UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
_____________________
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date
of
Report (Date of earliest event reported): February
8, 2007
LivePerson,
Inc.
(Exact
Name of Registrant as Specified in its Charter)
|
Delaware
|
0-30141
|
13-3861628
|
|
(State
or other Jurisdiction
of
Incorporation)
|
(Commission
File Number)
|
(I.R.S.
Employer
Identification
No.)
|
|
462
Seventh Avenue, New York, New York
|
10018
|
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
|
Registrant’s
telephone number, including area code:
(212) 609-4200
|
|
_____________________
(Former
name or former address, if changed since last
report)
|
_____________________
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
|
o
|
Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
|
|
o
|
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
|
o
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
|
|
o
|
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
|
| Item 2.02. |
Results
of Operations and Financial
Condition.
|
A
copy of
the press release issued by LivePerson, Inc. on February 8, 2007, announcing
its
results of operations and financial condition for the quarter and year ended
December 31, 2006, is included herewith as Exhibit 99.1 and is incorporated
herein by reference. The information included in this Current Report on Form
8-K
(including Exhibit 99.1 hereto) that is furnished pursuant to this Item 2.02
shall not be deemed to be “filed” for the purposes of Section 18 of the
Securities Exchange Act of 1934, as amended, or otherwise subject to the
liabilities of that Section or Sections 11 and 12(a) (2) of the Securities
Act
of 1933, as amended. The information contained herein and in the accompanying
exhibit shall not be incorporated by reference into any filing of the
Registrant, whether made before or after the date hereof, regardless of any
general incorporation language in such filing, unless expressly incorporated
by
specific reference into such filing.
| Item 8.01. |
Other
Events.
|
The
press
release issued on February 8, 2007 also contained an announcement with respect
to a stock repurchase program. As part of the company's ongoing strategy to
enhance value to its stockholders, the company's Board of Directors continues
to
evaluate the most appropriate actions to best utilize LivePerson's excess cash
balances. Recognizing that historical volatility in the company's stock
price has on occasion resulted in prices at which the Board felt that the
company's stock was undervalued, the Board has approved a stock repurchase
program to give the company the ability to repurchase its shares, only if and
when such occasions arise in the future and it would be in the best interest
of
stockholders to do so. The stock repurchase program authorizes the company
to repurchase shares of its common stock, in the open market or privately
negotiated transactions, at times and prices considered appropriate by the
company depending upon prevailing market conditions and other corporate
considerations. The program limits the company to an aggregate purchase
price of $8 million. It is expected that repurchases, if any, would be completed
no later than the end of the first quarter of 2008.
| Item 9.01. |
Financial
Statements and Exhibits.
|
(d)
Exhibits. The following documents are included as exhibits to this
report:
99.1 Press
release issued February 8, 2007.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
|
LIVEPERSON,
INC.
(Registrant)
|
|
Date:
February 8, 2007
|
By:
|
/s/
TIMOTHY E. BIXBY
|
|
Timothy E. Bixby |
||
|
President,
Chief Financial Officer and
Secretary
|
EXHIBIT
INDEX
|
99.1
|
Press
release issued February 8, 2007.
|
For
Immediate Release
Media
Contacts:
|
Tim
Bixby
LivePerson,
Inc.
(212)
609-4200
bixby@liveperson.com
|
Budd
Zuckerman
Genesis
Select Corp.
(303)
415-0200
budd@genesisselect.com
|
LivePerson
Reports Fourth Quarter Revenue Increase of 64% to $10.3
million
| · |
Quarterly
Revenue Increases 16% from Prior
Quarter
|
| · |
Company
Expects Annual Revenue Growth of 45% in
2007
|
| · |
Announces
Stock Repurchase Program
|
NEW
YORK,
NY - February 8, 2007 - LivePerson, Inc. (Nasdaq: LPSN), a provider of online
conversion solutions, today announced financial results for the fourth quarter
ended December 31, 2006.
