UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 29, 2013

MANHATTAN ASSOCIATES, INC.
(Exact Name of Registrant as Specified in Its Charter)

 
 	 	 	 	 	
Georgia	 	0-23999	 	58-2373424	
(State or Other Jurisdiction
of Incorporation or organization)	 	(Commission
File Number)	 	(I.R.S. Employer
Identification No.)	
 	 	
2300 Windy Ridge Parkway, Suite 1000,
Atlanta, Georgia	 	30339	
(Address of Principal Executive Offices)	 	(Zip Code)	
(770) 955-7070
(Registrant’s telephone number, including area code)
NONE
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)	
 
¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)	
 
¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))	
 
¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))	

 

Item 2.02 Results of Operations and Financial Condition.
On January 29, 2013, Manhattan Associates, Inc. (the “Company”) issued a press release providing the results for its financial performance for the fourth quarter and full year ended December 31, 2012. A copy of this press release is attached as Exhibit 99.1. Pursuant to General Instruction B.2 of Form 8-K, this exhibit is “furnished” and not “filed” for purposes of Section 18 of the Securities Exchange Act of 1934.
Non-GAAP Financial Measures in the Press Release
The press release includes, as additional information regarding our operating results, our adjusted operating income, adjusted net income and adjusted earnings per share, which excludes the impact of acquisition-related costs and the amortization thereof; equity-based compensation; and asset impairment charges and related recovery related to an investment security—all net of income tax effects and unusual tax adjustments.
These various measures are not in accordance with, or an alternative for, financial measures calculated in accordance with generally accepted accounting principles in the United States (“GAAP”) and may be different from similarly titled non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be used as a substitute for, or considered superior to, measures of financial performance prepared in accordance with GAAP.
We believe that these adjusted (non-GAAP) results provide more meaningful information regarding those aspects of our current operating performance that can be effectively managed, and consequently have developed our internal reporting, compensation and planning systems using these measures. Non-GAAP measures used in the press release exclude the impact of the items described above for the following reasons:
 
 	•	 	Because we sporadically engage in acquisitions, we incur acquisition-related costs that consist primarily of expenses from accounting and legal due diligence, whether or not we ultimately proceed with the transaction. Additionally, we might assume and incur certain unusual costs, such as employee retention benefits, that result from arrangements made prior to the acquisition. These acquisition costs are difficult to predict and do not correlate to the expenses of our core operations. We believe our competitors and peers typically present as a non-GAAP measure adjusted net income and adjusted earnings per share that exclude the amortization of acquisition-related intangible assets, and thus we exclude these amortization costs when calculating adjusted net income and adjusted earnings per share to facilitate more relevant and meaningful comparisons of our operating results with that of our competitors.	
 
 	•	 	Because equity-based compensation expense is not an expense that typically requires or will require cash settlement by the Company, and because we believe our competitors and peers typically present non-GAAP results excluding all equity-based compensation expense, we have not included equity-based compensation expense and the related tax benefit generated upon the disposition of equity-based compensation in the assessment of our operating performance.	
 
 	•	 	We previously excluded the asset impairment charge recorded in 2008 to writedown the value of an auction rate security because we typically invest our treasury funds in cash, cash equivalents or other liquid investments, not illiquid, risky securities. We believed the write-down in value of the auction rate security was due to unusual changes in the characteristics of the auction rate security since our initial investment in it, including failed auctions and default risk for a municipal obligor. Consistent with our prior exclusion of the charge, we have excluded the third quarter of 2011 recovery of the investment.	
 
1

We believe the reporting of adjusted operating income, adjusted net income and adjusted earnings per share facilitates investors’ understanding of our historical operating trends, because it provides important supplemental measurement information in evaluating the operating results of our business. We also believe that adjusted operating income, adjusted net income and adjusted earnings per share provide a basis for more relevant comparisons to other companies in the industry, enable investors to evaluate our operating performance in a manner consistent with our internal basis of measurement and also present our investors our operating results on the same basis as that used by our management. Management refers to adjusted operating income, adjusted net income and adjusted earnings per share in making operating decisions because we believe they provide meaningful supplemental information regarding our operational performance and our ability to invest in research and development and fund acquisitions and capital expenditures. In addition, adjusted operating income, adjusted net income and adjusted earnings per share facilitate management’s internal comparisons to our historical operating results and comparisons to competitors’ operating results.
Further, we rely on adjusted operating income, adjusted net income and adjusted net income per share information as primary measures to review and assess the operating performance of our company and our management team in connection with our executive compensation and bonus plans. Since most of our employees are not directly involved with decisions surrounding acquisitions and other items that are not central to our core operations, we do not believe it is appropriate or fair to have their incentive compensation affected by these items.
Item 9.01. Financial Statements and Exhibits.
 
 	(d)	Exhibits.	

Exhibit
Number	 	Description	
 	 	
99.1	 	Press Release, dated January 29, 2013	
 
2

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

MANHATTAN ASSOCIATES, INC.	
 	 	
By:	 	/s/ Dennis B. Story	
 	 	 	
Dennis B. Story	
Executive Vice President, Chief Financial Officer and Treasurer	
Dated: January 29, 2013
 
3

EXHIBIT INDEX

Exhibit
Number	 	Description	
 	 	
99.1	 	Press Release, dated January 29, 2013	

Exhibit 99.1

 
 	 	 	 	 	
