SAN FRANCISCO--(BUSINESS WIRE)--Atlassian Corporation Plc (NASDAQ: TEAM), a leading provider of team collaboration and productivity software, today announced financial results for its second quarter of fiscal 2019 ended December 31, 2018 and released a shareholder letter on the Investor Relations section of its website at https://investors.atlassian.com. All financial results and targets are based on the new revenue recognition standard IFRS 15, which the company adopted on July 1, 2018.
“The second quarter of fiscal 2019 capped off a fantastic 2018, as we eclipsed $1 billion in calendar year revenue for the first time,” said Scott Farquhar, Atlassian’s co-CEO and co-founder. “The quarter also highlighted the growing demand for Atlassian products to drive digital transformation in businesses large and small. Our flagship product, Jira Software, surpassed 65,000 customers, and we ended the quarter with more than 138,000 total customers, underscoring the growth opportunity for Jira just within our installed base.”
Second Quarter Fiscal Year 2019 Financial Highlights:
On an IFRS basis, Atlassian reported:
- Revenue: Total revenue was $299.0 million for the second quarter of fiscal 2019, up 39% from $214.6 million for the second quarter of fiscal 2018.
- Operating Loss and Operating Margin: Operating loss was $3.2 million for the second quarter of fiscal 2019, compared with $13.0 million for the second quarter of fiscal 2018. Operating margin was (1%) for the second quarter of fiscal 2019, compared with (6%) for the second quarter of fiscal 2018.
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Net Income/Loss and Net Income/Loss Per Diluted Share: Net
income was $45.2 million for the second quarter of fiscal 2019,
compared with a net loss of $64.2 million for the second quarter of
fiscal 2018. Net income per diluted share was $0.18 for the second
quarter of fiscal 2019, compared with a net loss per diluted share of
$0.28 for the second quarter of fiscal 2018.
Net income for the second quarter of fiscal 2019 included a non-cash gain recorded in “other non-operating income” of $31.3 million, as a result of marking to fair value the exchange feature of Atlassian’s exchangeable senior notes and the related capped calls. - Balance Sheet: Cash and cash equivalents, and short-term investments at the end of the second quarter of fiscal 2019 totaled $1.6 billion.
On a non-IFRS basis, Atlassian reported:
- Operating Income and Operating Margin: Operating income was $74.8 million for the second quarter of fiscal 2019, compared with $46.7 million for the second quarter of fiscal 2018. Operating margin was 25% for the second quarter of fiscal 2019, compared with 22% for the second quarter of fiscal 2018.
- Net Income and Net Income Per Diluted Share: Net income was $61.7 million for the second quarter of fiscal 2019, compared with $32.0 million for the second quarter of fiscal 2018. Net income per diluted share was $0.25 for the second quarter of fiscal 2019, compared with $0.13 per diluted share for the second quarter of fiscal 2018.
- Free Cash Flow: Cash flow from operations for the second quarter of fiscal 2019 was $130.4 million, while capital expenditures totaled $7.8 million, resulting in free cash flow of $122.6 million, an increase of 81% year-over-year. Free cash flow margin for the second quarter of fiscal 2019 was 41%.
A reconciliation of IFRS to non-IFRS financial measures has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below, under the heading “About Non-IFRS Financial Measures.”
Recent Business Highlights:
- Customer growth: Atlassian ended the second quarter of fiscal 2019 with a total customer count, on an active subscription or maintenance agreement basis, of 138,235. Atlassian added 6,551 net new customers during the quarter; this number benefited from an increase of 1,396 customers as a result of our acquisition of Opsgenie during the quarter. Excluding Opsgenie, Atlassian added 5,155 net new customers during the quarter.
