Angoss reports revenue and profit growth in third quarter

    TORONTO, Oct. 2 /CNW/ - Angoss Software Corporation (Angoss) (TSX-V: ANC)
today announced unaudited results for the third quarter and nine months ending
August 31, 2007.
    During the third quarter, revenues of $1,965,009 were up 19% from 2006
results ($1,652,517). For the nine months ended August 31, 2007 revenues of
$5,449,645 were up 9% over 2006 results ($4,998,295). The Company's billed
revenues in the quarter were approximately $2.26 million, an increase of 126%
over prior year third quarter billed revenues of approximately $1.0 million.
In year to date results, billed revenues were $5.4 million, up 21% from prior
year billed revenues of $4.5 million.
    Third quarter operating profit of $364,633 was up 145% over prior year
third quarter operating profit of $148,821. Net income was $162,191 compared
with third quarter 2006 net income of $2,540. In year to date results
operating income and net income were $642,893 (2006: $605,152) and $83,654
(2006: $257,565), respectively.
    Third quarter operating expenses of $1,600,376 were up 6% from the third
quarter of 2006 ($1,503,696). For the year to date operating expenses were
$4,806,752, up 9% from 2006 year to date expenses of $4,393,447.
    The Company continues to focus on expanding its predictive analytics
solutions offerings for existing and new clients in the financial services and
information and communications technology industries. The Company provides
predictive analytics solutions for these clients using both software licensing
and on demand subscription delivery models.
    Billed revenues are cyclical, reflecting implementation timing and stages
for Angoss on demand client solutions, and knowledge transfer services
associated with licensed technology sales. The Company expects fluctuations in
quarterly billed revenues will continue while the Company expands its
opportunity pipeline and backlog of signed contracts for future period
deliveries of both subscription service offerings and implementation services
and knowledge transfer associated with software sales.
    Revenue growth resulted from expanded deployments of the Angoss
KnowledgeSEEKER(R), KnowledgeSTUDIO(R) and StrategyBUILDER(TM) predictive
analytics software for financial services marketing and credit risk management
applications, expanded mutual fund industry sales of the Angoss FundGUARD(TM)
on demand marketing, sales targeting and predictive leads system with existing
and new mutual fund customers, and initial implementation services for the
follow on phase for its ClaimGUARD(TM) fraud and abuse detection subscription
solution with a leading North American benefits insurance provider. During the
quarter the Company also expanded its Telecom Marketing Analytics(TM) solution
implementation with a leading North American telecommunications service
provider, and signed an initial proof of concept for its on demand predictive
analytics offering with one of the world's leading wireless appliance
    "Our proven ability to deliver more powerful, more usable and more
affordable predictive analytics software systems than traditional statistical
tools vendors, combined with our ability to deliver sophisticated predictive
analytics solutions via on demand subscriptions for organizations looking to
achieve business results faster without the cost and complexity of traditional
tools based approaches, are combining to create interesting business growth
opportunities" commented Angoss President Eric Apps.
    Year to date changes in the mix of operating expenses reflect higher
billed revenue growth, expanded sales and marketing investments for demand
generation, and shifting of personnel formerly engaged in research and
development to client facing roles primarily supporting the Company's on
demand subscriptions based business. Operating expenses were also impacted by
continued research and development expense which resulted in the completion of
a major software platform upgrade, administrative costs associated with the
Company's relocation to new premises, as well as investments in data center
infrastructure to support the Company's on demand subscription based business.
These investments should support higher revenue growth and improved operating
margins on both packaged software sales and for the delivery of Angoss on
demand analytics solutions as the Company's business base expands.
    Operating income growth has been positively impacted by revenue growth,
partially offset by increased sales and marketing expenses. Lower net income
resulted from primarily increased amortization expense for capital assets and
foreign exchange impacts associated with the decline in value of the US
Dollar. The continuing relative decline of the US Dollar is currently expected
to continue to impact on revenues through the balance of 2007 and into 2008.

    Third Quarter Highlights

    Financial Services Market Leaders Choose KnowledgeSEEKER(R),
KnowledgeSTUDIO(R) and StrategyBUILDER(TM). During the third quarter the
Company continued to focus on the finance and information and communications
technology industries with analytics teams within Bank of America, MBNA
Europe, Barclays, Bharti AXA Life, ABN Amro, Deutsche Bank India, Dun &
Bradstreet, JP Morgan Chase, eBay Paypal, Sears Roebuck, State Farm Bank,
Washington Mutual, Target Financial Services and HSBC Hong Kong. During the
third quarter the Company also expanded its opportunity funnel in India with
both local market affiliates of global financial services organizations, India
based financial services organizations, and analytics business process
outsourcing organizations serving global markets from India.