Contact:	  	Dennis Story	  	Will Haraway	
 	  	Chief Financial Officer	  	Director, North America Public Relations	
 	  	Manhattan Associates, Inc.	  	Manhattan Associates, Inc.	
 	  	678-597-7115	  	678-597-7466	
 	  	dstory@manh.com	  	wharaway@manh.com	
Manhattan Associates Reports Record Fourth Quarter and Full Year 2012 Performance
ATLANTA – January 29, 2013 – Leading supply chain optimization provider Manhattan Associates, Inc. (NASDAQ: MANH) today reported record fourth quarter 2012 non-GAAP adjusted diluted earnings per share of $0.71 compared to $0.60 in the fourth quarter of 2011, on license revenue of $14.4 million and record fourth quarter total revenue of $95.4 million. GAAP diluted earnings per share for the fourth quarter was a record $0.63 compared to $0.50 in the prior year fourth quarter.
Manhattan Associates CEO Eddie Capel commented, “We’re very pleased with both our fourth quarter and full year results. They reflect solid support in the market for our product and solution strategy. These results allow us to continue to make significant investments in supply chain innovation across our technology and solution suites in order to provide differentiated capabilities to our customers.”
FOURTH QUARTER 2012 FINANCIAL SUMMARY:
 
 	•	 	Adjusted diluted earnings per share, a non-GAAP measure, was $0.71 in the fourth quarter of 2012, compared to $0.60 in the fourth quarter of 2011.	
 
 	•	 	GAAP diluted earnings per share was $0.63 in the fourth quarter of 2012, compared to $0.50 in the fourth quarter of 2011.	
 
 	•	 	Consolidated total revenue was $95.4 million in the fourth quarter of 2012, compared to $83.5 million in the fourth quarter of 2011. License revenue was $14.4 million in the fourth quarter of 2012, compared to $16.6 million in the fourth quarter of 2011.	
 
 	•	 	Adjusted operating income, a non-GAAP measure, was $21.7 million in the fourth quarter of 2012, compared to $19.3 million in the fourth quarter of 2011.	
 
 	•	 	GAAP operating income was $19.1 million in the fourth quarter of 2012, compared to $16.2 million in the fourth quarter of 2011.	

 
 	•	 	Cash flow from operations was $23.9 million in the fourth quarter of 2012, compared to $14.8 million in the fourth quarter of 2011. Days Sales Outstanding was 60 days at December 31, 2012, compared to 70 days at September 30, 2012.	
 
 	•	 	Cash and investments on-hand were $103.0 million at December 31, 2012, compared to $106.8 million at September 30, 2012.	
 
 	•	 	During the three months ended December 31, 2012, the Company repurchased 526,623 shares of Manhattan Associates common stock under the share repurchase program authorized by the Board of Directors, for a total investment of $31.2 million. In January 2013, the Board of Directors approved raising the Company’s remaining share repurchase authority to an aggregate of $50.0 million of the Company’s outstanding common stock.	
FULL YEAR 2012 FINANCIAL SUMMARY:
 
 	•	 	Adjusted diluted earnings per share, a non-GAAP measure, was a record $2.82 for the twelve months ended December 31, 2012, compared to $2.32 for the twelve months ended December 31, 2011.	
 
 	•	 	GAAP diluted earnings per share for the twelve months ended December 31, 2012 was a record $2.56, compared to $2.09 for the twelve months ended December 31, 2011. Results for the twelve months ended December 31, 2011 included a $0.12 per share benefit for the recovery of a previously impaired auction rate security investment.	
 
 	•	 	Consolidated revenue for the twelve months ended December 31, 2012 was a record $376.2 million, compared to $329.3 million for the twelve months ended December 31, 2011. License revenue was $61.5 million for the twelve months ended December 31, 2012, compared to $54.2 million for the twelve months ended December 31, 2011.	
 
 	•	 	Adjusted operating income, a non-GAAP measure, was $88.4 million for the twelve months ended December 31, 2012, compared to $70.4 million for the twelve months ended December 31, 2011.	
 
 	•	 	GAAP operating income was $80.1 million for the twelve months ended December 31, 2012, compared to $61.4 million for the twelve months ended December 31, 2011. Results for the twelve months ended December 31, 2011 included a $2.5 million recovery of a previously impaired auction rate security investment.	

 
 	•	 	During the twelve months ended December 31, 2012, the Company repurchased 1,944,828 shares of Manhattan Associates common stock under the share repurchase program authorized by the Board of Directors, for a total investment of $99.7 million.	
SALES ACHIEVEMENTS:
 
 	•	 	Three contracts of $1.0 million or more in recognized license revenue during the fourth quarter of 2012, resulting in a total of 12 contracts of $1.0 million or more in recognized license revenue for the full year 2012.	
 
 	•	 	Completing software license wins during the fourth quarter with new customers such as: Bison Stores, Empire Express, Essilor International, Hirschbach Motor Lines, Legacy Supply Chain Services, NTT Data China Outsourcing, Optimist Logistic, Pearson Educacion de Mexico, Rhee Brothers, Southern States Cooperative and Zongbao District (Beijing) International Pharmaceutical Distribution Center.	
 
 	•	 	Expanding relationships during the fourth quarter with existing customers such as: Acco Brands Benelux, Alliance Healthcare, Assuramed, ATB Market, Belk, Batory Foods, Carolina Logistics Services, Catering Engros, Chico’s Retail Services, Copernica, CRC Industries, Dean Foods, Elektra del Milenio, Essilor of America, Exel, Foot Locker Corporate Services, Groupe Dynamite, HEB Grocery Company, Keystone Distribution, Leroy Merlin France, Meyer Group, Northern Tool and Equipment, Olympus Corporation of the Americas, PepsiCo, Performance Team Freight Systems, Primark Stores, SamsonOpt, Shoppers Drug Mart, Southern Wine & Spirits of America, Vera Bradley Designs and VF Services.	
2013 GUIDANCE
Manhattan Associates provides the following revenue and diluted earnings per share guidance for the full year 2013:

 	  	Guidance Range—2013 Full Year	 	
($‘s in millions, except EPS)	  	$ Range	 	  	% Growth Range	 	
Total revenue	  	$	410	  	  	$	415	  	  	 	9	% 	 	 	10	% 	
 	 	 	 	 	
Diluted earnings per share (EPS):	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	
Adjusted EPS(1)	  	$	3.15	  	  	$	3.21	  	  	 	12	% 	 	 	14	% 	
GAAP EPS	  	$	2.85	  	  	$	2.91	  	  	 	11	% 	 	 	14	% 	
 