- Opsgenie acquisition closing: On October 1, 2018, Atlassian closed its acquisition of Opsgenie, whose technology enables companies to better plan for and respond to IT service disruptions. When outages occur, Opsgenie’s technology quickly routes alerts to the appropriate IT teams, speeding diagnosis and resolution, and reducing downtime. The acquisition was valued at approximately $295 million, of which approximately $259 million was paid in cash and the remainder in Atlassian restricted shares subject to continued vesting provisions.
- Acquisition of Butler for Trello: In December, Atlassian announced the acquisition of one of Trello’s most popular integrations, Butler for Trello, bringing the power of workplace automation to Trello boards. Trello will incorporate Butler’s automation technology to allow teams of all kinds, such as HR, marketing, and finance, to codify business processes. With Butler’s technology, Trello users can take tasks that might require multiple manual steps and automate them into one click.
- Investor session at Atlassian Summit 2019 - April 10, 2019: Atlassian will hold its Summit user conference in Las Vegas for the first time, at the Mandalay Bay South Convention Center, from April 9-11, 2019. The company will host an Investor session at Summit 2019 on April 10. General information on Atlassian Summit 2019 can be found at https://www.atlassian.com/company/events/summit.
Financial Targets:
Atlassian is providing its financial targets for the third quarter and full fiscal year 2019. The company’s financial targets are as follows:
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Third Quarter Fiscal Year 2019:
- Total revenue is expected to be in the range of $303 million to $305 million.
- Gross margin is expected to be approximately 82% on an IFRS basis and approximately 86% on a non-IFRS basis.
- Operating margin is expected to be approximately (10%) on an IFRS basis and approximately 17% on a non-IFRS basis.
- Net loss per diluted share is expected to be approximately ($0.14) on an IFRS basis, and net income per diluted share is expected to be approximately $0.18 on a non-IFRS basis.
- Weighted average share count is expected to be in the range of 238 million to 239 million shares when calculating diluted IFRS net loss per share and in the range of 248 million to 250 million shares when calculating diluted non-IFRS net income per share.
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Fiscal Year 2019:
- Total revenue is expected to be in the range of $1,195 million to $1,199 million.
- Gross margin is expected to be approximately 83% on an IFRS basis and approximately 86% on a non-IFRS basis.
- Operating margin is expected to be in the range of (6%) to (5.5%) on an IFRS basis and in the range of 20% to 20.5% on a non-IFRS basis.
- Net loss per diluted share is expected to be in the range of ($1.07) to ($1.06) on an IFRS basis, and net income per diluted share is expected to be in the range of $0.81 to $0.82 on a non-IFRS basis.
- Weighted average share count is expected to be in the range of 238 million to 240 million shares when calculating diluted IFRS net loss per share and in the range of 248 million to 250 million shares when calculating diluted non-IFRS net income per share.
- Cash flow from operations is expected to be in the range of $410 million to $420 million and free cash flow is expected to be in the range of $370 million to $380 million, which includes capital expenditures that are expected to be approximately $40 million.
With respect to Atlassian’s expectations under “Financial Targets” above, a reconciliation of IFRS to non-IFRS gross margin, operating margin, net income per diluted share, and free cash flow has been provided in the financial statement tables included in this press release.
Shareholder Letter and Webcast/Conference Call Details
A detailed shareholder letter is available on the Investor Relations section of Atlassian’s website at: https://investors.atlassian.com. Atlassian will host a webcast and conference call to answer questions today:
- When: Thursday, January 17, 2019 at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time).
- Webcast: A live webcast of the call can be accessed from the Investor Relations section of Atlassian’s website at: https://investors.atlassian.com. Following the call, a replay will be available on the same website.
- Dial in: To access the call via telephone in North America, please dial 1-888-346-0688. For international callers, please dial 1-412-902-4250. Participants should request the “Atlassian call” after dialing in.
- Audio replay: An audio replay of the call will be available via telephone for seven days, beginning two hours after the call. To listen to the replay in North America, please dial 1-877-344-7529 (access code 10127151). International callers, please dial 1-412-317-0088 (access code 10127151).
