RealPage Reports Third Quarter 2015 Financial Results

Nov 03, 2015

  • Q3'15 total GAAP revenue of $121.6 million, representing 16 percent year-over-year growth
  • Q3'15 Adjusted EBITDA of $24.2 million, margin expands over 430 basis points year-over-year
  • Q3'15 Non-GAAP net income per diluted share of $0.15, representing 88 percent year-over-year growth

CARROLLTON, Texas--(BUSINESS WIRE)-- RealPage, Inc. (NASDAQ:RP), a leading provider of on demand software and software-enabled solutions for the multifamily, commercial, single-family and vacation rental housing industries, today announced financial results for its third quarter ended September 30, 2015.

"Financial performance for the third quarter was strong," said Steve Winn, Chairman and CEO of RealPage. "Revenue, adjusted EBITDA, and non-GAAP net income per diluted share performance all exceeded expectations. Subscription revenue growth of 18% was driven primarily by continued demand for our Property Management, Resident Services and Asset Optimization solutions. I'm also quite pleased with the continued traction of our new Business Intelligence solutions which fueled sequential revenue growth for Asset Optimization, demonstrating that the investments made in this area are delivering results."

"With adjusted EBITDA margin growing over 430 basis points compared to the prior year period, our focused plan to expand profit margins is achieving significant results," said Bryan Hill, CFO and Treasurer of RealPage. "The third quarter marks the fifth consecutive quarter of sequential margin improvement. We also continue to prioritize efficient capital allocation strategies. During the quarter we repurchased approximately 800 thousand shares of our common stock, resulting in 2.5 million shares repurchased program-to-date, which we view as an appropriate use of capital with the potential for a significant return."

Third Quarter 2015 Financial Highlights

  • Total GAAP revenue of $121.6 million, an increase of 16 percent year-over-year;
  • Adjusted EBITDA of $24.2 million, representing margin expansion of over 430 basis points and an increase of 48 percent year-over-year;
  • Non-GAAP net income of $11.3 million, or $0.15 per diluted share, a year-over-year increase of 73 percent and 88 percent, respectively; and
  • GAAP net loss of $8.2 million, or $0.11 per diluted share, compared to a GAAP net loss of $3.3 million, or $0.04 per diluted share, in the prior year quarter. In connection with the preparation of the third quarter financial statements, the company identified certain indicators of impairment for identified intangibles within its Leasing and Marketing solutions. As a result, the company has taken a non-cash, non-tax-deductible income statement charge during the third quarter to impair certain trade name intangible assets primarily related to its 2011 acquisition of Multifamily Technology Solutions, Inc. The charge is not expected to have a material impact on the company's cash flows or liquidity nor does the company anticipate the charge to affect its ongoing business or financial performance.

Financial Outlook

RealPage management expects to achieve the following results during its fourth quarter ended December 31, 2015:

  • Total revenue is expected to be in the range of $120.0 million to $122.0 million;
  • Adjusted EBITDA is expected to be in the range of $24.0 million to $25.0 million;
  • Non-GAAP net income per diluted share is expected to be in the range of $0.14 to $0.15;
  • Non-GAAP tax rate is expected to be approximately 40 percent; and
  • Weighted average shares outstanding are expected to be approximately 78.0 million, exclusive of any stock repurchase activity.

RealPage management expects to achieve the following results during its calendar year ended December 31, 2015:

  • Total revenue is expected to be in the range of $465.2 million to $467.2 million;
  • Adjusted EBITDA is expected to be in the range of $89.7 million to $90.7 million;
  • Non-GAAP net income per diluted share is expected to be approximately $0.53;
  • Non-GAAP tax rate is expected to be approximately 40 percent; and
  • Weighted average shares outstanding are expected to be approximately 77.6 million, exclusive of any stock repurchase activity.

Please note that the above statements are forward looking and that total revenue may exclude certain adjustments and the impact of acquisitions. Actual results may differ materially. Please reference the information under the caption "Non-GAAP Financial Measures," as well as reconciliation tables of GAAP financial measures to Non-GAAP financial measures, as set forth in this press release.

