Press Releases

November 10, 2016

Determine Announces 2nd Quarter Fiscal Year 2017 Financial Results

CARMEL, IN November 10, 2016 – Determine, Inc. (NASDAQ: DTRM), a leading global provider of SaaS enterprise Source to Pay and Enterprise Contract Lifecycle Management, including cloud-based strategic sourcing, supplier management, contract management and procure-to-pay solutions, announced financial results for its second fiscal quarter ended September 30, 2016.

Q2 FY2017 GAAP Financial Highlights:

  • GAAP revenue was $6.6 million in Q2 FY2017, compared to $6.8 million in Q2 FY2016, representing a 2.7% decrease year-over-year, and compared to $6.5 million in Q1 FY2017 GAAP revenue, representing a 1.4% quarter-over-quarter increase.
  • GAAP gross profit percentage decreased to 47.7% in Q2 FY2017, compared to 51.8% in Q2 FY2016, representing a year-over-year decrease of 4.1 percentage points, and compared to 52.1% in Q1 FY2017.
  • Deferred revenues increased 12.3% to $9.3 million in Q2 FY2017 from $8.3 million in Q2 FY2016.
  • GAAP net loss was $3.2 million or ($0.28) per share in Q2 FY2017, compared to $3.4 million or ($0.32) per share in Q2 FY2016, representing a $0.04 improvement per share year-over-year; in Q1 FY2017 the GAAP net loss was $2.3 million or ($0.21) per share.
(in thousands, except per share amounts)
GAAP Q1 Q4 Q1 Change Change Six Months
Financial Measures FY 2017 FY 2017 FY 2016 Q/Q Y/Y FY 2017′ FY 2016′ Change Y/Y
Revenue – total $6,584 $6,492 $6,765 1.4% -2.7% 13,076 12,980 0.7%
Revenue – recurring $5,145 $5,068 $5,413 1.5% -4.9% 10,213 10,508 (2.8%)
Revenue – non-recurring $1,439 $1,424 $1,352 1.1% 6.5% 2,863 2,472 15.8%
Gross profit – total $3,138 $3,385 $3,505 -7.3% -10.5% 6,523 6,811 (4.2%)
Gross profit – recurring $3,442 $3,462 $3,656 -0.6% -5.9% 6,903 7,321 (5.7%)
Gross profit/(loss) – non-recurring $(304) $(77) $(151) -295.7% -101.2% (381) (510) 25.4%
Gross margin – total 47.7% 52.1% 51.8% (4.6 pts) (4.1 pts) 49.9% 52.5% (2.6 pts)
Gross margin – recurring 66.9% 68.3% 67.5% (1.6 pts) (0.7 pts) 67.6% 69.7% (2.1 pts)
Gross margin – non recurring (21.1%) (5.4%) (11.2%) (15.7 pts) (9.9 pts) -13.3% -20.6% 7.3 pts
Net loss $(3,207) $(2,342) $(3,425) (36.9%) 6.4% $(5,550) $(6,368) 12.9%
EPS $(0.28) $(0.21) $(0.32) $(0.07) $0.04 $(0.48) $(0.66) $0.17

Q2 FY2017 Non-GAAP Financial Highlights:

  • Non-GAAP revenue was $6.6 million in Q2 FY2017, compared to $6.8 million in Q2 FY2016, representing a 3.8% decrease year-over-year, and compared to $6.5 million in Q1 FY2017, representing a 1.3% quarter-over-quarter increase.
  • Non-GAAP gross profit percentage was 52.5% in Q2 FY2017, compared to 57.5% in Q2 FY2016, representing a 5.0 percentage point decrease, and compared to 57.1% in Q1 FY2017.
  • Non-GAAP net loss was $2.0 million or ($0.17) per share in Q2 FY2017, compared to $1.6 million or ($0.15) per share in Q2 FY2016, representing an additional ($0.02) loss per share year-over-year, compared to $1.3 million or ($0.11) per share in Q1 FY2017, representing an additional loss of ($0.06) per share quarter-over-quarter.
  • Billings decreased 15.6% to $5.8 million in Q2 FY2017 from $6.8 million in Q2 FY2016. Billings, a non-GAAP measure, are defined as revenues plus the change in deferred revenues.
(in thousands, except per share amounts)
Non-GAAP Q1 Q4 Q1 Change Change Six Months
Financial Measures FY 2017 FY 2017 FY 2016 Q/Q Y/Y FY 2017′ FY 2016′ Change Y/Y
Revenue – total $6,584 $6,500 $6,843 1.3% (3.8%) 13,084 13,121 (0.3%)
Revenue – recurring $5,145 $5,076 $5,463 1.4% (5.8%) 10,221 10,621 (3.8%)
Revenue – non-recurring $1,439 $1,424 $1,380 1.1% 4.3% 2,863 2,500 14.6%
Gross profit – total $3,460 $3,710 $3,934 (6.7%) (12.0%) 7,170 7,542 (4.9%)
Gross profit – recurring $3,710 $3,737 $3,962 (0.7%) (6.4%) 7,447 7,877 (5.5%)
Gross profit/(loss) – non-recurring $(250) $(27) $(28) (837.9%) (780.3%) (277) (335) 17.5%
Gross margin – total 52.5% 57.1% 57.5% (4.6 pts) (5.0 pts) 54.8% 57.5% (2.7 pts)
Gross margin – recurring 72.1% 73.6% 72.5% (1.5 pts) (0.4 pts) 72.9% 74.2% (1.3 pts)
Gross margin – non recurring (17.4%) (1.9%) (2.1%) (15.5 pts) (15.3 pts) -9.7% -13.4% 3.7 pts
Net loss $(1,959) $(1,284) $(1,563) (52.6%) (25.3%) $(3,243) $(3,082) (5.2%)
EPS $(0.17) $(0.11) $(0.15) $(0.06) $(0.02) $(0.28) $(0.32) $0.04
Billings $5,770 $6,280 $6,836 (8.1%) (15.6%) $12,050 $12,867 (6.4%)