Atlassian has used, and will continue to use, its Investor Relations website at https://investors.atlassian.com as a means of making material information public and for complying with its disclosure obligations.
About Atlassian
Atlassian unleashes the potential of every team. Our team collaboration and productivity software helps teams organize, discuss and complete shared work. Teams at more than 138,000 customers, across large and small organizations - including General Motors, Walmart Labs, Bank of America Merrill Lynch, Lyft, Verizon, Spotify and NASA - use Atlassian’s project tracking, content creation and sharing, and service management products to work better together and deliver quality results on time. Learn more about our products, including Jira Software, Confluence, Trello, Bitbucket and Jira Service Desk, at https://atlassian.com/.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which statements involve substantial risks and uncertainties. All statements other than statements of historical fact could be deemed forward looking, including risks and uncertainties related to statements about our products, customers, anticipated growth, anticipated benefits of the Opsgenie and Butler for Trello acquisitions, market expansion, technology and other key strategic areas, and our financial targets such as revenue, share count and IFRS and non-IFRS financial measures including gross margin, operating margin, net income (loss) per diluted share, and free cash flow.
We undertake no obligation to update any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law.
The achievement or success of the matters covered by such forward-looking statements involves known and unknown risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make. You should not rely upon forward-looking statements as predictions of future events. Forward-looking statements represent our management’s beliefs and assumptions only as of the date such statements are made.
Further information on these and other factors that could affect our financial results is included in filings we make with the Securities and Exchange Commission from time to time, including the section titled “Risk Factors” in our most recent Forms 20-F and 6-K (reporting our quarterly results). These documents are available on the SEC Filings section of the Investor Relations section of our website at: https://investors.atlassian.com/.
About Non-IFRS Financial Measures
Our reported results and financial targets include certain non-IFRS financial measures, including non-IFRS gross profit, non-IFRS operating income, non-IFRS net income, non-IFRS net income per diluted share, and free cash flow. Management believes that the use of these non-IFRS financial measures provides consistency and comparability with our past financial performance, facilitates period-to-period comparisons of our results of operations, and also facilitates comparisons with peer companies, many of which use similar non-IFRS or non-GAAP financial measures to supplement their IFRS or GAAP results. Non-IFRS results are presented for supplemental informational purposes only to aid in understanding our operating results. The non-IFRS results should not be considered a substitute for financial information presented in accordance with IFRS, and may be different from non-IFRS or non-GAAP measures used by other companies.
Our non-IFRS financial measures include:
- Non-IFRS gross profit. Excludes expenses related to share-based compensation and amortization of acquired intangible assets.
- Non-IFRS operating income. Excludes expenses related to share-based compensation and amortization of acquired intangible assets.
- Non-IFRS net income and non-IFRS net income per diluted share. Excludes expenses related to share- based compensation, amortization of acquired intangible assets, non-coupon impact related to exchangeable senior notes and capped calls, the related income tax effects on these items, and changes in our assessment regarding the realizability of our deferred tax assets.
- Free cash flow. Free cash flow is defined as net cash provided by operating activities less capital expenditures, which consists of purchases of property and equipment.
Our non-IFRS financial measures reflect adjustments based on the items below:
- Share-based compensation
- Amortization of acquired intangible assets
-
Non-coupon impact related to exchangeable senior notes and capped
calls:
- Amortization of notes discount and issuance costs
- Mark to fair value of the exchangeable senior notes exchange feature
- Mark to fair value of the related capped call transactions
- The related income tax effects on these items, and changes in our assessment regarding the realizability of our deferred tax assets
We exclude expenses related to share-based compensation, amortization of acquired intangible assets, non-coupon impact related to exchangeable senior notes and capped calls, the related income tax effects on these items, and changes in our assessment regarding the realizability of our deferred tax assets from certain of our non-IFRS financial measures as we believe this helps investors understand our operational performance. In addition, share-based compensation expense can be difficult to predict and varies from period to period and company to company due to differing valuation methodologies, subjective assumptions, and the variety of equity instruments, as well as changes in stock price. Management believes that providing non-IFRS financial measures that exclude share-based compensation expense, amortization of acquired intangible assets, non-coupon impact related to exchangeable senior notes and capped calls, the related income tax effects on these items, and changes in our assessment regarding the realizability of our deferred tax assets allow for more meaningful comparisons between our operating results from period to period.
