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Mattersight Announces First Quarter 2017 Results

CHICAGO, May 09, 2017 (GLOBE NEWSWIRE) — Mattersight Corporation (NASDAQ:MATR), the pioneer in personality-based software applications, today announced financial results for the first quarter ended March 31, 2017. 

“Mattersight’s first quarter was marked by 9% growth in total revenues and 12% growth in subscription revenue versus the same period last year,” said Mattersight CEO Kelly Conway. “We are quite encouraged by our outlook for the remainder of the year based on the conversion of our backlog to revenue; our strong pipeline; and tight expense management.”  

First Quarter 2017 Financial Highlights

  • Bookings: Annual Contract Value (ACV) bookings were $3.5 million.
  • Total Revenue: Total revenue was $11.0 million.
  • Subscription Revenue: Total subscription revenue was $10.3 million.
  • Backlog: ACV in deployment was $14.5 million at the end of the quarter.
  • Gross Margin: Gross margin was 69%.

Non-GAAP Financial Measures

Mattersight’s net loss was $5.0 million in the first quarter of 2017. The Company realized an “Adjusted EBITDA1” loss of $1.9 million for the first quarter of 2017. Adjusted EBITDA is a non-GAAP measure. For a reconciliation of net loss to Adjusted EBITDA, see the accompanying schedule.

Conference Call Information

Mattersight management will host a conference call at 5:00 p.m. ET on Tuesday, May 9, 2017. The conference call and slide presentation will be available at the Investor Relations section of Mattersight’s website at http://www.mattersight.com/about-us/investor-relations. To listen to the conference call via telephone, please call 800.952.4789 (domestic) or 404.665.9579 (international), conference ID: 10151911.

For those who cannot access the live broadcast, a replay of the conference call will be available beginning approximately two hours after the live call is completed until June 9, 2017, by dialing 855.859.2056 (domestic) or 404.537.3406 (international), conference ID: 10151911.

Safe Harbor for Forward-Looking Statements

Statements in this press release that are not historical facts are “forward-looking statements” that are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.  These forward-looking statements, which may be identified by use of words such as “plan,” “may,” “might,” “believe,” “expect,” “intend,” “could,” “would,” “should,” and other words and terms of similar meaning, involve risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.  In addition to other factors and matters contained or incorporated in this document, important factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements include, among other things, the risks detailed from time to time in Mattersight’s SEC filings.  You can locate these filings on the Investor Relations page of Mattersight’s website, www.mattersight.com.  Statements included or incorporated by reference into this press release are based upon information known to Mattersight as of the date of this press release, and the company assumes no obligation to publicly revise or update any forward-looking statement for any reason. In light of Regulation FD, it is our policy not to comment on earnings, financial guidance or operations other than through press releases, publicly announced conference calls, or other means that will constitute public disclosure for purposes of Regulation FD.  Mattersight uses its website at www.mattersight.com as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.

About Mattersight
Mattersight’s mission is to help brands have more effective and effortless conversations with their customers. Using a suite of innovative personality-based software applications, Mattersight can analyze and predict customer behavior based on the language exchanged during service and sales interactions. This insight can then facilitate real-time connections between customers and the agents best capable of handling their needs. Mattersight’s stack of patented SaaS applications has influenced hundreds of millions of shorter, more satisfying customer interactions. Organizations across the Financial Services, Healthcare, Technology and Telco industries rely on Mattersight to drive customer retention, employee engagement and operating efficiency. An independent research study documents the average return on investment for these organizations over a 3-year period is 344%. To learn more about how Mattersight can help your company, please visit www.mattersight.com.

1 Mattersight presents Adjusted EBITDA, a non-GAAP measure that represents cash earnings performance, excluding the impact of non-cash expenses and expense reduction activities, because management believes that Adjusted EBITDA provides investors with a better understanding of the results of Mattersight’s operations. Management believes that Adjusted EBITDA reflects Mattersight’s resources available to invest in its business and strengthen its balance sheet. In addition, expense reduction activities can vary significantly between periods on the basis of factors that management does not believe reflect current-period operating performance. Although similar adjustments for expense reduction activities may be recorded in future periods, the size and frequency of these adjustments cannot be predicted. The Adjusted EBITDA measure should be considered in addition to, not as a substitute for or superior to other measures of financial performance prepared in accordance with GAAP.

(Unaudited and in thousands, except per share data)  
  For the Three Months
  March 31,
  March 31,
Subscription revenue $ 10,343     $ 9,222
Other revenue   616       831
Total revenue   10,959       10,053
Operating expenses:            
Cost of subscription revenue   2,718       2,480
Cost of other revenue   721       766
Total cost of revenue, exclusive of depreciation and amortization   3,439       3,246
Product development   3,321       3,250
Sales and marketing   3,450       4,630
General and administrative   3,295       3,167
Depreciation and amortization   1,545       1,400
Total operating expenses   15,050       15,693
Operating loss   (4,091)       (5,640)
Non-operating income (expense):            
Interest and other borrowing costs   (969)       (181)
Change in fair value of warrant liability   97      
Other non-operating income   10       10
Total non-operating income (expense)   (862)       (171)
Loss before income taxes   (4,953)       (5,811)
Income tax benefit (provision)   1       (10)
Net loss   (4,952)       (5,821)
Dividends related to 7% Series B convertible preferred stock   (146)       (143)
Net loss available to common stockholders $ (5,098)     $ (5,964)
Per share of common stock:            
Basic net loss available to common stockholders $ (0.19)     $ (0.24)
Diluted net loss available to common stockholders $ (0.19)     $ (0.24)
Shares used to calculate basic net loss per share   27,423       25,064
Shares used to calculate diluted net loss per share   27,423       25,064
Stock-based compensation expense is included in individual line items above:            
Total cost of revenue $ 81     $ 74
Product development   134       329
Sales and marketing   123       479
General and administrative   354       743

CONTACT: Contact
David Mullen
Chief Financial Officer
[email protected]
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