This quarter we are pleased by both our quarter-over-quarter revenue growth as well as the market’s building excitement for our new, disruptive Determine Cloud Platform offering,” said Patrick Stakenas, President and CEO of Determine.“We have redeployed assets internally to fund accelerated platform development, while continuing to drive business efficiencies by aggressively managing expenses. We exited this transition quarter with annualized bookings results in line with expectations and are optimistically looking ahead. The sales pipeline strength, as well as customer and market analyst enthusiasm for the Determine Cloud Platform, puts us in a strong position to accelerate sales in the coming quarters.”

Q2 FY2017 Business Highlights:

  • Determine Unveils the “Future of Source to Pay and Enterprise Contract Lifecycle Management” with our Determine Cloud Platform:During Q2 FY2017, Determine introduced our new Determine Cloud Platform features including a modernized Google-like User Interface (UI) and User Experience (UX), multi-level workflows, improved Apple and Android mobile apps, and self-service contract management. The new features provide an advanced, intuitive workflow and ease of use for our end users to improve collaboration and effective time management across their overall organization.
  • Determine’s Contract Lifecycle Management Ranked as a Strong Performer by Forrester Research, Inc.:In Q2 FY2017, The Forrester Wave™: Contract Life-Cycle Management, Q3 2016, “The 14 CLM Vendors That Matter Most and How They Stack Up,” announced that Determine’s Contract Management solution ranked as a strong performer, especially in contract approval. The latest Determine Cloud Platform contract management solution adds more robust capabilities, including an intuitive UI/UX, unified master data and self-service templates.
  • New Customer and Customer Expansions:During Q2 FY2017, the company engaged numerous new customer accounts in the US and Europe across its Determine SaaS suite of Source to Pay and Enterprise Contract Lifecycle Management solutions. The company added and expanded customers in key verticals including: car rental, financial, healthcare, hospitality, medical equipment, industrial services, industrial machinery and equipment, manufacturing and retail.
  • Annualized Bookings:Consistent with expectations during the transition period, in Q2 FY2017, the sales team delivered approximately $750,000 in annualized bookings.
  • Thought Leadership:In Q2 FY2017, Determine continued to provide meaningful educational resources to inform our customers and prospects on the ever-changing Source to Pay and Enterprise Contract Lifecycle Management landscape. The company held a well-attended webinar addressing “What Procurement Organizations Need Most – Flexibility and Agility” presented by Joanna Martinez, former CPO, Cushman & Wakefield, Vishal Patel, Director, Solutions Marketing, Tradeshift and Constantine LImberakis, VP Product Marketing, Determine. The company discussed the procurement organization’s role in enabling enterprises to be more responsive, adaptable and agile in today’s uncertain and competitive environment. In addition to the webinar, the company published a sponsored white paper with Ardent Partners on The Rise of Analytics for Procurement and many blogs topics from third party risk management to legal’s view on EU-US data protection.

Conference Call and Webcast: Thursday, November 10, 2016 at 5:00 PM Eastern Time

Participant Conference Call Numbers:
Toll-Free: 1-877-407-0789
Toll/International: 1-201-689-8562
Participant Webcast Link: http://public.viavid.com/index.php?id=121489

Replay Dial-in Information:

Toll-Free: 1-844-512-2921
Toll/International: 1-412-317-6671
From: 11/10/16 @ 8:00 pm Eastern Time
To: 11/17/16 @ 11:59 pm Eastern Time
Replay Pin Number: 13647597
Related: http://investor.determine.com

Supporting Resources

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About Determine, Inc.

Determine, Inc. (NASDAQ: DTRM) is a leading global provider of SaaS Source to Pay and Enterprise Contract Lifecycle Management (ECLM) solutions. Our visionary technologies allow our customers to effectively manage the full scope of Source to Pay and ECLM using our Determine Cloud Platform. Our Source to Pay software suite includes strategic sourcing, supplier management, contract management and procure-to-pay applications.

The Determine Cloud Platform gives procurement, finance and legal professionals the ability to deliver profound insights through analysis of their supplier relationships and contractual requirements. Our customers leverage the Determine Cloud Platform to discover previously unseen supplier and spend data; make more informed and smarter business decisions; drive new revenue; control costs; improve workflow efficiencies; and mitigate risk.

Our customers benefit from the Determine Cloud Platform’s robust suite of integrated applications. Whether they start with a full-suite implementation or choose to implement just one application and build over time, each additional application allows for the automatic sharing of data already in place on the Determine Cloud Platform.

For more information, please visit: www.determine.com.

Contact

Media Relations:
Rose Lee
Determine Inc.
+1.650.532.1590
pr@determine.com

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