Management considers free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by our business that can be used for strategic opportunities, including investing in our business, making strategic acquisitions, and strengthening our statement of financial position.
Management uses non-IFRS gross profit, non-IFRS operating income, non-IFRS net income, non-IFRS net income per diluted share, and free cash flow:
- As measures of operating performance, because these financial measures do not include the impact of items not directly resulting from our core operations;
- For planning purposes, including the preparation of our annual operating budget;
- To allocate resources to enhance the financial performance of our business;
- To evaluate the effectiveness of our business strategies; and
- In communications with our Board of Directors concerning our financial performance.
The tables in this press release titled “Reconciliation of IFRS to Non-IFRS Results” and “Reconciliation of IFRS to Non-IFRS Financial Targets” provide reconciliations of non-IFRS financial measures to the most recent directly comparable financial measures calculated and presented in accordance with IFRS.
We understand that although non-IFRS gross profit, non-IFRS operating income, non-IFRS net income, non-IFRS net income per diluted share, and free cash flow are frequently used by investors and securities analysts in their evaluation of companies, these measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results of operations as reported under IFRS.
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Atlassian Corporation Plc Consolidated Statements of Operations (U.S. $ and shares in thousands, except per share data) (unaudited) |
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| Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| *As Adjusted | *As Adjusted | |||||||||||||||
| Revenues: | ||||||||||||||||
| Subscription | $ | 152,500 | $ | 97,704 | $ | 286,565 | $ | 184,095 | ||||||||
| Maintenance | 97,161 | 80,489 | 189,897 | 156,708 | ||||||||||||
| Perpetual license | 25,778 | 21,444 | 47,617 | 40,892 | ||||||||||||
| Other | 23,540 | 14,941 | 42,192 | 28,363 | ||||||||||||
| Total revenues | 298,979 | 214,578 | 566,271 | 410,058 | ||||||||||||
| Cost of revenues (1) (2) | 49,782 | 43,164 | 94,967 | 83,254 | ||||||||||||
| Gross profit | 249,197 | 171,414 | 471,304 | 326,804 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development (1) (2) | 131,364 | 101,324 | 255,744 | 196,186 | ||||||||||||
| Marketing and sales (1) (2) | 68,950 | 44,519 | 121,212 | 89,611 | ||||||||||||
| General and administrative (1) | 52,052 | 38,584 | 97,709 | 74,309 | ||||||||||||
| Total operating expenses | 252,366 | 184,427 | 474,665 | 360,106 | ||||||||||||
| Operating loss | (3,169 | ) | (13,013 | ) | (3,361 | ) | (33,302 | ) | ||||||||
| Other non-operating income (expense), net | 32,592 | (493 | ) | (204,656 | ) | (1,158 | ) | |||||||||
| Finance income | 7,659 | 1,568 | 14,925 | 2,823 | ||||||||||||
| Finance costs | (10,019 | ) | (7 | ) | (19,921 | ) | (16 | ) | ||||||||
| Income (loss) before income tax benefit (expense) | 27,063 | (11,945 | ) | (213,013 | ) | (31,653 | ) | |||||||||
| Income tax benefit (expense) | 18,122 | (52,264 | ) | 15,753 | (44,026 | ) | ||||||||||
| Net income (loss) | $ | 45,185 | $ | (64,209 | ) | $ | (197,260 | ) | $ | (75,679 | ) | |||||
| Net income (loss) per share attributable to ordinary shareholders: | ||||||||||||||||
