ANGOSS REPORTS FOURTH QUARTER AND FISCAL 2010 RESULTS

Billed Revenues outside of Canada Delivers Significant Growth as Company Continues Focus on Cloud Based Sales & Marketing Predictive Analytic Solutions

TORONTO, Feb. 9 /CNW/ - Angoss Software Corporation (Angoss) (TSX-V: ANC) a leading provider of predictive analytics software and solutions, today announced unaudited results for the fourth quarter and fiscal year ended November 30, 2010.

In 2010, billed revenue of $8,560,154 was up 0.9% from 2009 billed revenue of $8,482,925.  2010 billed fourth quarter revenue of $2,582,636 was down 3.4% from 2009 billed fourth quarter revenue of $2,672,242

In 2010, earned revenue of $7,922,046 was down 7.6% from 2009 revenue of $8,572,308.  2010 earned fourth quarter revenue of $1,827,942 was down 18.4% from 2009 earned fourth quarter revenue of $2,239,017

The decline in earned revenue was primarily the result of a decline in revenue in Canada.  The Canadian decline was attributed to the solutions business area. In Canada, the Company embarked on a strategy to sell longer term subscription contracts designed to replaced traditional Canadian solution revenue that has generally focused on short-term, transaction based consulting projects in which revenue was billed and earned over three months. The US subscription contracts are generally billed and then recognized over 12 months but also tend to have longer sales cycles. This changing focus and different revenue model resulted in lower 2010 earned revenues and an increase in deferred revenues. As the Company continues to grow revenue outside Canada, foreign exchange continues to have an impact.  In 2010, the year over year decline in the weighted average of US dollar and UK sterling were 9.5% and 10.5% respectively.

The following table highlights 2010 billings by region in local currencies.

Billed Revenue in local currency   2010   2009   % Change
             
US billings in $US   $ 5,342,873   $ 4,194,063   27.4%
Canadian billings in $CN   $ 2,146,495   $ 2,815,745   -23.8%
UK billings-in £   £ 519,332   £491,747   5.6%

In 2010, the Company reported a net loss of $1,404,252 ($0.19 per share) compared with 2009 net loss of $63,398 ($0.01 per share).  The 2010 net loss reflects the previously mentioned $650,000 decline in earned revenue coupled with one-time special charges of $516,000 and a 17% increase in R&D expenses.

The 2010 fourth quarter net loss was $1,004,637 compared with the 2009 loss of $66,184 for the same period.  The 2010 fourth quarter net loss reflects a $411,000 decline in earned revenue coupled with one-time special charges of $516,000 and a general increase in all operating expenses.

Cash flow provided by operating activities in 2010 was $772,573 compared to $889,312 in 2009.  At November 30, 2010, cash and cash equivalents were $1,325,546 (2009 - $1,523,663).

"Software sales continue to show solid growth and we see continued demand for our products.  From desktop and server based solutions to in-database predictive analytics, Angoss offers highly competitive and scalable alternatives" commented Angoss CFO Lon Vining.  "As we continue to transition our Software as a Solution (SaaS) business from short-term projects to subscription, cloud based contracts, growth in earned revenue and net income will be affected.  We are focused on signing annual, recurring, subscription agreements with corresponding growth of deferred revenue.  Cash flow, driven by billed revenues, continues to be monitored closely as we continue to invest in our cloud based solutions."

"While the overall financial results for the year are disappointing, the billed revenue growth in the United States is encouraging.  Customer loyalty remains strong, as evidenced by a very high renewal rate for existing licenses," commented John Gardner, Chairman.  "We feel confident as we enter the 2011 fiscal year that the Company has made the necessary management changes that will strengthen our marketing and sales focus and advance our position as a leading provider of predictive analytics software and solutions."

ANGOSS Software Corporation      
Income Statement Information      
(unaudited, stated in Canadian dollars)      
For the period ended Three months ended   Twelve months ending
 
 
November 30,
2010
November 30,
2009
 
 
November 30,
2010
November 30,
2009
           
Revenues $1,827,942 $2,239,017   $7,922,046 $8,572,308
Operating Expenses          
    General and administration 398,019 375,053   1,680,265 1,571,969
    Sales and marketing 1,234,851 1,124,603   4,566,123 4,526,429
    Research and development, net 419,561 386,612   1,636,158 1,398,538
  2,052,431 1,886,268   7,882,546 7,496,936
Income (loss) before the following (224,489) 352,749   39,500 1,075,372
      Special charges (516,000) -   (516,000) -
    Amortization of capital assets (88,487) (111,757)   (339,017) (387,174)
    Amortization of intangible assets (104,521) (202,661)   (419,958) (335,713)
      Interest expense (34,025) (37,840)   (209,295) (150,149)
    Foreign exchange gain (loss) (24,473) (57,342)   61,525 (221,060)
    Stock based compensation (12,642) (9,333)   (21,007) (44,674)
Net (loss) and comprehensive (loss) income for the period $(1,004,637) $(66,184)   $(1,404,252) $(63,398)
           