Revenue
for the fourth quarter was $10.3 million, a 64% increase from the fourth quarter
of 2005, and a 16% sequential increase versus the third quarter of 2006. Revenue
for the full year 2006 was $33.5 million, a 50% increase from $22.3 million
in
the prior year. Revenue growth was due primarily to expansion of existing
deployments of TimpaniTM
Sales
& Marketing, continuing strong sales of LivePerson Pro to small and mid-size
business customers, as well as the impact of the midyear acquisition of
Proficient Systems. Excluding the impact of Proficient in both the third and
fourth quarters, organic sequential quarterly revenue growth was approximately
15%.
“The
fourth quarter was a very strong finish for us,” CEO Robert LoCascio said. “It
capped off a terrific year where we delivered 50% revenue growth, solidified
our
position as a market leader in proactive online sales support and completed
the
acquisition of Proficient Systems.”
LivePerson
signed several new blue-chip clients during the quarter including Verizon
Wireless, Panasonic, Sandals & Beaches Resorts and Halifax Bank of Scotland,
and expanded business with several existing customers including Royal Bank
of
Scotland, Bluefly and one of the nation’s largest home improvement
retailers. With the expansion at Royal Bank of Scotland and the signing of
Halifax Bank of Scotland, LivePerson now counts two of the top five banks in
the
United Kingdom as customers.
Through
the acquisition of Proficient, the company solidified or expanded business
with
global leaders in technology services, internet networking and financial
services.
Net
income for the fourth quarter of 2006 was $1.2 million or $0.03 per share as
compared to net income of $1.1 million or $0.03 per share in the fourth quarter
of 2005, and net income of $0.3 million or $0.01 per share in the third quarter
of 2006. Net income for the year was $2.2 million or $0.05 per share, as
compared to $2.5 million or $0.06 per share in the prior year.
Included
in the net income for the three and twelve months ending December 31, 2006
is a
net tax benefit of $0.4 million, resulting from a partial release of the
company’s valuation allowance against deferred tax assets based on current
estimates of future taxable income.
Also
included in the net income figures for the three and twelve months ended
December 31, 2006 is the impact of amortization of stock-based compensation
expense of $0.6 million and $2.2 million respectively, related to the adoption
of SFAS No. 123(R). There was no stock-based compensation expense in the prior
year periods as the company was not required to adopt SFAS No. 123(R) until
January 1, 2006.
Earnings
before interest, taxes, depreciation, amortization and stock-based
compensation (EBITDA) for the fourth quarter of 2006 was $1.9 million as
compared to $1.3 million in the fourth quarter of 2005 and $1.3 million in
the
third quarter of 2006. EBITDA for the year was $5.3 million as compared to
$4.0
million in the prior year.
The
difference between EBITDA per share, a non-GAAP measure, and GAAP EPS, is
interest, taxes, depreciation, amortization and stock-based compensation. A
reconciliation of the differences between EBITDA and the most comparable
financial measure calculated and presented in accordance with generally accepted
accounting principles (GAAP) is located under the heading “Reconciliation of
Non-GAAP Financial Information to GAAP” immediately following the Condensed
Consolidated Statements of Income included in this press release.
LivePerson
considers EBITDA and cash from operations to be important financial indicators
of the company's operational strength and the performance of its business.
EBITDA should be considered in addition to results prepared in accordance with
GAAP, but should not be considered a substitute for, or superior to, GAAP
results. The non-GAAP measures included in this press release have been
reconciled to the nearest GAAP measure in the table below.
The
Company’s cash balance increased by $4.6 million or 27% to $21.7 million at
December 31, 2006 as compared to the prior year.
Financial
Expectations
The
company currently expects the following financial results:
| · |
Revenue
of $10.8-$10.9 million for the first quarter of
2007
|
| · |
EBITDA
of $0.05 per share and GAAP EPS of $0.02 for the first quarter of
2007
|
| · |
Revenue
of $48.5 - $49.5 million for the full year
2007
|
| · |
EBITDA
of $0.24 per share and GAAP EPS of $0.09 for the full year
2007
|
| · |
An
assumed effective tax rate of 42% for the full year
2007
|
These
GAAP EPS expectations already include the estimated impact of a change in
accounting policy related to adopting SFAS 123(R) as of January 1, 2006. This
change is expected to decrease net income per share by $0.08 and $0.02, for
the
full year 2007 and the first quarter of 2007, respectively. This impact may
change based upon additional stock option grants, if any, methodology refinement
or other factors.