(1)	Adjusted EPS is a Non-GAAP measure which excludes the impact of equity-based compensation	

 
Manhattan Associates currently intends to publish, in each quarterly earnings release, certain expectations with respect to future financial performance. Those statements, including the guidance provided above, are forward-looking. Actual results may differ materially, especially in the current uncertain economic environment. Those statements, including the guidance provided above, do not reflect the potential impact of mergers, acquisitions or other business combinations that may be completed after the date of the release.
Manhattan Associates will make its earnings release and published expectations available on its website (www.manh.com). Beginning March 15, 2013, Manhattan Associates will observe a “Quiet Period” during which Manhattan Associates and its representatives will not comment concerning previously published financial expectations. Prior to the start of the Quiet Period, the public can continue to rely on the expectations published in this 2013 Guidance section as being Manhattan Associates’ current expectation on matters covered, unless Manhattan Associates publishes a notice stating otherwise. During the Quiet Period, previously published expectations should be considered historical only, speaking only as of or prior to the Quiet Period, and Manhattan Associates disclaims any obligation to update any previously published financial expectations during the Quiet Period. The Quiet Period will extend until publication of Manhattan Associates’ next quarterly earnings release, currently scheduled for the third full week of April 2013.
CONFERENCE CALL
The Company’s conference call regarding its fourth quarter and full year financial results will be held at 4:30 p.m. Eastern Time on Tuesday January 29, 2013. Investors are invited to listen to a live webcast of the conference call through the investor relations section of Manhattan Associates’ website at  www.manh.com . To listen to the live webcast, please go to the website at least 15 minutes before the call to download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay can be accessed shortly after the call by dialing +1.888.471.9891 in the U.S. and Canada, or +1.973.200.3379 outside the U.S., and entering the conference identification number 32249193 or via the web at  www.manh.com . The phone replay will be available for two weeks after the call, and the Internet webcast will be available until Manhattan Associates’ first quarter 2013 earnings release.

 
GAAP VERSUS NON-GAAP PRESENTATION
The Company provides adjusted operating income, adjusted net income and adjusted earnings per share in this press release as additional information regarding the Company’s operating results. These measures are not in accordance with – or an alternative to – GAAP, and may be different from non-GAAP operating income, non-GAAP net income and non-GAAP earnings per share measures used by other companies. The Company believes that the presentation of these non-GAAP financial measures facilitates investors’ understanding of its historical operating trends, because it provides important supplemental measurement information in evaluating the operating results of its business, as distinct from results that include items that are not indicative of ongoing operating results. The Company consequently believes that the presentation of these non-GAAP financial measures provides investors with useful insight into its profitability. This release should be read in conjunction with the Company’s Form 8-K earnings release filing for the quarter and year ended December 31, 2012.
The non-GAAP adjusted operating income, adjusted net income and adjusted earnings per share exclude the impact of acquisition-related costs and the amortization thereof; equity-based compensation; and asset impairment charges and related recovery related to an investment security – all net of income tax effects and unusual tax adjustments. Reconciliations of the Company’s GAAP financial measures to non-GAAP adjustments are included in the supplemental information attached to this release.
ABOUT MANHATTAN ASSOCIATES, INC.
Manhattan Associates continues to deliver on its 23-year heritage of providing global supply chain excellence to more than 1,200 customers worldwide that consider supply chain optimization core to their strategic market leadership. The Company’s supply chain innovations include: Manhattan SCOPE ® , a portfolio of software solutions and technology that leverages Manhattan Associates’ Supply Chain Process Platform to help organizations optimize their supply chains from planning through execution; Manhattan SCALE™, a portfolio of distribution management and transportation management solutions built on Microsoft .NET technology; and Manhattan Carrier™, a suite of supply chain solutions specifically addressing the needs of the motor carrier industry. For more information, please visit www.manh.com.
This press release contains “forward-looking statements” relating to Manhattan Associates, Inc. Forward-looking statements in this press release include the information set forth under “2013 Guidance.” Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: uncertainty about the global economy; delays in product development; competitive pressures; software errors; and the additional risk factors set forth in Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2011. Manhattan Associates undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes in future operating results.
###

MANHATTAN ASSOCIATES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Income
(in thousands, except per share amounts)

 	  	Three Months Ended December 31,	 	  	Twelve Months Ended December 31,	 	
 	  	2012	 	  	2011	 	  	2012	 	  	2011	 	
 	  	(unaudited)	 	  	 	 	  	 	 	
Revenue:	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Software license	  	$	14,398	  	  	$	16,567	  	  	$	61,494	  	  	$	54,241	  	
Services	  	 	72,294	  	  	 	60,612	  	  	 	283,872	  	  	 	244,058	  	
Hardware and other	  	 	8,667	  	  	 	6,360	  	  	 	30,882	  	  	 	30,954	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total revenue	  	 	95,359	  	  	 	83,539	  	  	 	376,248	  	  	 	329,253	  	
Costs and expenses:	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Cost of license	  	 	2,487	  	  	 	2,547	  	  	 	7,838	  	  	 	6,806	  	
Cost of services	  	 	34,040	  	  	 	27,036	  	  	 	128,686	  	  	 	107,510	  	
Cost of hardware and other	  	 	6,797	  	  	 	5,333	  	  	 	25,213	  	  	 	24,785	  	
Research and development	  	 	10,951	  	  	 	10,436	  	  	 	44,704	  	  	 	42,372	  	
Sales and marketing	  	 	10,805	  	  	 	10,170	  	  	 	45,622	  	  	 	43,944	  	
General and administrative	  	 	9,668	  	  	 	10,452	  	  	 	38,474	  	  	 	37,708	  	
Depreciation and amortization	  	 	1,497	  	  	 	1,362	  	  	 	5,638	  	  	 	7,284	  	
Recovery of previously impaired investment	  	 	—  	  	  	 	—  	  	  	 	—  	  	  	 	(2,519	) 	
 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total costs and expenses	  	 	76,245	  	  	 	67,336	  	  	 	296,175	  	  	 	267,890	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Operating income	  	 	19,114	  	  	 	16,203	  	  	 	80,073	  	  	 	61,363	  	
Other income, net	  	 	534	  	  	 	650	  	  	 	965	  	  	 	1,864	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Income before income taxes	  	 	19,648	  	  	 	16,853	  	  	 	81,038	  	  	 	63,227	  	
Income tax provision	  	 	7,178	  	  	 	6,328	  	  	 	29,185	  	  	 	18,320	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Net income	  	$	12,470	  	  	$	10,525	  	  	$	51,853	  	  	$	44,907	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Basic earnings per share	  	$	0.64	  	  	$	0.53	  	  	$	2.64	  	  	$	2.20	  	
Diluted earnings per share	  	$	0.63	  	  	$	0.50	  	  	$	2.56	  	  	$	2.09	  	
Weighted average number of shares:	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Basic	  	 	19,409	  	  	 	19,941	  	  	 	19,660	  	  	 	20,455	  	
Diluted	  	 	19,913	  	  	 	20,923	  	  	 	20,271	  	  	 	21,492	  	