Basic and diluted (loss) per share $(0.14) $(0.01)   $(0.19) $(0.01)
           
Weighted average number of shares outstanding          
Basic 7,256,612 7,256,612   7,256,612 7,256,612
Diluted 7,256,612 7,256,612   7,256,612 7,256,612

ANGOSS Software Corporation Selected Cash Flow Information Three months ended   Twelve months ending
(unaudited, stated in Canadian dollars)
 
November 30,
2010
November 30,
2009
 
 
November 30,
2010
November 30,
2009
           
Cash provided (used) by operating activities $(26,856) $755,857   $772,573 $889,312
Cash used in investing activities (344,105) (33,589)   (455,848) (2,436,252)
Cash provided (used) by financing activities (122,060) (93,236)   (441,895) 1,780,792
Effect of foreign exchange rate fluctuations on cash and cash equivalents (66,827) (36,049)   (72,947) (136,183)
Net increase (decrease) in cash during the period (559,848) 592,983   (198,117) 97,669

ANGOSS Software Corporation
Selected Balance Sheet Information
(unaudited, stated in Canadian dollars)
November 30,
2010
 
November 30,
2009
 
     
   Cash and cash equivalents $ 1,325,546 $ 1,523,663
   Restricted investments 335,000 391,000
   Accounts receivable 2,021,389 1,860,796
     
Total assets 6,380,359 6,834,076
     
   Accounts payable and accrued liabilities 1,580,646 719,642
   Current portion of deferred revenue 4,236,185 3,627,590
     
Total liabilities 8,408,033 7,478,505
     
Liabilities and shareholders' equity 6,380,359 6,834,076

About Angoss Software Corporation

Angoss Software empowers sales, marketing and risk professionals to make "Better Business Decisions.  Every Day."™

Angoss is a recognized global leader in providing powerful predictive analytics software that can be deployed on the desk-top or in complex in-database environments. Users of Angoss software universally applaud our products for its ease of use, its agility, and its impressive visualization of data which allows analysts, as well as business leaders, to participate in solving sales, marketing and risk challenges. The ability to do so is enabled through our patented decision tree technology.  For clients that require a fully managed service, our innovative cloud based delivery model integrates Angoss software and our predictive analytics expertise to enable measureable B2B sales and marketing analytic solutions.  Our differentiators include thought leadership in the predictive analytics space, demonstrable ROI and an unwavering commitment to delivering the right solution to our customers.

Many of the world's leading financial services, ICT, life sciences, and retail organizations use Angoss predictive analytics software and our Software as a Service (SaaS) platform to grow revenues, increase sales productivity and improve marketing effectiveness while reducing risk and cost.  Angoss helps our clients utilize business data to discover the key drivers of behavior, predict future trends and events, and act with confidence when making mission critical business decisions.

For more information, visit www.angoss.com.

This press release contains statements of a forward-looking nature. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. The accuracy of these statements may be impacted by a number of business risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including: the risk that the sale of our products and services involves a long sales cycle; the risk that the economic environment and business conditions will remain difficult to predict; the risk of competition in our target markets; the risk that we may not respond adequately to evolving technologies; the risk that we or our customers may have difficulties in introducing our products or services; the risk that we will encounter difficulties in continuing to offer services; the risk that we will encounter difficulties in integrating the operations of acquired companies with our own; the risks of conducting our operations in a variety of international locations; the risk that we may need to record future write-downs of assets arising from our investments in other companies; the risks relating to the costs that we may incur as a result of litigation against us; and  other risks described in our filings with securities regulatory authorities, including our annual reports, interim financial statements and similar disclosure documents. ANGOSS Software does not undertake any obligation to update this forward-looking information after the date of its initial publication, except as required under applicable law.

Note: The Toronto Venture Exchange has neither approved nor disapproved the above information.

SOURCE ANGOSS Software Corporation

For further information:

Lon Vining
Chief Financial Officer
416-593-2420
lvining@angoss.com

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ANGOSS Software Corporation

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