Conference Call and Webcast

The company will host a conference call on November 3, 2015 at 5:00 p.m. EST to discuss its financial results. Participants are encouraged to listen to the presentation via a live web broadcast on the Investor Relations section of the RealPage website. In addition, a live dial-in is available domestically at 866-743-9666 and internationally at 760-298-5103. A replay will be available at 855-859-2056 or 404-537-3406, passcode 72154959, until November 7, 2015.

About RealPage

RealPage, Inc. is a leading provider of comprehensive property management software solutions for the multifamily, commercial, single-family and vacation rental housing industries. These solutions help property owners increase efficiency, decrease expenses, enhance the resident experience and generate more revenue. Using its innovative SaaS platform, RealPage's on demand software enables easy system integration and streamlines online property management. Its product line covers the full spectrum of property management, leasing and marketing, asset optimization, and resident services solutions. Founded in 1998 and headquartered in Carrollton, Texas, RealPage currently serves over 11,000 clients worldwide from offices in North America, Europe and Asia. For more information about the company, visit http://www.realpage.com.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains "forward-looking" statements relating to RealPage, Inc.'s expected, possible or assumed future results; the results of its investments in Asset Optimization; its focus on driving margin expansion; and the results of its capital allocation strategies. These forward-looking statements are based on management's beliefs and assumptions and on information currently available to management. Forward-looking statements include all statements that are not historical facts and may be identified by terms such as "expects," "believes," "plans," or similar expressions and the negatives of those terms. Those forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. The Company may be required to revise its results upon finalizing its review of quarterly results, which could cause or contribute to such differences. Additional factors that could cause or contribute to such differences include, but are not limited to, the following: (a) the possibility that general economic conditions, including leasing velocity or uncertainty cause information technology spending, particularly in the rental housing industry, to be reduced or purchasing decisions to be delayed; (b) an increase in insurance claims; (c) an increase in customer cancellations; (d) the inability to increase sales to existing customers and to attract new customers; (e) RealPage, Inc.'s failure to integrate acquired businesses and any future acquisitions successfully; (f) the timing and success of new product introductions by RealPage, Inc. or its competitors; (g) changes in RealPage, Inc.'s pricing policies or those of its competitors; (h) legal or regulatory proceedings; (i) the inability to achieve revenue growth or to enable margin expansion; and (j) such other risks and uncertainties described more fully in documents filed with or furnished to the Securities and Exchange Commission ("SEC") by RealPage Inc., including its Quarterly Report on Form 10-Q previously filed with the SEC on August 7, 2015 and its Annual Report on Form 10-K previously filed with the SEC on March 2, 2015. All information provided in this release is as of the date hereof and RealPage Inc. undertakes no duty to update this information except as required by law.

Non-GAAP Financial Measures

This press release contains non-GAAP financial measures. These measures differ from traditional GAAP financial measures in that they (1) include acquisition-related and other deferred revenue adjustments; (2) exclude depreciation, loss on impairment and disposal of assets; amortization of intangible assets; stock-based compensation expenses; any impact related to the Yardi litigation (including related insurance litigation and settlement costs), collectively the "Yardi Litigation"; and acquisition related expenses (including any purchase accounting adjustments); and (3) include income taxes at a sustainable effective rate, which excludes the reversal of valuation allowances due to expected realization of deferred tax assets.

We define non-GAAP total revenue as total revenue plus acquisition-related and other deferred revenue adjustments. We also define non-GAAP on demand revenue as on demand revenue plus acquisition-related and other deferred revenue adjustments. Non-GAAP net income is defined as net (loss) income plus acquisition-related and other deferred revenue adjustments; amortization of intangible assets; stock-based compensation expense; acquisition-related expense; any impact related to the Yardi Litigation; loss on disposal and impairment of assets; and an adjustment to income tax expense (benefit) to reflect our effective tax rate. Other non-GAAP measures such as non-GAAP product development, non-GAAP sales and marketing, non-GAAP general and administrative, and non-GAAP operating expense and income exclude amortization of intangible assets; litigation-related expense; loss on disposal and impairment of assets; and stock-based compensation when calculating their composition. In addition to these adjustments, non-GAAP operating income is adjusted for acquisition-related and other deferred revenue.

Adjusted gross profit is defined as gross profit plus acquisition-related and other deferred revenue adjustments, depreciation and amortization of intangible assets, and stock-based compensation.