Stock
Repurchase Program
As
part
of the company's ongoing strategy to enhance value to its stockholders, the
company's Board of Directors continues to evaluate the most appropriate actions
to best utilize LivePerson's excess cash balances. Recognizing that
historical volatility in the company's stock price has on occasion resulted
in
prices at which the Board felt that the company's stock was undervalued, the
Board has approved a stock repurchase program to give the company the ability
to
repurchase its shares, only if and when such occasions arise in the future
and
it would be in the best interest of stockholders to do so. The stock
repurchase program authorizes the company to repurchase shares of its common
stock, in the open market or privately negotiated transactions, at times and
prices considered appropriate by the company depending upon prevailing market
conditions and other corporate considerations. The program limits the
company to an aggregate purchase price of $8 million. It is expected that
repurchases, if any, would be completed no later than the end of the first
quarter of 2008.
|
LivePerson,
Inc.
|
||||||||||||
|
Condensed
Consolidated Statements of Income
|
||||||||||||
|
(In
Thousands, Except Share and Per Share Data)
|
||||||||||||
|
Unaudited
|
|
|
|
|
|
|
|
||||||||
|
|
|
Three
Months Ended
|
|
Year
Ended
|
|
||||||||
|
|
|
December
31,
|
|
December
31,
|
|
||||||||
|
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|||||
|
Total
revenue
|
$
|
10,347
|
$
|
6,316
|
$
|
33,521
|
$
|
22,277
|
|||||
|
Operating
expenses:
|
|||||||||||||
|
Cost
of revenue
|
2,376
|
1,300
|
7,621
|
4,297
|
|||||||||
|
Product
development
|
1,783
|
672
|
5,062
|
2,699
|
|||||||||
|
Sales
and marketing
|
3,258
|
2,086
|
11,864
|
6,975
|
|||||||||
|
General
and administrative
|
1,853
|
1,058
|
6,542
|
4,458
|
|||||||||
|
Amortization
of intangibles
|
472
|
232
|
1,383
|
931
|
|||||||||
|
Total
operating expenses
|
9,742
|
5,348
|
32,472
|
19,360
|
|||||||||
|
Income
from operations
|
605
|
968
|
1,049
|
2,917
|
|||||||||
|
Other
income, net
|
202
|
117
|
715
|
300
|
|||||||||
|
Income
before provision for income taxes
|
807
|
1,085
|
1,764
|
3,217
|
|||||||||
|
Benefit
from (provision for) income taxes
|
438
|
63
|
438
|
(675
|
)
|
||||||||
|
Net
income
|
$
|
1,245
|
$
|
1,148
|
$
|
2,202
|
$
|
2,542
|
|||||
|
Basic
net income per common share
|
$
|
0.03
|
$
|
0.03
|
$
|
0.06
|
$
|
0.07
|
|||||
|
Diluted
net income per common share
|
$
|
0.03
|
$
|
0.03
|
$
|
0.05
|
$
|
0.06
|
|||||
|
Weighted
average shares outstanding used in basic net
|
|||||||||||||
|
income
per common share calculation
|
40,979,922
|
37,750,875
|
39,680,182
|
37,557,722
|
|||||||||
|
Weighted
average shares outstanding used in diluted net
|
|||||||||||||
|
income
per common share calculation
|
44,591,617
|
40,616,738
|
43,345,232
|
39,885,328
|
|||||||||
|
LivePerson,
Inc.
|
||||||||||||
|
Reconciliation
of Non-GAAP Financial Information to GAAP
|
||||||||||||
|
(In
Thousands, Except Share and Per Share Data)
|
||||||||||||
|
Unaudited
|
Unaudited
Supplemental Data
The
following information is not a financial measure under generally accepted
accounting principles (GAAP). In addition, it should not be construed
as an
alternative to any other measures of performance determined in accordance
with
GAAP, or as an indicator of our operating performance, liquidity or cash
flows
generated by operating, investing and financing activities as there may
be
significant factors or trends that it fails to address. We present this
financial information because we believe that it is helpful to some investors
as
one measure of our operations. We caution investors that non-GAAP financial
information, by its nature, departs from traditional accounting conventions;
accordingly, its use can make it difficult to compare our results with
our
results from other reporting periods and with the results of other
companies.
