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 11, 2009
LivePerson,
Inc.
(Exact
Name of Registrant as Specified in its Charter)
|
Delaware
|
0-30141
|
13-3861628
|
|
(State
or other Jurisdiction
of
Incorporation)
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(Commission
File Number)
|
(I.R.S.
Employer
Identification
No.)
|
|
462
Seventh Avenue, New York, New York
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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
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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|
o
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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. (the “Registrant”) on February 11,
2009, announcing its results of operations and financial condition for the
quarter and year ended December 31, 2008, 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
9.01. Financial
Statements and Exhibits.
(d)
Exhibits. The following documents are included as exhibits to this
report:
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99.1
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Press
release issued February 11, 2009.
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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 11, 2009
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By:
|
/s/ TIMOTHY E. BIXBY | |
|
Timothy
E. Bixby
|
|||
|
President
and Chief Financial Officer
|
|||
EXHIBIT
INDEX
|
99.1
|
Press
release issued February 11, 2009.
|
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 2008 Financial Results
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·
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Quarterly revenue increases 17%
from prior year
|
|
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·
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Full year revenue increases 43%
from prior year
|
|
|
·
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Business operations revenue
grows 30% from prior year, and 3% from prior
quarter
|
|
|
·
|
EBITDA per share is $0.07 for
fourth quarter, $0.20 for full
year
|
NEW YORK,
NY – February 11, 2009 – LivePerson, Inc. (Nasdaq: LPSN), a leading provider of
online communication platforms that facilitate real-time assistance and expert
advice, today announced financial results for the fourth quarter and full year
ended December 31, 2008.
Revenue
Revenue
for the fourth quarter was $19.6 million, a 17% increase from the fourth quarter
of 2007, and a 1% sequential increase as compared to the third quarter of 2008.
Revenue from business operations for the fourth quarter was $17.2 million, a 23%
increase from the fourth quarter of 2007, and a 3% sequential increase as
compared to the third quarter of 2008.
Revenue
for the full year was $74.7 million, a 43% increase from 2007. Revenue from
business operations for the year was $64.1 million, a 30% increase from
2007.
As a
result of the significant deterioration of the company’s market capitalization
in the fourth quarter of 2008, the company reevaluated goodwill related to its
consumer operations. Due to weaker than expected financial
performance of these operations in the latter portion of 2008, the company
recorded a non-cash goodwill impairment charge of $23.5 million or $0.50 per
share. The charge is a non-cash item, and therefore had no impact on
the company’s cash flows.
“While a
tough external economic environment has made our growth targets more difficult
to reach, our performance against cost control targets in the fourth quarter was
strong and has created a firm foundation to build upon in 2009,” CEO Robert
LoCascio said. “With gross margin improvement for the third consecutive quarter
and record quarterly EBITDA, we continue to see impressive operating
improvements.”
Client
and Partner Expansion
LivePerson
added several new clients, including:
|
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·
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ShopNBC.com
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·
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a
global leader in consumer
electronics
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|
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·
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TMobile
UK
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|
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·
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the
world’s largest online florist and gift
shop
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The
company expanded business with customers, including:
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·
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Panasonic
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·
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the
worlds leading provider of networking
equipment
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·
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the
leading online photo service
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|
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·
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a
leading global financial lending and services
company
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|
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·
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the
world’s largest home improvement
retailer
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Net
Income/Loss
Net loss
for the fourth quarter of 2008 was $23.8 million or $0.50 per share as compared
to net income of $2.4 million or $0.05 per share in the fourth quarter of 2007,
and net income of $0.4 million or $0.01 per share in the third quarter of
2008. Net loss for the full year was $23.8 million or $0.50 per share
as compared to net income of $5.8 million or $0.12 per share in
2007. Net loss in both the fourth quarter and the full year of 2008
included the impact of the goodwill impairment of $23.5 million or $0.50 per
share, and a tax provision of $1.2 million, or $0.03 per share.
Adjusted
Net Income and EBITDA
LivePerson
considers adjusted net income and earnings before interest, taxes, depreciation
and amortization (EBITDA) to be important financial indicators of the company's
operational strength and the performance of its business. These results should
be considered in addition to results prepared in accordance with generally
accepted accounting principles (GAAP), but should not be considered as a
substitute for, or superior to, GAAP results.
A
reconciliation of the differences between EBITDA and adjusted net income, and
the most comparable financial measure calculated and presented in accordance
with GAAP, is presented under the heading “Reconciliation of Non-GAAP Financial
Information to GAAP” immediately following the Condensed Consolidated Statements
of Operations included below.
