation expenses from our non-GAAP financial measures for these reasons and the other reasons stated above. We compute weighted average dilutive shares using the method required by SFAS 123(R) for both GAAP and non-GAAP diluted net income per share. | ||
| Amortization of purchased intangible assets and acquisition-related charges. In accordance with GAAP, amortization of purchased intangible assets in cost of revenue includes amortization of software and other technology assets related to acquisitions and acquisition-related charges in operating expenses includes amortization of other purchased intangible assets such as customer lists and covenants not to compete. Acquisition activities are managed on a corporate-wide basis and segment managers are not held accountable for the acquisition-related costs impacting their business units operating income (loss). We exclude these amounts from our measures of segment performance and from our budget and planning process. We exclude these items from our non-GAAP financial measures for these reasons, the other reasons stated above and because we believe that excluding these items facilitates comparisons to the results of other companies in our industry, which have their own unique acquisition histories. | ||
| Gains and losses on disposals of businesses. We exclude these amounts from our non-GAAP financial measures for the reasons stated above and because they are unrelated to our ongoing business operating results. | ||
| Gains and losses on marketable equity securities and other investments. We exclude these amounts from our non-GAAP financial measures for the reasons stated above and because they are unrelated to our ongoing business operating results. | ||
| Income tax effects of excluded items. Our non-GAAP financial measures exclude the income tax effects of the adjustments described above that relate to the current period as well as adjustments for similar items that relate to prior periods. We exclude the impact of these tax items for the reasons stated above and because management believes that they are not indicative of our ongoing business operations. | ||
| Operating results and gains and losses on the sale of discontinued operations. From time to time, we sell or otherwise dispose of selected operations as we adjust our portfolio of businesses to meet our strategic goals. In accordance with GAAP, we segregate the operating results of discontinued operations as well as gains and losses on the sale of these discontinued operations from continuing operations on our GAAP statements of operations but continue to include them in GAAP net income or loss and net income or loss per share. We exclude these amounts from our non-GAAP financial measures for the reasons stated above and because they are unrelated to our ongoing business operations. |
The following describes each non-GAAP financial measure, the items excluded from the most
directly comparable GAAP measure in arriving at each non-GAAP financial measure, and the reasons
management uses each measure and excludes the specified amounts in arriving at each non-GAAP
financial measure.
(A) | Operating income (loss) and related operating margin as a percentage of revenue. We exclude share-based compensation expenses, amortization of purchased intangible assets and acquisition-related charges from our GAAP operating income (loss) from continuing operations and related operating margin in arriving at our non-GAAP operating income (loss) and related operating margin primarily because we do not consider them part of ongoing operating results when assessing the performance of the organization, our operating segments and senior management or when undertaking our budget and planning process. We believe that the exclusion of these expenses from our non-GAAP financial measures also facilitates the comparison of results for fiscal 2006 and guidance for |
future periods with results for prior periods. In addition, we exclude amortization of purchased intangible assets and acquisition-related charges from non-GAAP operating income (loss) and operating margin because we believe that excluding these items facilitates comparisons to the results of other companies in our industry, which have their own unique acquisition histories. |
(B) | Net income (loss) and net income (loss) per share (or earnings per share). We exclude share-based compensation expenses, amortization of purchased intangible assets, acquisition-related charges, net gains on marketable equity securities and other investments, gains and losses on disposals of businesses, certain tax items as described above, and amounts related to discontinued operations from our GAAP net income (loss) and net income (loss) per share in arriving at our non-GAAP net income (loss) and net income (loss) per share. We exclude all of these items from our non-GAAP net income (loss) and net income (loss) per share primarily because we do not consider them part of ongoing operating results when assessing the performance of the organization, our operating segments and senior management or when undertaking our budget and planning process. We believe that the exclusion of these items from our non-GAAP financial measures also facilitates the comparison of results for fiscal 2006 and guidance for future periods with results for prior periods. | ||
In addition, we exclude amortization of purchased intangible assets and acquisition-related charges from our non-GAAP net income (loss) and net income (loss) per share because we believe that excluding these items facilitates comparisons to the results of other companies in our industry, which have their own unique acquisition histories. We exclude gains on marketable equity securities and other investments, net from our non-GAAP net income (loss) and net income (loss) per share because they are unrelated to our ongoing business operating results. Our non-GAAP financial measures exclude the income tax effects of the adjustments described above that relate to the current period as well as adjustments for similar items that relate to prior periods. We exclude the impact of these tax items because management believes that they are not indicative of our ongoing business operations. The effective tax rates used to calculate non-GAAP net income (loss) and net income (loss) per share were as follows: 35% for the first and second quarters of fiscal 2006; 37% for the first quarter of fiscal 2007; 36% for the second quarter of fiscal 2007; 35% for the first six months of fiscal 2007; and 35% for fiscal 2007 guidance. Finally, we exclude amounts related to discontinued operations from our non-GAAP net income (loss) and net income (loss) per share because they are unrelated to our ongoing business operations. |
We refer to these non-GAAP financial measures in assessing the performance of Intuits ongoing
operations and for planning and forecasting in future periods. These non-GAAP financial measures
also facilitate our internal comparisons to Intuits historical operating results. We have
historically reported similar non-GAAP financial measures and believe that the inclusion of
comparative numbers provides consistency in our financial reporting. We compute non-GAAP
financial measures using the same consistent method from quarter to quarter and year to year.
