ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
MASSACHUSETTS (State or other jurisdiction of incorporation or organization) | 04-2746201 (I.R.S. Employer Identification No.) |
Large accelerated filer | ý | Accelerated filer | ¨ | ||
Non-accelerated filer | ¨ | Smaller reporting company | ¨ |
PART I | ||
Item 1. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
PART II | ||
Item 1. | ||
Item 1A. | ||
Item 2. | ||
Item 6. | ||
(In thousands, except share data) | May 31, 2013 | November 30, 2012 | |||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 218,387 | $ | 301,792 | |||
Short-term investments | 37,417 | 53,425 | |||||
Total cash, cash equivalents and short-term investments | 255,804 | 355,217 | |||||
Accounts receivable (less allowances of $2,536 and $3,024, respectively) | 50,772 | 70,793 | |||||
Other current assets | 26,782 | 16,478 | |||||
Deferred tax assets | 13,254 | 16,301 | |||||
Assets held for sale | 11,236 | 68,029 | |||||
Total current assets | 357,848 | 526,818 | |||||
Property and equipment, net | 59,352 | 63,071 | |||||
Intangible assets, net | 11,430 | 5,119 | |||||
Goodwill | 224,440 | 226,110 | |||||
Deferred tax assets | 26,776 | 26,565 | |||||
Investments in auction rate securities | 26,500 | 26,321 | |||||
Other assets | 4,747 | 10,973 | |||||
Total assets | $ | 711,093 | $ | 884,977 | |||
Liabilities and shareholders’ equity | |||||||
Current liabilities: | |||||||
Accounts payable | 6,594 | 10,477 | |||||
Accrued compensation and related taxes | 23,053 | 39,105 | |||||
Income taxes payable | 154 | 21,486 | |||||
Other accrued liabilities | 29,480 | 39,876 | |||||
Short-term deferred revenue | 102,094 | 103,925 | |||||
Liabilities held for sale | 4,012 | 25,285 | |||||
Total current liabilities | 165,387 | 240,154 | |||||
Long-term deferred revenue | 1,293 | 2,817 | |||||
Deferred tax liabilities | 515 | 1,032 | |||||
Other noncurrent liabilities | 1,660 | 2,575 | |||||
Commitments and contingencies | |||||||
Shareholders’ equity: | |||||||
Preferred stock, $0.01 par value; authorized, 1,000,000 shares; issued, none | — | — | |||||
Common stock, $0.01 par value, and additional paid-in capital; authorized, 200,000,000 shares; issued and outstanding, 54,046,817 shares in 2013 and 59,594,961 shares in 2012 | 232,838 | 300,333 | |||||
Retained earnings, including accumulated other comprehensive loss of $13,139 in 2013 and $10,764 in 2012 | 309,400 | 338,066 | |||||
Total shareholders’ equity | 542,238 | 638,399 | |||||
Total liabilities and shareholders’ equity | $ | 711,093 | $ | 884,977 |
Three Months Ended | Six Months Ended | ||||||||||||||
(In thousands, except per share data) | May 31, 2013 | May 31, 2012 | May 31, 2013 | May 31, 2012 | |||||||||||
Revenue: | |||||||||||||||
Software licenses | $ | 29,347 | $ | 20,506 | $ | 59,254 | $ | 50,179 | |||||||
Maintenance and services | 52,358 | 53,622 | 106,184 | 106,420 | |||||||||||
Total revenue | 81,705 | 74,128 | 165,438 | 156,599 | |||||||||||
Costs of revenue: | |||||||||||||||
Cost of software licenses | 1,356 | 1,357 | 3,446 | 2,743 | |||||||||||
Cost of maintenance and services | 6,990 | 7,114 | 14,640 | 14,039 | |||||||||||
Amortization of acquired intangibles | 143 | 139 | 282 | 383 | |||||||||||
Total costs of revenue | 8,489 | 8,610 | 18,368 | 17,165 | |||||||||||
Gross profit | 73,216 | 65,518 | 147,070 | 139,434 | |||||||||||
Operating expenses: | |||||||||||||||
Sales and marketing | 25,890 | 19,373 | 54,532 | 42,115 | |||||||||||
Product development | 14,671 | 10,387 | 28,293 | 20,699 | |||||||||||
General and administrative | 14,064 | 18,014 | 28,730 | 33,414 | |||||||||||
Amortization of acquired intangibles | 167 | 208 | 338 | 415 | |||||||||||
Restructuring expenses | 2,766 | 4,736 | 3,726 | 4,736 | |||||||||||
Acquisition-related expenses | 1,272 | — | 1,272 | 215 | |||||||||||
Total operating expenses | 58,830 | 52,718 | 116,891 | 101,594 | |||||||||||
Income from operations | 14,386 | 12,800 | 30,179 | 37,840 | |||||||||||
Other (expense) income: | |||||||||||||||
Interest income and other | 244 | 743 | 775 | 1,335 | |||||||||||
Foreign currency loss, net | (536 | ) | (494 | ) | (1,615 | ) | (816 | ) | |||||||
Total other (expense) income, net | (292 | ) | 249 | (840 | ) | 519 | |||||||||
Income from continuing operations before income taxes | 14,094 | 13,049 | 29,339 | 38,359 | |||||||||||
Provision for income taxes | 5,952 | 4,194 | 11,384 | 13,644 | |||||||||||
Income from continuing operations | 8,142 | 8,855 | 17,955 | 24,715 | |||||||||||
Income (loss) from discontinued operations, net | (4,232 | ) | (10,763 | ) | 17,073 | (19,134 | ) | ||||||||
Net income (loss) | $ | 3,910 | $ | (1,908 | ) | $ | 35,028 | $ | 5,581 | ||||||
Earnings per share: | |||||||||||||||
Basic: | |||||||||||||||
Continuing operations | $ | 0.15 | $ | 0.14 | $ | 0.32 | $ | 0.39 | |||||||
Discontinued operations | (0.08 | ) | (0.17 | ) | 0.30 | (0.31 | ) | ||||||||
Net income (loss) per share | $ | 0.07 | $ | (0.03 | ) | $ | 0.62 | $ | 0.09 | ||||||
Diluted: | |||||||||||||||
Continuing operations | $ | 0.15 | $ | 0.14 | $ | 0.31 | $ | 0.39 | |||||||
Discontinued operations | (0.08 | ) | (0.17 | ) | 0.30 | (0.30 | ) | ||||||||
Net income (loss) per share | $ | 0.07 | $ | (0.03 | ) | $ | 0.61 | $ | 0.09 | ||||||
Weighted average shares outstanding: | |||||||||||||||
Basic | 54,919 | 63,051 | 56,410 | 62,598 | |||||||||||
Diluted | 55,736 | 63,051 | 57,244 | 63,641 |
Three Months Ended | Six Months Ended | ||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | May 31, 2013 | May 31, 2012 | |||||||||||
Net income (loss) | $ | 3,910 | $ | (1,908 | ) | $ | 35,028 | $ | 5,581 | ||||||
Other comprehensive (loss) income, net of tax: | |||||||||||||||
Foreign currency translation adjustments | (2,017 | ) | (5,056 | ) | (2,462 | ) | (2,023 | ) | |||||||
Unrealized gains on investments, net of tax of $3 and $51 for the second quarter and the first six months of 2013 and $368 and $91 for the second quarter and first six months of 2012, respectively | 5 | 396 | 87 | 819 | |||||||||||
Total other comprehensive (loss) income, net of tax | (2,012 | ) | (4,660 | ) | (2,375 | ) | (1,204 | ) | |||||||
Comprehensive income (loss) | $ | 1,898 | $ | (6,568 | ) | $ | 32,653 | $ | 4,377 |
Six Months Ended | |||||||
(In thousands) | May 31, 2013 | May 31, 2012 | |||||
Cash flows from operating activities: | |||||||
Net income | $ | 35,028 | $ | 5,581 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization of property and equipment | 5,567 | 4,640 | |||||
Amortization of acquired intangibles and other | 1,910 | 12,339 | |||||
Stock-based compensation | 10,787 | 13,760 | |||||
Gain on dispositions | (35,106 | ) | — | ||||
Asset impairment | 111 | 848 | |||||
Deferred income taxes | (750 | ) | 82 | ||||
Tax (deficiency) benefit from stock plans | (806 | ) | 801 | ||||
Excess tax benefit from stock plans | (721 | ) | (1,171 | ) | |||
Allowances for accounts receivable | (35 | ) | 443 | ||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | 21,410 | 23,262 | |||||
Other assets | (4,930 | ) | (3,891 | ) | |||
Accounts payable and accrued liabilities | (23,298 | ) | 5,614 | ||||
Income taxes payable and uncertain tax positions | (22,534 | ) | (10,844 | ) | |||
Deferred revenue | 1,949 | 2,225 | |||||
Net cash flows (used in) from operating activities | (11,418 | ) | 53,689 | ||||
Cash flows from investing activities: | |||||||
Purchases of investments | — | (25,887 | ) | ||||
Sales and maturities of investments | 15,210 | 44,855 | |||||
Redemptions and sales of auction rate securities | 25 | 225 | |||||
Purchases of property and equipment | (2,386 | ) | (6,141 | ) | |||
Payments for acquisitions, net of cash acquired | (9,450 | ) | — | ||||
Proceeds from divestitures, net | 73,381 | — | |||||
Increase in other noncurrent assets | 172 | (52 | ) | ||||
Net cash flows from investing activities | 76,952 | 13,000 | |||||
Cash flows from financing activities: | |||||||
Proceeds from stock-based compensation plans | 32,443 | 20,487 | |||||
Purchases of common stock related to withholding taxes from the issuance of restricted stock units | (1,915 | ) | (2,452 | ) | |||
Repurchases of common stock | (176,537 | ) | — | ||||
Excess tax benefit from stock plans | 721 | 1,171 | |||||
Payment of long-term debt | — | (286 | ) | ||||
Net cash flows (used in) from financing activities | (145,288 | ) | 18,920 | ||||
Effect of exchange rate changes on cash | (3,651 | ) | (4,820 | ) | |||
Net (decrease) increase in cash and cash equivalents | (83,405 | ) | 80,789 | ||||
Cash and cash equivalents, beginning of period | 301,792 | 161,095 | |||||