The
difference between EBITDA per share, a non-GAAP measure, and GAAP EPS, is
interest, taxes, depreciation, amortization, stock-based compensation and other
non-cash charges, if any. The difference between adjusted net income
per share and GAAP EPS is amortization of intangible assets and stock-based
compensation.
Adjusted
net income, excluding the impact of the goodwill impairment, for the fourth
quarter of 2008 was $1.3 million or $0.03 per share, as compared to $4.4 million
or $0.09 per share in the comparable period in 2007, and $2.1 million or $0.04
per share in the third quarter of 2008. Adjusted net income,
excluding the impact of the goodwill impairment, for the full year was $6.6
million or $0.14 per share, as compared to $11.5 million or $0.25 per share in
2007.
EBITDA
for the fourth quarter of 2008 was $3.5 million or $0.07 per share, as compared
to $2.8 million or $0.06 per share in the fourth quarter of 2007, and $2.7
million or $0.05 per share in the third quarter of
2008. EBITDA for the full year was $9.9 million or $0.20
per share, as compared to $9.7 million or $0.21 per share in 2007.
Cash
The
company’s cash balance was $25.5 million at December 31, 2008 as compared to
$23.8 million as of September 30, 2008. The company generated $1.7
million from operations in the fourth quarter. Also during the fourth
quarter, the company incurred planned capital expenditures related primarily to
the purchase of servers and computer networking equipment, resulting in a cash
outlay of approximately $1.4 million. For the full year, capital
expenditures were $6.8 million.
Financial
Expectations
First Quarter
2009
|
|
·
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Revenue
of $19.5 - $20.0 million
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·
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EBITDA
of $0.05 - $0.06 per share
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·
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GAAP
EPS of $0.00 - $0.01
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·
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Fully
diluted share count of approximately 49
million
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Full Year
2009
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·
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Revenue
of $84 - $86 million
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·
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EBITDA
of $0.23 - $0.27 per share
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·
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GAAP
EPS of $0.04 - $0.05
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·
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Fully
diluted share count of approximately 49
million
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Other
Full Year 2009 Assumptions
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·
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Amortization
of intangibles of approximately $2.0
million
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·
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Stock-compensation
expense of approximately $4.3
million
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·
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Depreciation
of approximately $3.7 million
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·
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Effective
tax rate of approximately 65%
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·
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Cash
tax rate of approximately 40%
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·
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Capital
expenditures of approximately $7.0 - $9.0
million
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Stock-Based
Compensation
Included
in the accompanying financial results are expenses related to stock-based
compensation, as follows (in thousands):
|
Q4 2008
|
||||
|
Cost
of revenue
|
$ | 137 | ||
|
Product
development
|
271 | |||
|
Sales
and marketing
|
369 | |||
|
General
and administrative
|
311 | |||
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Total
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$ | 1,088 |
Amortization
of Intangible Assets
Included
in the accompanying financial results are expenses related to the amortization
of intangible assets, as follows (in thousands):
|
Q4 2008
|
||||
|
Cost
of revenue
|
$ | 307 | ||
|
General
and administrative
|
272 | |||
|
Total
|
$ | 579 |
LivePerson, Inc.