MANHATTAN ASSOCIATES, INC. AND SUBSIDIARIES
Reconciliation of Selected GAAP to Non-GAAP Measures
(in thousands, except per share amounts)

 	  	Three Months Ended December 31,	 	 	Twelve Months Ended December 31,	 	
 	  	2012	 	  	2011	 	 	2012	 	  	2011	 	
GAAP Operating income	  	$	19,114	  	  	$	16,203	  	 	$	80,073	  	  	$	61,363	  	
Equity-based compensation(a)	  	 	2,543	  	  	 	3,055	  	 	 	8,338	  	  	 	10,372	  	
Purchase amortization(b)	  	 	1	  	  	 	2	  	 	 	6	  	  	 	1,172	  	
Recovery of previously impaired investment(c)	  	 	—  	  	  	 	—  	  	 	 	—  	  	  	 	(2,519	) 	
 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Adjusted operating income (Non-GAAP)	  	$	21,658	  	  	$	19,260	  	 	$	88,417	  	  	$	70,388	  	
 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
GAAP Income tax provision	  	$	7,178	  	  	$	6,328	  	 	$	29,185	  	  	$	18,320	  	
Equity-based compensation(a)	  	 	942	  	  	 	1,075	  	 	 	3,028	  	  	 	3,526	  	
Purchase amortization(b)	  	 	—  	  	  	 	6	  	 	 	2	  	  	 	398	  	
Unusual tax adjustments(d)	  	 	—  	  	  	 	11	  	 	 	—  	  	  	 	238	  	
 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Adjusted income tax provision (Non-GAAP)	  	$	8,120	  	  	$	7,420	  	 	$	32,215	  	  	$	22,482	  	
 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
GAAP Net income	  	$	12,470	  	  	$	10,525	  	 	$	51,853	  	  	$	44,907	  	
Equity-based compensation(a)	  	 	1,601	  	  	 	1,980	  	 	 	5,310	  	  	 	6,846	  	
Purchase amortization(b)	  	 	1	  	  	 	(4	) 	 	 	4	  	  	 	774	  	
Recovery of previously impaired investment(c)	  	 	—  	  	  	 	—  	  	 	 	—  	  	  	 	(2,519	) 	
Unusual tax adjustments(d)	  	 	—  	  	  	 	(11	) 	 	 	—  	  	  	 	(238	) 	
 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Adjusted net income (Non-GAAP)	  	$	14,072	  	  	$	12,490	  	 	$	57,167	  	  	$	49,770	  	
 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
GAAP Diluted EPS	  	$	0.63	  	  	$	0.50	  	 	$	2.56	  	  	$	2.09	  	
Equity-based compensation(a)	  	 	0.08	  	  	 	0.09	  	 	 	0.26	  	  	 	0.32	  	
Purchase amortization(b)	  	 	—  	  	  	 	—  	  	 	 	—  	  	  	 	0.04	  	
Recovery of previously impaired investment(c)	  	 	—  	  	  	 	—  	  	 	 	—  	  	  	 	(0.12	) 	
Unusual tax adjustments(d)	  	 	—  	  	  	 	—  	  	 	 	—  	  	  	 	(0.01	) 	
 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Adjusted diluted EPS (Non-GAAP)	  	$	0.71	  	  	$	0.60	  	 	$	2.82	  	  	$	2.32	  	
 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Fully diluted shares	  	 	19,913	  	  	 	20,923	  	 	 	20,271	  	  	 	21,492	  	
 
(a)	To be consistent with other companies in the software industry, we report adjusted results excluding all equity-based compensation. The equity-based compensation is included in the following GAAP operating expense lines for the three and twelve months ended December 31, 2012 and 2011:	

 	  	Three Months Ended December 31,	 	  	Twelve Months Ended December 31,	 	
 	  	2012	 	  	2011	 	  	2012	 	  	2011	 	
Cost of services	  	$	334	  	  	$	290	  	  	$	824	  	  	$	1,367	  	
Research and development	  	 	424	  	  	 	410	  	  	 	1,558	  	  	 	1,583	  	
Sales and marketing	  	 	553	  	  	 	812	  	  	 	2,220	  	  	 	2,545	  	
General and administrative	  	 	1,232	  	  	 	1,543	  	  	 	3,736	  	  	 	4,877	  	
 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total equity-based compensation	  	$	2,543	  	  	$	3,055	  	  	$	8,338	  	  	$	10,372	  	

