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):  February 2, 2016
 
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, Tenth Floor, 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 February 2, 2016, Manhattan Associates, Inc. (the “Company”) issued a press release providing the results for its financial performance for the three and twelve months ended December 31, 2015. 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 diluted earnings per share, which excludes the impact of equity-based compensation and acquisition-related costs and the amortization thereof - all net of income tax effects. We have developed our internal reporting, compensation and planning systems using these measures.
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.
Non-GAAP measures used in the press release exclude the impact of the items described above for the following reasons:
 
 	·	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.	
 
 	·	Because we engage in acquisitions from time to time, we incur acquisition-related costs that consist primarily of accounting and legal expenses, 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. Consequently, we exclude these amortization costs when calculating adjusted net income and adjusted earnings per share.	
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 and enable investors to evaluate our operating performance in a manner consistent with our internal basis of measurement.  Management refers to adjusted operating income, adjusted net income and adjusted earnings per share in making
1

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 February 2, 2016	

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:  February 2, 2016
 
3

EXHIBIT INDEX
 	 	
Exhibit	 	
Number	Description	
99.1	Press Release, dated February 2, 2016	

 

Exhibit 99.1

Contact:	 	Dennis Story	 	Cameron Smith	
 	 	Chief Financial Officer	 	Director, Corporate Communications	
 	 	Manhattan Associates, Inc.	 	Manhattan Associates, Inc.	
 	 	770-955-7070	 	678-597-6841	
 	 	dstory@manh.com	 	camsmith@manh.com	
 
Manhattan Associates Reports Record Fourth Quarter and Full Year 2015 Performance
 
ATLANTA – February 2, 2016 – Leading Supply Chain Commerce Solutions provider Manhattan Associates, Inc. (NASDAQ: MANH) today reported record non-GAAP adjusted diluted earnings per share for the fourth quarter ended December 31, 2015 of $0.39 compared to $0.30 in Q4 2014, on license revenue of $20.4 million and record total revenue of $141.4 million. GAAP diluted earnings per share for Q4 2015 was a record $0.36 compared to $0.27 in Q4 2014.
“We’re very pleased with our 2015 fourth quarter and full year financial results. This marks our 4th consecutive year of record revenue and earnings per share performance. Our associates continue to execute very well serving our customers and therefore delivering strong financial performance,” said Eddie Capel, Manhattan Associates President and CEO. “ Demand for our omni-channel, store and distribution management solutions continues to be strong and we’re working hard to extend our market leadership position. Despite persistent global macro sluggishness, we are optimistic about our growth opportunities in 2016. We will continue to be a serial investor in innovation and focus on the customer to increase market share and improve our financial results.”
FOURTH QUARTER 2015 FINANCIAL SUMMARY:
 	·	Adjusted diluted earnings per share, a non-GAAP measure, was $0.39 in Q4 2015, compared to $0.30 in Q4 2014.	 	

 	·	GAAP diluted earnings per share was $0.36 in Q4 2015, compared to $0.27 in Q4 2014.	 	

 	·	Consolidated total revenue was $141.4 million in Q4 2015, compared to $130.4 million in Q4 2014. License revenue was $20.4 million in Q4 2015, compared to $19.5 million in Q4 2014.	 	

 	
 
 	·	Adjusted operating income, a non-GAAP measure, was $43.1 million in Q4 2015, compared to $31.9 million in Q4 2014.  	 	

 	·	GAAP operating income was $39.5 million in Q4 2015, compared to $29.1 million in Q4 2014.	 	

 	·	Cash flow from operations was $36.1 million in Q4 2015, compared to $40.4 million in Q4 2014. Days Sales Outstanding was 63 days at December 31, 2015, compared to 60 days at September 30, 2015.	 	

 	·	Cash and investments totaled $128.8 million at December 31, 2015, compared to $119.1 million at September 30, 2015.	 	

 	·	During the three months ended December 31, 2015, the Company repurchased 340,082 shares of Manhattan Associates common stock under the share repurchase program authorized by the Board of Directors, for a total investment of $25.1 million. In January 2016, the Board of Directors approved raising the Company's share repurchase authority to an aggregate of $50.0 million of the Company’s outstanding common stock.	 	
 
FULL YEAR 2015 FINANCIAL SUMMARY:
 	·	Adjusted diluted earnings per share, a non-GAAP measure, was a record $1.52 for the twelve months ended December 31, 2015, compared to $1.16 for the twelve months ended December 31, 2014.	 	

 	·	GAAP diluted earnings per share for the twelve months ended December 31, 2015 was a record $1.40, compared to $1.08 for the twelve months ended December 31, 2014.  	 	

 	·	Consolidated revenue for the twelve months ended December 31, 2015 was a record $556.4 million, compared to $492.1 million for the twelve months ended December 31, 2014. License revenue was a record $78.6 million for the twelve months ended December 31, 2015, compared to $71.6 million for the twelve months ended December 31, 2014.  	 	

 	
 
 	·	Adjusted operating income, a non-GAAP measure, was a record $176.4 million for the twelve months ended December 31, 2015, compared to $137.0 million for the twelve months ended December 31, 2014.   	 	

 	·	GAAP operating income was a record $161.4 million for the twelve months ended December 31, 2015, compared to $127.1 million for the twelve months ended December 31, 2014.	 	

 	·	Cash flow from operations was a record $120.2 million in the twelve months ended December 31, 2015, compared to $94.2 million in the twelve months ended December 31, 2014.	 	

 	·	During the twelve months ended December 31, 2015, the Company repurchased 1,721,457 shares of Manhattan Associates common stock under the share repurchase program authorized by the Board of Directors, for a total investment of $101.6 million.	 	
SALES ACHIEVEMENTS:
 	·	Recognized license revenue of $1.0 million or more on six contracts during Q4 2015.	 	