The reconciliations of the forward-looking non-GAAP financial measures to the most directly
comparable GAAP financial measures in Table E include all information reasonably available to
Intuit at the date of this press release. These tables include adjustments that we can reasonably
predict. Events that could cause the reconciliation to change include acquisitions and
divestitures of businesses, goodwill and other asset impairments and sales of marketable equity
securities and other investments.
Table B
INTUIT INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
TO MOST DIRECTLY COMPARABLE GAAP FINANCIAL MEASURES
(In thousands, except per share amounts)
(Unaudited)
INTUIT INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
TO MOST DIRECTLY COMPARABLE GAAP FINANCIAL MEASURES
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended | Six Months Ended | |||||||||||||||
January 31, | January 31, | January 31, | January 31, | |||||||||||||
2007 | 2006 | 2007 | 2006 | |||||||||||||
GAAP operating income from continuing
operations |
$214,324 | $238,972 | $112,830 | $136,351 | ||||||||||||
Amortization of purchased intangible assets |
2,583 | 2,763 | 4,891 | 5,712 | ||||||||||||
Acquisition-related charges |
2,334 | 3,553 | 5,176 | 7,312 | ||||||||||||
Share-based compensation expense |
19,312 | 17,749 | 38,171 | 38,173 | ||||||||||||
Non-GAAP operating income |
$238,553 | $263,037 | $161,068 | $187,548 | ||||||||||||
GAAP net income |
$145,362 | $182,973 | $86,432 | $137,169 | ||||||||||||
Amortization of purchased intangible assets |
2,583 | 2,763 | 4,891 | 5,712 | ||||||||||||
Acquisition-related charges |
2,334 | 3,553 | 5,176 | 7,312 | ||||||||||||
Share-based compensation expense |
19,312 | 17,749 | 38,171 | 38,173 | ||||||||||||
Gains on marketable equity securities |
| (3,027 | ) | (1,221 | ) | (7,294 | ) | |||||||||
Income tax effect of non-GAAP adjustments |
(8,663 | ) | (7,784 | ) | (17,095 | ) | (15,787 | ) | ||||||||
Exclusion of discrete tax items |
(368 | ) | 5,932 | 1,658 | 3,711 | |||||||||||
Discontinued operations |
| (27,726 | ) | | (39,533 | ) | ||||||||||
Non-GAAP net income |
$160,560 | $174,433 | $118,012 | $129,463 | ||||||||||||
GAAP diluted net income per share |
$0.40 | $0.50 | $0.24 | $0.38 | ||||||||||||
Amortization of purchased intangible assets |
0.01 | 0.01 | 0.01 | 0.02 | ||||||||||||
Acquisition-related charges |
0.01 | 0.01 | 0.01 | 0.02 | ||||||||||||
Share-based compensation expense |
0.05 | 0.05 | 0.11 | 0.10 | ||||||||||||
Gains on marketable equity securities |
| (0.01 | ) | | (0.02 | ) | ||||||||||
Income tax effect of non-GAAP adjustments |
(0.02 | ) | (0.03 | ) | (0.04 | ) | (0.05 | ) | ||||||||
Exclusion of discrete tax items |
| 0.02 | | 0.01 | ||||||||||||
Discontinued operations |
| (0.07 | ) | | (0.11 | ) | ||||||||||
Non-GAAP diluted net income per share |
$0.45 | $0.48 | $0.33 | $0.35 | ||||||||||||
Shares used in diluted per share amounts |
360,573 | 363,582 | 360,654 | 365,200 | ||||||||||||
See About Non-GAAP Financial Measures immediately preceding this Table B for information on these
measures, the items excluded from the most directly comparable GAAP measures in arriving at
non-GAAP financial measures, and the reasons management uses each measure and excludes the
specified amounts in arriving at each non-GAAP financial measure. All share and per share figures
in this Table B retroactively reflect our July 2006 two-for-one common stock split.
