BakBone Software Generates Revenue Growth and Continued Profitability in the
Third Quarter of Fiscal 2010


    



    
</pre>
<p><location>SAN DIEGO</location>, <chron>Feb. 10</chron> /CNW/ -- BakBone Software, Incorporated (OTC Bulletin Board:   BKBO), a leading provider of Universal Data Management solutions, today announced its financial results for the third quarter of fiscal 2010, ended <chron>December 31, 2009</chron>.</p>
<pre>
    

    Third Quarter Fiscal 2010 financial and operational highlights include

    
</pre>
<p> </p>
<p> </p>
<pre>
    
        -- GAAP Revenues                       $15.2 million
        -- Operating Income                    $0.8 million
        -- Net Income                          $0.6 million
        -- Net Income per Share                $0.01
        -- Total Bookings                      $15.3 million


    
</pre>
<p>"Our third fiscal quarter results demonstrate the success of our focus on managing the business for profitability, while we continue to make investments in ColdSpark and other growth opportunities," said <person>Jim Johnson</person>, president and CEO, BakBone. "We reported a six percent increase in revenue in the recent third fiscal quarter compared with the same quarter last year and generated a profit of <money>$0.6 million</money>. Our bookings and GAAP revenues reflected strength in <location>Europe</location> and Asia, as well as strong maintenance contract renewals from existing customers across geographies."</p>
<p/>
<p>"The improvement to positive operating income compared with a loss the prior year reflected significantly reduced operating expenses overall. We continued to make strategic investments in R&D and sales, and marketing initiatives that should further position BakBone as a leader in the enterprise messaging and infrastructure space, as well as in its core backup and recovery business," continued <person>Mr. Johnson</person>.</p>
<p/>
<p>In mid-October, the Company introduced the newest version of its flagship product NetVault®: Backup and new disk-based backup and deduplication options with NetVault: SmartDisk. NetVault: SmartDisk is based on BakBone's Open Data Protection Platform, which offers more affordable, long-term disk-based storage to customers with additional features such as data deduplication. "Our new NetVault: Backup and NetVault: SmartDisk product offerings have been well received in the market and we are delivering this new version to our client base around the world," commented <person>Mr. Johnson</person>.</p>
<p/>
<p>During the quarter, ColdSpark introduced a new managed services offering for e-mail management and delivery that will help customers reduce the costs and complexity of managing e-mail infrastructures. This, along with the new versions of the ColdSpark SparkEngine(TM), Compliance Catalyst and MailFusion that were launched in October, is targeted at ColdSpark's key markets including financial services, healthcare and other regulated industries.</p>
<p/>
<p>"ColdSpark expanded its footprint with a well-known global financial services company in the third quarter. We continue to focus on expanding our presence with global healthcare companies.  We believe we are making good progress in our pursuit of new accounts, and as we've stated previously, the e-mail management and infrastructure business has a relatively long selling cycle and is characterized by large orders and unpredictable timing. As a result of anticipated lower near-term bookings from ColdSpark and slowness in the new license bookings for backup and recovery products in <location>North America</location>, we have revised our guidance for expected consolidated bookings in fiscal 2010 to <money>$56.5 to $57.5 million</money>.</p>
<p/>
<p>"We remain very optimistic about the opportunities for ColdSpark and for backup and recovery and are working aggressively to grow these businesses. We are committed to sustained profitability, while we invest the necessary resources to maintain our technological lead and drive a more efficient, productive sales and marketing effort. We are focused on execution and believe that our success will generate increased revenue and profitability and enhanced valuation for BakBone shareholders," concluded <person>Mr. Johnson</person>.</p>
<pre>
    

    Financial Results
    
</pre>
<p>Total revenue grew six percent to <money>$15.2 million</money> in the third quarter of fiscal 2010 from <money>$14.3 million</money> in the third quarter of fiscal 2009. Operating income totaled <money>$0.8 million</money> for the third quarter ended <chron>December 31, 2009</chron>, compared with an operating loss of <money>$1.1 million</money> in the third quarter of the prior fiscal year. The increase in operating income in the third quarter ended <chron>December 31, 2009</chron>, was the result of higher revenue and a significant reduction in general and administrative costs primarily associated with accounting and auditing fees incurred in the prior fiscal year.</p>
<p/>
<p>The Company reported net income of <money>$0.6 million</money>, or <money>$0.01</money> per share, in the third quarter compared with net income of <money>$0.6 million</money>, or <money>$0.01</money> per share, in the third quarter last year.</p>
<p/>
<p>For the nine months ended <chron>December 31, 2009</chron>, revenue grew 13% to <money>$47.1 million</money> compared with <money>$41.6 million</money> through the nine months ended <chron>December 31, 2008</chron>.  Net income for the recent nine-month period totaled <money>$2.4 million</money>, or <money>$0.02</money> per diluted share, compared with a net loss of <money>$4.6 million</money> for the comparable period in the prior year, or $(0.07) per share.</p>
<pre>
    

    Total cash at December 31, 2009, totaled $5.7 million.