|
Three
Months Ended
|
|
Year
Ended
|
|
|||||||||||
|
|
|
|
December
31,
|
|
December
31,
|
|
||||||||
|
|
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|||||
|
Net
income in accordance with generally
|
||||||||||||||
|
accepted
accounting principles
|
$
|
1,245
|
$
|
1,148
|
$
|
2,202
|
$
|
2,542
|
||||||
|
Add/(less):
|
||||||||||||||
|
(a)
Amortization
of intangibles
|
472
|
232
|
1,383
|
931
|
||||||||||
|
(b)
Stock-based
compensation
|
600
|
-
|
2,179
|
-
|
||||||||||
|
(c)
Depreciation/Loss
on disposal of fixed assets
|
216
|
56
|
666
|
171
|
||||||||||
|
(d)
Benefit
from (provision for) income taxes
|
(438
|
)
|
(63
|
)
|
(438
|
)
|
675
|
|||||||
|
(e)
Interest
income, net
|
(202
|
)
|
(117
|
)
|
(715
|
)
|
(300
|
)
|
||||||
|
EBITDA
(1)
|
$
|
1,893
|
$
|
1,256
|
$
|
5,277
|
$
|
4,019
|
||||||
|
Diluted
EBITDA per common share
|
$
|
0.04
|
$
|
0.03
|
$
|
0.12
|
$
|
0.10
|
||||||
|
Weighted
average shares used in diluted EBITDA
|
||||||||||||||
|
per
common share
|
44,591,617
|
40,616,738
|
43,345,232
|
39,885,328
|
||||||||||
|
EBITDA
|
$
|
1,893
|
$
|
1,256
|
$
|
5,277
|
$
|
4,019
|
||||||
|
Add/(less):
|
||||||||||||||
|
Changes
in operating assets and liabilities
|
(316
|
)
|
255
|
(2,025
|
)
|
263
|
||||||||
|
Provision
for doubtful accounts
|
8
|
-
|
38
|
30
|
||||||||||
|
Benefit
from (provision for) income taxes
|
438
|
63
|
438
|
(675
|
)
|
|||||||||
|
Tax
benefit from employee stock option exercises
|
-
|
(32
|
)
|
-
|
666
|
|||||||||
|
Interest
income, net
|
202
|
117
|
715
|
300
|
||||||||||
|
Net
cash provided by operating activities
|
$
|
2,225
|
$
|
1,659
|
$
|
4,443
|
$
|
4,603
|
||||||
|
(1)
Earnings before interest, taxes, depreciation, amortization and
stock-based compensation.
|
||||||||||||||||
|
LivePerson,
Inc.
|
|||||||
|
Condensed
Consolidated Balance Sheets
|
|||||||
|
(In
Thousands)
|
|||||||
|
Unaudited
|
|
December
31, 2006
|
December
31, 2005
|
||||||
|
ASSETS
|
|||||||
|
Current
assets:
|
|||||||
|
Cash
and cash equivalents
|
$
|
21,729
|
$
|
17,117
|
|||
|
Accounts
receivable, net
|
4,269
|
1,727
|
|||||
|
Prepaid
expenses and other current assets
|
1,317
|
591
|
|||||
|
Total
current assets
|
27,315
|
19,435
|
|||||
|
Property
and equipment, net
|
1,124
|
575
|
|||||
|
Intangibles,
net
|
2,640
|
790
|
|||||
|
Goodwill
|
7,865
|
-
|
|||||
|
Deferred
tax assets, net
|
1,580
|
-
|
|||||
|
Security
deposits
|
299
|
180
|
|||||
|
Other
assets
|
684
|
446
|
|||||
|
Total
assets
|
$
|
41,507
|
$
|
21,426
|
|||
|
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|||||||
|
Current
liabilities:
|
|||||||
|
Accounts
payable
|
$
|
813
|
$
|
346
|
|||
|
Accrued
expenses
|
3,754
|
1,803
|
|||||
|
Deferred
revenue
|
3,256
|
1,618
|
|||||
|
Deferred
tax liabilities, net
|
259
|
-
|
|||||
|
Total
current liabilities
|
8,082
|
3,767
|
|||||
|
Other
liabilities
|
684
|
446
|
|||||
|
Commitments
and contingencies
|
|||||||
|
Total
stockholders' equity
|
32,741
|
17,213
|
|||||
|
Total
liabilities and stockholders' equity
|
$
|
41,507
|
$
|
21,426
|
|||
About
LivePerson
LivePerson
(Nasdaq: LPSN) is a provider of online conversion solutions. Our hosted software
enables companies to identify and proactively engage online visitors—increasing
sales, satisfaction and loyalty while reducing service costs. Combining
web-interaction technology (chat, email, voice and a self-service knowledgebase)
with a deep understanding of consumer behavior and industry best practices,
LivePerson’s TimpaniTM
platform
engages the right customer, at the right time, with the right communications
channel. This Engagement Marketing platform creates more relevant, compelling
and personalized experiences—converting traffic into revenues, and facilitating
real-time sales and customer service. More than 5,000 companies including
EarthLink, Hewlett-Packard, Microsoft, Qwest and Verizon, rely on LivePerson
to
help maximize the return on their marketing and e-commerce investments.
LivePerson is headquartered in New York City.
EBITDA
Financial Disclosure