(b)	Adjustments represent purchased intangibles amortization from prior acquisitions. Such amortization is commonly excluded from GAAP net income by companies in our industry and we therefore exclude these amortization costs to provide more relevant and meaningful comparisons of our operating results to that of our competitors.	
(c)	During the quarter ended September 30, 2008, we recorded an impairment charge of $3.5 million on an investment in an auction rate security. We reduced the carrying value to zero due to credit downgrades of the underlying issuer and the bond insurer as well as increasing publicly reported exposure to bankruptcy risk by the issuer. However, during the quarter ended September 30, 2011, we were able to sell the auction rate security and recovered over 70%, or $2.5 million, of our original investment. We previously excluded the asset impairment charge recorded in 2008 to write down the value of the auction rate security because we typically invest our treasury funds in cash, cash equivalents or other liquid investments, not illiquid, risky securities. We believed the write-down in value of the auction rate security was due to unusual changes in the characteristics of the auction rate security since our initial investment in it, including failed auctions and default risk for a municipal obligor. Consistent with our prior exclusion of the charge, we have excluded the reversal of the charge from adjusted non-GAAP results because it is not indicative of ongoing operating performance.	
(d)	For the three and twelve months ended December 31, 2011, the adjustments represent tax benefits from disqualifying dispositions of incentive stock options that were previously expensed. As discussed above, we excluded equity-based compensation from adjusted non-GAAP results to be consistent with other companies in the software industry. Therefore, we also excluded the related tax benefit generated upon their disposition.	

MANHATTAN ASSOCIATES, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands, except share and per share data)

 	  	December 31,	 	
 	  	2012	 	 	2011	 	
ASSETS	  	
Current Assets:	  	 	 	 	 	 	 	 	
Cash and cash equivalents	  	$	96,737	  	 	$	92,180	  	
Short term investments	  	 	6,310	  	 	 	6,079	  	
Accounts receivable, net of allowance of $6,235 and $4,816 in 2012 and 2011, respectively	  	 	62,102	  	 	 	56,264	  	
Deferred income taxes	  	 	7,787	  	 	 	7,599	  	
Income taxes receivable	  	 	—  	  	 	 	4,859	  	
Prepaid expenses and other current assets	  	 	8,571	  	 	 	7,533	  	
 	  	 	 	 	 	 	 	 	
Total current assets	  	 	181,507	  	 	 	174,514	  	
Property and equipment, net	  	 	15,650	  	 	 	13,321	  	
Long-term investments	  	 	—  	  	 	 	855	  	
Goodwill	  	 	62,265	  	 	 	62,261	  	
Deferred income taxes	  	 	732	  	 	 	5,696	  	
Other assets	  	 	1,659	  	 	 	2,953	  	
 	  	 	 	 	 	 	 	 	
Total assets	  	$	261,813	  	 	$	259,600	  	
 	  	 	 	 	 	 	 	 	
LIABILITIES AND SHAREHOLDERS’ EQUITY	  	
Current liabilities:	  	 	 	 	 	 	 	 	
Accounts payable	  	$	10,229	  	 	$	8,090	  	
Accrued compensation and benefits	  	 	16,720	  	 	 	16,503	  	
Accrued and other liabilities	  	 	12,233	  	 	 	13,648	  	
Deferred revenue	  	 	47,935	  	 	 	49,882	  	
Income taxes payable	  	 	4,024	  	 	 	—  	  	
 	  	 	 	 	 	 	 	 	
Total current liabilities	  	 	91,141	  	 	 	88,123	  	
Other non-current liabilities	  	 	9,163	  	 	 	9,397	  	
 	 	 	
Shareholders’ equity:	  	 	 	 	 	 	 	 	
Preferred stock, no par value; 20,000,000 shares authorized, no shares issued or outstanding in 2012 or 2011	  	 	—  	  	 	 	—  	  	
Common stock, $.01 par value; 100,000,000 shares authorized; 19,620,967 and 20,415,946 shares issued and outstanding at December 31, 2012 and 2011, respectively	  	 	196	  	 	 	204	  	
Additional paid-in capital	  	 	—  	  	 	 	—  	  	
Retained earnings	  	 	166,016	  	 	 	166,989	  	
Accumulated other comprehensive loss	  	 	(4,703	) 	 	 	(5,113	) 	
 	  	 	 	 	 	 	 	 	
Total shareholders’ equity	  	 	161,509	  	 	 	162,080	  	
 	  	 	 	 	 	 	 	 	
Total liabilities and shareholders’ equity	  	$	261,813	  	 	$	259,600	  	

MANHATTAN ASSOCIATES, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(in thousands)

 	  	Year Ended December 31,	 	
 	  	2012	 	 	2011	 	
Operating activities:	  	 	 	 	 	 	 	 	
Net income	  	$	51,853	  	 	$	44,907	  	
Adjustments to reconcile net income to net cash provided by operating activities:	  	 	 	 	 	 	 	 	
Depreciation and amortization	  	 	5,638	  	 	 	7,284	  	
Recovery of previously impaired investment	  	 	—  	  	 	 	(2,519	) 	
Equity-based compensation	  	 	8,338	  	 	 	10,372	  	
(Gain) loss on disposal of equipment	  	 	(46	) 	 	 	25	  	
Tax benefits of stock awards exercised/vested	  	 	9,901	  	 	 	7,481	  	
Excess tax benefits from equity-based compensation	  	 	(7,531	) 	 	 	(2,474	) 	
Deferred income taxes	  	 	5,388	  	 	 	2,409	  	
Unrealized foreign currency loss (gain)	  	 	427	  	 	 	(189	) 	
Changes in operating assets and liabilities:	  	 	 	 	 	 	 	 	
Accounts receivable, net	  	 	(5,446	) 	 	 	(8,994	) 	
Other assets	  	 	281	  	 	 	(1,332	) 	
Accounts payable, accrued and other liabilities	  	 	(162	) 	 	 	(3,537	) 	
Income taxes	  	 	8,831	  	 	 	(2,514	) 	
Deferred revenue	  	 	(2,201	) 	 	 	4,905	  	
 	  	 	 	 	 	 	 	 	