| Basic | $ | 0.19 | $ | (0.28 | ) | $ | (0.83 | ) | $ | (0.33 | ) | |||||
| Diluted | $ | 0.18 | $ | (0.28 | ) | $ | (0.83 | ) | $ | (0.33 | ) | |||||
| Weighted-average shares outstanding used to compute net income (loss) per share attributable to ordinary shareholders: | ||||||||||||||||
| Basic | 237,740 | 230,208 | 236,979 | 229,182 | ||||||||||||
| Diluted | 247,255 | 230,208 | 236,979 | 229,182 | ||||||||||||
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(1) Amounts include share-based payment expense, as follows: |
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| Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| Cost of revenues | $ | 3,766 | $ | 3,180 | $ | 7,285 | $ | 6,172 | ||||||||
| Research and development | 32,976 | 27,020 | 59,822 | 52,991 | ||||||||||||
| Marketing and sales | 9,850 | 6,136 | 17,611 | 12,345 | ||||||||||||
| General and administrative | 13,912 | 9,015 | 24,166 | 17,968 | ||||||||||||
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(2) Amounts include amortization of acquired intangible assets, as follows: |
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| Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| Cost of revenues | $ | 7,060 | $ | 5,294 | $ | 12,411 | $ | 10,587 | ||||||||
| Research and development | 21 | — | 21 | — | ||||||||||||
| Marketing and sales | 10,368 | 9,023 | 19,356 | 18,045 | ||||||||||||
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* As adjusted to reflect the impact of the full retrospective adoption of IFRS 15. |
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Atlassian Corporation Plc Consolidated Statements of Financial Position (U.S. $ in thousands) (unaudited) |
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| December 31, 2018 | June 30, 2018 | ||||||||
| *As Adjusted | |||||||||
| Assets | |||||||||
| Current assets: | |||||||||
| Cash and cash equivalents | $ | 1,340,589 | $ | 1,410,339 | |||||
| Short-term investments | 303,772 | 323,134 | |||||||
| Trade receivables | 71,207 | 46,141 | |||||||
| Current tax receivables | 1,423 | 12,622 | |||||||
| Prepaid expenses and other current assets | 47,741 | 29,795 | |||||||
| Total current assets | 1,764,732 | 1,822,031 | |||||||
| Non-current assets: | |||||||||
| Property and equipment, net | 63,716 | 51,656 | |||||||
| Deferred tax assets | 81,055 | 59,220 | |||||||
| Goodwill | 506,121 | 311,943 | |||||||
| Intangible assets, net | 120,942 | 63,577 | |||||||
| Other non-current assets | 188,378 | 113,401 | |||||||
| Total non-current assets | 960,212 | 599,797 | |||||||
| Total assets | $ | 2,724,944 | $ | 2,421,828 | |||||
| Liabilities | |||||||||
| Current liabilities: | |||||||||
| Trade and other payables | $ | 119,831 | $ | 113,105 | |||||
| Current tax liabilities | 1,664 | 172 | |||||||
| Provisions | 7,504 | 7,215 | |||||||
| Deferred revenue | 383,776 | 324,394 | |||||||
| Total current liabilities | 512,775 | 444,886 | |||||||
| Non-current liabilities: | |||||||||
| Deferred tax liabilities | 32,976 | 12,160 | |||||||
| Provisions | 4,326 | 4,363 | |||||||
| Deferred revenue | 33,056 | 18,477 | |||||||
| Exchangeable senior notes, net | 836,403 | 819,637 | |||||||
| Other non-current liabilities | 485,660 | 214,985 | |||||||
| Total non-current liabilities | 1,392,421 | 1,069,622 | |||||||
| Total liabilities | 1,905,196 | 1,514,508 | |||||||
| Equity | |||||||||
| Share capital | 23,844 | 23,531 | |||||||
| Share premium | 456,404 | 454,766 | |||||||
