Accelrys revenues decline 2% to $19.8 million in second quarter

Accelrys, Inc. (NASDAQ:ACCL) today reported financial results for the fiscal quarter ended June 30, 2010. Revenue for the quarter ended June 30, 2010 decreased 2% to $19.8 million from $20.1 million for the same quarter of the previous year.

Non-GAAP net income was $1.3 million, or $0.05 per diluted share, for the current quarter compared to non-GAAP net income of $1.8 million, or $0.07 per diluted share, for the same quarter of the previous year.

GAAP net loss was ($1.6) million, or ($0.06) per diluted share, for the current quarter compared to GAAP net income of $0.7 million, or $0.03 per diluted share, for the same quarter of the previous year. GAAP net loss for the current quarter includes business consolidation costs of $1.7 million.

The Company's balance sheet as of June 30, 2010 included cash, cash equivalents, marketable securities and restricted cash of $92.9 million. Deferred revenue at the end of the quarter was $53.0 million, up 5% from June 30, 2009.

"We reached a significant milestone in the Company's history, completing our merger with Symyx Technologies on July 1, 2010. Through the merger, we have expanded the breadth and depth of our product portfolio and team, putting us in a strong position to deliver on our opportunity as the leading provider of scientific informatics software and services. Our management team is in place and I am pleased with the progress we are making executing our integration plan," said Max Carnecchia, Accelrys' President and Chief Executive Officer.

The combined organization offers an open enterprise-scale informatics system for global scientific R&D with deep domain expertise in chemistry, biology and materials science, a dedicated professional services organization and a growing partner ecosystem. Through the merger, the Accelrys product portfolio has expanded to include a market leading electronic laboratory notebook, decision support software, chemical informatics and sourcing databases. The name of the combined company is Accelrys, Inc. and, over time, all products and services will be unified under that single brand.

Recent Business Highlights:

• Completed merger with Symyx Technologies on July 1, 2010. The combined organization has over 1,350 customers, including 29 of the top 30 biopharmaceutical companies, the top five chemical companies, the top five aerospace companies, three of the top five consumer packaged goods companies, a number of top government agencies and top academic institutions from around the world.
• Integration planning with Symyx Technologies completed and the Company began executing its plan on July 1, 2010.
• Introduced the Materials Studio Collection for Pipeline Pilot. This new offering leverages key modeling and simulation tools from Accelrys' Materials Studio application. For the first time, scientific R&D organizations are able to integrate predictive analytics for materials properties into workflows, thereby increasing productivity.
• Announces a change in the Company's fiscal year end from March 31 to December 31, effective for the period ended December 31, 2010.

Balance of Fiscal Year Outlook

For the six-month period ending December 31, 2010, the company expects non-GAAP revenue to be between $80.0 and $82.0 million, and non-GAAP diluted earnings per share to be between $0.14 and $0.16 per diluted share. Non-GAAP revenue includes revenue not recognized under GAAP due to purchase accounting treatment of deferred revenue related to the Company's acquisitions.

Non-GAAP Financial Measures:

This press release describes financial measures for revenue, operating income, net income, and net income per diluted share that exclude fair value deferred revenue adjustments, stock-based compensation expense, purchased intangible assets amortization and business consolidation costs (recoveries). These financial measures are not calculated in accordance with generally accepted accounting principles (GAAP) and are not based on any comprehensive set of accounting rules or principles.

Management believes these non-GAAP financial measures provide a useful measure of the Company's operating results, a meaningful comparison with historical results and with the results of other companies, and insight into the Company's ongoing operating performance. Further, management and the Board of Directors utilize these measures, in addition to GAAP measures, when evaluating and comparing the Company's operating performance against internal financial forecasts and budgets. These non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. In addition, these non-GAAP financial measures may be different from non-GAAP financial measures used by other companies.