Cash and cash equivalents, end of period | $ | 218,387 | $ | 241,884 |
Six Months Ended | |||||||
May 31, 2013 | May 31, 2012 | ||||||
Supplemental disclosure: | |||||||
Cash paid for income taxes, net of refunds of $1,812 in 2013 and $127 in 2012 | $ | 52,266 | $ | 12,558 | |||
Non-cash financing activities: | |||||||
Total fair value of restricted stock awards, restricted stock units and deferred stock units on date vested | $ | 7,592 | $ | 7,638 |
Amortized Cost Basis | Unrealized Gains | Unrealized Losses | Fair Value | ||||||||||||
Cash | $ | 170,476 | $ | — | $ | — | $ | 170,476 | |||||||
Money market funds | 47,911 | — | — | 47,911 | |||||||||||
State and municipal bond obligations | 37,228 | 189 | — | 37,417 | |||||||||||
Auction rate securities – municipal bonds | 27,150 | — | (3,588 | ) | 23,562 | ||||||||||
Auction rate securities – student loans | 3,500 | — | (562 | ) | 2,938 | ||||||||||
Total | $ | 286,265 | $ | 189 | $ | (4,150 | ) | $ | 282,304 |
Amortized Cost Basis | Unrealized Gains | Unrealized Losses | Fair Value | ||||||||||||
Cash | $ | 176,201 | $ | — | $ | — | $ | 176,201 | |||||||
Money market funds | 125,591 | — | — | 125,591 | |||||||||||
State and municipal bond obligations | 50,565 | 255 | (2 | ) | 50,818 | ||||||||||
Auction rate securities – municipal bonds | 27,175 | — | (3,755 | ) | 23,420 | ||||||||||
Auction rate securities – student loans | 3,500 | — | (599 | ) | 2,901 | ||||||||||
Corporate bonds | 2,608 | — | (1 | ) | 2,607 | ||||||||||
Total | $ | 385,640 | $ | 255 | $ | (4,357 | ) | $ | 381,538 |
May 31, 2013 | November 30, 2012 | ||||||||||||||||||||||
Cash and Equivalents | Short-Term Investments | Long-Term Investments | Cash and Equivalents | Short-Term Investments | Long-Term Investments | ||||||||||||||||||
Cash | $ | 170,476 | $ | — | $ | — | $ | 176,201 | $ | — | $ | — | |||||||||||
Money market funds | 47,911 | — | — | 125,591 | — | — | |||||||||||||||||
State and municipal bond obligations | — | 37,417 | — | — | 50,818 | — | |||||||||||||||||
Auction rate securities – municipal bonds | — | — | 23,562 | — | — | 23,420 | |||||||||||||||||
Auction rate securities – student loans | — | — | 2,938 | — | — | 2,901 | |||||||||||||||||
Corporate bonds | — | — | — | — | 2,607 | — | |||||||||||||||||
Total | $ | 218,387 | $ | 37,417 | $ | 26,500 | $ | 301,792 | $ | 53,425 | $ | 26,321 |
May 31, 2013 | November 30, 2012 | ||||||
Due in one year or less (1) | $ | 46,705 | $ | 55,001 | |||
Due after one year | 17,212 | 24,745 | |||||
Total | $ | 63,917 | $ | 79,746 |
(1) | Includes ARS which are tendered for interest-rate setting purposes periodically throughout the year. Beginning in February 2008, auctions for these securities began to fail, and therefore these investments currently lack short-term liquidity. The remaining contractual maturities of these securities range from 11 to 30 years. |
Less Than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | ||||||||||||||||||
Auction rate securities – municipal bonds | $ | — | $ | — | $ | 23,562 | $ | (3,588 | ) | $ | 23,562 | $ | (3,588 | ) | |||||||||
Auction rate securities – student loans | — | — | 2,938 | (562 | ) | 2,938 | (562 | ) | |||||||||||||||
Total | $ | — | $ | — | $ | 26,500 | $ | (4,150 | ) | $ | 26,500 | $ | (4,150 | ) |
Less Than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | ||||||||||||||||||
State and municipal bond obligations | $ | 5,818 | $ | (1 | ) | $ | 472 | $ | (1 | ) | $ | 6,290 | $ | (2 | ) | ||||||||
Auction rate securities – municipal bonds | — | — | 23,420 | (3,755 | ) | 23,420 | (3,755 | ) | |||||||||||||||
Auction rate securities – student loans | — | — | 2,901 | (599 | ) | 2,901 | (599 | ) | |||||||||||||||
Corporate bonds | 2,607 | (1 | ) | — | — | 2,607 | (1 | ) | |||||||||||||||
Total | $ | 8,425 | $ | (2 | ) | $ | 26,793 | $ | (4,355 | ) | $ | 35,218 | $ | (4,357 | ) |
May 31, 2013 | November 30, 2012 | ||||||||||||||
Notional Value | Fair Value | Notional Value | Fair Value | ||||||||||||
Forward contracts to sell U.S. dollars | $ | 22,025 | $ | (55 | ) | $ | 6,453 | $ | 4 | ||||||
Forward contracts to purchase U.S. dollars | 19,900 | 15 | 31,465 | (190 | ) | ||||||||||
Total | $ | 41,925 | $ | (40 | ) | $ | 37,918 | $ | (186 | ) |
Fair Value Measurements Using | |||||||||||||||
Total Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||
Assets | |||||||||||||||
Money market funds | $ | 47,911 | $ | 47,911 | $ | — | $ | — | |||||||
State and municipal bond obligations | 37,417 | — | 37,417 | — | |||||||||||
Auction rate securities – municipal bonds | 23,562 | — | — | 23,562 | |||||||||||
Auction rate securities – student loans | 2,938 | — | — | 2,938 | |||||||||||
Foreign exchange derivatives | (40 | ) | — | (40 | ) | — | |||||||||
Liabilities | |||||||||||||||
Contingent consideration | $ | 379 | $ | — | $ | — | $ | 379 |
Fair Value Measurements Using | |||||||||||||||
Total Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||
Money market funds | $ | 125,591 | $ | 125,591 | $ | — | $ | — | |||||||
State and municipal bond obligations | 50,818 | — | 50,818 | — | |||||||||||
Auction rate securities – municipal bonds | 23,420 | — | — | 23,420 | |||||||||||
Auction rate securities – student loans | 2,901 | — | — | 2,901 | |||||||||||
Corporate bonds | 2,607 | — | 2,607 | — | |||||||||||
Foreign exchange derivatives | (186 | ) | — | (186 | ) | — |
Valuation Technique | Unobservable Input | Range (Weighted Average) | |||
Auction rate securities | Discounted cash flow | Probability of earning the maximum rate until maturity | 0.3% - 9.4% (1.6%) | ||
Probability of principal return prior to maturity | 79.1% - 95.2% (88.6%) | ||||
Probability of default | 4.0% - 12.8% (9.8%) | ||||
Liquidity risk premium | 4.0% | ||||
Recovery rate in default | 50% - 70% (56.5%) | ||||
Market valuation | Market credit default swap spread of insurer | 2.8% | |||
Credit rating of insurer | AA- |
Three Months Ended | Six Months Ended | ||||||||||||||
May 31, 2013 | May 31, 2012 | May 31, 2013 | May 31, 2012 | ||||||||||||
Balance, beginning of period | $ | 26,442 | $ | 33,343 | $ | 26,321 | $ | 33,539 | |||||||
Redemptions and repurchases | — | — | (25 | ) | (225 | ) | |||||||||
Transfer to Level 2 fair value measurement | — | (2,700 | ) | — | (2,700 | ) | |||||||||
Unrealized gains included in accumulated other comprehensive loss | 58 | 805 | 204 | 834 | |||||||||||
Balance, end of period | $ | 26,500 | $ | 31,448 | $ | 26,500 | $ | 31,448 |
Fair Value Measurements Using | |||||||||||||||||||
Total Fair Value | Level 1 | Level 2 | Level 3 | Total Losses | |||||||||||||||
Disposal group | $ | 16,487 | $ | — | $ | 16,487 | $ | — | $ | 8,601 |
May 31, 2013 | November 30, 2012 | ||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Book Value | Gross Carrying Amount | Accumulated Amortization | Net Book Value | ||||||||||||||||||
Purchased technology | $ | 44,652 | $ | (35,509 | ) | $ | 9,143 | $ | 42,520 | $ | (40,066 | ) | $ | 2,454 | |||||||||
Customer-related and other | 19,529 | (17,242 | ) | 2,287 | 26,477 | (23,812 | ) | 2,665 | |||||||||||||||
Total | $ | 64,181 | $ | (52,751 | ) | $ | 11,430 | $ | 68,997 | $ | (63,878 | ) | $ | 5,119 |
Remainder of 2013 | $ | 1,480 | |
2014 | 2,638 | ||
2015 | 2,409 | ||
2016 | 1,906 | ||
2017 | 1,906 | ||
Thereafter | 1,091 | ||
Total | $ | 11,430 |
Balance, November 30, 2012 | $ | 226,110 | |
Additions | 4,798 | ||
Goodwill transfered to assets held for sale | (6,377 | ) | |
Translation adjustments | (91 | ) | |
Balance, May 31, 2013 | $ | 224,440 |
Three Months Ended | Six Months Ended | ||||||||||||||
May 31, 2013 | May 31, 2012 | May 31, 2013 | May 31, 2012 | ||||||||||||
Revenue | $ | 4,431 | $ | 40,468 | $ | 15,606 | $ | 82,423 | |||||||
Income (loss) before income taxes | (4,802 | ) | (16,572 | ) | (3,117 | ) | (29,718 | ) | |||||||
Income tax provision (benefit) | (570 | ) | (5,809 | ) | (433 | ) | (10,584 | ) | |||||||
Gain on sale, net of tax | — | — | 19,757 | — | |||||||||||
Income (loss) from discontinued operations, net | $ | (4,232 | ) | $ | (10,763 | ) | $ | 17,073 | $ | (19,134 | ) |
Assets: | |||
Accounts receivable | $ | 3,672 | |
Other current assets | 165 | ||
Goodwill and intangible assets | 6,990 | ||
Other long-term assets | 409 | ||
Total assets held for sale | $ | 11,236 | |
Liabilities: | |||
Deferred revenue | $ | 4,012 | |
Total liabilities held for sale | $ | 4,012 |
Purchase price | $ | 15,000 | |
Less: transaction costs | 826 | ||
Less: indemnification obligation | 1,000 | ||
Less: net assets | |||
Accounts receivables | 2,300 | ||
Goodwill and intangible assets | 24,325 | ||
Other assets | 20 | ||
