Angoss Reports Fourth Quarter and Fiscal 2009 Results

Demand for Hosted Predictive Analytics Solutions Drives Growth in Revenue and Operating Income

TORONTO, Feb. 2 /CNW/ - Angoss Software Corporation (Angoss) (TSX-V: ANC) today announced unaudited results for the fourth quarter and fiscal year ended November 30, 2009, reporting strong growth in revenues and operating profitability.

2009 revenues were $8,572,308, up 14% from 2008 revenues of $7,541,523. Fourth quarter revenues of $2,239,017 were up 21% from 2008 fourth quarter revenues of $1,855,106. Revenue growth resulted primarily from expansion of the Company's on demand predictive analytics solutions business, highlighted by expanding sales of the Angoss KnowledgeSEEKER data mining plug-in for Salesforce.com and the Company's acquisition of the IntelliMaxx(TM) integrated marketing solutions business.

2009 operating income tripled to $1,075,372, from 2008 operating income of $392,228. During the fourth quarter operating income was $352,749 compared with prior year operating income of $19,135. Improved operating profitability resulted from revenue growth, cost reductions combined with improved marketing effectiveness and sales productivity. The Company's research and development expenses grew by 53% in 2009, largely as a result of headcount growth associated with the IntelliMaxx(TM) business. Additional development investments in the Company's on demand predictive analytics capabilities for IntelliMaxx(TM) - the Company's integrated on-line, e-mail and mobile marketing system - and for KnowledgeSEEKER for Salesforce.com - the Company's on demand sales analytics system are planned for FY 2010.

The Company also reported a net loss of $63,398 ($0.01 per share) compared with 2008 net income of $334,255 ($0.05 per share). Reduced net income resulted from debt service and amortization expenses of approximately $493,000 associated with the IntelliMaxx(TM) acquisition, and a $620,000 adverse swing in foreign exchange due to the weakening of the US Dollar during 2009.

Billed revenues were $8,482,925 up 11% compared with prior year billed revenues of $7,616,363. In the fourth quarter billed revenues of $2,672,242 were 5% lower than prior year fourth quarter billed revenues of $2,810,663. Billed revenues reflect solution implementation cycles and will continue to fluctuate on a quarterly basis.

"We delivered a solid performance in a challenging 2009 business environment" commented Angoss President Eric Apps. "We completed our first acquisition, successfully integrating the IntelliMaxx(TM) business, expanding our team capabilities, adding important new retail industry clients, and expanding our offerings to them. In parallel, we successfully launched what we believe is the world's first truly on demand predictive sales analytics solution, through our KnowledgeSEEKER(R) for Salesforce.com solution initially targeting the advanced analytics needs of the financial services industry.

Fourth Quarter and Fiscal Year Highlights

Marketing Analytics Solutions: Integration and Expansion of IntelliMaxx(TM) Capabilities

During 2009 the Company successfully completed its acquisition of IntelliMaxx(TM) bringing stability and improved breadth and quality of service to IntelliMaxx(TM) customers. In addition to introducing more advanced analytics capabilities to selected IntelliMaxx(TM) clients, the Company began introducing IntelliMaxx(TM) integrated marketing capabilities to the Company's own client base. The Company completed the year by finalizing the terms of an innovative "pay for performance" solution for a financial services organization to be introduced in 2010 which reflects a potential future business and revenue model change for the IntelliMaxx(TM) business. The Company has also commenced development of a proprietary, analytics enriched consumer data asset, incorporating predictive models and behavioral scores intended to provide marketers with significantly better insights into consumer segments and their buying behaviors and preferences. This asset will be made available initially to Canadian marketers for market planning and campaign execution during fiscal 2010. On demand marketing analytics solutions now offered under the IntelliMaxx(TM) brand represent approximately 25% of the Company's business.

Sales Analytics Solutions: Expansion of FundGUARD and Completion of First KnowledgeSEEKER(R) for Salesforce.com Integration

During 2009 the Company successfully expanded its FundGUARD(TM) sales analytics solution for the mutual fund and wealth management industry with several renewing clients, new customer additions, and new solution capabilities highlighted by fully integrated Angoss predictive analytics for sales force effectiveness embedded within the Salesforce.com platform. Angoss plans for FY 2010 include awareness raising activities within Salesforce.com and across its client base in financial services and ICT verticals, with additional planned initiatives through Dreamforce 2010. Sales Analytics solutions, focused around the Company's KnowledgeSEEKER(R) for Salesforce.com offering, represent approximately 25% of the Company's business. Using the mutual fund and wealth management industry as a launch pad the Company plans to extend the solution to the sales organizations of financial services and ICT clients and prospects in coming quarters.

Risk Analytics Solutions: Expansion In Credit Risk and Claims Fraud Detection

During 2009 the Company continued to expand its KnowledgeSTUDIO(R) footprint in major financial services organizations such as Citigroup, Bank of America, Wells Fargo, Chase, Royal Bank of Canada and others, while continuing to add net new customer accounts across finance, ICT and retailing industries in North America and Europe. The Company's ClaimGUARD(TM) solution for insurance claims fraud abuse detection also entered its third year of successful deployment at one of North America's largest group benefits claims organizations, while launching a pilot program at another major insurance claims carrier. The Company achieved these results against the backdrop of continued business uncertainty and tight budget environments in most financial services organizations, and despite continued focus within traditional big bank IT organizations on standardizing on a smaller number of global technology vendors, including for their analytics and reporting toolkits. Competitive conditions in FY 2010 are expected to continue to be challenging as analytics vendor The SAS Institute competes to preserve market share against IBM in large enterprise accounts following IBM's acquisition of SPSS. Risk analytics solutions represent approximately 25% of the Company's business. The Company believes it is uniquely positioned to deliver advanced analytics solutions for financial services, ICT and retailing organizations seeking easier to deploy, easier to use, and lower cost predictive analytics systems.

