Angoss Software Corporation reports Third Quarter Results



    TORONTO, Oct. 6 /CNW/ - Angoss Software Corporation (Angoss) (TSX-V: ANC)
today announced unaudited results for the third quarter and nine months ending
August 31, 2008.
    During the third quarter, revenues were $1,844,573, compared with 2007
results of $1,965,009. For the nine months ended August 31, 2008 revenues were
$5,686,417, up 4% over 2007 results ($5,449,645).
    New bookings were impacted in the third quarter as a result of several
factors, including general market conditions, the Company's focus on pursuing
larger transaction value opportunities, and more complex approval and
procurement processes associated with these transactions in a challenging
business environment. Software license renewals continued to grow, in both
North America and Europe. Based on recent events, business conditions are
unlikely to improve significantly for the balance of 2008 and extending into
2009.
    Despite these factors, many of the Company's financial services & ICT
clients continue to expand their use of Angoss within their marketing, sales
and risk management areas. The Company is currently pursuing several
opportunities to broaden deployments with existing and new groups at existing
customers and continues to secure new customer wins. These initiatives are
directly related to the Company's field sales organization established earlier
this year, which is expanding contacts with both existing clients and
prospects and selling at higher levels within targeted organizations.
    Recent acquisitions by Angoss customers of other financial services
organizations have also created the potential for new sales into their
expanding retail banking and investment banking units. These acquisitions also
align well with new CRM analytics opportunities the Company is pursuing
involving its recently released KnowledgeSEEKER(R) for Salesforce.com, an
On-Demand CRM plug-in. This solution addresses the needs of both retail and
investment banks to increase sales team productivity, improve forecasting
predictability, and achieve growth in assets under management in their fund
and wealth management businesses in a challenging investment environment. In
addition, the shift for lenders from securitization to deposit based funding
models, as well as increased needs for better, faster analytics to support
collections lifecycle management across all consumer debt portfolios, and to
optimize the disposition of mortgages and other distress debts, are both
positive drivers for business growth in the current business climate. Angoss
capabilities are already well established with clients and prospects in all of
these areas in both finance and, for collections, telecom industry verticals.
    The Company's billed revenues in the quarter were $1,701,000, off 25%
from prior year third quarter billed revenues of $2,264,000. In year to date
results, billed revenues of $4,840,009 are off 10% from prior year billed
revenues of $5.4 million. Billed revenues for Angoss analytics solutions are
dependent on specific solution implementation cycles and will continue to
fluctuate on a quarterly basis. Offsetting these trends was an improved
foreign exchange environment which resulted in larger per transaction revenues
on US denominated sales and higher year over year net income.
    "Third quarter results reflect our continued focus on expanding key
financial services and ICT client and prospect relationships in a challenging
business environment" commented Angoss President Eric Apps. "Angoss is getting
higher levels of direct sales engagement and executive sponsorship at major
financial services and ICT organizations. We are successfully positioning
broader deployments of our easier to use systems to help them address gaps in
their analytics and reporting capabilities. Some of our Q3 deals have since
closed and our pipeline continues to be strong and well diversified across
geographies, industries and clients. However we also recognize that our
customers and prospects are currently facing significant and in some cases
unprecedented business challenges that are impacting on their purchase
decisions."
    Third quarter operating expenses of $1,854,771 were up 16% from the third
quarter of 2007 ($1,600,376). Year to date operating expenses were $5,343,779,
up 11% from 2007 year to date expenses of $4,806,752. Increases in Q3
operating expenses reflect costs associated with setting up a larger US based
field sales organization, as well as non-recurring costs incurred in
implementing new business initiatives. Q4 expenses are expected to be
comparable to Q3 quarterly results, as the initial phase of the Company's US
field sales expansion is now complete. Investments in a direct field sales
presence in the US market have already led to growth in transaction values and
improved levels of engagement with existing clients and prospects and are
expected to translate into improved revenue growth moving forward.
    Third quarter operating loss was $10,198 compared with prior year
operating profit of $364,633. Net income was $11,838 compared with third
quarter 2007 net income of $162,191. In year to date results operating income
was $342,638, compared with 2007 operating income of $642,893. Net income grew
to $132,774 from $83,654 in 2007 as a result of revenue growth despite higher
costs, due to improved foreign exchange impacts of the strengthening US
Dollar.
    The Company continues to focus on expanding its predictive analytics
solutions offerings with existing and new clients in the financial services
and information and communications technology industries. The Company provides
predictive analytics solutions for these clients using software licensing and
on demand subscription delivery models.

    Third Quarter Highlights

    Continued Expansion of Financial and ICT Client Base. Angoss continued to
expand its relationship with existing and new financial services and ICT
industry clients, completing transactions with several existing and new
customers in these industries.

    Angoss Positioned As Challenger In Gartner Magic Quadrant for Customer
Data Mining. Angoss moved to the 'Challenger Quadrant' in the Gartner Magic
Quadrant for Customer Data Mining released in July, 2008, reflecting the
Company's differentiated focus on providing easier to deploy analytics
solutions, its industry leadership in the introduction of "on demand"
analytics capabilities for marketing and sales organizations, and favorable
feedback based on independent research conducted with end customers on
participating vendors and their capabilities. The Company expects this trend
to continue as it strengthens its position as a leading alternative analytics
solution provider to traditional statistical tools vendors in this industry.

