Ann: FLLYR: DIL: Diligent Q4 and Full Year 2014 Results...

• Release Date: 02/03/15 08:30
• Summary: FLLYR: DIL: Diligent Q4 and Full Year 2014 Results Announcement
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					DIL
02/03/2015 08:30
FLLYR
PRICE SENSITIVE
REL: 0830 HRS Diligent Board Member Services INC (NS)

FLLYR: DIL: Diligent Q4 and Full Year 2014 Results Announcement

March 2, 2015

Diligent Board Member Services Announces Fourth Quarter and Fiscal Year 2014
Financial Results

Fourth Quarter total revenue of $US 22.2 million, up 22% year-over-year
Fiscal Year 2014 total revenue of $US 83.1 million, up 28% year-over-year

March 2, 2015 --Diligent Board Member Services, Inc. ("Diligent" or the
"Company") (NZX: DIL) (www.boardbooks.com), provider of the world's most
widely used secure board portal, today announced financial results for the
fourth quarter and fiscal year ended December 31, 2014.

Alessandro Sodi, President and Chief Executive Officer of Diligent, stated,
"We ended 2014 on a high note generating fourth quarter revenue that exceeded
the high-end of our guidance range and full year revenue growth of 28%
year-over-year. Our results demonstrate strong demand for Diligent Boardbooks
and the continued execution of our growth strategy."

Mr. Sodi continued, "Looking to 2015, we will continue to make investments to
strengthen our leading solution, as we also work to introduce new and
complimentary use cases and expand our global sales and marketing platforms
to position Diligent for its next stage of growth. Consistent with this
strategy, we plan to introduce a new SaaS collaboration solution called
Diligent Teams during the third quarter of 2015. The launch of Diligent Teams
will be an important milestone in the evolution of the Company, as we look to
extend our best-of-breed technology beyond the boardroom and deliver even
greater value to our customers."

Fourth Quarter 2014 Financial Highlights

- Revenue: For the quarter ended December 31, 2014, total revenue was $US
22.2 million, an increase of 22% compared with $US 18.2 million in the prior
year.

- Gross Profit: Gross profit for the fourth quarter was $US 18.0 million, an
increase of 26% compared with $US 14.2 million in the prior year. Gross
margin was 81.2% in the fourth quarter of 2014 compared with 78.3% in the
prior year period.

- Adjusted EBITDA: For the quarter ended December 31, 2014, Adjusted EBITDA
was $US 5.5 million, compared with $US 6.4 million in the prior year.
Adjusted EBITDA margin was 24.6% in the fourth quarter of 2014 compared with
35.4% in the prior year period.

- Net Income: For the quarter ended December 31, 2014, net income was $US 1.8
million, compared with $US 0.6 million in the prior year. Diluted earnings
per share were $US 0.01, compared with $US 0.00 in the prior year.

Adjusted Net Income for the fourth quarter was $US 2.5 million, compared with
$US 3.7 million in the prior year. Adjusted Net Income per diluted share was
$US 0.02, compared with $US 0.03 in the prior year.

Fourth Quarter and Recent Business Highlights

- Boardbooks Users and Client Agreements: During the fourth quarter of 2014,
the number of Diligent Boardbooks users increased by approximately 5,100 to
over 92,000 users. As of December 31, 2014, total client agreements exceeded
3,000.

- Revenue Retention Rate: In the fourth quarter, Diligent's annual revenue
retention rate (excluding upsells into the existing customer base) continued
to exceed 95%; which the Company believes places it among the best-in-class
for SaaS companies.

- Industry Awards: Diligent was recently honored with two awards for its
customer service and support excellence. In December 2014, Diligent was named
a gold winner in the "Most Customer Friendly Company of the Year" category in
the Best in Biz Awards 2014. In January 2015, Diligent was awarded an
International Service Excellence Award from the Customer Service Institute of
America.

Fiscal Year 2014 Financial Highlights

- Revenue: For the year ended December 31, 2014, total revenue was $US 83.1
million, an increase of 28% compared with $US 64.8 million in the prior year.

- Gross Profit: Gross profit for the year ended December 31, 2014 was $US
67.1 million, an increase of 30% compared with $US 51.8 million in the prior
year. Gross margin for the year ended December 31, 2014 was 80.7% compared
with 80.0% in the prior year.

- Adjusted EBITDA: For the year ended December 31, 2014, Adjusted EBITDA was
$US 24.6 million, an increase of 10% compared with $US 22.4 million in the
prior year. Adjusted EBITDA margin for the year ended December 31, 2014 was
29.6% compared with 34.6% in the prior year.

- Net Income: For the year ended December 31, 2014, net income was $US 8.9
million, an increase of 43% compared with $US 6.3 million in the prior year.
Diluted earnings per share were $US 0.07 for the year ended December 31,
2014, compared with $US 0.05 in the prior year.

Adjusted Net Income for the year ended December 31, 2014 was $US 12.9
million, an increase of 1% compared with $US 12.8 million in the prior year.
Adjusted Net Income per diluted share was $US 0.11 for the year ended
December 31, 2014, compared with $US 0.11 in the prior year.

- Balance Sheet and Cash Flow: As of December 31, 2014, Diligent had $US 70.8
million in cash and cash equivalents and short-term investments and no bank
debt, compared with $56.1 million in cash and cash equivalents and short-term
investments as of December 31, 2013.

The Company generated $US 24.4 million in cash from operations and invested
$US 7.2 million in capital expenditures, yielding free cash flow of $US 17.2
million for the year ended December 31, 2014. Free cash flow was $US 23.8
million in fiscal 2013.