We define Adjusted EBITDA as net (loss) income plus acquisition-related and other deferred revenue adjustments; depreciation, asset impairment and loss on disposal of assets; amortization of intangible assets; net interest expense; income tax expense (benefit); stock-based compensation expense; any impact related to the Yardi Litigation; and acquisition-related expenses.

Non-GAAP on demand revenue per average on demand unit represents non-GAAP on demand revenue for the period presented divided by average on demand units for the same period. For interim periods, the calculation is performed on an annualized basis. We calculate average on demand units as the average of the beginning and ending on demand units for each quarter in the period presented. We monitor this metric to measure our success in increasing the number of on demand software solutions utilized by our customers to manage their rental housing units, our overall revenue and profitability.

Non-GAAP on demand annual customer value, or "ACV", represents management's estimate of the current annual run-rate value of on demand customer relationships. ACV is calculated by multiplying ending on demand units by annualized Non-GAAP on demand revenue per average on demand unit.

We believe that the non-GAAP financial measures defined above are useful to investors and other users of our financial statements in evaluating our operating performance because they provide additional tools to compare business performance across companies and across periods. We believe that:

  • these non-GAAP financial measures provide investors and other users of our financial information consistency and comparability with our past financial performance, facilitate period-to-period comparisons of operations and facilitate comparisons with our peer companies, many of which use similar non-GAAP financial measures to supplement their GAAP results;
  • it is useful to exclude certain non-cash charges, such as depreciation and asset impairment, amortization of intangible assets and stock-based compensation and non-core operational charges, such as acquisition-related expenses and any impact related to the Yardi Litigation, from non-GAAP earnings measures, such as Adjusted EBITDA and non-GAAP net income, because the amount of such expenses in any specific period may not directly correlate to the underlying performance of our business operations and these expenses can vary significantly between periods as a result of new acquisitions, full amortization of previously acquired tangible and intangible assets or the timing of new stock-based awards, as the case may be; and
  • it is useful to include deferred revenue written down for GAAP purposes under purchase accounting rules and revenue deferred due to a lack of historical experience determining the settlement of the contractual obligation in order to appropriately measure the underlying performance of our business operations in the period of activity and associated expense.

We use the non-GAAP financial measures defined above in conjunction with traditional GAAP financial measures as part of our overall assessment of our performance; for planning purposes, including the preparation of our annual operating budget; to evaluate the effectiveness of our business strategies; and to communicate with our board of directors concerning our financial performance.

We do not place undue reliance on non-GAAP financial measures as our only measures of operating performance. Non-GAAP financial measures should not be considered as a substitute for other measures of financial performance or liquidity reported in accordance with GAAP. There are limitations to using non-GAAP financial measures, including that other companies may calculate these measures differently than we do, that they do not reflect changes in, or cash requirements for, our working capital, and they do not reflect our capital expenditures or future requirements. We compensate for the inherent limitations associated with using non-GAAP financial measures through disclosure of these limitations, presentation of our financial statements in accordance with GAAP, and reconciliation of non-GAAP financial measures to the most directly comparable GAAP measure.

         
Condensed Consolidated Balance Sheets
(In thousands, except share amounts)
 
 
September 30, December 31,
  2015     2014  
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $ 18,566 $ 26,936
Restricted cash 94,086 85,543

Accounts receivable, less allowance for doubtful accounts of $1,926 and $2,363 at September 30, 2015 and December 31, 2014, respectively

68,460 64,845
Prepaid expenses 9,610 7,647
Deferred tax asset, net 17,635 10,996
Other current assets   2,571     1,848  
Total current assets 210,928 197,815
Property, equipment and software, net 71,944 72,616
Goodwill 220,104 193,378
Identified intangible assets, net 87,287 100,085
Deferred tax asset, net 2,537
Other assets   5,201     5,059  
Total assets $ 595,464   $ 571,490  
 
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 15,670 $ 14,830
Accrued expenses and other current liabilities 33,582 22,905
Current portion of deferred revenue 77,217 73,485
Customer deposits held in restricted accounts   93,956     85,489  
Total current liabilities 220,425 196,709
Deferred revenue 7,107 6,903
Deferred tax liability, net 1,439 5,196
Revolving credit facility 44,000 20,000
Other long-term liabilities   10,574     13,902  
Total liabilities 283,545 242,710
Stockholders' equity:

Preferred stock, $0.001 par value: 10,000,000 shares authorized and zero shares issued and outstanding at September 30, 2015 and December 31, 2014, respectively

Common stock, $0.001 par value: 125,000,000 shares authorized, 82,370,113 and 83,211,650 shares issued and 78,479,774 and 79,037,351 shares outstanding at September 30, 2015 and December 31, 2014, respectively

82 83
Additional paid-in capital 456,707 437,664

Treasury stock, at cost: 3,890,339 and 4,174,299 shares at September 30, 2015 and December 31, 2014, respectively

(23,496 ) (33,398 )
Accumulated deficit (120,898 ) (75,360 )
Accumulated other comprehensive loss   (476 )   (209 )
Total stockholders' equity   311,919     328,780  
Total liabilities and stockholders' equity $ 595,464   $ 571,490  

                 
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
 
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
Revenue:
On demand $ 116,772 $ 100,747 $ 333,872 $ 289,361
On premise 834 755 2,301 2,446
Professional and other   3,982     3,034     10,647     8,280  
Total revenue 121,588 104,536 346,820 300,087
Cost of revenue(1)   52,879     46,311     150,160     128,353  
Gross profit 68,709 58,225 196,660 171,734
Operating expense:
Product development(1) 16,858 17,528 52,919 48,310
Sales and marketing(1) 31,559 29,949 90,333 83,970
General and administrative(1) 13,424 15,443 51,797 53,191
Impairment of identified intangible assets   20,274         20,801      
Total operating expense   82,115     62,920     215,850     185,471  
Operating loss (13,406 ) (4,695 ) (19,190 ) (13,737 )
Interest expense and other, net   (391 )   (345 )   (1,048 )   (771 )
Loss before income taxes (13,797 ) (5,040 ) (20,238 ) (14,508 )
Income tax benefit   (5,605 )   (1,783 )   (7,120 )   (4,124 )
Net loss $ (8,192 ) $ (3,257 ) $ (13,118 ) $ (10,384 )
 
Net loss per share
Basic $ (0.11 ) $ (0.04 ) $ (0.17 ) $ (0.13 )
Diluted $ (0.11 ) $ (0.04 ) $ (0.17 ) $ (0.13 )
Weighted average shares used in computing net loss per share
Basic 76,564 77,280 76,772 77,075
Diluted 76,564 77,280 76,772 77,075
                         
 
(1) Includes stock-based compensation expense as follows:
 
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
Cost of revenue $ 817 $ 1,141 $ 3,267 $ 3,014
Product development 1,759 2,707 7,050 6,763
Sales and marketing 3,118 3,774 10,750 10,018
General and administrative   2,975     1,914     9,599     8,999  
$ 8,669   $ 9,536   $ 30,666   $ 28,794  

 
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
         
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
Cash flows from operating activities:
Net loss $ (8,192 ) $ (3,257 ) $ (13,118 ) $ (10,384 )

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation and amortization 11,913 10,962 33,787 30,533
Deferred tax benefit (7,173 ) (2,161 ) (8,827 ) (6,011 )
Stock-based compensation 8,669 9,536 30,666 28,794
Excess tax benefit from stock options 331 968
Loss on disposal and impairment of assets 20,966 16 23,769 36
Acquisition-related contingent consideration (3,511 ) 630 (3,018 ) 564

Changes in assets and liabilities, net of assets acquired and liabilities assumed in business combinations

(3,283 ) (8,420 ) 4,287 6,522
Net cash provided by operating activities 19,720 7,306 68,514 50,054
 
Cash flows from investing activities:
Purchases of property, equipment and software (7,476 ) (9,990 ) (18,553 ) (29,125 )
Proceeds from disposal of assets 305
Acquisition of businesses, net of cash acquired 111 (45,450 ) (41,942 )
Intangible asset additions   (60 )       (231 )    
Net cash used in investing activities (7,536 ) (9,879 ) (63,929 ) (71,067 )
 