Impairment reserve | (8,601 | ) | |
Deferred revenue | (5,893 | ) | |
Gain on sale | 1,023 | ||
Tax provision | — | ||
Gain on sale, net of tax | $ | 1,023 |
Purchase price | $ | 60,500 | |
Less: transaction costs | 1,211 | ||
Less: net assets | |||
Accounts receivables | 12,004 | ||
Goodwill and intangible assets | 31,693 | ||
Other assets | 976 | ||
Deferred revenue | (19,168 | ) | |
Other liabilities | (299 | ) | |
Gain on sale | 34,083 | ||
Tax provision | 15,349 | ||
Gain on sale, net of tax | $ | 18,734 |
Total | Life | ||||
Cash | $ | 50 | |||
Acquired intangible assets | 7,960 | 1 to 5 years | |||
Goodwill | 4,798 | ||||
Deferred taxes | (2,921 | ) | |||
Accounts payable and other liabilities | (8 | ) | |||
Net assets acquired | $ | 9,879 |
Three Months Ended | Six Months Ended | ||||||||||||||
May 31, 2013 | May 31, 2012 | May 31, 2013 | May 31, 2012 | ||||||||||||
Cost of software licenses | $ | — | $ | — | $ | — | $ | 3 | |||||||
Cost of maintenance and services | 158 | 204 | 367 | 429 | |||||||||||
Sales and marketing | 881 | 892 | 1,920 | 2,147 | |||||||||||
Product development | 1,225 | 703 | 2,688 | 1,514 | |||||||||||
General and administrative | 2,717 | 2,782 | 4,495 | 5,206 | |||||||||||
Stock-based compensation from continuing operations | 4,981 | 4,581 | 9,470 | 9,299 | |||||||||||
Income (loss) from discontinued operations | 900 | 2,088 | 1,317 | 4,461 | |||||||||||
Total stock-based compensation | $ | 5,881 | $ | 6,669 | $ | 10,787 | $ | 13,760 |
Foreign Currency Translation Adjustment | Unrealized Gains (Losses) on investments | Accumulated Other Comprehensive Loss | |||||||||
Balance, December 1, 2012 | $ | (8,183 | ) | $ | (2,581 | ) | $ | (10,764 | ) | ||
Other comprehensive income (loss) before reclassifications, net of tax | (2,462 | ) | 87 | (2,375 | ) | ||||||
Amounts reclassified from accumulated other comprehensive income (loss) | — | — | — | ||||||||
Balance, May 31, 2013 | $ | (10,645 | ) | $ | (2,494 | ) | $ | (13,139 | ) |
Excess Facilities and Other Costs | Employee Severance and Related Benefits | Total | |||||||||
Balance, December 1, 2012 | $ | 603 | $ | 6,429 | $ | 7,032 | |||||
Costs incurred | 1,096 | 3,053 | 4,149 | ||||||||
Cash disbursements | (398 | ) | (7,286 | ) | (7,684 | ) | |||||
Asset impairment | (111 | ) | — | (111 | ) | ||||||
Translation adjustments and other | (18 | ) | 34 | 16 | |||||||
Balance, May 31, 2013 | $ | 1,172 | $ | 2,230 | $ | 3,402 |
Three Months Ended | Six Months Ended | ||||||||||||||
May 31, 2013 | May 31, 2012 | May 31, 2013 | May 31, 2012 | ||||||||||||
Income from continuing operations | $ | 8,142 | $ | 8,855 | $ | 17,955 | $ | 24,715 | |||||||
Weighted average shares outstanding | 54,919 | 63,051 | 56,410 | 62,598 | |||||||||||
Dilutive impact from common stock equivalents | 817 | — | 834 | 1,043 | |||||||||||
Diluted weighted average shares outstanding | 55,736 | 63,051 | 57,244 | 63,641 | |||||||||||
Basic earnings per share from continuing operations | $ | 0.15 | $ | 0.14 | $ | 0.32 | $ | 0.39 | |||||||
Diluted earnings per share from continuing operations | $ | 0.15 | $ | 0.14 | $ | 0.31 | $ | 0.39 |
Percentage of Total Revenue | Percentage Change | ||||||||||||||||
Three Months Ended | Six Months Ended | Three Months Ended | Six Months Ended | ||||||||||||||
May 31, 2013 | May 31, 2012 | May 31, 2013 | May 31, 2012 | ||||||||||||||
Revenue: | |||||||||||||||||
Software licenses | 36 | % | 28 | % | 36 | % | 32 | % | 43 | % | 18 | % | |||||
Maintenance and services | 64 | 72 | 64 | 68 | (2 | ) | — | ||||||||||
Total revenue | 100 | 100 | 100 | 100 | 10 | 6 | |||||||||||
Costs of revenue: | |||||||||||||||||
Cost of software licenses | 2 | 2 | 2 | 2 | — | 26 | |||||||||||
Cost of maintenance and services | 9 | 10 | 9 | 9 | (2 | ) | 4 | ||||||||||
Amortization of acquired intangibles | — | — | — | — | 3 | (26 | ) | ||||||||||
Total costs of revenue | 11 | 12 | 11 | 11 | (1 | ) | 7 | ||||||||||
Gross profit | 89 | 88 | 89 | 89 | 12 | 5 | |||||||||||
Operating expenses: | |||||||||||||||||
Sales and marketing | 32 | 26 | 33 | 27 | 34 | 29 | |||||||||||
Product development | 18 | 14 | 17 | 13 | 41 | 37 | |||||||||||
General and administrative | 17 | 24 | 17 | 21 | (22 | ) | (14 | ) | |||||||||
Amortization of acquired intangibles | — | — | — | — | (20 | ) | (19 | ) | |||||||||
Restructuring expenses | 3 | 6 | 2 | 3 | (42 | ) | (21 | ) | |||||||||
Acquisition-related expenses | 2 | — | 1 | — | 100 | 492 | |||||||||||
Total operating expenses | 72 | 70 | 70 | 64 | 12 | 15 | |||||||||||
Income from operations | 17 | 18 | 19 | 25 | 12 | (20 | ) | ||||||||||
Other (expense) income | — | — | (1 | ) | — | (217 | ) | (262 | ) | ||||||||
Income from continuing operations before income taxes | 17 | 18 | 18 | 25 | 8 | (24 | ) | ||||||||||
Provision for income taxes | 7 | 6 | 7 | 9 | 42 | (17 | ) | ||||||||||
Income from continuing operations | 10 | 12 | 11 | 16 | (8 | ) | (27 | ) | |||||||||
Income (loss) from discontinued operations, net | (5 | ) | (15 | ) | 10 | (12 | ) | 61 | 189 | ||||||||
Net income | 5 | % | (3 | )% | 21 | % | 4 | % | 305 | % | 528 | % |
Three Months Ended | Percentage Change | ||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | As Reported | Constant Currency | |||||||||
Revenue | $ | 81,705 | $ | 74,128 | 10 | % | 12 | % |
Six Months Ended | Percentage Change | ||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | As Reported | Constant Currency | |||||||||
Revenue | $ | 165,438 | $ | 156,599 | 6 | % | 6 | % |
Three Months Ended | Percentage Change | ||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | As Reported | Constant Currency | |||||||||
License | $ | 29,347 | $ | 20,506 | 43 | % | 45 | % | |||||
As a percentage of total revenue | 36 | % | 28 | % |
Six Months Ended | Percentage Change | ||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | As Reported | Constant Currency | |||||||||
License | $ | 59,254 | $ | 50,179 | 18 | % | 19 | % | |||||
As a percentage of total revenue | 36 | % | 32 | % |
Three Months Ended | Percentage Change | ||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | As Reported | Constant Currency | |||||||||
Maintenance | $ | 50,419 | $ | 51,350 | (2 | )% | (1 | )% | |||||
As a percentage of total revenue | 62 | % | 69 | % | |||||||||
Professional services | 1,939 | 2,272 | (15 | )% | (14 | )% | |||||||
As a percentage of total revenue | 2 | % | 3 | % | |||||||||
Total maintenance and services revenue | $ | 52,358 | $ | 53,622 | (2 | )% | (1 | )% | |||||
As a percentage of total revenue | 64 | % | 72 | % |
Six Months Ended | Percentage Change | ||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | As Reported | Constant Currency | |||||||||
Maintenance | $ | 101,875 | $ | 101,515 | — | % | 1 | % | |||||
As a percentage of total revenue | 62 | % | 65 | % | |||||||||
Professional services | 4,309 | 4,905 | (12 | )% | (12 | )% | |||||||
As a percentage of total revenue | 2 | % | 3 | % | |||||||||
Total maintenance and services revenue | $ | 106,184 | $ | 106,420 | — | % | 1 | % | |||||
As a percentage of total revenue | 64 | % | 68 | % |
Three Months Ended | Percentage Change | ||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | As Reported | Constant Currency | |||||||||
North America | $ | 37,540 | $ | 32,190 | 17 | % | 17 | % | |||||
As a percentage of total revenue | 46 | % | 44 | % | |||||||||
EMEA | $ | 33,481 | $ | 30,689 | 9 | % | 11 | % | |||||
As a percentage of total revenue | 41 | % | 41 | % | |||||||||
Latin America | $ | 6,526 | $ | 6,660 | (2 | )% | 4 | % | |||||
As a percentage of total revenue | 8 | % | 9 | % | |||||||||
Asia Pacific | $ | 4,158 | $ | 4,589 | (9 | )% | (7 | )% | |||||
As a percentage of total revenue | 5 | % | 6 | % |
Six Months Ended | Percentage Change | ||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | As Reported | Constant Currency | |||||||||
North America | $ | 76,849 | $ | 68,932 | 11 | % | 11 | % | |||||
As a percentage of total revenue | 46 | % | 44 | % | |||||||||
EMEA | $ | 66,029 | $ | 64,197 | 3 | % | 3 | % | |||||
As a percentage of total revenue | 40 | % | 41 | % | |||||||||
Latin America | $ | 13,348 | $ | 14,046 | (5 | )% | 3 | % | |||||
As a percentage of total revenue | 8 | % | 9 | % | |||||||||
Asia Pacific | $ | 9,212 | $ | 9,424 | (2 | )% | (1 | )% | |||||
As a percentage of total revenue | 6 | % | 6 | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Cost of software licenses | $ | 1,356 | $ | 1,357 | — | % | $ | 3,446 | $ | 2,743 | 26 | % | |||||||||
As a percentage of software license revenue | 5 | % | 7 | % | 6 | % | 5 | % | |||||||||||||