ANGOSS Software Corporation

Income Statement Information

(unaudited, stated in Canadian dollars)

    
    For the period ended     Three months ended       YTD - Twelve Months
                          November 30, November 30, November 30, November 30,
                              2009         2008         2009         2008

    Revenues               $2,239,017   $1,855,106   $8,572,308   $7,541,523
                          ------------------------- -------------------------
    Operating Expenses
      General and
       administration         375,053      418,674    1,571,969    1,643,625
      Sales and marketing   1,124,603    1,239,243    4,526,429    4,593,452
      Research and
       development, net       386,612      178,054    1,398,538      912,218
                          ------------------------- -------------------------
                            1,886,268    1,835,971    7,496,936    7,149,295
                          ------------------------- -------------------------
    Income before the
     following                352,749       19,135    1,075,372      392,228
      Other income                  -            -            -       19,895
      Amortization of
       capital assets        (129,418)     (93,482)    (387,887)    (366,339)
      Amortization of
       intangible assets     (185,000)           -     (335,000)           -
      Interest expense        (37,840)       3,212     (150,149)     (27,243)
      Preferred share
       expenses                     -      (11,827)           -      (63,837)
      Foreign exchange
       gain (loss)            (57,342)     273,023     (221,060)     398,251
      Stock based
       compensation            (9,333)      11,420      (44,674)     (18,700)
                          ------------------------- -------------------------
    Net (loss) income and
     comprehensive (loss)
     income for the period   $(66,184)    $201,481     $(63,398)    $334,255
                          ------------------------- -------------------------
                          ------------------------- -------------------------

    Basic and diluted (loss)
     earnings per share        $(0.01)       $0.03       $(0.01)       $0.05
                          ------------------------- -------------------------
                          ------------------------- -------------------------

    Weighted average number
     of shares outstanding
      Basic                 7,256,612    7,256,612    7,256,612    7,380,744
      Diluted               7,256,612    7,291,626    7,256,612    7,406,943
    

Selected Cash Flow Information

(unaudited, stated in Canadian dollars)

    
    For the period ended     Three months ended       YTD - Twelve Months
                          ------------------------- -------------------------
                          November 30, November 30, November 30, November 30,
                              2009         2008         2009         2008

    Cash provided by
     operating activities    $755,856     $395,886     $889,311     $529,594
    Cash used in investing
     activities               (33,589)     (32,079)    (548,252)    (225,068)
    Cash provided (used) by
     financing activities     (93,235)    (659,066)    (107,207)    (981,290)
    Effect of foreign
     exchange rate
     fluctuations on cash
     and cash equivalents     (36,049)     131,705     (136,183)     145,651
    Net increase (decrease)
     in cash during the
     period                   592,983     (163,554)      97,669     (531,113)
    

Selected Balance Sheet Information

    
                                                    November 30, November 30,
    (unaudited, stated in Canadian dollars)             2009         2008

      Cash and cash equivalents                      $1,523,663   $1,425,994
      Restricted investments                            391,000      423,000
      Accounts receivable                             1,860,796    2,035,651
      Prepaid expenses and other assets                 425,179      414,201
                                                    -------------------------
    Total current assets                              4,200,638    4,298,846
      Capital assets, net                               978,438      721,197
      Intangible assets, net                          1,655,000            -
                                                    -------------------------
    Total assets                                     $6,834,076   $5,020,043
                                                    -------------------------

      Accounts payable and accrued liabilities         $719,641     $659,678
      Current portion of deferred revenue             3,627,590    3,875,058
      Current portion of capital leases                 182,311      102,853
      Current portion of term debt                      214,286      214,286
      Other                                             151,219       27,763
                                                    -------------------------
    Total current liabilities                         4,895,047    4,879,638
                                                    -------------------------
      Long-term debt                                  1,980,379            -
      Deferred revenue                                  128,963       67,045
      Capital leases                                    149,377      121,970
      Term debt                                         267,857      482,143
      Lease inducement                                   56,882       94,952
                                                    -------------------------
    Total liabilities                                 7,478,505    5,645,748
    Total shareholders' equity                         (644,429)    (625,705)
                                                    -------------------------
    Liabilities and shareholders' equity             $6,834,076   $5,020,043
                                                    -------------------------
    

About Angoss Software Corporation

Angoss Software empowers people to make "Better Business Decisions. Every Day."(TM)

Some of the world's leading financial services, telecom, life sciences, and retail organizations use Angoss predictive analytics software and services to grow revenues, 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 business decisions.

Angoss combines powerful market proven software with focused industry services expertise in the deployment, integration and use of predictive analytics in enterprise environments. Our differentiators include broad user acceptance, a commitment to open standards, rich functionality, rapid deployment, exceptional ease-of-use and affordability.

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: For further information: Lon Vining, Chief Financial Officer, (416) 593-2420, lvining@angoss.com

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