Cash flows from financing activities:
Payments on and proceeds from debt, net (6,143 ) 12,440 23,563 37,160
Payments of deferred acquisition-related consideration (875 ) (3,259 ) (2,109 ) (4,007 )
Issuance of common stock 1,431 152 2,900 5,168
Excess tax benefit from stock options (331 ) (968 )
Purchase of treasury stock   (16,991 )   (15,298 )   (36,074 )   (21,122 )
Net cash (used in) provided by financing activities   (22,909 )   (5,965 )   (12,688 )   17,199  
Net decrease in cash and cash equivalents (10,725 ) (8,538 ) (8,103 ) (3,814 )
Effect of exchange rate on cash (31 ) (9 ) (267 ) (18 )
 
Cash and cash equivalents:
Beginning of period   29,322     39,217     26,936     34,502  
End of period $ 18,566   $ 30,670   $ 18,566   $ 30,670  

         
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share amounts)
(Unaudited)
       
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
 
Non-GAAP revenue:
Revenue (GAAP) $ 121,588 $ 104,536 $ 346,820 $ 300,087
Acquisition-related and other deferred revenue   (614 )   (392 )   (1,612 )   725  
Non-GAAP revenue $ 120,974   $ 104,144   $ 345,208   $ 300,812  
 
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
Adjusted gross profit:
Gross profit (GAAP) $ 68,709 $ 58,225 $ 196,660 $ 171,734
Acquisition-related and other deferred revenue (614 ) (392 ) (1,612 ) 725
Depreciation 2,431 2,311 7,269 6,182
Amortization of intangible assets 4,052 2,982 10,142 7,852
Stock-based compensation expense   817     1,141     3,267     3,014  
Adjusted gross profit $ 75,395   $ 64,267   $ 215,726   $ 189,507  
 
Adjusted gross profit margin 62.3 % 61.7 % 62.5 % 63.0 %
 
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
Adjusted EBITDA:
Net loss (GAAP) $ (8,192 ) $ (3,257 ) $ (13,118 ) $ (10,384 )
Acquisition-related and other deferred revenue (614 ) (392 ) (1,612 ) 725
Depreciation, asset impairment and loss on disposal of assets 25,952 5,121 38,970 13,911
Amortization of intangible assets 6,927 5,857 18,586 16,658
Acquisition-related expense (3,310 ) 860 (1,653 ) 2,098
Interest expense, net 391 349 966 780
Income tax benefit (5,605 ) (1,783 ) (7,120 ) (4,124 )
Litigation-related expense 39 2 4,884
Stock-based compensation expense   8,669     9,536     30,666     28,794  
Adjusted EBITDA $ 24,218   $ 16,330   $ 65,687   $ 53,342  
 
Adjusted EBITDA margin 20.0 % 15.7 % 19.0 % 17.7 %
 
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
Non-GAAP total product development:
Product development (GAAP) $ 16,858 $ 17,528 $ 52,919 $ 48,310
Less: Loss on disposal and impairment of assets 532 1,333
Stock-based compensation expense   1,759     2,707     7,050     6,763  
Non-GAAP total product development $ 14,567   $ 14,821   $ 44,536   $ 41,547  
 
Non-GAAP total product development as % of non-GAAP revenue: 12.0 % 14.2 % 12.9 % 13.8 %

         
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share amounts)
(Unaudited)
       
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
Non-GAAP total sales and marketing:
Sales and marketing (GAAP) $ 31,559 $ 29,949 $ 90,333 $ 83,970
Less: Amortization of intangible assets 2,875 2,875 8,444 8,614
Stock-based compensation expense   3,118     3,774     10,750     10,018  
Non-GAAP total sales and marketing $ 25,566   $ 23,300   $ 71,139   $ 65,338  
 
Non-GAAP total sales and marketing as % of non-GAAP revenue: 21.1 % 22.4 % 20.6 % 21.7 %
 
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
Non-GAAP total general and administrative:
General and administrative (GAAP) $ 13,424 $ 15,443 $ 51,797 $ 53,191
Less: Loss on disposal and impairment of assets 160 16 1,635 36
Amortization of intangible assets 192
Acquisition-related expense (3,310 ) 860 (1,653 ) 2,098
Litigation-related expense 39 2 4,884
Stock-based compensation expense   2,975     1,914     9,599     8,999  
Non-GAAP total general and administrative $ 13,599   $ 12,614   $ 42,214   $ 36,982  
 
Non-GAAP total general and administrative as % of non-GAAP revenue: 11.2 % 12.1 % 12.2 % 12.3 %
 