As a percentage of total revenue | 2 | % | 2 | % | 2 | % | 2 | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Cost of maintenance and services | $ | 6,990 | $ | 7,114 | (2 | )% | $ | 14,640 | $ | 14,039 | 4 | % | |||||||||
As a percentage of maintenance and services revenue | 13 | % | 13 | % | 14 | % | 13 | % | |||||||||||||
As a percentage of total revenue | 9 | % | 10 | % | 9 | % | 9 | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Amortization of acquired intangibles | $ | 143 | $ | 139 | 3 | % | $ | 282 | $ | 383 | (26 | )% | |||||||||
As a percentage of total revenue | — | % | — | % | — | % | — | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Gross profit | $ | 73,216 | $ | 65,518 | 12 | % | $ | 147,070 | $ | 139,434 | 5 | % | |||||||||
As a percentage of total revenue | 89 | % | 88 | % | 89 | % | 89 | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Sales and marketing | $ | 25,890 | $ | 19,373 | 34 | % | $ | 54,532 | $ | 42,115 | 29 | % | |||||||||
As a percentage of total revenue | 32 | % | 26 | % | 33 | % | 27 | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Product development | $ | 14,671 | $ | 10,387 | 41 | % | $ | 28,293 | $ | 20,699 | 37 | % | |||||||||
As a percentage of total revenue | 18 | % | 14 | % | 17 | % | 13 | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
General and administrative | $ | 14,064 | $ | 18,014 | (22 | )% | $ | 28,730 | $ | 33,414 | (14 | )% | |||||||||
As a percentage of total revenue | 17 | % | 24 | % | 17 | % | 21 | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Amortization of acquired intangibles | $ | 167 | $ | 208 | (20 | )% | $ | 338 | $ | 415 | (19 | )% | |||||||||
As a percentage of total revenue | — | % | — | % | — | % | — | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Restructuring expenses | $ | 2,766 | $ | 4,736 | (42 | )% | $ | 3,726 | $ | 4,736 | (21 | )% | |||||||||
As a percentage of total revenue | 3 | % | 6 | % | 2 | % | 3 | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Acquisition-related expenses | $ | 1,272 | $ | — | 100 | % | $ | 1,272 | $ | 215 | 492 | % | |||||||||
As a percentage of total revenue | 2 | % | — | % | 1 | % | — | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Income from operations | $ | 14,386 | $ | 12,800 | 12 | % | $ | 30,179 | $ | 37,840 | (20 | )% | |||||||||
As a percentage of total revenue | 17 | % | 18 | % | 19 | % | 25 | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Interest income and other | $ | 244 | $ | 743 | (67 | )% | $ | 775 | $ | 1,335 | (42 | )% | |||||||||
Foreign currency loss, net | (536 | ) | (494 | ) | (9 | )% | (1,615 | ) | (816 | ) | (98 | )% | |||||||||
Total other (expense) income, net | $ | (292 | ) | $ | 249 | (217 | )% | $ | (840 | ) | $ | 519 | (262 | )% | |||||||
As a percentage of total revenue | — | % | — | % | (1 | )% | — | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Provision for income taxes | $ | 5,952 | $ | 4,194 | 42 | % | $ | 11,384 | $ | 13,644 | (17 | )% | |||||||||
As a percentage of total revenue | 7 | % | 6 | % | 7 | % | 9 | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||
(In thousands) | May 31, 2013 | May 31, 2012 | Percentage Change | May 31, 2013 | May 31, 2012 | Percentage Change | |||||||||||||||
Income from continuing operations | $ | 8,142 | $ | 8,855 | (8 | )% | $ | 17,955 | $ | 24,715 | (27 | )% | |||||||||
Income (loss) from discontinued operations | (4,232 | ) | (10,763 | ) | 61 | % | 17,073 | (19,134 | ) | 189 | % | ||||||||||
Net income | $ | 3,910 | $ | (1,908 | ) | 305 | % | $ | 35,028 | $ | 5,581 | 528 | % | ||||||||
As a percentage of total revenue | 5 | % | (3 | )% | 21 | % | 4 | % |
(In thousands) | May 31, 2013 | November 30, 2012 | |||||
Cash and cash equivalents | $ | 218,387 | $ | 301,792 | |||
Short-term investments | 37,417 | 53,425 | |||||
Total cash, cash equivalents and short-term investments | $ | 255,804 | $ | 355,217 |
Six Months Ended | |||||||
(In thousands) | May 31, 2013 | May 31, 2012 | |||||
Net income | $ | 35,028 | $ | 5,581 | |||
Non-cash reconciling items included in net income | (19,043 | ) | 31,742 | ||||
Changes in operating assets and liabilities | (27,403 | ) | 16,366 | ||||
Net cash flows (used in) from operating activities | $ | (11,418 | ) | $ | 53,689 |
Six Months Ended | |||||||
(In thousands) | May 31, 2013 | May 31, 2012 | |||||
Net investment activity | $ | 15,235 | $ | 19,193 | |||
Purchases of property and equipment | (2,386 | ) | (6,141 | ) | |||
Payments for acquisitions, net of cash acquired | (9,450 | ) | — | ||||
Proceeds from divestitures, net | 73,381 | — | |||||
Other investing activities | 172 | (52 | ) | ||||
Net cash flows from investing activities | $ | 76,952 | $ | 13,000 |
Six Months Ended | |||||||
(In thousands) | May 31, 2013 | May 31, 2012 | |||||
Proceeds from stock-based compensation plans | $ | 32,443 | $ | 20,487 | |||
Repurchases of common stock | (176,537 | ) | — | ||||
Other financing activities | (1,194 | ) | (1,567 | ) | |||
Net cash flows (used in) from financing activities | $ | (145,288 | ) | $ | 18,920 |
(In thousands) | May 31, 2013 | May 31, 2012 | |||||
Deferred revenue, primarily related to unexpired maintenance and support contracts (1) | $ | 103,466 | $ | 152,399 | |||
Multi-year licensing arrangements (2) | 15,841 | 21,058 | |||||
Open software license orders received but not shipped (2) | — | — | |||||
Total revenue backlog | $ | 119,307 | $ | 173,457 |
(1) | Deferred revenue as of May 31, 2012 included the deferred revenue of the 10 product lines we sold in the fourth quarter of fiscal year 2012 and the first quarter of fiscal year 2013. Since the ten product lines were divested prior to May 31, 2013, the deferred revenue balances as of May 31, 2013 is not comparable to the prior period presented. The deferred revenue as of May 31, 2013 excludes $4.0 million of deferred revenue that is held for sale as part of the Apama product line divestiture, and includes $0.1 million of contractual maintenance which has not been invoiced or included on our balance sheet and relates to a customer who changed its invoicing schedule and if excluded, amounts would not be comparable to the prior period presented. |
(2) | Our backlog of orders not included on the balance sheet is not subject to our normal accounting controls for information that is either reported in or derived from our basic financial statements. |
• | The termination of employment of various sales representatives and a former regional sales director determined to be in violation of our revenue recognition policy and code of conduct; |
• | The enhancement of communications from senior management, including the Chief Executive Officer, Senior Vice President of Global Field Operations and General Counsel and Chief Compliance Officer, regarding inappropriate business arrangements; |
• | The expansion of our existing sales employee certification process to include all Global Field Operations personnel, revenue operations personnel and commercial legal support personnel; |
• | Additional revenue recognition and compliance training to sales employees; |
• | The enhancement of processes with respect to the assessment of existing customer and partner credit worthiness; and |
• | The expansion of our existing quarterly pyramid certification process to include all direct reports of the CEO staff. |
Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (1) | ||||||||||
March 2013 | 1,055 | $ | 23.56 | 1,055 | $ | 130,479 | ||||||||
April 2013 | 1,738 | 21.59 | 1,738 | 92,959 | ||||||||||
May 2013 | 37 | 21.95 | 37 | 92,145 | ||||||||||
Total | 2,830 | $ | 22.33 | 2,830 | $ | 92,145 |
(1) | In April 2012, the Board of Directors authorized a $350.0 million return of capital to shareholders in the form of share repurchases through fiscal year 2013, and in October 2012 we launched a 10b5-1 to repurchase up to $250.0 million of our common stock through June 30, 2013, under the authorization. We completed this 10b5-1 in May 2013. |
Exhibit No. | Description | |
31.1* | Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act – Philip M. Pead | |
31.2* | Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act – Chris E. Perkins | |
32.1** | Certification Pursuant to Section 906 of the Sarbanes-Oxley Act | |
101*** | The following materials from Progress Software Corporation’s Quarterly Report on Form 10-Q for the three months ended May 31, 2013, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets as of May 31, 2013 and November 30, 2012; (ii) Condensed Consolidated Statements of Income for the three and six months ended May 31, 2013 and May 31, 2012; (iii) Condensed Consolidated Statements of Comprehensive Income for the three and six months ended May 31, 2013 and May 31, 2012; (iv) Condensed Consolidated Statements of Cash Flows for the six months ended May 31, 2013 and May 31, 2012; and (v) Notes to Condensed Consolidated Financial Statements. |