Net cash provided by operating activities	  	 	75,271	  	 	 	55,824	  	
 	  	 	 	 	 	 	 	 	
Investing activities:	  	 	 	 	 	 	 	 	
Purchase of property and equipment	  	 	(7,873	) 	 	 	(5,074	) 	
Net maturities of investments	  	 	864	  	 	 	465	  	
 	  	 	 	 	 	 	 	 	
Net cash used in investing activities	  	 	(7,009	) 	 	 	(4,609	) 	
 	  	 	 	 	 	 	 	 	
Financing activities:	  	 	 	 	 	 	 	 	
Purchase of common stock	  	 	(103,155	) 	 	 	(133,144	) 	
Proceeds from issuance of common stock from options exercised	  	 	32,082	  	 	 	52,721	  	
Excess tax benefits from equity-based compensation	  	 	7,531	  	 	 	2,474	  	
 	  	 	 	 	 	 	 	 	
Net cash used in financing activities	  	 	(63,542	) 	 	 	(77,949	) 	
 	  	 	 	 	 	 	 	 	
Foreign currency impact on cash	  	 	(163	) 	 	 	(1,830	) 	
 	  	 	 	 	 	 	 	 	
Net change in cash and cash equivalents	  	 	4,557	  	 	 	(28,564	) 	
Cash and cash equivalents at beginning of period	  	 	92,180	  	 	 	120,744	  	
 	  	 	 	 	 	 	 	 	
Cash and cash equivalents at end of period	  	$	96,737	  	 	$	92,180	  	

MANHATTAN ASSOCIATES, INC.
SUPPLEMENTAL INFORMATION
 
1.	GAAP and Adjusted earnings (loss) per share by quarter are as follows:	

 	 	2011	 	 	2012	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	YTD	 	
GAAP Diluted EPS	 	$	0.32	  	 	$	0.57	  	 	$	0.70	  	 	$	0.50	  	 	$	2.09	  	 	$	0.55	  	 	$	0.70	  	 	$	0.69	  	 	$	0.63	  	 	$	2.56	  	
Adjustments to GAAP:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Equity-based compensation	 	 	0.07	  	 	 	0.07	  	 	 	0.08	  	 	 	0.09	  	 	 	0.32	  	 	 	0.05	  	 	 	0.06	  	 	 	0.07	  	 	 	0.08	  	 	 	0.26	  	
Purchase amortization	 	 	0.01	  	 	 	0.01	  	 	 	0.01	  	 	 	—  	  	 	 	0.04	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	
Recovery of previously impaired investment	 	 	—  	  	 	 	—  	  	 	 	(0.12	) 	 	 	—  	  	 	 	(0.12	) 	 	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	
Unusual tax adjustments	 	 	—  	  	 	 	—  	  	 	 	(0.01	) 	 	 	—  	  	 	 	(0.01	) 	 	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	—  	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Adjusted Diluted EPS	 	$	0.41	  	 	$	0.65	  	 	$	0.67	  	 	$	0.60	  	 	$	2.32	  	 	$	0.60	  	 	$	0.76	  	 	$	0.75	  	 	$	0.71	  	 	$	2.82	  	

2.	Revenues and operating income (loss) by reportable segment are as follows (in thousands):	

 	 	2011	 	 	2012	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	YTD	 	
Revenue:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Americas	 	$	60,185	  	 	$	72,634	  	 	$	70,663	  	 	$	69,377	  	 	$	272,859	  	 	$	73,195	  	 	$	77,094	  	 	$	79,657	  	 	$	77,646	  	 	$	307,592	  	
EMEA	 	 	8,336	  	 	 	11,075	  	 	 	10,041	  	 	 	8,843	  	 	 	38,295	  	 	 	12,407	  	 	 	12,334	  	 	 	10,589	  	 	 	11,808	  	 	 	47,138	  	
APAC	 	 	3,189	  	 	 	4,693	  	 	 	4,898	  	 	 	5,319	  	 	 	18,099	  	 	 	5,879	  	 	 	4,139	  	 	 	5,595	  	 	 	5,905	  	 	 	21,518	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	$	71,710	  	 	$	88,402	  	 	$	85,602	  	 	$	83,539	  	 	$	329,253	  	 	$	91,481	  	 	$	93,567	  	 	$	95,841	  	 	$	95,359	  	 	$	376,248	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
GAAP Operating Income (Loss):	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Americas	 	$	7,087	  	 	$	15,749	  	 	$	17,183	  	 	$	13,531	  	 	$	53,550	  	 	$	13,685	  	 	$	18,130	  	 	$	17,718	  	 	$	15,984	  	 	$	65,517	  	
EMEA	 	 	909	  	 	 	1,963	  	 	 	1,334	  	 	 	1,033	  	 	 	5,239	  	 	 	2,580	  	 	 	2,944	  	 	 	2,707	  	 	 	1,494	  	 	 	9,725	  	
APAC	 	 	(443	) 	 	 	501	  	 	 	877	  	 	 	1,639	  	 	 	2,574	  	 	 	1,675	  	 	 	268	  	 	 	1,252	  	 	 	1,636	  	 	 	4,831	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	$	7,553	  	 	$	18,213	  	 	$	19,394	  	 	$	16,203	  	 	$	61,363	  	 	$	17,940	  	 	$	21,342	  	 	$	21,677	  	 	$	19,114	  	 	$	80,073	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Adjustments (pre-tax):	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Americas:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Equity-based compensation	 	$	2,409	  	 	$	2,405	  	 	$	2,503	  	 	$	3,055	  	 	$	10,372	  	 	$	1,660	  	 	$	1,977	  	 	$	2,158	  	 	$	2,543	  	 	$	8,338	  	
Purchase amortization	 	 	439	  	 	 	438	  	 	 	293	  	 	 	2	  	 	 	1,172	  	 	 	2	  	 	 	1	  	 	 	2	  	 	 	1	  	 	 	6	  	
Recovery of previously impaired investment	 	 	—  	  	 	 	—  	  	 	 	(2,519	) 	 	 	—  	  	 	 	(2,519	) 	 	 	—  	  	 	 	—  	  	 	 	 	 	 	 	—  	  	 	 	—  	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	$	2,848	  	 	$	2,843	  	 	$	277	  	 	$	3,057	  	 	$	9,025	  	 	$	1,662	  	 	$	1,978	  	 	$	2,160	  	 	$	2,544	  	 	$	8,344	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Adjusted non-GAAP Operating Income (Loss):	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Americas	 	$	9,935	  	 	$	18,592	  	 	$	17,460	  	 	$	16,588	  	 	$	62,575	  	 	$	15,347	  	 	$	20,108	  	 	$	19,878	  	 	$	18,528	  	 	$	73,861	  	
EMEA	 	 	909	  	 	 	1,963	  	 	 	1,334	  	 	 	1,033	  	 	 	5,239	  	 	 	2,580	  	 	 	2,944	  	 	 	2,707	  	 	 	1,494	  	 	 	9,725	  	
APAC	 	 	(443	) 	 	 	501	  	 	 	877	  	 	 	1,639	  	 	 	2,574	  	 	 	1,675	  	 	 	268	  	 	 	1,252	  	 	 	1,636	  	 	 	4,831	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	$	10,401	  	 	$	21,056	  	 	$	19,671	  	 	$	19,260	  	 	$	70,388	  	 	$	19,602	  	 	$	23,320	  	 	$	23,837	  	 	$	21,658	  	 	$	88,417	  	