    Launch of "Got Leads" Trial Program for Salesforce.com. Angoss announced
the introduction during the third quarter of its KnowledgeSEEKER(R) for
Salesforce.com platform, with a trial program showcasing the product's
predictive leads and predictive forecasting capabilities for trial clients.
The program is being promoted at several CRM industry venues and conferences,
culminating in the launch of the program at the Salesforce.com annual user
conference "Dreamforce 2008" planned for November, 2008.


    
    ANGOSS Software Corporation
    Income Statement Information
    (unaudited, stated in Canadian dollars)

                               Three Months ended       YTD - Nine Months
                              August 31,  August 31,  August 31,  August 31,
                                 2008        2007        2008        2007

    Revenues                  $1,844,573  $1,965,009  $5,686,417  $5,449,645
                              ----------------------- -----------------------
    Gross margin               1,844,573   1,965,009   5,686,417   5,449,645
    Operating Expenses
      General and
       administration            435,638     363,577   1,255,406   1,203,392
      Sales and marketing      1,180,699   1,054,609   3,354,209   2,960,695
      Research and
       development, net          238,434     182,190     734,164     642,665
                              ----------------------- -----------------------
                               1,854,771   1,600,376   5,343,779   4,806,752
                              ----------------------- -----------------------
    (Loss) income before the
     following                   (10,198)    364,633     342,638     642,893
      Other income                     -           -      19,895      36,194
      Amortization of capital
       assets                    (82,810)    (92,945)   (272,857)   (241,404)
      Amortization of deferred
       charges                    (7,210)    (17,345)    (21,630)    (43,581)
      Dividend expense           (10,117)    (20,235)    (30,380)    (60,540)
      Foreign exchange gain
       (loss)                    136,147     (66,049)    125,228    (234,965)
      Stock based compensation   (13,974)     (5,868)    (30,120)    (14,943)
                              ----------------------- -----------------------
    Net income and
     comprehensive income
     for the period              $11,838    $162,191    $132,774     $83,654
                              ----------------------- -----------------------
                              ----------------------- -----------------------

    Basic and diluted loss
     per share                     $0.00       $0.02       $0.02       $0.01
                              ----------------------- -----------------------
                              ----------------------- -----------------------

    Weighted average number
     of shares outstanding
                        Basic  7,256,612   8,008,154   7,421,821   7,961,584
                      Diluted  7,292,711   8,096,207   7,448,059   8,127,191


    Selected Cash Flow Information
    (unaudited, stated in Canadian dollars)

                               Three Months ended       YTD - Nine Months
                              ----------------------- -----------------------
                              August 31,  August 31,  August 31,  August 31,
                                 2008        2007        2008        2007

    Cash (used in) provided
     by operating activities   $ 140,519   $ 721,697   $ 192,654   $ 571,614
    Cash used in investing
     activities                  (21,898)   (102,978)   (192,989)   (776,810)
    Cash (used) provided by
     financing activities        494,504     (55,884)   (322,224)    611,031
    Net increase (decrease) in
     cash during the period      613,125     562,835    (322,559)    405,835


    Selected Balance Sheet Information
    (unaudited, stated in Canadian dollars)

                                                      August 31, November 30,
                                                         2008        2007

      Cash and cash equivalents                       $2,012,548  $2,335,107
      Accounts receivable                              1,247,780   2,025,907
      Prepaid expenses and other assets                  374,233     467,440
                                                      -----------------------
    Total current assets                               3,634,561   4,828,454
      Capital assets, net                                782,600     862,468
                                                      -----------------------
    Total assets                                      $4,417,161  $5,690,922
                                                      -----------------------

      Accounts payable and accrued liabilities        $  530,190  $  752,731
      Current portion of deferred revenue              2,992,402   3,880,371
      Current portion of repayable contribution                -      10,988
      Current portion of capital leases                  113,400     110,685
      Current portion of term debt                       214,286      60,000
      Current redeemable portion of preferred shares
       (notes 5, 6 & 8)                                  569,477     547,847
      Other                                               33,647      38,376
                                                      -----------------------
    Total current liabilities                          4,453,402   5,400,998
                                                      -----------------------
      Capital leases                                     141,918     175,047
      Term debt                                          535,714     195,000
      Lease inducement                                   101,893     122,715
                                                      -----------------------
    Total liabilities                                  5,232,927   5,893,760
    Total shareholders' equity                          (815,766)   (202,838)
                                                      -----------------------
    Liabilities and shareholders' equity              $4,417,161  $5,690,922
                                                      -----------------------
    

    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, information and
communications technology and retail organizations use Angoss On-Demand
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.
    Headquartered in Toronto Canada, Angoss has offices in New York and the
UK and has partnered with the world's leading enterprise software and services
vendors. 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.
    




For further information:

For further information: Alim Khan, Director - Marketing, (416)
593-2412, akhan@angoss.com

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Angoss Software Corporation

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