* | Filed herewith |
** | Furnished herewith |
*** | Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections. |
Dated: | July 10, 2013 | /s/ PHILIP M. PEAD | |
Philip M. Pead | |||
President and Chief Executive Officer | |||
(Principal Executive Officer) | |||
Dated: | July 10, 2013 | /s/ CHRIS E. PERKINS | |
Chris E. Perkins | |||
Senior Vice President, Finance and Administration and Chief Financial Officer | |||
(Principal Financial Officer) | |||
Dated: | July 10, 2013 | /s/ PAUL A. JALBERT | |
Paul A. Jalbert | |||
Vice President, Corporate Controller and Chief Accounting Officer | |||
(Principal Accounting Officer) |
/s/ PHILIP M. PEAD |
Philip M. Pead |
President and Chief Executive Officer |
(Principal Executive Officer) |
/s/ CHRIS E. PERKINS |
Chris E. Perkins |
Senior Vice President, Finance and Administration and Chief Financial Officer |
(Principal Financial Officer) |
/s/ PHILIP M. PEAD | /s/ CHRIS E. PERKINS | |||
President and Chief Executive Officer | Senior Vice President, Finance and Administration | |||
and Chief Financial Officer | ||||
Date: | July 10, 2013 | Date: | July 10, 2013 |
Common Stock Repurchases
|
6 Months Ended |
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May 31, 2013
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Common Stock Repurchases [Abstract] | |
Common Stock Repurchases | Common Stock Repurchases We repurchased and retired 7,613,000 shares of our common stock for $169.5 million in the six months ended May 31, 2013. The shares were repurchased as part of our Board of Directors authorized return of capital to shareholders in the form of share repurchases through fiscal year 2013 of $350.0 million. No shares were repurchased in the six months ended May 31, 2012. |
Divestitures (Income (Loss) from Discontinued Operations) (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
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May 31, 2013
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May 31, 2012
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May 31, 2013
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May 31, 2012
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Discontinued Operations and Disposal Groups [Abstract] | ||||
Revenue | $ 4,431 | $ 40,468 | $ 15,606 | $ 82,423 |
Income (loss) before income taxes | (4,802) | (16,572) | (3,117) | (29,718) |
Income tax provision (benefit) | (570) | (5,809) | (433) | (10,584) |
Gain on sale, net of tax | 0 | 0 | 19,757 | 0 |
Income (loss) from discontinued operations, net | $ (4,232) | $ (10,763) | $ 17,073 | $ (19,134) |
Cash, Cash Equivalents and Investments
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May 31, 2013
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Investments and Cash [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash, Cash Equivalents And Investments | Cash, Cash Equivalents and Investments A summary of our cash, cash equivalents and available-for-sale investments at May 31, 2013 is as follows (in thousands):
A summary of our cash, cash equivalents and available-for-sale investments at November 30, 2012 is as follows (in thousands):
Such amounts are classified on our condensed consolidated balance sheets as follows (in thousands):
The valuation methodologies for our auction rate securities (ARS) are described in Note 4. Based on these methodologies, we determined that the fair value of our ARS investments is $26.5 million and $26.3 million at May 31, 2013 and November 30, 2012, respectively. The temporary impairment recorded in accumulated other comprehensive loss to reduce the value of our available-for-sale ARS investments was $4.2 million and $4.4 million at May 31, 2013 and November 30, 2012, respectively. We will not be able to access the funds associated with our ARS investments until a future auction for these ARS is successful, we sell the securities in a secondary market, or they are redeemed by the issuer. As such, these remaining investments currently lack short-term liquidity and are therefore classified as long-term investments on the condensed consolidated balance sheets at May 31, 2013 and November 30, 2012. Based on our cash, cash equivalents and short-term investments balance of $255.8 million, expected operating cash flows and the availability of funds under our revolving credit facility, we do not anticipate that the lack of liquidity associated with our ARS will adversely affect our ability to conduct business and we believe that we have the ability to hold the affected securities throughout the currently estimated recovery period. Therefore, the impairment of these securities is considered only temporary in nature. If the credit rating of either the security issuer or the third-party insurer underlying the investments deteriorates significantly, we may be required to adjust the carrying value of the ARS through an other-than-temporary impairment charge to earnings. The fair value of debt securities by contractual maturity is as follows (in thousands):
Investments with continuous unrealized losses and their related fair values are as follows at May 31, 2013 (in thousands):
Investments with continuous unrealized losses and their related fair values are as follows at November 30, 2012 (in thousands):
The unrealized losses associated with state and municipal bond obligations and corporate bonds are attributable to changes in interest rates. The unrealized losses associated with ARS are discussed above. Management does not believe any unrealized losses represent other-than-temporary impairments based on our evaluation of available evidence as of May 31, 2013 and November 30, 2012. |
Basis of Presentation (Policies)
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6 Months Ended |
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May 31, 2013
|
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Accounting | We prepared the accompanying unaudited condensed consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) regarding interim financial reporting. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (GAAP) for complete financial statements and these unaudited financial statements should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended November 30, 2012. We made no significant changes in the application of our significant accounting policies that were disclosed in our Annual Report on Form 10-K for the fiscal year ended November 30, 2012. We have prepared the accompanying unaudited condensed consolidated financial statements on the same basis as the audited financial statements included in our Annual Report on Form 10-K, and these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of the interim periods presented. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full fiscal year. During the fourth quarter of fiscal year 2012 and the first quarter of fiscal year 2013, we completed the divestitures of the ten product lines which were not considered core product lines of our business: Actional, Artix, DataXtend, FuseSource, ObjectStore, Orbacus, Orbix, Savvion, Shadow and Sonic. The divestitures were part of the new strategic plan (the "Plan") we announced during fiscal year 2012. After the announcement of the Plan, we began reporting our results in two reportable segments: Core and non-Core. Since the non-Core segment ceased to exist during the first quarter of fiscal year 2013, after the closing of all these divestitures, we now operate as one reportable segment. In addition, the revenues and direct expenses of the product lines divested are included in discontinued operations in our condensed consolidated statements of income, including prior period amounts which have been revised to reflect the presentation. In June 2013, we entered into a definitive purchase and sale agreement to divest our Apama product line to Software AG. The target market, deployment and sales model for the Apama product line differs significantly from those of our application development platform and the divestiture allows us to focus entirely on providing leading cloud and mobile application development technologies through a single cohesive platform. The sale is expected to close in July 2013 for $44.3 million. As of May 31, 2013, we met the requirements to classify the sale of this product line as both held for sale and discontinued operations in the consolidated financial statements. The revenues and direct expenses of the Apama product line are included in discontinued operations in our consolidated statements of income, including prior period amounts which have been revised to reflect the presentation. |