3.	Our services revenue consists of fees generated from professional services and customer support and software enhancements related to our software products as follows (in thousands):	

 	 	2011	 	 	2012	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	YTD	 	
Professional services	 	$	35,184	  	 	$	42,150	  	 	$	41,403	  	 	$	38,057	  	 	$	156,794	  	 	$	46,621	  	 	$	45,497	  	 	$	47,082	  	 	$	46,042	  	 	$	185,242	  	
Customer support and software enhancements	 	 	20,894	  	 	 	21,624	  	 	 	22,191	  	 	 	22,555	  	 	 	87,264	  	 	 	23,749	  	 	 	23,825	  	 	 	24,804	  	 	 	26,252	  	 	 	98,630	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total services revenue	 	$	56,078	  	 	$	63,774	  	 	$	63,594	  	 	$	60,612	  	 	$	244,058	  	 	$	70,370	  	 	$	69,322	  	 	$	71,886	  	 	$	72,294	  	 	$	283,872	  	

4.	Hardware and other revenue includes the following items (in thousands):	

 	 	2011	 	 	2012	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	YTD	 	
Hardware revenue	 	$	5,504	  	 	$	5,540	  	 	$	5,597	  	 	$	3,895	  	 	$	20,536	  	 	$	3,054	  	 	$	5,740	  	 	$	4,234	  	 	$	5,242	  	 	$	18,270	  	
Billed travel	 	 	2,366	  	 	 	2,741	  	 	 	2,846	  	 	 	2,465	  	 	 	10,418	  	 	 	2,470	  	 	 	3,160	  	 	 	3,557	  	 	 	3,425	  	 	 	12,612	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total hardware and other revenue	 	$	7,870	  	 	$	8,281	  	 	$	8,443	  	 	$	6,360	  	 	$	30,954	  	 	$	5,524	  	 	$	8,900	  	 	$	7,791	  	 	$	8,667	  	 	$	30,882	  	

5.	Impact of Currency Fluctuation	
The following table reflects the increases (decreases) in the results of operations for each period attributable to the change in foreign currency exchange rates from the prior period as well as foreign currency gains (losses) included in other income, net for each period (in thousands):

 	 	2011	 	 	2012	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	YTD	 	
Revenue	 	$	282	  	 	$	1,743	  	 	$	1,140	  	 	$	110	  	 	$	3,275	  	 	$	(136	) 	 	$	(1,251	) 	 	$	(958	) 	 	$	(128	) 	 	$	(2,473	) 	
Costs and expenses	 	 	386	  	 	 	1,513	  	 	 	1,038	  	 	 	(668	) 	 	 	2,269	  	 	 	(848	) 	 	 	(2,067	) 	 	 	(1,845	) 	 	 	(422	) 	 	 	(5,182	) 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating income	 	 	(104	) 	 	 	230	  	 	 	102	  	 	 	778	  	 	 	1,006	  	 	 	712	  	 	 	816	  	 	 	887	  	 	 	294	  	 	 	2,709	  	
Foreign currency (losses) gains in other income	 	 	(207	) 	 	 	77	  	 	 	575	  	 	 	367	  	 	 	812	  	 	 	(370	) 	 	 	571	  	 	 	(564	) 	 	 	231	  	 	 	(132	) 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	$	(311	) 	 	$	307	  	 	$	677	  	 	$	1,145	  	 	$	1,818	  	 	$	342	  	 	$	1,387	  	 	$	323	  	 	$	525	  	 	$	2,577	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Manhattan Associates has a large research and development center in Bangalore, India. The following table reflects the increases (decreases) in the financial results for each period attributable to changes in the Indian Rupee exchange rate (in thousands):

 	 	2011	 	 	2012	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	YTD	 	
Operating income	 	$	(53	) 	 	$	(82	) 	 	$	(76	) 	 	$	727	  	 	$	516	  	 	$	704	  	 	$	1,193	  	 	$	1,161	  	 	$	348	  	 	$	3,406	  	
Foreign currency (losses) gains in other income	 	 	(112	) 	 	 	53	  	 	 	653	  	 	 	638	  	 	 	1,232	  	 	 	(144	) 	 	 	724	  	 	 	(500	) 	 	 	282	  	 	 	362	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total impact of changes in the Indian Rupee	 	$	(165	) 	 	$	(29	) 	 	$	577	  	 	$	1,365	  	 	$	1,748	  	 	$	560	  	 	$	1,917	  	 	$	661	  	 	$	630	  	 	$	3,768	  	