    Conference Call Information
    
</pre>
<p>The Company has scheduled a conference call for today, <chron>February 10, 2010</chron>, at <chron>2:00 p.m. PT</chron> to discuss the results for the quarter ended <chron>December 31, 2009</chron>. The call will be hosted by <person>Jim Johnson</person>, CEO of BakBone, and <person>Steve Martin</person>, CFO of BakBone.</p>
<p/>
<p>To access the conference call, please dial 800-854-3238; internationally, dial 706-634-9547 (Passcode: 52847729. This call will also be webcast and can be accessed at <a href="http://www.bakbone.com">www.bakbone.com</a> by clicking on "Company Info" and then "Investor Relations." The webcast is also being distributed through the Thomson StreetEvents Network. Individual investors can listen to the call at <a href="http://www.earnings.com">www.earnings.com</a>, Thomson's individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson StreetEvents (<a href="http://www.streetevents.com">www.streetevents.com</a>), a password-protected event management site.</p>
<pre>
    

    About BakBone Software
    
</pre>
<p>BakBone Software is a leader in Universal Data Management. This provides a data-centric approach to integrating data protection, centralizing policy management and managing organizations' messaging infrastructure to optimize performance, increase data availability and improve corporate compliance. Learn more about BakBone's Universal Data Management vision at <a href="http://www.bakbone.com">www.bakbone.com</a> or e-mail <a href="mailto:info@bakbone.com">info@bakbone.com</a>.</p>
<pre>
    

    Safe Harbor
    
</pre>
<p>This press release contains express and/or implied forward-looking statements including, without limitation, statements regarding anticipated revenues, operating results, bookings and market developments that involve risks, uncertainties, assumptions and other factors, which, if they do not materialize or prove correct, could cause BakBone's results to differ materially from historical results, or those expressed or implied by such forward-looking statements. The potential risks and uncertainties may include, but are not limited to: risks that the anticipated benefits of the Coldspark acquisition will not be achieved;  risks that the ongoing weak economic and market conditions, particularly in <location>North America</location>, could continue to lead to reduced spending on information technology products; competition in our target markets; potential capital needs; management of future growth and expansion; the development, implementation and execution of the Company's Universal Data Management strategic vision; risk of third-party claims of infringement; protection of proprietary information; customer acceptance of the Company's existing and newly introduced products and fee structures; the success of the Company's brand development efforts; risks associated with strategic alliances; reliance on distribution channels; product concentration; need to develop new and enhanced products; potential product defects; our ability to hire and retain qualified employees and key management personnel; and risks associated with changes in domestic and international market conditions and the entry into and development of international markets for the Company's products. Our forward-looking statements should be considered in the context of these and other risk factors disclosed in our most recent report filed with the Securities and Exchange Commission, which may be found at <a href="http://www.sec.gov">www.sec.gov</a>, as well as those risk factors disclosed in our current report filed with the relevant Canadian securities regulators, which is available on SEDAR at <a href="http://www.sedar.com">www.sedar.com</a>.  All future written and oral forward-looking statements made by us or on our behalf are also subject to these factors. BakBone assumes no obligation to update any forward-looking statement to reflect events or circumstances arising after the date on which it was made, other than as required under applicable securities laws.</p>
<p/>
<p>BakBone®, BakBone Software®, NetVault®, Application Plugin Module(TM), BakBone logo®, Integrated Data Protection(TM), NetVault: SmartDisk(TM), Asempra®, FASTRecover(TM), ColdSpark® and SparkEngine(TM) are all trademarks or registered trademarks of BakBone Software, Inc., in the <location>United States</location> and/or in other countries. All other brands, products or service names are or may be trademarks, registered trademarks or service marks of, and used to identify, products or services of their respective owners.</p>
<pre>
    


    
</pre>
<p> </p>
<p> </p>
<p> </p>
<pre>
    
    Investor Contact:         Corporate Contact:     Media Contact:
    Doug Sherk /Jenifer
     Kirtland                 Steve Martin           Amber Winans
    415-896-6820              858-795-7525           858-795-7584
    jkirtland@evcgroup.com    IR@bakbone.com         amber.winans@bakbone.com