Recent Accounting Pronouncements | In September 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-08, Intangibles – Goodwill and Other (Topic 350) – Testing Goodwill for Impairment (ASU 2011-08), to allow entities to use a qualitative approach to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. If after performing the qualitative assessment an entity determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step goodwill impairment test is unnecessary. However, if an entity concludes otherwise, then it is required to perform the first step of the two-step goodwill impairment test. ASU 2011-08 is effective for us in fiscal year 2013. We adopted ASU 2011-08 during the first quarter of fiscal year 2013 for our annual impairment test, which occurs in the first quarter of our fiscal year. The adoption did not have any impact on our financial position, results of operations or cash flows. In June 2011, the FASB issued ASU No. 2011-05, Comprehensive Income (Topic 220) – Presentation of Comprehensive Income (ASU 2011-05), to require an entity to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of equity. In December 2011, the FASB issued ASU No. 2011-12, Comprehensive Income (Topic 220) – Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in ASU 2011-05 (ASU 2011-12), which defers the effective date of only those changes in ASU 2011-05 that relate to the presentation of reclassification adjustments. We adopted ASU 2011-05 in our first quarter of fiscal year 2013, and applied it retrospectively. We elected to report comprehensive income as a separate, but consecutive statement to net income. The adoption of ASU 2011-05 did not have any impact on our financial position, results of operations or cash flows. In February 2013, the FASB issued ASU No. 2013-02, Comprehensive Income (Topic 220) – Reporting of Amounts Reclassified out of Accumulative Other Comprehensive Income (ASU 2013-02), which replaces the presentation requirements for reclassifications out of accumulated other comprehensive income in ASU 2011-05 and ASU 2011-12. ASU 2013-02 requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component and to present significant amounts reclassified out of accumulated other comprehensive income by respective line items of net income if the amount reclassified is required to be reclassified to net income in its entirety. We adopted ASU 2013-02 in the second quarter of fiscal year 2013 and applied it prospectively. The adoption of ASU 2013-02 did not have any impact on our financial position, results of operations or cash flows. |
Earnings Per Share (Narrative) (Details)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2013
|
May 31, 2012
|
May 31, 2013
|
May 31, 2012
|
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Earnings Per Share [Abstract] | ||||
Number of shares excluded from the calculation of diluted earnings per share | 775 | 7,890 | 1,084 | 3,668 |
Business Combinations (Narrative) (Details) (USD $)
|
3 Months Ended | 6 Months Ended | 0 Months Ended | |||
---|---|---|---|---|---|---|
May 31, 2013
|
May 31, 2012
|
May 31, 2013
|
May 31, 2012
|
Nov. 30, 2012
|
May 24, 2013
Rollbase [Member]
|
|
Business Acquisition [Line Items] | ||||||
Equity interests in Rollbase, Inc. | 100.00% | |||||
Total purchase consideration | $ 9,900,000 | |||||
Purchase consideration, cash | 9,500,000 | |||||
Purchase consideration, contingent consideration | 400,000 | |||||
Expected payout period | 2 years | |||||
Earn-out provision | 5,000,000 | |||||
Goodwill | 224,440,000 | 224,440,000 | 226,110,000 | 4,798,000 | ||
Acquisition-related expenses | 1,272,000 | 0 | 1,272,000 | 215,000 | ||
Termination fee related to pre-existing license arrangement | $ 1,000,000 |
Stock-Based Compensation
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2013
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense reflects the fair value of stock-based awards measured at the grant date and recognized over the relevant service period. We estimate the fair value of each stock-based award on the measurement date using either the current market price of the stock or the Black-Scholes option valuation model. The Black-Scholes option valuation model incorporates assumptions as to stock price volatility, the expected life of options, a risk-free interest rate and dividend yield. We recognize stock-based compensation expense on a straight-line basis over the service period of the award, which is generally 4 or 5 years for options and 3 years for restricted stock units and restricted stock awards. The following table provides the classification of stock-based compensation as reflected in our condensed consolidated statements of income (in thousands):
During the second quarter of fiscal year 2013, in connection with the divestiture of the Apama product line, we entered into transition agreements with five executives. As part of the agreements, the executives are entitled to accelerated vesting of certain stock-based awards upon the completion of the divestiture. Due to the anticipated accelerated vesting, we recognized additional stock-based compensation of $0.6 million in the three and six months ended May 31, 2013 in discontinued operations. During the six months ended May 31, 2012, the employment of three of our executives terminated. As part of the separation agreements, the executives were entitled to accelerated vesting of certain stock-based awards. Due to the separation and accelerated vesting, we recognized additional stock-based compensation of $1.2 million and $1.8 million in the three and six months ended May 31, 2012, respectively. |
Intangible Assets and Goodwill (Narrative) (Details) (USD $)
|
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2013
|
May 31, 2012
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May 31, 2013
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May 31, 2012
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Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Acquired intangible assets, weighted average useful life | 4 years 10 months 24 days | |||
Intangible assets, amortization expense | $ 300,000 | $ 300,000 | $ 600,000 | $ 800,000 |
Goodwill impairment loss | 0 | |||
Purchased Technology [Member]
|
||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Acquired finite-lived intangible asset, amount | 7,800,000 | 7,800,000 | ||
Customer Relationships [Member]
|
||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Acquired finite-lived intangible asset, amount | $ 200,000 | $ 200,000 |
Business Combinations (Schedule of Net Assets Acquired) (Details) (USD $)
In Thousands, unless otherwise specified |
6 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
May 31, 2013
|
Nov. 30, 2012
|
May 24, 2013
Rollbase [Member]
|
May 31, 2013
Customer Relationships [Member]
Rollbase [Member]
|
May 31, 2013
Purchased Technology [Member]
Rollbase [Member]
|
|
Business Acquisition [Line Items] | |||||
Cash | $ 50 | ||||
Acquired intangible assets | 7,960 | ||||
Goodwill | 224,440 | 226,110 | 4,798 | ||
Deferred taxes | (2,921) | ||||
Accounts payable and other liabilities | (8) | ||||
Net assets acquired | $ 9,879 | ||||
Acquired intangible assets, Life | 4 years 10 months 24 days | 1 year | 5 years |
Fair Value Measurements (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2013
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements within the Fair Value Hierarchy of the Financial Assets | The following table details the fair value measurements within the fair value hierarchy of our financial assets and liabilities at May 31, 2013 (in thousands):
The following table details the fair value measurements within the fair value hierarchy of our financial assets at November 30, 2012 (in thousands):
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Quantitative Information about Unobservable Inputs | The following table provides additional quantitative information about the unobservable inputs used in our Level 3 valuations as of May 31, 2013:
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Activity for Financial Assets Measured at Fair Value Using Level 3 Inputs | The following table reflects the activity for our financial assets measured at fair value using Level 3 inputs for each period presented (in thousands):