Table C
INTUIT INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
INTUIT INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
January 31, | July 31, | |||||||
2007 | 2006 | |||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$286,328 | $179,601 | ||||||
Investments |
849,228 | 1,017,599 | ||||||
Accounts receivable, net |
310,506 | 97,797 | ||||||
Income taxes receivable |
9,318 | 64,178 | ||||||
Deferred income taxes |
56,016 | 47,199 | ||||||
Prepaid expenses and other current assets |
100,824 | 53,357 | ||||||
Current assets before funds held for payroll customers |
1,612,220 | 1,459,731 | ||||||
Funds held for payroll customers |
411,774 | 357,299 | ||||||
Total current assets |
2,023,994 | 1,817,030 | ||||||
Property and equipment, net |
205,377 | 194,434 | ||||||
Goodwill, net |
555,023 | 504,991 | ||||||
Purchased intangible assets, net |
57,350 | 59,521 | ||||||
Long-term deferred income taxes |
135,358 | 144,697 | ||||||
Loans to executive officers and other employees |
8,865 | 8,865 | ||||||
Other assets |
48,032 | 40,489 | ||||||
Total assets |
$3,033,999 | $2,770,027 | ||||||
LIABILITIES AND STOCKHOLDERS EQUITY |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$120,300 | $70,808 | ||||||
Accrued compensation and related liabilities |
138,145 | 171,903 | ||||||
Deferred revenue |
295,463 | 293,113 | ||||||
Income taxes payable |
35,984 | 33,560 | ||||||
Other current liabilities |
189,328 | 89,291 | ||||||
Current liabilities before payroll customer fund deposits |
779,220 | 658,675 | ||||||
Payroll customer fund deposits |
411,774 | 357,299 | ||||||
Total current liabilities |
1,190,994 | 1,015,974 | ||||||
Long-term obligations |
18,378 | 15,399 | ||||||
Minority interest |
978 | 568 | ||||||
Stockholders equity |
1,823,649 | 1,738,086 | ||||||
Total liabilities and stockholders equity |
$3,033,999 | $2,770,027 | ||||||
Table D
INTUIT INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
INTUIT INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Three Months Ended | Six Months Ended | |||||||||||||||
January 31, | January 31, | January 31, | January 31, | |||||||||||||
2007 | 2006 | 2007 | 2006 | |||||||||||||
Cash flows from operating activities: |
||||||||||||||||
Net income |
$145,362 | $182,973 | $86,432 | $137,169 | ||||||||||||
Net income from discontinued operations |
| (27,726 | ) | | (39,533 | ) | ||||||||||
Net income from continuing operations |
145,362 | 155,247 | 86,432 | 97,636 | ||||||||||||
Adjustments to reconcile net income from continuing operations
to net cash provided by operating activities: |
||||||||||||||||
Depreciation |
21,061 | 22,616 | 43,336 | 45,761 | ||||||||||||
Acquisition-related charges |
2,334 | 3,553 | 5,176 | 7,312 | ||||||||||||
Amortization of purchased intangible assets |
2,583 | 2,763 | 4,891 | 5,712 | ||||||||||||
Amortization of other purchased intangible assets |
2,734 | 2,259 | 5,305 | 4,290 | ||||||||||||
Share-based compensation |
19,312 | 17,749 | 38,171 | 38,173 | ||||||||||||
Amortization of premiums and discounts on available-for-sale
debt securities |
1,071 | 972 | 1,961 | 2,066 | ||||||||||||
Net realized loss (gain) on sales of available-for-sale debt securities |
(9 | ) | 98 | (1 | ) | 478 | ||||||||||
Net gains on marketable equity securities and other investments |
| (3,027 | ) | (1,221 | ) | (7,294 | ) | |||||||||
Minority interest, net of tax |
335 | 244 | 550 | 244 | ||||||||||||
Deferred income taxes |
(6,552 | ) | (4,128 | ) | (9,399 | ) | (1,608 | ) | ||||||||
Tax benefit from share-based compensation plans |
12,634 | 26,554 | 29,430 | 29,076 | ||||||||||||
Excess tax benefit from share-based compensation plans |