    (Logo:  http://www.newscom.com/cgi-bin/prnh/20031120/SDBAKLOGO)


    
</pre>
<p> </p>
<p> </p>
<pre>
    
    BAKBONE SOFTWARE INCORPORATED
    Condensed Consolidated Balance Sheets
    (in thousands)
                                                    Fiscal Period Ended
                                                    -------------------
                                                (unaudited)
    
</pre>
<p> </p>
<pre>
    
                                             December 31, 2009  March 31, 2009
                           ASSETS
    Current assets:
        Cash and cash equivalents                  $5,660           $8,398
        Restricted cash                                51              264
        Accounts receivable, net                    9,847            9,646
        Prepaid expenses and other assets           1,409            1,159
                                                    -----            -----
            Total current assets                   16,967           19,467
    Property and equipment, net                     2,250            2,713
    Intangible assets, net                          7,798              824
    Trademarks                                        400                -
    Goodwill                                       14,007            7,615
    Other assets                                      957              939
                                                      ---              ---
            Total assets                          $42,379          $31,558
                                                  =======          =======
    
</pre>
<p> </p>
<pre>
    
            LIABILITIES AND SHAREHOLDERS' DEFICIT
    Current liabilities:
        Accounts payable and accrued liabilities   $8,778           $9,603
        Current portion of acquisition 
         consideration payable                      2,279                -
        Current portion of deferred revenue        44,482           44,081
                                                   ------           ------
            Total current liabilities              55,539           53,684
    Deferred revenue, excluding current portion    46,719           47,684
    Acquisition consideration payable, excluding          
     current portion                                4,452                -
    Other liabilities                                 834            1,337
                                                      ---            -----
            Total liabilities                     107,544          102,705
                                                  -------          -------
    Shareholders' deficit                         (65,165)         (71,147)
                                                  -------          -------
    Total liabilities and shareholders' deficit   $42,379          $31,558
                                                  =======          =======
    
</pre>
<p> </p>
<p> </p>
<p> </p>
<pre>
    
                    BAKBONE SOFTWARE INCORPORATED                     
            Condensed Consolidated Statements of Operations         
                            (in thousands)                             
                              (unaudited)                              
    
</pre>
<p> </p>
<pre>
    
                                        Three months ended  Nine months ended
                                            December 31,       December 31,  
                                          2009      2008      2009      2008 
                                          ----      ----      ----      ----
                                                 Restated(1)       Restated(1)
                                                 -----------       -----------
    Revenues:                                                          
      License and service               $15,199   $14,348   $45,619   $41,606
      Other                                   -         -     1,500         - 
                                            ---       ---     -----       --- 
      Total revenues                     15,199    14,348    47,119    41,606 
    Cost of revenues                      1,660     1,818     4,874     5,466 
                                          -----     -----     -----     ----- 
      Gross profit                       13,539    12,530    42,245    36,140 
                                         ------    ------    ------    ------ 
    Operating expenses:                                                      
      Sales and marketing                 6,841     6,483    20,015    20,784 
      Research and development            3,292     2,780     9,685     8,804 
      General and administrative          2,614     4,366     9,734    12,350 
                                          -----     -----     -----    ------ 
      Total operating expenses           12,747    13,629    39,434    41,938 
                                         ------    ------    ------    ------ 
      Operating income (loss)               792    (1,099)    2,811    (5,798)
    Other non-operating (expense) income   (414)    1,837      (549)    1,477 
                                           -----    -----      -----    ----- 
      Income (loss) before income taxes     378       738     2,262    (4,321)
    (Benefit from) provision for income                                    
     taxes                                 (231)      100      (169)      247 
                                           -----      ---      -----      --- 
      Net income (loss)                    $609      $638    $2,431   $(4,568)
                                           ====      ====    ======   ======= 
                                                                         
    Net income (loss) per common share:                                       
      Basic                               $0.01     $0.01     $0.03    $(0.07)
                                          =====     =====     =====    ======
                                                                         
      Diluted                             $0.01     $0.01     $0.02    $(0.07)
                                          =====     =====     =====    ======
                                                                             
    Weighted-average common shares
     outstanding:                                            
      Basic                              86,644    64,610    83,368    64,616 
                                         ======    ======    ======    ====== 
                                                                              
      Diluted                           104,690    82,647   101,488    64,616 
                                        =======    ======   =======    ====== 
                                                                             
                                                                            
    (1) As discussed in the Company's Annual Report on Form 10-K for the year 
    ended March 31, 2009, the Company restated its consolidated financial 
    statements for each of the first three quarters in fiscal 2009, in 
    accordance with Staff Accounting Bulletin No. 108, Considering the Effect 
    of Prior Year Misstatements When Quantifying Misstatements in the Current 
    Year Financial Statements, to correct errors in such consolidated 
    financial statements that would have had a material effect on the 
    financial statements for the three and twelve months ended March 31, 2009 
    if not corrected. The Company does not believe that these adjustments are 
    material to any of the restated periods.  
    
