10-QPeriod: Q3 FY2002

FAIR ISAAC CORP Quarterly Report for Q3 Ended Jun 30, 2002

Filed August 14, 2002For Securities:FICO

Summary

Fair, Isaac and Company, Inc. (FICO) reported solid revenue growth and improved profitability for the nine months and third quarter ended June 30, 2002. Total revenues increased by 8% year-over-year for the third quarter to $91.0 million and by 8% for the nine-month period to $263.1 million. Net income saw a significant boost, rising to $14.4 million ($0.41 per diluted share) for the third quarter, up from $12.4 million ($0.35 per diluted share) in the prior year. For the nine-month period, net income grew to $42.1 million ($1.17 per diluted share), compared to $31.8 million ($0.93 per diluted share) in the same period last year. Financially, the company ended the quarter with a strong cash position of $42.0 million, a substantial increase from $24.6 million at the end of fiscal year 2001, supported by robust operating cash flows. The company also repurchased a significant amount of its stock, indicating a commitment to shareholder value. A major development disclosed is the completed acquisition of HNC Software Inc. on August 5, 2002, which is expected to be accretive to earnings.

Key Highlights

  • 1Revenue increased by 8% to $91.0 million for the third quarter ended June 30, 2002, compared to $84.2 million in the prior year.
  • 2Net income for the third quarter rose to $14.4 million ($0.41 per diluted share) from $12.4 million ($0.35 per diluted share) in the same period last year.
  • 3Nine-month revenue reached $263.1 million, an 8% increase over the prior year's $242.7 million.
  • 4Nine-month net income grew to $42.1 million ($1.17 per diluted share), up from $31.8 million ($0.93 per diluted share) in the comparable period.
  • 5Cash and cash equivalents significantly increased to $42.0 million as of June 30, 2002, from $24.6 million at September 30, 2001.
  • 6The company completed the acquisition of HNC Software Inc. on August 5, 2002, which is expected to impact future financial results.
  • 7A new stock repurchase program authorizing the acquisition of up to 3 million shares was announced on July 25, 2002.

Frequently Asked Questions

For the third quarter ended June 30, 2002, FICO reported revenues of $91.0 million, an 8% increase compared to $84.2 million in the same period last year. Net income was $14.4 million, or $0.41 per diluted share, up from $12.4 million, or $0.35 per diluted share, in the prior year's third quarter.

FICO completed its acquisition of HNC Software Inc. on August 5, 2002. HNC is a provider of analytic and decision management software. This acquisition is expected to be accretive to earnings and will result in the inclusion of HNC's results of operations prospectively from the acquisition date.

FICO's cash and cash equivalents significantly strengthened, reaching $42.0 million as of June 30, 2002. This is a substantial increase from the $24.6 million reported at the end of fiscal year 2001, driven by strong operating cash flows.

FICO has demonstrated a commitment to shareholder returns through active stock repurchases. The company repurchased a significant amount of its stock during the reported periods. Furthermore, on July 25, 2002, the Board of Directors authorized a new stock repurchase program to acquire up to 3 million shares of its outstanding common stock.