| Other capital reserves | 665,934 | 557,100 | |||||||
| Other components of equity | (1,158 | ) | (61 | ) | |||||
| Accumulated deficit | (325,276 | ) | (128,016 | ) | |||||
| Total equity | 819,748 | 907,320 | |||||||
| Total liabilities and equity | $ | 2,724,944 | $ | 2,421,828 | |||||
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* As adjusted to reflect the impact of the full retrospective adoption of IFRS 15. |
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Atlassian Corporation Plc Consolidated Statements of Cash Flows (U.S. $ in thousands) (unaudited) |
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| Three Months Ended December 31, | Six Months Ended December 31, | ||||||||||||||||
| 2018 | 2017 | 2018 | 2017 | ||||||||||||||
| *As Adjusted | *As Adjusted | ||||||||||||||||
| Operating activities | |||||||||||||||||
| Income (loss) before income tax benefit (expense) | $ | 27,063 | $ | (11,945 | ) | $ | (213,013 | ) | $ | (31,653 | ) | ||||||
| Adjustments to reconcile income (loss) before income tax benefit (expense) to net cash provided by operating activities: | |||||||||||||||||
| Depreciation and amortization | 20,685 | 20,990 | 38,100 | 41,570 | |||||||||||||
| Gain on sale of investments and other assets | (2,357 | ) | (16 | ) | (2,347 | ) | (32 | ) | |||||||||
| Net unrealized gain on investments | (47 | ) | — | (47 | ) | — | |||||||||||
| Net unrealized foreign currency loss (gain) | 530 | (142 | ) | 108 | (162 | ) | |||||||||||
| Share-based payment expense | 60,504 | 45,351 | 108,884 | 89,476 | |||||||||||||
| Net unrealized (gain) loss on exchange derivative and capped call transactions | (31,348 | ) | — | 205,005 | — | ||||||||||||
| Amortization of debt discount and issuance cost | 8,433 | — | 16,766 | — | |||||||||||||
| Interest income | (7,545 | ) | (1,568 | ) | (14,811 | ) | (2,823 | ) | |||||||||
| Interest expense | 1,585 | — | 3,155 | — | |||||||||||||
| Changes in assets and liabilities: | |||||||||||||||||
| Trade receivables | (17,769 | ) | (4,668 | ) | (23,140 | ) | (8,387 | ) | |||||||||
| Prepaid expenses and other assets | (18,885 | ) | (3,023 | ) | (17,207 | ) | (328 | ) | |||||||||
| Trade and other payables, provisions and other non-current liabilities | 32,252 | 5,105 | 17,974 | 6,258 | |||||||||||||
| Deferred revenue | 51,097 | 21,653 | 72,745 | 42,894 | |||||||||||||
| Interest received | 6,981 | 1,361 | 13,721 | 2,791 | |||||||||||||
| (Income tax paid) tax refunds received, net | (743 | ) | (770 | ) | 9,472 | (2,027 | ) | ||||||||||
| Net cash provided by operating activities | 130,436 | 72,328 | 215,365 | 137,577 | |||||||||||||
| Investing activities | |||||||||||||||||
| Business combinations, net of cash acquired | (263,554 | ) | — | (263,554 | ) | — | |||||||||||
| Purchases of intangible assets | — | — | (850 | ) | — | ||||||||||||
| Purchases of property and equipment | (7,807 | ) | (4,550 | ) | (18,523 | ) | (7,114 | ) | |||||||||
| Proceeds from sales of property, equipment and intangible assets | 3,000 | — | 3,721 | — | |||||||||||||
| Purchases of investments | (129,948 | ) | (124,787 | ) | (194,389 | ) | (227,128 | ) | |||||||||
| Proceeds from maturities of investments | 93,581 | 31,119 | 185,914 | 81,887 | |||||||||||||
| Proceeds from sales of investments | 151 | 32,674 | 5,672 | 82,058 | |||||||||||||
| Increase in restricted cash | (552 | ) | (3,009 | ) | (552 | ) | (3,141 | ) | |||||||||
| Net cash used in investing activities | (305,129 | ) | (68,553 | ) | (282,561 | ) | (73,438 | ) | |||||||||