</pre>
<p> </p>
<p> </p>
<p> </p>
<pre>
    
                           BAKBONE SOFTWARE INCORPORATED              
                  Condensed Consolidated Statements of Cash Flows            
                                   (in thousands)                             
                                    (unaudited)  
                                 
                                                Nine months ended December 31,
                                                        2009          2008 
                                                                   Restated(1)
                                                    -----------    -----------
                                                                              
    Cash flows from operating activities:                                   
    Net income (loss)                                  $2,431       $(4,568)
    Adjustments to reconcile net income (loss)
     to net cash used in operating activities:                             
        Depreciation and amortization                   1,868         1,274 
        Non-cash interest expense                         474             - 
        Operating expenses funded by financing                              
         arrangement                                      267            59 
        Provision for bad debt                            173             - 
        Stock-based compensation                           29           229 
        Loss on disposal of capital assets                  9            19 
        Other changes in assets and liabilities        (6,928)        2,576 
                                                       -------        ----- 
            Net cash used in operating activities      (1,677)         (411)
                                                       -------         ----
                                                                         
    Cash flows from investing activities:                                  
        Cash paid for acquisitions, net of cash                           
         received                                      (1,014)            - 
        Capital expenditures                             (256)         (946)
        Release of restricted cash                        325           227 
                                                          ---           --- 
            Net cash used in investing activities        (945)         (719)
                                                         -----         ----
                                                                            
    Cash flows from financing activities:                                 
        Payments on capital lease obligations            (227)         (186)
        Payments on long-term debt obligations           (437)         (419)
                                                         -----         ----
            Net cash used in financing activities        (664)         (605)
                                                         -----         ----
                                                                            
    Effect of exchange rates on cash and cash                             
     equivalents                                          548          (257)
                                                          ---          ----
                                                                            
        Net decrease in cash and cash equivalents      (2,738)       (1,992)
        Cash and cash equivalents, beginning of period  8,398         9,496 
                                                        -----         ----- 
        Cash and cash equivalents, end of period       $5,660        $7,504 
                                                       ======        ====== 
    
</pre>
<p> </p>
<p> </p>
<p> </p>
<pre>
    
                        BAKBONE SOFTWARE INCORPORATED
                Reconciliation of Bookings to U.S. GAAP Revenue (2)
                          (unaudited, in thousands)
    
</pre>
<p> </p>
<pre>
    
                                         Three months ended  Nine months ended
                                             December 31,       December 31,
                                            2009     2008      2009     2008
                                            ----     ----      ----     ----
    Revenues sourced from current
     period bookings:
        Total bookings for the period     $15,265  $15,541   $42,395  $43,844
        Bookings deferred into
         subsequent periods               (14,333) (14,273)  (32,604) (35,466)
                                           ------   ------    ------   ------
    
</pre>
<p> </p>
<pre>
    
        Revenues from current period
         bookings                             932    1,268     9,791    8,378
    Revenues sourced from prior period
     bookings:                             14,267   13,080    37,328   33,228
    
</pre>
<p> </p>
<pre>
    
        Total revenues recognized in the
         period                           $15,199  $14,348   $47,119  $41,606
                                          =======  =======   =======  =======
    
</pre>
<p> </p>
<pre>
    
    (2) We define bookings as the gross dollars invoiced through the sale of 
    software licenses, maintenance contracts and professional services. We 
    utilize bookings information as an operations measure, but it is not 
    intended to replace U.S. GAAP accounting. Under the ratable revenue
    recognition method, license bookings are recognized as revenue over the 
    appropriate period (generally three to five years). In general, variations
    in revenues period-over-period are affected by the amortization of current
    and prior period license bookings. Accordingly, we believe that trends in
    current and historical bookings are key factors in analyzing our 
    operating results.





    

For further information: For further information: Investors, Doug Sherk or Jenifer Kirtland, +1-415-896-6820, jkirtland@evcgroup.com, for BakBone Software; or Corporate, Steve Martin, +1-858-795-7525, IR@bakbone.com, or Media, Amber Winans, +1-858-795-7584, amber.winans@bakbone.com, both of BakBone Software Web Site: http://www.bakbone.com

Organization Profile

BAKBONE SOFTWARE, INCORPORATED

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890