MANHATTAN ASSOCIATES, INC.
SUPPLEMENTAL INFORMATION
 
6.	Other income (expense) includes the following components (in thousands):	

 	 	2011	 	 	2012	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	YTD	 	
Interest income	 	$	225	  	 	$	269	  	 	$	298	  	 	$	280	  	 	$	1,072	  	 	$	264	  	 	$	228	  	 	$	278	  	 	$	292	  	 	$	1,062	  	
Foreign currency (losses) gains	 	 	(207	) 	 	 	77	  	 	 	575	  	 	 	367	  	 	 	812	  	 	 	(370	) 	 	 	571	  	 	 	(564	) 	 	 	231	  	 	 	(132	) 	
Other non-operating (expense) income	 	 	—  	  	 	 	(12	) 	 	 	(11	) 	 	 	3	  	 	 	(20	) 	 	 	(18	) 	 	 	3	  	 	 	39	  	 	 	11	  	 	 	35	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total other income (expense)	 	$	18	  	 	$	334	  	 	$	862	  	 	$	650	  	 	$	1,864	  	 	$	(124	) 	 	$	802	  	 	$	(247	) 	 	$	534	  	 	$	965	  	

7.	Total equity-based compensation is as follows (in thousands except per share amounts):	

 	 	2011	 	 	2012	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	YTD	 	
Stock options	 	$	512	  	 	$	487	  	 	$	486	  	 	$	518	  	 	$	2,003	  	 	$	120	  	 	$	140	  	 	$	138	  	 	$	223	  	 	$	621	  	
Restricted stock	 	 	1,897	  	 	 	1,918	  	 	 	2,017	  	 	 	2,537	  	 	 	8,369	  	 	 	1,540	  	 	 	1,837	  	 	 	2,020	  	 	 	2,320	  	 	 	7,717	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total equity-based compensation	 	 	2,409	  	 	 	2,405	  	 	 	2,503	  	 	 	3,055	  	 	 	10,372	  	 	 	1,660	  	 	 	1,977	  	 	 	2,158	  	 	 	2,543	  	 	 	8,338	  	
Income tax provision	 	 	807	  	 	 	806	  	 	 	838	  	 	 	1,075	  	 	 	3,526	  	 	 	598	  	 	 	711	  	 	 	777	  	 	 	942	  	 	 	3,028	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	 	$	1,602	  	 	$	1,599	  	 	$	1,665	  	 	$	1,980	  	 	$	6,846	  	 	$	1,062	  	 	$	1,266	  	 	$	1,381	  	 	$	1,601	  	 	$	5,310	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Diluted earnings per share	 	$	0.07	  	 	$	0.07	  	 	$	0.08	  	 	$	0.09	  	 	$	0.32	  	 	$	0.05	  	 	$	0.06	  	 	$	0.07	  	 	$	0.08	  	 	$	0.26	  	
 	 	 	 	 	 	 	 	 	 	 	
Diluted earnings per share—stock options	 	$	0.02	  	 	$	0.01	  	 	$	0.02	  	 	$	0.02	  	 	$	0.06	  	 	$	0.00	  	 	$	—  	  	 	$	—  	  	 	$	0.01	  	 	$	0.02	  	
Diluted earnings per share—restricted stock	 	$	0.06	  	 	$	0.06	  	 	$	0.06	  	 	$	0.08	  	 	$	0.26	  	 	$	0.05	  	 	$	0.06	  	 	$	0.07	  	 	$	0.07	  	 	$	0.24	  	
 
8.	Capital expenditures are as follows (in thousands):	

 	 	2011	 	 	2012	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	YTD	 	
Capital expenditures	 	$	1,338	  	 	$	658	  	 	$	1,676	  	 	$	1,402	  	 	$	5,074	  	 	$	1,796	  	 	$	1,454	  	 	$	1,086	  	 	$	3,537	  	 	$	7,873	  	

9.	Stock Repurchase Activity (in thousands):	

 	 	2011	 	 	2012	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	YTD	 	
Shares purchased under publicly-announced buy-back program	 	 	826	  	 	 	1,079	  	 	 	845	  	 	 	857	  	 	 	3,607	  	 	 	653	  	 	 	346	  	 	 	419	  	 	 	527	  	 	 	1,945	  	
Shares withheld for taxes due upon vesting of restricted stock	 	 	65	  	 	 	4	  	 	 	4	  	 	 	5	  	 	 	78	  	 	 	66	  	 	 	3	  	 	 	5	  	 	 	4	  	 	 	78	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total shares purchased	 	 	891	  	 	 	1,083	  	 	 	849	  	 	 	862	  	 	 	3,685	  	 	 	719	  	 	 	349	  	 	 	424	  	 	 	531	  	 	 	2,023	  	
 	 	 	 	 	 	 	 	 	 	 	
Total cash paid for shares purchased under publicly-announced buy-back program	 	$	25,621	  	 	$	38,286	  	 	$	29,414	  	 	$	37,390	  	 	$	130,711	  	 	$	30,647	  	 	$	16,616	  	 	$	21,202	  	 	$	31,223	  	 	$	99,688	  	
Total cash paid for shares withheld for taxes due upon vesting of restricted stock	 	 	1,960	  	 	 	129	  	 	 	159	  	 	 	185	  	 	 	2,433	  	 	 	2,840	  	 	 	132	  	 	 	230	  	 	 	265	  	 	 	3,467	  	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total cash paid for shares repurchased	 	$	27,581	  	 	$	38,415	  	 	$	29,573	  	 	$	37,575	  	 	$	133,144	  	 	$	33,487	  	 	$	16,748	  	 	$	21,432	  	 	$	31,488	  	 	$	103,155