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
Non-GAAP total operating expense:
Operating expense (GAAP) $ 82,115 $ 62,920 $ 215,850 $ 185,471
Less: Loss on disposal and impairment of assets 20,966 16 23,769 36
Amortization of intangible assets 2,875 2,875 8,444 8,806
Acquisition-related expense (3,310 ) 860 (1,653 ) 2,098
Litigation-related expense 39 2 4,884
Stock-based compensation expense   7,852     8,395     27,399     25,780  
Non-GAAP total operating expense $ 53,732   $ 50,735   $ 157,889   $ 143,867  
 
Non-GAAP total operating expense as % of non-GAAP revenue: 44.4 % 48.7 % 45.7 % 47.8 %
 
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
Non-GAAP operating income:
Operating loss (GAAP) $ (13,406 ) $ (4,695 ) $ (19,190 ) $ (13,737 )
Acquisition-related and other deferred revenue (614 ) (392 ) (1,612 ) 725
Loss on disposal and impairment of assets 20,966 16 23,769 36
Amortization of intangible assets 6,927 5,857 18,586 16,658
Acquisition-related expense (3,310 ) 860 (1,653 ) 2,098
Litigation-related expense 39 2 4,884
Stock-based compensation expense   8,669     9,536     30,666     28,794  
Non-GAAP operating income $ 19,232   $ 11,221   $ 50,568   $ 39,458  
 
Non-GAAP operating margin 15.9 % 10.8 % 14.6 % 13.1 %

         
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share amounts)
(Unaudited)
     
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
Non-GAAP net income:
Net loss (GAAP) $ (8,192 ) $ (3,257 ) $ (13,118 ) $ (10,384 )
 
Tax deductible items:
Acquisition-related and other deferred revenue (614 ) (392 ) (1,612 ) 725
Loss on disposal and impairment of assets 20,966 16 23,769 36
Amortization of intangible assets 6,927 5,857 18,586 16,658
Acquisition-related expense (3,310 ) 860 (1,653 ) 2,098
Litigation-related expense 39 2 4,884
Stock-based compensation expense   8,669     9,536     30,666     28,794  
Subtotal of tax deductible items 32,638 15,916 69,758 53,195
 
Tax impact of tax deductible items(1) (13,055 ) (6,366 ) (27,903 ) (21,278 )
Tax (expense) benefit resulting from applying effective tax rate(2)   (86 )   233     975     1,679  
Non-GAAP net income $ 11,305 $ 6,526 $ 29,712 $ 23,212
 
Non-GAAP net income per share - diluted $ 0.15 $ 0.08 $ 0.38 $ 0.30
 
Weighted average shares - basic 76,564 77,280 76,772 77,075
Weighted average effect of dilutive securities - non-GAAP   499     494     603     727  
Non-GAAP weighted average shares - diluted 77,063 77,774 77,375 77,802
                         

(1)

Reflects the removal of the tax benefit associated with the acquisition-related and other deferred revenue adjustment, loss on disposal and impairment of assets, amortization of intangible assets, acquisition-related expense, litigation-related expense, and stock-based compensation expense.
 
 

(2)

Represents adjusting to a normalized effective tax rate of 40%.
 
Three Months Ended Nine Months Ended
September 30, September 30,
  2015     2014     2015     2014  
Annualized non-GAAP on demand revenue per average on demand unit:
On demand revenue (GAAP) $ 116,772 $ 100,747 $ 333,872 $ 289,361
Acquisition-related and other deferred revenue   (614 )   (392 )   (1,612 )   725  
Non-GAAP on demand revenue 116,158 100,355 332,260 290,086
 
Ending on demand units 10,406 9,496 10,406 9,496
Average on demand units 10,354 9,434 9,995 9,305
   
Annualized non-GAAP on demand revenue per average on demand unit $ 44.87   $ 42.55  
 
Non-GAAP on demand annual customer value(1) $ 466,917 $ 404,055
                           

(1)

This metric represents management's estimate of the current annual run-rate value of on demand customer relationships. This metric is calculated by multiplying ending on demand units by annualized non-GAAP on demand revenue per average on demand unit for the periods presented.

RealPage, Inc.
Investor Relations:
Rhett Butler, 972-820-3773
rhett.butler@realpage.com

Source: RealPage, Inc.

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Phone: (972) 820-3773
Email: ir@realpage.com

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