(7,967 | ) | (12,446 | ) | (16,720 | ) | (13,385 | ) | ||||||||
Other |
68 | (40 | ) | 194 | (21 | ) | ||||||||||
Subtotal |
192,966 | 212,414 | 188,105 | 208,440 | ||||||||||||
Changes in operating assets and liabilities: |
||||||||||||||||
Accounts receivable |
(215,488 | ) | (245,772 | ) | (212,884 | ) | (232,851 | ) | ||||||||
Prepaid expenses, taxes and other current assets |
66,985 | 70,864 | 8,727 | 32,370 | ||||||||||||
Accounts payable |
22,619 | 28,937 | 48,970 | 59,602 | ||||||||||||
Accrued compensation and related liabilities |
47,436 | 43,917 | (33,726 | ) | (20,482 | ) | ||||||||||
Deferred revenue |
19,052 | (17,825 | ) | 2,273 | (23,062 | ) | ||||||||||
Income taxes payable |
18,415 | 8,343 | 2,702 | (8,428 | ) | |||||||||||
Other liabilities |
91,152 | 66,473 | 102,264 | 57,002 | ||||||||||||
Total changes in operating assets and liabilities |
50,171 | (45,063 | ) | (81,674 | ) | (135,849 | ) | |||||||||
Net cash provided by operating activities
of continuing operations |
243,137 | 167,351 | 106,431 | 72,591 | ||||||||||||
Net cash provided by operating activities of
discontinued operations |
| 3,109 | | 14,090 | ||||||||||||
Net cash provided by operating activities |
243,137 | 170,460 | 106,431 | 86,681 | ||||||||||||
Cash flows from investing activities: |
||||||||||||||||
Purchases of available-for-sale debt securities |
(479,703 | ) | (392,673 | ) | (880,578 | ) | (681,792 | ) | ||||||||
Liquidation of available-for-sale debt securities |
495,550 | 271,213 | 985,747 | 826,282 | ||||||||||||
Maturity of available-for-sale debt securities |
26,784 | 31,665 | 61,614 | 52,440 | ||||||||||||
Proceeds from the sale of marketable equity securities |
| 4,235 | 858 | 4,235 | ||||||||||||
Net change in funds held for payroll customers money
market funds and other cash equivalents |
24,438 | (78,576 | ) | (54,475 | ) | (66,170 | ) | |||||||||
Purchases of property and equipment |
(23,683 | ) | (22,855 | ) | (52,906 | ) | (47,912 | ) | ||||||||
Proceeds from sale of property |
22 | 334 | 22 | 334 | ||||||||||||
Change in other assets |
(2,026 | ) | (1,925 | ) | (6,704 | ) | (6,379 | ) | ||||||||
Net change in payroll customer fund deposits |
(24,438 | ) | 78,576 | 54,475 | 66,170 | |||||||||||
Acquisitions of businesses and intangible assets, net of cash acquired |
(1,991 | ) | (23,733 | ) | (61,993 | ) | (33,881 | ) | ||||||||
Net cash provided by (used in) investing activities
of continuing operations |
14,953 | (133,739 | ) | 46,060 | 113,327 | |||||||||||
Net cash provided by investing activities of
discontinued operations |
20,989 | 171,833 | 20,989 | 171,833 | ||||||||||||
Net cash provided by investing activities |
35,942 | 38,094 | 67,049 | 285,160 | ||||||||||||
Cash flows from financing activities: |
||||||||||||||||
Change in long-term obligations |
(874 | ) | (260 | ) | (1,315 | ) | (894 | ) | ||||||||
Net proceeds from issuance of common stock under stock plans |
41,299 | 126,083 | 124,197 | 147,551 | ||||||||||||
Purchase of treasury stock |
(205,373 | ) | (300,181 | ) | (205,373 | ) | (494,981 | ) | ||||||||
Excess tax benefit from share-based compensation plans |
7,967 | 12,446 | 16,720 | 13,385 | ||||||||||||
Net cash used in financing activities |
(156,981 | ) | (161,912 | ) | (65,771 | ) | (334,939 | ) | ||||||||
Effect of exchange rates on cash and cash equivalents |
(1,844 | ) | 1,090 | (982 | ) | 1,962 | ||||||||||
Net increase in cash and cash equivalents |
120,254 | 47,732 | 106,727 | 38,864 | ||||||||||||
Cash and cash equivalents at beginning of period |
166,074 | 74,974 | 179,601 | 83,842 | ||||||||||||
Cash and cash equivalents at end of period |
$286,328 | $122,706 | $286,328 | $122,706 | ||||||||||||
Table E
INTUIT INC.