| Financing activities | |||||||||||||||||
| Proceeds from exercise of share options | 707 | 1,278 | 1,704 | 2,155 | |||||||||||||
| Payment of exchangeable senior notes issuance costs | — | — | (410 | ) | — | ||||||||||||
| Interest paid | (3,194 | ) | — | (3,194 | ) | — | |||||||||||
| Net cash (used in) provided by financing activities | (2,487 | ) | 1,278 | (1,900 | ) | 2,155 | |||||||||||
| Effect of exchange rate changes on cash and cash equivalents | (11 | ) | (19 | ) | (654 | ) | 191 | ||||||||||
| Net (decrease) increase in cash and cash equivalents | (177,191 | ) | 5,034 | (69,750 | ) | 66,485 | |||||||||||
| Cash and cash equivalents at beginning of period | 1,517,780 | 305,871 | 1,410,339 | 244,420 | |||||||||||||
| Cash and cash equivalents at end of period | $ | 1,340,589 | $ | 310,905 | $ | 1,340,589 | $ | 310,905 | |||||||||
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* As adjusted to reflect the impact of the full retrospective adoption of IFRS 15. |
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Atlassian Corporation Plc Reconciliation of IFRS to Non-IFRS Results (U.S. $ and shares in thousands, except per share data) (unaudited) |
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| Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| *As Adjusted | *As Adjusted | |||||||||||||||
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Gross profit |
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| IFRS gross profit | $ | 249,197 | $ | 171,414 | $ | 471,304 | $ | 326,804 | ||||||||
| Plus: Share-based payment expense | 3,766 | 3,180 | 7,285 | 6,172 | ||||||||||||
| Plus: Amortization of acquired intangible assets | 7,060 | 5,294 | 12,411 | 10,587 | ||||||||||||
| Non-IFRS gross profit | $ | 260,023 | $ | 179,888 | $ | 491,000 | $ | 343,563 | ||||||||
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Operating income |
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| IFRS operating loss | $ | (3,169 | ) | $ | (13,013 | ) | $ | (3,361 | ) | $ | (33,302 | ) | ||||
| Plus: Share-based payment expense | 60,504 | 45,351 | 108,884 | 89,476 | ||||||||||||
| Plus: Amortization of acquired intangible assets | 17,449 | 14,317 | 31,788 | 28,632 | ||||||||||||
| Non-IFRS operating income | $ | 74,784 | $ | 46,655 | $ | 137,311 | $ | 84,806 | ||||||||
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Net income |
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| IFRS net income (loss) | $ | 45,185 | $ | (64,209 | ) | $ | (197,260 | ) | $ | (75,679 | ) | |||||
| Plus: Share-based payment expense | 60,504 | 45,351 | 108,884 | 89,476 | ||||||||||||
| Plus: Amortization of acquired intangible assets | 17,449 | 14,317 | 31,788 | 28,632 | ||||||||||||
| Plus: Non-coupon impact related to exchangeable senior notes and capped calls | (22,915 | ) | — | 221,771 | — | |||||||||||
| Less: Income tax effects and adjustments | (38,528 | ) | 36,564 | (54,262 | ) | 22,062 | ||||||||||
| Non-IFRS net income | $ | 61,695 | $ | 32,023 | $ | 110,921 | $ | 64,491 | ||||||||
|
Net income per share |
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| IFRS net income (loss) per share - diluted | $ | 0.18 | $ | (0.28 | ) | $ | (0.83 | ) | $ | (0.33 | ) | |||||
| Plus: Share-based payment expense | 0.24 | 0.20 | 0.47 | 0.39 | ||||||||||||
| Plus: Amortization of acquired intangible assets | 0.07 | 0.06 | 0.13 | 0.12 | ||||||||||||
| Plus: Non-coupon impact related to exchangeable senior notes and capped calls | (0.08 | ) | — | 0.90 | — | |||||||||||