    Beta Release of KnowledgeSEEKER(R), KnowledgeSTUDIO(R) and
StrategyBUILDER(TM) 6.0. During the third quarter, the Company released to
beta distribution the newest version of the Angoss data mining and predictive
analytics suite, incorporating new data preparation, scorecard creation and
strategy design capabilities. These new features help financial services
organizations get from "Analytics to Action"(TM) without the cost, complexity
and bottlenecks of traditional SAS based and manually intensive analytics and
deployment processes. Version 6.0 also enables significantly larger data
volumes to be processed with "best in class" performance benchmarks for every
stage of the data mining and predictive modeling lifecycle.

    Angoss Expands FundGUARD(TM) Customer Base and Solution Capabilities. The
Angoss FundGUARD(TM) solution continues to drive significant value for Angoss
customers, with assets under management ("aum") of adopting clients continuing
to grow. FundGUARD(TM) uses advanced analytics to drive territory coverage
planning and growth in aum while reducing redemption risk. Additional client
signings during the third quarter as well as planned enhancements of the
FundGUARD(TM) solution to provide additional analytics and execution
capabilities for mutual fund marketing and sales organizations reflect the
expanded Angoss leadership position in this market segment. Angoss expects to
bring a new version of the FundGUARD(TM) on demand solution to market in
tandem with its KnowledgeSEEKER(R) for initiative with
additional breadth of marketing and sales analytics capabilities for mutual
fund organizations in 2008.

    Results Summary

    Unaudited preliminary results for the three and nine months ended
August 31, 2007 and corresponding 2006 results are as follows:

    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,
                            2007          2006          2007          2006

    Revenues           $ 1,965,009   $ 1,652,517   $ 5,449,645   $ 4,998,295
                       --------------------------  --------------------------

    Operating Expenses
      General and
       administration      363,577       374,687     1,203,392     1,186,599
      Sales and
       marketing         1,054,609       801,360     2,960,695     2,312,214
      Research and
       net                 182,190       327,649       642,665       894,330
                       --------------------------  --------------------------
                         1,600,376     1,503,696     4,806,752     4,393,143
                       --------------------------  --------------------------
    Income before the
     following             364,633       148,821       642,893       605,152
      Other income               -             -        36,194       156,292
      Amortization of
       capital assets      (92,945)      (61,877)     (241,404)     (124,672)
      Amortization of
       deferred charges    (17,345)      (22,779)      (43,581)      (59,095)
      Dividend expense     (20,235)      (30,353)      (60,540)      (90,810)
      Foreign exchange
       (loss) gain         (66,049)        8,728      (234,965)     (113,407)
      Stock option
       expense              (5,868)      (40,000)      (14,943)     (115,895)
                       --------------------------  --------------------------
    Net income for the
     period            $   162,191   $     2,540   $    83,654   $   257,565
                       --------------------------  --------------------------
                       --------------------------  --------------------------

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

    Weighted average
     number of shares

      Basic             40,040,768    39,576,522    39,807,919    39,551,296
      Diluted           40,481,033    40,703,361    40,635,957    41,636,522

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

                            Three Months ended          YTD - Nine Months
                       --------------------------  --------------------------
                         August 31,    August 31,    August 31,    August 31,
                            2007          2006          2007          2006

    Cash (used in)
     provided by
     activities        $   721,697   $   170,454   $   571,614   $   768,072
    Cash used in
     activities           (102,978)      (88,972)     (776,810)     (239,488)
    Cash provided by
     activities            (55,884)       49,352       611,031       104,021
    Net (decrease)
     increase in cash
     during the period     562,835       130,834       405,835       632,605

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

                                                    August 31,  November 30,
                                                       2007         2006

      Cash and cash equivalents                    $ 2,499,820   $ 2,093,985
      Accounts receivable                            1,624,529     1,831,410
      Prepaid expenses and other assets                415,779       479,591
    Total current assets                             4,540,128     4,404,986
      Other assets                                     963,689       441,147
    Total assets                                   $ 5,503,817   $ 4,846,133

      Accounts payable and accrued liabilities     $   615,562   $   702,243
      Current portion of deferred revenue            3,206,435     3,201,319
      Current portion of repayable contribution         32,013        88,835
      Current portion of capital leases                106,307        43,379
      Current portion of term debt                      60,000             -
      Current redeemable portion of preferred
       shares (note 5)                                 575,000       575,000
      Other                                             14,074        18,333
    Total current liabilities                        4,609,391     4,629,109
      Capital leases                                   212,893        70,628
      Term debt                                        210,000             -
      Lease inducement                                 147,103             -
      Class A Preferred shares, Series 1               551,199       520,482
    Total liabilities                                5,730,586     5,220,219
    Total shareholders' equity                        (226,769)     (374,086)
    Liabilities and shareholders' equity           $ 5,503,817   $ 4,846,133

    Angoss Software empowers people to make "Better Business Decisions. Every
    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.

    Headquartered in Toronto Canada, Angoss has offices in the UK and
Australia and partners with the world's leading enterprise software and
services vendors. For more information, visit

    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

    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,

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