Investors
are cautioned that the EBITDA, or earnings before interest, taxes, depreciation,
amortization and stock-based compensation, information contained in this press
release is not a financial measure under generally accepted accounting
principles. In addition, it should not be construed as an alternative to any
other measures of performance determined in accordance with generally accepted
accounting principles, or as an indicator of our operating performance,
liquidity or cash flows generated by operating, investing and financing
activities, as there may be significant factors or trends that it fails to
address. We present this financial information because we believe that it is
helpful to some investors as one measure of our performance. We caution
investors that non-GAAP financial information such as EBITDA, by its nature,
departs from traditional accounting conventions; accordingly, its use can make
it difficult to compare our current results with our results from other
reporting periods and with the results of other companies.
Safe
Harbor Provision
Statements
in this press release regarding LivePerson that are not historical facts are
forward-looking statements and are subject to risks and uncertainties that
could
cause actual future events or results to differ materially from such statements.
Any such forward-looking statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. It is
routine for our internal projections and expectations to change as the quarter
progresses, and therefore it should be clearly understood that the internal
projections and beliefs upon which we base our expectations may change prior
to
the end of the quarter. Although these expectations may change, we are under
no
obligation to inform you if they do. Our company policy is generally to provide
our expectations only once per quarter, and not to update that information
until
the next quarter. Actual events or results may differ materially from those
contained in the projections or forward-looking statements. Some of the factors
that could cause actual results to differ materially from the forward-looking
statements contained herein include, without limitation: risks related to the
operational integration of acquisitions; risks related to our international
operations, particularly our operations in Israel, and the current civil and
political unrest in that region; our history of losses; potential fluctuations
in our quarterly and annual results; impairments to goodwill that result in
significant charges to earnings; responding to rapid technological change and
changing client preferences; competition in the real-time sales, marketing
and
customer service solutions market; continued use by our clients of the
LivePerson services and their purchase of additional services; technology
systems beyond our control and technology-related defects that could disrupt
the
LivePerson services; risks related to adverse business conditions experienced
by
our clients; our dependence on key employees; competition for qualified
personnel; the impact of new accounting rules, including the requirement to
expense stock options; the possible unavailability of financing as and if
needed; risks related to protecting our intellectual property rights or
potential infringement of the intellectual property rights of third parties;
our
dependence on the continued use of the Internet as a medium for commerce and
the
viability of the infrastructure of the Internet; and risks related to the
regulation or possible misappropriation of personal information. This list
is
intended to identify only certain of the principal factors that could cause
actual results to differ from those discussed in the forward-looking statements.
Readers are referred to the reports and documents filed from time to time by
us
with the Securities and Exchange Commission for a discussion of these and other
important risk factors that could cause actual results to differ from those
discussed in forward-looking statements.