Condensed Consolidated Statements of
Operations
(In Thousands, Except Share and Per
Share Data)
Unaudited
|
Three Months
Ended
|
Twelve Months
Ended
|
|||||||||||||||
|
December
31,
|
December
31,
|
|||||||||||||||
|
2008
|
2007
|
2008
|
2007
|
|||||||||||||
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Revenue
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$ | 19,607 | $ | 16,775 | $ | 74,655 | $ | 52,228 | ||||||||
|
Operating
expenses:
|
||||||||||||||||
|
Cost of
revenue
|
4,960 | 4,335 | 20,307 | 13,534 | ||||||||||||
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Product
development
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3,023 | 2,999 | 12,899 | 9,032 | ||||||||||||
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Sales and
marketing
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7,260 | 5,654 | 26,124 | 16,124 | ||||||||||||
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General and
administrative
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3,009 | 2,857 | 13,042 | 9,208 | ||||||||||||
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Amortization of
intangibles
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272 | 390 | 1,407 | 1,116 | ||||||||||||
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Goodwill
impairment
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23,501 | - | 23,501 | - | ||||||||||||
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Total operating
expenses
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42,025 | 16,235 | 97,280 | 49,014 | ||||||||||||
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(Loss) income from
operations
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(22,418 | ) | 540 | (22,625 | ) | 3,214 | ||||||||||
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Other (expense) income,
net
|
(192 | ) | 153 | (47 | ) | 896 | ||||||||||
|
(Loss) income before provision for
(benefit from) income taxes
|
(22,610 | ) | 693 | (22,672 | ) | 4,110 | ||||||||||
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Provision for (benefit from)
income taxes
|
1,234 | (1,711 | ) | 1,165 | (1,711 | ) | ||||||||||
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Net (loss)
income
|
$ | (23,844 | ) | $ | 2,404 | $ | (23,837 | ) | $ | 5,821 | ||||||
|
Basic net (loss) income per common
share
|
$ | (0.50 | ) | $ | 0.05 | $ | (0.50 | ) | $ | 0.13 | ||||||
|
Diluted net (loss) income per
common share
|
$ | (0.50 | ) | $ | 0.05 | $ | (0.50 | ) | $ | 0.12 | ||||||
|
Weighted average shares
outstanding used in basic net
|
||||||||||||||||
|
(loss) income per common share
calculation
|
47,411,354 | 47,336,618 | 47,428,251 | 43,696,378 | ||||||||||||
|
Weighted average shares
outstanding used in diluted net
|
||||||||||||||||
|
(loss) income per common share
calculation
|
47,411,354 | 50,384,112 | 47,428,251 | 46,814,080 | ||||||||||||
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
|
Twelve Months
Ended
|
|||||||||||||||
|
December
31,
|
December
31,
|
|||||||||||||||
|
2008
|
2007
|
2008
|
2007
|
|||||||||||||
|
Net (loss) income in accordance
with generally
|
||||||||||||||||
|
accepted accounting
principles
|
$ | (23,844 | ) | $ | 2,404 | $ | (23,837 | ) | $ | 5,821 | ||||||
|
Add/(less):
|
||||||||||||||||
|
(a) Goodwill
impairment
|
23,501 | - | 23,501 | - | ||||||||||||
|
(b) Amortization of
intangibles
|
579 | 793 | 2,634 | 1,772 | ||||||||||||
|
(c) Stock-based
compensation
|
1,088 | 1,240 | 4,266 | 3,881 | ||||||||||||
|
(d) Depreciation
|
768 | 217 | 2,093 | 802 |
|
|||||||||||
|
(e) Provision for (benefit from)
income taxes
|
1,234 | (1,711 | ) | 1,165 | (1,711 | ) | ||||||||||
|
(f) Other expense (income),
net
|
192 | (153 | ) | 47 | (896 | ) | ||||||||||
|
EBITDA (1), excluding goodwill
impairment
|
$ | 3,518 | $ | 2,790 | $ | 9,869 | $ | 9,669 | ||||||||
|
Diluted EBITDA per common
share
|
$ | 0.07 | $ | 0.06 | $ | 0.20 | $ | 0.21 | ||||||||
|
Weighted average shares used in
diluted EBITDA
|
||||||||||||||||
|
per common
share
|
48,116,364 | 50,384,112 | 48,573,455 | 46,814,080 | ||||||||||||
|
Net (loss) income in accordance
with generally
|
||||||||||||||||
|
accepted accounting
principles
|
$ | (23,844 | ) | $ | 2,404 | $ | (23,837 | ) | $ | 5,821 | ||||||
|
Add:
|
||||||||||||||||
|
(a) Goodwill
impairment
|
23,501 | - | 23,501 | - | ||||||||||||
|
(b) Amortization of
intangibles
|
579 | 793 | 2,634 | 1,772 | ||||||||||||
|
(c) Stock-based
compensation
|
1,088 | 1,240 | 4,266 | 3,881 | ||||||||||||
|
Adjusted net income, excluding
goodwill impairment
|
$ | 1,324 | $ | 4,437 | $ | 6,564 | $ | 11,474 | ||||||||
|
Diluted adjusted net income per
common share
|
$ | 0.03 | $ | 0.09 | $ | 0.14 | $ | 0.25 | ||||||||
|
Weighted average shares used in
diluted adjusted net income
|
||||||||||||||||
|
per common
share
|
48,116,364 | 50,384,112 | 48,573,455 | 46,814,080 | ||||||||||||
|
EBITDA, excluding
impairment
|
$ | 3,518 | $ | 2,790 | $ | 9,869 | $ | 9,669 | ||||||||
|
Add/(less):
|
||||||||||||||||
|
(a) Changes in operating assets and
liabilities
|
703 | 1,184 | 364 | 1,594 | ||||||||||||
|
(b) Provision for doubtful
accounts
|
80 | 30 | 148 | 103 | ||||||||||||
|
(c) (Provision for) benefit from
income taxes
|
(1,234 | ) | 1,711 | (1,165 | ) | 1,711 | ||||||||||
|
(d) Deferred income
taxes
|
(1,145 | ) | (1,459 | ) | (1,184 | ) | (4,980 | ) | ||||||||
|
(e) (Other expense) income,
net
|
(192 | ) | 153 | (47 | ) | 896 | ||||||||||
|
Net cash provided by operating
activities
|
$ | 1,730 | $ | 4,409 | $ | 7,985 | $ | 8,993 | ||||||||
|
(1)
|
Earnings before interest, taxes,
depreciation, amortization and stock-based
compensation.