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Fair Value, Assets and Liabilities Measured on Nonrecurring Basis | The following table details our nonrecurring fair value measurements at November 30, 2012 (in thousands):
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Derivative Instruments (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2013
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outstanding Foreign Currency Forward Contracts | The table below details outstanding foreign currency forward contracts where the notional amount is determined using contract exchange rates (in thousands):
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Fair Value Measurements (Activity for Financial Assets Measured at Fair Value Using Level 3 Inputs) (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2013
|
May 31, 2012
|
May 31, 2013
|
May 31, 2012
|
|
Fair Value, Assets Measured on Recurring Basis, Level 3 Reconciliation [Roll Forward] | ||||
Balance, beginning of period | $ 26,442 | $ 33,343 | $ 26,321 | $ 33,539 |
Redemptions and repurchases | 0 | 0 | (25) | (225) |
Transfer to Level 2 fair value measurement | 0 | (2,700) | 0 | (2,700) |
Unrealized gains included in accumulated other comprehensive loss | 58 | 805 | 204 | 834 |
Balance, end of period | $ 26,500 | $ 31,448 | $ 26,500 | $ 31,448 |
Earnings Per Share (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2013
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Calculation of Basic and Diluted Earnings Per Share | The following table sets forth the calculation of basic and diluted earnings per share from continuing operations on an interim basis (in thousands, expect per share data):
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Intangible Assets and Goodwill (Schedule Of Intangible Assets) (Details) (USD $)
In Thousands, unless otherwise specified |
May 31, 2013
|
Nov. 30, 2012
|
---|---|---|
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 64,181 | $ 68,997 |
Accumulated Amortization | (52,751) | (63,878) |
Net Book Value | 11,430 | 5,119 |
Purchased technology [Member]
|
||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 44,652 | 42,520 |
Accumulated Amortization | (35,509) | (40,066) |
Net Book Value | 9,143 | 2,454 |
Customer-related and other [Member]
|
||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 19,529 | 26,477 |
Accumulated Amortization | (17,242) | (23,812) |
Net Book Value | $ 2,287 | $ 2,665 |
Stock-Based Compensation (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2013
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Classification of Stock-Based Compensation | The following table provides the classification of stock-based compensation as reflected in our condensed consolidated statements of income (in thousands):
|
Restructuring Charges (Summary of Restructuring Activity) (Details) (USD $)
|
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2013
|
May 31, 2012
|
May 31, 2013
|
May 31, 2012
|
|
Restructuring Reserve [Roll Forward] | ||||
Costs incurred | $ 2,766,000 | $ 4,736,000 | $ 3,726,000 | $ 4,736,000 |
2012 Restructuring Activities [Member]
|
||||
Restructuring Reserve [Roll Forward] | ||||
Balance at the beginning of the period | 7,032,000 | |||
Costs incurred | 2,800,000 | 4,149,000 | ||
Cash disbursements | (7,684,000) | |||
Asset impairment | (111,000) | |||
Translation adjustments and other | 16,000 | |||
Balance at the end of the period | 3,402,000 | 3,402,000 | ||
2012 Restructuring Activities [Member] | Excess Facilities and Other Costs [Member]
|
||||
Restructuring Reserve [Roll Forward] | ||||
Balance at the beginning of the period | 603,000 | |||
Costs incurred | 200,000 | 1,096,000 | ||
Cash disbursements | (398,000) | |||
Asset impairment | (111,000) | |||
Translation adjustments and other | (18,000) | |||
Balance at the end of the period | 1,172,000 | 1,172,000 | ||
2012 Restructuring Activities [Member] | Employee Severance and Related Benefits [Member]
|
||||
Restructuring Reserve [Roll Forward] | ||||
Balance at the beginning of the period | 6,429,000 | |||
Costs incurred | 2,600,000 | 3,053,000 | ||
Cash disbursements | (7,286,000) | |||
Asset impairment | 0 | |||
Translation adjustments and other | 34,000 | |||
Balance at the end of the period | $ 2,230,000 | $ 2,230,000 |
Restructuring Charges (Narrative) (Details) (USD $)
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3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | 15 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | 15 Months Ended | 3 Months Ended | 6 Months Ended | 15 Months Ended | 6 Months Ended | 36 Months Ended | |||||||
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May 31, 2013
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May 31, 2012
|
May 31, 2013
|
May 31, 2012
|
May 31, 2013
2012 Restructuring Activities [Member]
|
May 31, 2013
2012 Restructuring Activities [Member]
|
May 31, 2013
2012 Restructuring Activities [Member]
|
Nov. 30, 2012
2012 Restructuring Activities [Member]
|
May 31, 2013
2012 Restructuring Activities [Member]
Income (loss) from discontinued operations [Member]
|
May 31, 2013
2012 Restructuring Activities [Member]
Excess Facilities and Other Costs [Member]
|
May 31, 2013
2012 Restructuring Activities [Member]
Excess Facilities and Other Costs [Member]
|
May 31, 2013
2012 Restructuring Activities [Member]
Excess Facilities and Other Costs [Member]
|
Nov. 30, 2012
2012 Restructuring Activities [Member]
Excess Facilities and Other Costs [Member]
|
May 31, 2013
2012 Restructuring Activities [Member]
Employee Severance and Related Benefits [Member]
|
May 31, 2013
2012 Restructuring Activities [Member]
Employee Severance and Related Benefits [Member]
|
May 31, 2013
2012 Restructuring Activities [Member]
Employee Severance and Related Benefits [Member]
|
Nov. 30, 2012
2012 Restructuring Activities [Member]
Employee Severance and Related Benefits [Member]
|
May 31, 2013
2010 Restructuring Activities [Member]
|
Nov. 30, 2012
2010 Restructuring Activities [Member]
|
Nov. 30, 2012
2010 Restructuring Activities [Member]
Excess Facilities and Other Costs [Member]
|
Nov. 30, 2012
2010 Restructuring Activities [Member]
Employee Severance and Related Benefits [Member]
|
|
Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||
Restructuring expenses | $ 2,766,000 | $ 4,736,000 | $ 3,726,000 | $ 4,736,000 | $ 2,800,000 | $ 4,149,000 | $ 400,000 | $ 200,000 | $ 1,096,000 | $ 2,600,000 | $ 3,053,000 | $ 0 | |||||||||
Restructuring cumulative expenses | 23,200,000 | 3,800,000 | 19,400,000 | 43,300,000 | 8,000,000 | 35,300,000 | |||||||||||||||
Expected restructuring costs | 5,100,000 | 19,700,000 | |||||||||||||||||||
Short-term restructuring reserves | 3,200,000 | 3,200,000 | 3,200,000 | ||||||||||||||||||
Long-term restructuring reserves | 200,000 | 200,000 | 200,000 | ||||||||||||||||||
Restructuring reserve | $ 3,402,000 | $ 3,402,000 | $ 3,402,000 | $ 7,032,000 | $ 1,172,000 | $ 1,172,000 | $ 1,172,000 | $ 603,000 | $ 2,230,000 | $ 2,230,000 | $ 2,230,000 | $ 6,429,000 | $ 300,000 |
Cash, Cash Equivalents and Investments (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2013
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Investments and Cash [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Cash, Cash Equivalents and Trading and Available-for-sale Investments | A summary of our cash, cash equivalents and available-for-sale investments at May 31, 2013 is as follows (in thousands):
A summary of our cash, cash equivalents and available-for-sale investments at November 30, 2012 is as follows (in thousands):
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Summary of Cash, Cash Equivalents and Trading and Available-for-sale Investments by Balance Sheet Classification | Such amounts are classified on our condensed consolidated balance sheets as follows (in thousands):
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Fair Value of Debt Securities by Contractual Maturity | The fair value of debt securities by contractual maturity is as follows (in thousands):
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Investments with Continuous Unrealized Losses and Their Related Fair Values | Investments with continuous unrealized losses and their related fair values are as follows at May 31, 2013 (in thousands):
Investments with continuous unrealized losses and their related fair values are as follows at November 30, 2012 (in thousands):
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Condensed Consolidated Statements of Comprehensive Income (Parentheticals) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2013
|
May 31, 2012
|
May 31, 2013
|
May 31, 2012
|
|
Statement of Other Comprehensive Income [Abstract] | ||||