RECONCILIATION OF FORWARD-LOOKING GUIDANCE FOR NON-GAAP FINANCIAL MEASURES
TO PROJECTED GAAP REVENUE, OPERATING INCOME (LOSS), AND EPS
(In thousands, except per share amounts)
(Unaudited)
INTUIT INC.
RECONCILIATION OF FORWARD-LOOKING GUIDANCE FOR NON-GAAP FINANCIAL MEASURES
TO PROJECTED GAAP REVENUE, OPERATING INCOME (LOSS), AND EPS
(In thousands, except per share amounts)
(Unaudited)
Forward-Looking Guidance | ||||||||||||||||||||||||
GAAP | Non-GAAP | |||||||||||||||||||||||
Range of Estimate | Range of Estimate | |||||||||||||||||||||||
From | To | Adjustments | From | To | ||||||||||||||||||||
Three Months Ending
April 30, 2007 |
||||||||||||||||||||||||
Revenue |
$ | 1,102,000 | $ | 1,132,000 | $ | | $ | 1,102,000 | $ | 1,132,000 | ||||||||||||||
Operating income |
$ | 527,000 | $ | 554,000 | $ | 45,000 | [a] | $ | 572,000 | $ | 599,000 | |||||||||||||
Operating margin |
48 | % | 49 | % | 4 | % | [a] | 52 | % | 53 | % | |||||||||||||
Diluted earnings per share |
$ | 0.94 | $ | 0.98 | $ | 0.11 | [b] | $ | 1.05 | $ | 1.09 | |||||||||||||
Shares |
354,000 | 356,000 | 354,000 | 356,000 | ||||||||||||||||||||
Three Months Ending
July 31, 2007 |
||||||||||||||||||||||||
Revenue |
$ | 405,000 | $ | 418,000 | $ | | $ | 405,000 | $ | 418,000 | ||||||||||||||
Diluted loss per share |
$ | (0.12 | ) | $ | (0.10 | ) | $ | 0.05 | [c] | $ | (0.07 | ) | $ | (0.05 | ) | |||||||||
Twelve Months Ending
July 31, 2007 |
||||||||||||||||||||||||
Revenue |
$ | 2,625,000 | $ | 2,675,000 | $ | | $ | 2,625,000 | $ | 2,675,000 | ||||||||||||||
Operating income |
$ | 585,000 | $ | 611,000 | $ | 140,000 | [d] | $ | 725,000 | $ | 751,000 | |||||||||||||
Operating margin |
23 | % | 23 | % | 5 | % | [d] | 28 | % | 28 | % | |||||||||||||
Diluted earnings per share |
$ | 1.10 | $ | 1.14 | $ | 0.23 | [e] | $ | 1.33 | $ | 1.37 | |||||||||||||
Shares |
357,000 | 359,000 | 357,000 | 359,000 |
See About Non-GAAP Financial Measures immediately preceding Table B for more information on these
measures, the items excluded from the most directly comparable GAAP measures in arriving at
non-GAAP financial measures, and the reasons management uses each measure and excludes the
specified amounts in arriving at each non-GAAP financial measure.
[a] | Reflects estimated adjustments for share-based compensation expense of approximately $21 million; amortization of purchased intangible assets of approximately $14 million; and acquisition-related charges of approximately $10 million. | |
[b] | Reflects the estimated adjustments in item [a] and income taxes related to these adjustments. | |
[c] | Reflects adjustments for share-based compensation expense of approximately $22 million; amortization of purchased intangible assets of approximately $14 million; acquisition-related charges of approximately $10 million; an adjustment for an expected net gain on the sale of certain assets related to our Complete Payroll and Premier Payroll Service businesses of approximately $14 million; and income taxes related to these adjustments. | |
[d] | Reflects estimated adjustments for share-based compensation expense of approximately $82 million; amortization of purchased intangible assets of approximately $33 million; and acquisition-related charges of approximately $25 million. | |
[e] | Reflects the estimated adjustments in item [d]; an adjustment for net gains on marketable equity securities and other investments of approximately $1 million; an adjustment for an expected net gain on the sale of certain assets related to our Complete Payroll and Premier Payroll Service businesses of approximately $14 million; and income taxes related to these adjustments. |