|
LivePerson, Inc.
Condensed Consolidated Balance
Sheets
(In Thousands)
Unaudited
|
December
31,
2008 |
December
31,
2007 |
|||||||
|
ASSETS
|
||||||||
|
Current
assets:
|
||||||||
|
Cash and cash
equivalents
|
$ | 25,500 | $ | 26,222 | ||||
|
Accounts receivable,
net
|
7,574 | 6,026 | ||||||
|
Prepaid expenses and other current
assets
|
1,853 | 1,802 | ||||||
|
Deferred tax assets,
net
|
1,772 | 42 | ||||||
|
Total current
assets
|
36,699 | 34,092 | ||||||
|
Property and equipment,
net
|
7,473 | 3,733 | ||||||
|
Intangibles,
net
|
4,319 | 6,953 | ||||||
|
Goodwill
|
24,388 | 51,684 | ||||||
|
Deferred tax assets,
net
|
7,330 | 4,202 | ||||||
|
Security
deposits
|
349 | 499 | ||||||
|
Other
assets
|
1,390 | 1,325 | ||||||
|
Total
assets
|
$ | 81,948 | $ | 102,488 | ||||
|
LIABILITIES AND STOCKHOLDERS'
EQUITY
|
||||||||
|
Current
liabilities:
|
||||||||
|
Accounts
payable
|
$ | 3,555 | $ | 3,067 | ||||
|
Accrued
expenses
|
9,088 | 9,191 | ||||||
|
Deferred
revenue
|
4,332 | 4,000 | ||||||
|
Deferred tax liabilities,
net
|
- | 193 | ||||||
|
Total current
liabilities
|
16,975 | 16,451 | ||||||
|
Other
liabilities
|
1,390 | 1,325 | ||||||
|
Commitments and
contingencies
|
||||||||
|
Total stockholders'
equity
|
63,583 | 84,712 | ||||||
|
Total liabilities and
stockholders' equity
|
$ | 81,948 | $ | 102,488 | ||||
About
LivePerson
LivePerson,
founded in 1995 and headquartered in New York City, is a leading provider of
online communication platforms that facilitate real-time assistance and expert
advice. Intelligently connecting businesses and individual experts with
consumers seeking help on the Web, LivePerson’s platforms create more relevant,
compelling and personalized online experiences. Every month, millions of people
turn to LivePerson to get the information and advice they need to succeed
online. More than 7,000 companies, including EarthLink, Hewlett-Packard,
Microsoft, Qwest, and Verizon, and 30,000 individual experts rely on LivePerson
to maximize the impact of the online channel.
Non-GAAP
Financial Disclosure
Investors
are cautioned that the EBITDA, or earnings before interest, taxes, depreciation,
amortization and stock-based compensation, and adjusted net income, or net
income excluding amortization of intangible assets and stock-based compensation,
information contained in this press release are not financial measures under
generally accepted accounting principles. In addition, they should not be
construed as alternatives to any other measures of performance determined in
accordance with generally accepted accounting principles, or as indicators of
our operating performance, liquidity or cash flows generated by operating,
investing and financing activities, as there may be significant factors or
trends that they fail to address. We present this financial information because
we believe that it is helpful to some investors as a measure of our performance.
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 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
and year progresses, and therefore it should be clearly understood that the
internal projections and beliefs upon which we base our expectations may change.
Although these expectations may change, we are under no obligation to inform you
if they do. 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 increased
operations in the direct-to-consumer market; risks related to our international
operations, particularly our operations in Israel, and the civil and political
unrest in that region; volatility of the value of certain currencies in relation
to the US dollar, particularly the New Israeli Shekel, U.K. pound and
Euro; 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, customer service and
online engagement 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.