Bottomline Technologies Reports Fourth Quarter Results

We have presented supplemental non-GAAP financial measures as part of this earnings release. The presentation of this non-GAAP financial information should not be considered in isolation from, or as a substitute for, our financial results presented in accordance with GAAP. Core net income, core earnings per share, constant currency information, adjusted EBITDA and adjusted EBITDA as a percent of revenue are non-GAAP financial measures.

Non-core charges associated with our convertible notes and revolving credit facility consist of the amortization of debt issuance and debt discount costs. Acquisition and integration-related expenses include legal and professional fees and other direct transaction costs associated with business and asset acquisitions, costs associated with integrating acquired businesses, including costs for transitional employees or services, integration related professional services costs and other incremental charges we incur as a direct result of acquisition and integration efforts. Global ERP system implementation costs relate to direct and incremental costs incurred in connection with our implementation of a new, global ERP solution and the related technology infrastructure.

Periodically, such as in periods that include significant foreign currency volatility, we present certain metrics on a "constant currency" basis, to show the impact of period to period results normalized for the impact of foreign currency rate changes. We calculate constant currency information by translating prior period financial results using current period foreign exchange rates.

We believe that these supplemental non-GAAP financial measures are useful to investors because they allow for an evaluation of the company with a focus on the performance of its core operations, including more meaningful comparisons of financial results to historical periods and to the financial results of less acquisitive peer and competitor companies. Our executive management team uses these same non-GAAP financial measures internally to assess the ongoing performance of the company. Additionally, the same non-GAAP information is used for planning purposes, including the preparation of operating budgets and in communications with our board of directors with respect to our core financial performance. Since this information is not a GAAP measurement of financial performance, there are material limitations to its usefulness on a stand-alone basis, including the lack of comparability of this presentation to the GAAP financial results of other companies.

-- Three Months Ended June 30, -- -- Twelve Months Ended June 30, -- -- -- 2017 -- -- 2016 -- -- 2017 -- -- 2016 -- -- -- (in thousands) -- -- GAAP net loss -- $ -- (5,659 -- ) -- -- $ -- (5,926 -- ) -- -- $ -- (33,137 -- ) -- -- $ -- (19,648 -- ) -- -- Amortization of acquired intangible assets -- 5,865 -- -- -- 7,258 -- -- -- 24,246 -- -- -- 28,978 -- -- -- Goodwill impairment and fixed asset charges (1) -- 2,399 -- -- -- - -- -- -- 9,928 -- -- -- - -- -- -- Stock-based compensation expense -- 7,704 -- -- -- 7,185 -- -- -- 31,913 -- -- -- 30,279 -- -- -- Acquisition and integration-related expenses -- 324 -- -- -- 167 -- -- -- 2,596 -- -- -- 741 -- -- -- Restructuring expense (benefit) -- (14 -- ) -- -- (72 -- ) -- -- 547 -- -- -- 850 -- -- -- Global ERP system implementation costs -- 2,131 -- -- -- 2,433 -- -- -- 8,804 -- -- -- 4,252 -- -- -- Other non-core benefit -- (223 -- ) -- -- (246 -- ) -- -- (223 -- ) -- -- (246 -- ) -- -- Minimum pension liability adjustments -- 274 -- -- -- 63 -- -- -- 1,079 -- -- -- 203 -- -- -- Amortization of debt issuance and debt discount costs -- 3,649 -- -- -- 3,319 -- -- -- 14,067 -- -- -- 12,958 -- -- -- Non-recurring tax benefit -- (153 -- ) -- -- - -- -- -- (4,614 -- ) -- -- - -- -- -- Tax effects on non-GAAP income -- (5,674 -- ) -- -- (4,967 -- ) -- -- (17,530 -- ) -- -- (19,607 -- ) -- -- Core net income -- $ -- 10,623 -- -- -- $ -- 9,214 -- -- -- $ -- 37,676 -- -- -- $ -- 38,760 -- -- -- -- -- (1) Consists of a non-recurring fixed asset charge of $2.4 million and a goodwill impairment charge of $7.5 million in the three months ended June 30, 2017 and December 31, 2016, respectively. -- -- -

A reconciliation of our diluted core earnings per share to our GAAP basic and diluted net loss per share for the three and twelve months ended June 30, 2017 and 2016 is as follows:

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The table below is a comparative summary of our total revenues and our subscription and transaction revenues shown with a constant currency growth rate:

A reconciliation of our adjusted EBITDA to GAAP net loss for the three and twelve months ended June 30, 2017 and 2016 is as follows:

A reconciliation of adjusted EBITDA as a percent of revenue to GAAP net loss as a percent of revenue for the three and twelve months ended June 30, 2017 and 2016 is as follows:

Bottomline Technologies, Paymode-X and the BT logo are trademarks of Bottomline Technologies (de), Inc. which are registered in certain jurisdictions. All other brand/product names are trademarks of their respective holders.

Cautionary LanguageThis press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements reflecting our expectations about our ability to execute on our strategic plans, achieve future growth and profitability, expand margins and increase shareholder value. Any statements that are not statements of historical fact (including but not limited to statements containing the words "believes," "plans," "anticipates," "expects," "look forward", "confident", "estimates" and similar expressions) should be considered to be forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors including, among others, competition, market demand, technological change, strategic relationships, recent acquisitions, international operations and general economic conditions. For additional discussion of factors that could impact Bottomline Technologies' operational and financial results, refer to our Form 10-K for the fiscal year ended June 30, 2016 and the subsequently filed Form 10-Qs and Form 8-Ks or amendments thereto. Any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. We do not assume any obligation to update any forward-looking statements.