A reconciliation of GAAP to non-GAAP 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 "Non-GAAP
Financial Measures."

Financial Outlook

As of the date of this announcement, Diligent's guidance for its first
quarter and full year 2015 is as follows:
- First Quarter 2015: The Company expects revenue to be between $US 22.5
million and $US 22.7 million, or an increase of 18% to 19% year-over-year.
- Full Year 2015: The Company expects revenue to be between $US 97.0 million
and $US 99.0 million, or an increase of 17% to 19% in comparison to full year
2014. Diligent expects adjusted EBITDA margin for full year 2015 to be
between 24% and 26%.

Quarterly Conference Call

Diligent will host a conference call at 9:30 a.m. NZDT on March 2, 2015 (3:30
p.m. US ET on March 1) to review the Company's financial results for the
fourth quarter and fiscal year ended December 31, 2014. To access this call
participants should dial 0800 452 092 (New Zealand), 1-855-327-6837 (U.S.) or
+1-778-327-3988 (international). A live webcast of the conference call will
be accessible from the investor relations section of Diligent's website at
http://investor.boardbooks.com/investor-relations/events-and-presentations/.
A replay of this conference call can also be accessed through March 9, 2015
at 9:00 a.m. USET, by dialing 0800 452 092 (New Zealand), 1-800-319-6413
(U.S.). The replay pass code is 78523.

About Diligent

Over 92,000 individual directors, executives and board teams worldwide rely
on Diligent Board Member Services, Inc. (NZX: DIL) to speed and simplify how
board materials are produced, delivered, reviewed and voted on. Providing the
world's most widely used secure board portal via iPad, Windows devices and
browsers - Diligent has pioneered ease of use, stringent security, and
superior training and support since 2001. Diligent Boardbooks provides
directors and management with immediate access to their most time sensitive
and confidential information along with the tools to review, discuss and
collaborate on it. It also helps administrative staff accelerate production
and delivery, and corporate executives streamline board communications and
decisions.

Diligent uses the Software-as-a-Service (SaaS) model to distribute its
Diligent Boardbooks application to the market and maintain the security and
integrity of its clients' data. Under this model, Diligent offers annual
renewable subscriptions for customer access to its Diligent Boardbooks
product which is hosted on Diligent's secure servers, and offers a complete
suite of related services including training, support, data migration and
data security/backup.

Non-GAAP Financial Measures

This earnings release presents Adjusted EBITDA, Adjusted Net Income and
Adjusted Net Income per share information, which are provided to investors to
supplement the results of operations reported in accordance with accounting
principles generally accepted in the United States of America ("GAAP"). We
define these terms as follows:

- Adjusted EBITDA: operating income before depreciation and amortization
expense, stock based compensation expense, costs associated with the
investigation and restatement of our historical financial statements, and
non-recurring costs related to the CEO's performance cash awards and
restatement bonuses.

- Adjusted Net Income: net income before costs relating to non-cash stock
based compensation, costs associated with the investigation and restatement
of our historical financial statements, and non-recurring costs related to
the CEO's performance cash awards and restatement bonuses, net of tax.

These supplemental measures of the Company's performance are not required by,
or presented in accordance with GAAP. The Company's management uses these
non-GAAP financial measures internally in analyzing its financial results and
believes they are useful to investors, as a supplement to the corresponding
GAAP measures, in evaluating the Company's ongoing operational performance
and trends and in comparing its financial measures with other companies in
the same industry, many of which present similar non-GAAP financial measures
to help investors understand the operational performance of their businesses.
However, it is important to note that the particular items the Company
excludes from, or includes in, its non-GAAP financial measures may differ
from the items excluded from, or included in, similar non-GAAP financial
measures used by other companies in the same industry. Non-GAAP financial
measures should not be considered in isolation from, or a substitute for,
financial information prepared in accordance with GAAP. For a quantitative
reconciliation of Adjusted EBITDA and Adjusted Net Income to the most
directly comparable GAAP financial performance measure see Schedule 4:
Reconciliation of GAAP to Non-GAAP Operating Results in this earnings
release.

Safe Harbor Statement

Statements made in this press release that state Diligent's or management's
intentions, beliefs, expectations, or predictions for the future are
forward-looking statements within the meaning of The Private Securities
Litigation Reform Act of 1995, including without limitation Diligent's
revenue outlook for the first quarter and full year 2015 and the anticipated
release of the Diligent Teams product. Readers are cautioned that these
statements are only predictions and may differ materially from actual future
events or results. All forward looking-statements are only as of the date of
this press release and Diligent undertakes no obligation to update or revise
them. Such forward-looking statements are subject to a number of risks,
assumptions and uncertainties that could cause Diligent's actual results to
differ materially from those projected in such forward-looking statements.
For example, if we do not successfully develop or introduce new product
offerings, or enhancements to our existing Diligent Boardbooks offerings, or
keep pace with technological changes that impact the use of our product
offerings, or suffer security breaches or service interruptions, we may lose
existing customers or fail to attract new customers and our financial
performance and revenue growth may suffer. Factors which could cause our
actual results to differ materially from those projected in forward-looking
statements include, without limitation, economic, competitive, regulatory and
technological factors affecting Diligent Board Member Services, Inc.'s
operations, markets, products, services and other factors set forth in the
Company's Risk Factors included in its Annual Report on Form 10-K/A filed
with the SEC on May 20, 2014.

Investor inquiries:
Sonya Joyce
Ph: + 64 4 894 6912

Media inquiries:
Geoff Senescall
Ph: + 64 21 481 234
End CA:00261304 For:DIL    Type:FLLYR      Time:2015-03-02 08:30:45