News

AUTONOMY CORPORATION...

|

AUTONOMY CORPORATION...

|

AUTONOMY CORPORATION...

AUTONOMY CORPORATION PLC ANNOUNCES RESULTS FOR THE FIRST QUARTER ENDED MARCH 31, 2008

QUARTERLY REPORT AND INTERIM MANAGEMENT STATEMENT

Record Q1 results ahead of consensus, with strong organic growth; Highest Q1 revenues and profits in Autonomy's history; Revenues up 61%; Profit Before Tax (adjusted)* up 60% to $31.1 million

Autonomy's first quarter conference call will be available live at www.autonomy.com on April 24, 2008, at 9:30 a.m. BST/4:30 a.m. EDT/1:30 a.m. PDT.

Cambridge, England – April 24, 2008 – Autonomy Corporation plc (LSE: AU. or AU.L), a global leader in infrastructure software, today reported financial results for the first quarter ended March 31, 2008.

Financial Highlights

* Adjusted results exclude the share of loss of associates, post-acquisition restructuring costs and non-cash charges, namely the amortization of purchased intangibles, share-based compensation and non-cash translational foreign exchange gains and losses and associated tax effects. See reconciliations on page 5.

First Quarter 2008 Highlights

Commenting on the results, Dr. Mike Lynch, Group CEO of Autonomy said today: "We are witnessing continued strength as the momentum of the unstructured information revolution continues. Recent analyst reports acknowledge this development, placing Autonomy in the number one slot across a range of seemingly distinct software sectors, which are all united by the value of Autonomy's ability to understand meaning."

Dr. Lynch continued: "Q1 unfolded as expected with its usual seasonality. At the same time various sectors shifted spending from general IT to regulatory and litigation-related purchases, making the direct effect of the sub-prime crisis a net positive for our business. Our regulatory, compliance and government-driven prospects, which account for the significant majority of our revenues, are proving robust."

Dr. Lynch concluded, "We have decided to maintain our conservative view on prospects, which we will review if, as expected, current strength continues. While the current economic conditions bring a degree of uncertainty to businesses, we have seen no negative changes from the model outlined at the beginning of 2008. We will continue to monitor the situation closely as the year unfolds, although currently our strong fundamental market dynamics suggest that we have good reason to be confident in the current outlook for the business."

First Quarter Financial Highlights

Revenues for the first quarter of 2008 totalled $105.1 million, up 61% from $65.5 million for the first quarter of 2007 driven by strong organic growth and the contribution from ZANTAZ. In the first quarter of 2008, Americas revenues of $63.9 million represented 61% of total revenues and Rest of World revenues of $41.2 million represented 39% of total revenues (see note 2). The quarter demonstrated its traditional seasonal effects in revenue, profitability and deferred revenue movements.

Gross profits (adjusted) for the first quarter of 2008 were $93.5 million, up 56% from $60.0 million in the first quarter of 2007. Gross margins (adjusted) were 89% in the first quarter of 2008, versus 92% in the first quarter of 2007. Gross profits (IFRS) for the first quarter of 2008 were $88.2 million, up 52% from $58.1 million in the first quarter of 2007. Gross margins (IFRS) for the first quarter of 2008 were 84%, compared to 89% in the first quarter of 2007. Gross margins decreased in the third quarter of 2007 following the acquisition of ZANTAZ in July 2007, but have increased as planned in each subsequent quarter as a result of the integration of ZANTAZ and the transition of the core ZANTAZ business to higher margin sales.

Net profit (adjusted) for the first quarter of 2008 was $21.7 million, or $0.10 per diluted share, compared to net profit (adjusted) of $13.3 million, or $0.07 per diluted share, for the first quarter of 2007. Net profit (IFRS) for the first quarter of 2008 was $16.4 million, or $0.08 per diluted share, compared to net profit (IFRS) of $11.0 million, or $0.06 per diluted share, for the first quarter of 2007.

Cash balances were $95.5 million at March 31, 2008, an increase of $2.9 million from the prior quarter. Movements in cash flow during the quarter reflect a combination of strong cash generation from operating activities and proceeds from exercise of share options, offset by the quarterly repayment of Autonomy's bank loan and instalment tax payments. Although the company noticed some customers delay payments until immediately after quarter end, in light of recent receipts cash collection continues to be strong. Autonomy has no net debt.