| Less: Income tax effects and adjustments | (0.16 | ) | 0.15 | (0.22 | ) | 0.09 | ||||||||||
| Non-IFRS net income per share - diluted | $ | 0.25 | $ | 0.13 | $ | 0.45 | $ | 0.27 | ||||||||
|
Weighted-average diluted shares outstanding |
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| Weighted-average shares used in computing diluted IFRS net income (loss) per share | 247,255 | 230,208 | 236,979 | 229,182 | ||||||||||||
| Plus: Dilution from share options and RSUs (1) | — | 13,170 | 10,066 | 13,124 | ||||||||||||
| Weighted-average shares used in computing diluted non-IFRS net income per share | 247,255 | 243,378 | 247,045 | 242,306 | ||||||||||||
|
Free cash flow |
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| IFRS net cash provided by operating activities | $ | 130,436 | $ | 72,328 | $ | 215,365 | $ | 137,577 | ||||||||
| Less: Capital expenditures | (7,807 | ) | (4,550 | ) | (18,523 | ) | (7,114 | ) | ||||||||
| Free cash flow | $ | 122,629 | $ | 67,778 | $ | 196,842 | $ | 130,463 | ||||||||
|
* As adjusted to reflect the impact of the full retrospective adoption of IFRS 15. |
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| (1) | The effects of these dilutive securities were not included in the IFRS calculation of diluted net loss per share for the three months ended December 31, 2017 and the six months ended December 31, 2018 and 2017 because the effect would have been anti-dilutive. |
|
Atlassian Corporation Plc Reconciliation of IFRS to Non-IFRS Financial Targets (U.S. $) |
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|
Three Months Ending March 31, 2019 |
Fiscal Year Ending June 30, 2019 |
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| Revenue | $303 million to $305 million | $1,195 million to $1,199 million | ||
| IFRS gross margin | 82% | 83% | ||
| Plus: Share-based payment expense | 2 | 1 | ||
| Plus: Amortization of acquired intangible assets | 2 | 2 | ||
| Non-IFRS gross margin | 86% | 86% | ||
| IFRS operating margin | (10%) | (6%) to (5.5%) | ||
| Plus: Share-based payment expense | 23 | 21 | ||
| Plus: Amortization of acquired intangible assets | 4 | 5 | ||
| Non-IFRS operating margin | 17% | 20% to 20.5% | ||
| IFRS net loss per share - diluted | ($0.14) | ($1.07) to ($1.06) | ||
| Plus: Share-based payment expense | 0.29 | 1.01 | ||
| Plus: Amortization of acquired intangible assets | 0.05 | 0.22 | ||
| Plus: Non-coupon impact related to exchangeable senior notes and capped calls | 0.03 | 0.97 | ||
| Less: Income tax effects and adjustments | (0.05) | (0.32) | ||
| Non-IFRS net income per share - diluted | $0.18 | $0.81 to $0.82 | ||
| Weighted-average shares used in computing diluted IFRS net loss per share | 238 million to 239 million | 238 million to 240 million | ||
| Dilution from share options and RSUs (1) | 10 million to 11 million | 10 million | ||
| Weighted-average shares used in computing diluted non-IFRS net income per share | 248 million to 250 million | 248 million to 250 million | ||
| IFRS net cash provided by operating activities | $410 million to $420 million | |||
| Less: Capital expenditures | (40 million) | |||
| Free cash flow | $370 million to $380 million | |||
| (1) The effects of these dilutive securities are not included in our IFRS calculation of diluted net loss per share for the three months ending March 31, 2019 and fiscal year ending June 30, 2019 because the effect would be anti-dilutive. |