Tax provision (benefit) included in accumulated unrealized gains on investments | $ 3 | $ 368 | $ 51 | $ 91 |
Condensed Consolidated Statements Of Cash Flows (Parenthetical) (USD $)
In Thousands, unless otherwise specified |
6 Months Ended | |
---|---|---|
May 31, 2013
|
May 31, 2012
|
|
Statement of Cash Flows [Abstract] | ||
Proceeds from income tax refunds | $ 1,812 | $ 127 |
Derivative Instruments
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2013
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments | Derivative Instruments We use forward contracts that are not designated as hedging instruments to hedge economically the impact of the variability in exchange rates on accounts receivable and collections denominated in certain foreign currencies. We generally do not hedge the net assets of our international subsidiaries. All forward contracts are recorded at fair value in other current assets on the condensed consolidated balance sheets at the end of each reporting period and expire within 90 days. In the three and six months ended May 31, 2013 and May 31, 2012, realized and unrealized gains (losses) of $0.6 million, $(0.5) million, $2.5 million and $0.3 million, respectively, from our forward contracts were recognized in other income (expense) in the condensed consolidated statements of income. These losses were substantially offset by realized and unrealized gains on the offsetting positions. The table below details outstanding foreign currency forward contracts where the notional amount is determined using contract exchange rates (in thousands):
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Basis of Presentation
|
6 Months Ended |
---|---|
May 31, 2013
|
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation We prepared the accompanying unaudited condensed consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) regarding interim financial reporting. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (GAAP) for complete financial statements and these unaudited financial statements should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended November 30, 2012. We made no significant changes in the application of our significant accounting policies that were disclosed in our Annual Report on Form 10-K for the fiscal year ended November 30, 2012. We have prepared the accompanying unaudited condensed consolidated financial statements on the same basis as the audited financial statements included in our Annual Report on Form 10-K, and these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of the interim periods presented. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full fiscal year. During the fourth quarter of fiscal year 2012 and the first quarter of fiscal year 2013, we completed the divestitures of the ten product lines which were not considered core product lines of our business: Actional, Artix, DataXtend, FuseSource, ObjectStore, Orbacus, Orbix, Savvion, Shadow and Sonic. The divestitures were part of the new strategic plan (the "Plan") we announced during fiscal year 2012. After the announcement of the Plan, we began reporting our results in two reportable segments: Core and non-Core. Since the non-Core segment ceased to exist during the first quarter of fiscal year 2013, after the closing of all these divestitures, we now operate as one reportable segment. In addition, the revenues and direct expenses of the product lines divested are included in discontinued operations in our condensed consolidated statements of income, including prior period amounts which have been revised to reflect the presentation. In June 2013, we entered into a definitive purchase and sale agreement to divest our Apama product line to Software AG. The target market, deployment and sales model for the Apama product line differs significantly from those of our application development platform and the divestiture allows us to focus entirely on providing leading cloud and mobile application development technologies through a single cohesive platform. The sale is expected to close in July 2013 for $44.3 million. As of May 31, 2013, we met the requirements to classify the sale of this product line as both held for sale and discontinued operations in the consolidated financial statements. The revenues and direct expenses of the Apama product line are included in discontinued operations in our consolidated statements of income, including prior period amounts which have been revised to reflect the presentation. Recent Accounting Pronouncements In September 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-08, Intangibles – Goodwill and Other (Topic 350) – Testing Goodwill for Impairment (ASU 2011-08), to allow entities to use a qualitative approach to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. If after performing the qualitative assessment an entity determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step goodwill impairment test is unnecessary. However, if an entity concludes otherwise, then it is required to perform the first step of the two-step goodwill impairment test. ASU 2011-08 is effective for us in fiscal year 2013. We adopted ASU 2011-08 during the first quarter of fiscal year 2013 for our annual impairment test, which occurs in the first quarter of our fiscal year. The adoption did not have any impact on our financial position, results of operations or cash flows. In June 2011, the FASB issued ASU No. 2011-05, Comprehensive Income (Topic 220) – Presentation of Comprehensive Income (ASU 2011-05), to require an entity to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of equity. In December 2011, the FASB issued ASU No. 2011-12, Comprehensive Income (Topic 220) – Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in ASU 2011-05 (ASU 2011-12), which defers the effective date of only those changes in ASU 2011-05 that relate to the presentation of reclassification adjustments. We adopted ASU 2011-05 in our first quarter of fiscal year 2013, and applied it retrospectively. We elected to report comprehensive income as a separate, but consecutive statement to net income. The adoption of ASU 2011-05 did not have any impact on our financial position, results of operations or cash flows. In February 2013, the FASB issued ASU No. 2013-02, Comprehensive Income (Topic 220) – Reporting of Amounts Reclassified out of Accumulative Other Comprehensive Income (ASU 2013-02), which replaces the presentation requirements for reclassifications out of accumulated other comprehensive income in ASU 2011-05 and ASU 2011-12. ASU 2013-02 requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component and to present significant amounts reclassified out of accumulated other comprehensive income by respective line items of net income if the amount reclassified is required to be reclassified to net income in its entirety. We adopted ASU 2013-02 in the second quarter of fiscal year 2013 and applied it prospectively. The adoption of ASU 2013-02 did not have any impact on our financial position, results of operations or cash flows. |
Derivative Instruments (Narrative) (Details) (Forward Contracts [Member], USD $)
In Millions, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
May 31, 2013
|
May 31, 2012
|
May 31, 2013
|
May 31, 2012
|
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Forward Contracts [Member]
|
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Derivative [Line Items] | ||||
Maximum maturity period, foreign currency derivative (in days) | 90 days | |||
Gains (losses) on foreign currency forward contracts | $ 0.6 | $ 2.5 | $ (0.5) | $ 0.3 |
Intangible Assets and Goodwill (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2013
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Intangible Assets | Intangible assets are comprised of the following significant classes (in thousands):
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Schedule Of Future Amortization Expense From Intangible Assets Held | Future amortization expense for intangible assets as of May 31, 2013, is as follows (in thousands):
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Schedule of Goodwill | Changes in the carrying amount of goodwill for the six months ended May 31, 2013, are as follows (in thousands):
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Accumulated Other Comprehensive Loss (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2013
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table summarizes the changes in accumulated balances of other comprehensive loss during the six months ended May 31, 2013 (in thousands):
|