Receivables at March 31, 2008, were $111.8 million, compared to $110.5 million for the prior quarter. Accounts receivable days sales outstanding were 91 days at March 31, 2008, compared to 83 days at December 31, 2007. Deferred revenues were $93.6 million at March 31, 2008, compared with $97.9 million at December 31, 2007, including normal seasonality.

Although IFRS disclosure provides investors and management with an overall view of Autonomy's financial performance, Autonomy believes that it is important for investors to also understand the performance of Autonomy's fundamental business without giving effect to certain specific, non-recurring and non-cash charges. Consequently, the non-IFRS (adjusted) results exclude share of loss of associates, post-acquisition restructuring costs and non-cash charges for the amortization of purchased intangibles, share-based compensation, foreign exchange gains and losses and associated tax effects. Management uses the adjusted results to assess the financial performance of Autonomy's operational business activities.

Q1 Product Sales

Autonomy's infrastructure technology continued to be adopted by enterprises around the globe to process information across all internal and external data formats and sources, in virtually every vertical market. During the first quarter of 2008, major customer wins included: Costco, Allstate, Wolters Kluwer, Dow Jones, Fortis Investments, HBO, Michelin, Danske Bank, Logitech, MetLife, JP Morgan Chase, Jane's, JC Penney, T.Rowe Price, Barclays Capital, ABB, Dupont, TNT, Ernst & Young, Statoil, Pepsi, Mazda, Ameriprise and Linklaters. Q1 2008 business also included new and repeat licenses with multiple government, defence and intelligence agencies around the globe such as the US Army, US Marines, US DOJ, UK Land Registry, UK Home Office and the Northern Ireland Police, and in countries as diverse as the Netherlands, Singapore, Hungary, Germany, Spain, Mexico, Canada and South Africa. Repeat business from existing customers accounted for approximately 45% of revenue for the quarter.

Strategic Partnerships and OEMs

Autonomy's OEM Program continued to grow during Q1 2008. Agreements were signed with 12 customers during the quarter, including new and extended agreements with Oracle, Symantec, Tumbleweed, Filetech and Openwave.

Q1 Corporate Developments

During the first quarter of 2008 Autonomy continued to extend its market leadership with the introduction of key new and upgraded technologies, including:

During the first quarter Autonomy was recognized in multiple ways for its market leadership and unmatched technology, including:

About Autonomy Corporation plc

Autonomy Corporation plc (LSE: AU. or AU.L) is a global leader in infrastructure software for the enterprise and is spearheading the meaning-based computing movement. Autonomy's technology forms a conceptual and contextual understanding of any piece of electronic data including unstructured information, be it text, email, voice or video. Autonomy's software powers the full spectrum of mission-critical enterprise applications including information access technology, BI, CRM, KM, call center solutions, rich media management, information risk management solutions and security applications, and is recognized by industry analysts as the clear leader in enterprise search.

Autonomy's customer base comprises of more than 17,000 global companies and organizations including: 3, ABN AMRO, AOL, BAE Systems, BBC, Bloomberg, Boeing, Citigroup, Coca Cola, Daimler Chrysler, Deutsche Bank, Ericsson, Ford, GlaxoSmithKline, Lloyds TSB, NASA, Nestle, the New York Stock Exchange, Reuters, Shell, T-Mobile, the U.S. Department of Energy, the U.S. Department of Homeland Security and the U.S. Securities and Exchange Commission. Autonomy also has over 350 OEM partners and more than 400 VARs and Integrators, numbering among them leading companies such as BEA, Business Objects, Citrix, EDS, IBM Global Services, Novell, Satyam, Sybase, Symantec, TIBCO, Vignette and Wipro. The company has offices worldwide.

The Autonomy Group includes: ZANTAZ, the leader in the archiving, e-Discovery and Proactive Information Risk Management (IRM) markets; Cardiff, a leading provider of Intelligent Document solutions; etalk, award-winning provider of enterprise-class contact center products, Virage, a visionary in rich media management and security and surveillance technology and Meridio, a leading provider of records management software.

Autonomy and the Autonomy logo are registered trademarks or trademarks of Autonomy Corporation plc. All other trademarks are the property of their respective owners.

Download the full PDF version of the Q1 2008 Report (PDF)