 	·	Completed software license wins with new customers such as: Antalis, Biesheuvel Techniek (an IPH Group Company), Boston Scientific, Eddie Bauer, Eksmo, Fanatics, MVP Group, Nitori, Nortek, North Bay International, Riffle Machine Works, Selmec Equipos Industriales, The White Company, Value Drug.	 	

 	·	Expanded relationships with existing customers such as: Ahold USA, BCBGMaxazria, Citizen Watch, Coach, Darice, David’s Bridal, DOME, Essilor of America, eStore Logistics, Federal Mogul, Fiskars, Floor and Décor, Groupe Dynamite, Harris Teeter, Heineken, Hot Topic, House of Fraser, Inter-Fab, Kane Warehousing, Keeco, Kiabi, Kuehne & Nagel, Kwik Trip, Lacoste, LC Industries, Lennox International, Maggy London, O'Reilly Automotive Stores, Petrovich, Pitt-Ohio, RedMart, Republic National Distributing Company, Samson, Schurman Fine Papers, Southern Wine & Spirits of America, Telebrands, The Honest Company, Tractor Supply, TwinMed, Under Armour, West Coast Distribution, Wineworks.

 	
 
2016 GUIDANCE
Manhattan Associates provides the following revenue and diluted earnings per share guidance for the full year 2016:

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. 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 the close of business on March 15, 2016, 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 2016 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, 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 2016.

 	
 
CONFERENCE CALL
The Company’s conference call regarding its fourth quarter and twelve months ended December 31, 2015 financial results will be held today, February 2, 2016, at 4:30 p.m. Eastern Standard Time. 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 +1.855.859.2056 in the U.S. and Canada, or +1.404.537.3406 outside the U.S., and entering the conference identification number 20771536 or via the web 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 2016 earnings release.
GAAP VERSUS NON-GAAP PRESENTATION
The Company provides adjusted operating income, adjusted net income and adjusted diluted 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’ ability to understand and compare the Company’s results and guidance, because the measures provide important supplemental information in evaluating the operating results of its business, as distinct from results that include items that are not indicative of ongoing operating results, and because the Company’s competitors and peers typically publish similar non-GAAP measures. This release should be read in conjunction with the Company’s Form 8-K earnings release filing for the quarter and twelve months ended December 31, 2015.  
Non-GAAP adjusted operating income, adjusted net income and adjusted diluted earnings per share exclude the impact of equity-based compensation and acquisition-related costs and the amortization thereof – all net of income tax effects. 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
Manhattan Associates makes commerce-ready supply chains that bring all points of commerce together so you’re ready to sell and ready to execute. Across the store, through your network or from your fulfillment center, we design, build and deliver market-leading solutions that support both top-line growth and bottom-line profitability. By converging front-end sales with back-end supply chain execution, our software, platform technology and unmatched experience help our customers get commerce ready—and ready to reap the rewards of the omni-channel marketplace. 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 “2016 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, information security breaches and the risk factors set forth in Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. 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,	 	 	Year Ended December 31,	 	
 	 	2015	 	 	2014	 	 	2015	 	 	2014	 	
 	 	(unaudited)	 	 	(unaudited)	 	 	 	 	 	 	 	 	 	
Revenue:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Software license	 	$	20,413	 	 	$	19,542	 	 	$	78,615	 	 	$	71,583	 	
Services	 	 	106,982	 	 	 	97,073	 	 	 	428,078	 	 	 	376,023	 	
Hardware and other	 	 	14,040	 	 	 	13,788	 	 	 	49,678	 	 	 	44,498	 	
Total revenue	 	 	141,435	 	 	 	130,403	 	 	 	556,371	 	 	 	492,104	 	
Costs and expenses:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cost of license	 	 	2,590	 	 	 	1,970	 	 	 	9,938	 	 	 	7,110	 	
Cost of services	 	 	46,419	 	 	 	45,534	 	 	 	184,349	 	 	 	169,140	 	
Cost of hardware and other	 	 	11,322	 	 	 	11,088	 	 	 	41,141	 	 	 	36,328	 	
Research and development	 	 	13,457	 	 	 	13,047	 	 	 	53,859	 	 	 	48,953	 	
Sales and marketing	 	 	13,975	 	 	 	16,273	 	 	 	48,615	 	 	 	52,617	 	
General and administrative	 	 	12,036	 	 	 	11,694	 	 	 	49,259	 	 	 	44,455	 	
Depreciation and amortization	 	 	2,108	 	 	 	1,725	 	 	 	7,764	 	 	 	6,377	 	
Total costs and expenses	 	 	101,907	 	 	 	101,331	 	 	 	394,925	 	 	 	364,980	 	
Operating income	 	 	39,528	 	 	 	29,072	 	 	 	161,446	 	 	 	127,124	 	
Other income, net	 	 	170	 	 	 	850	 	 	 	1,395	 	 	 	874	 	
Income before income taxes	 	 	39,698	 	 	 	29,922	 	 	 	162,841	 	 	 	127,998	 	
Income tax provision	 	 	13,328	 	 	 	9,568	 	 	 	59,366	 	 	 	45,998	 	
Net income	 	$	26,370	 	 	$	20,354	 	 	$	103,475	 	 	$	82,000	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic earnings per share	 	$	0.36	 	 	$	0.27	 	 	$	1.41	 	 	$	1.09	 	
Diluted earnings per share	 	$	0.36	 	 	$	0.27	 	 	$	1.40	 	 	$	1.08	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Weighted average number of shares:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic	 	 	72,929	 	 	 	74,223	 	 	 	73,443	 	 	 	74,995	 	
Diluted	 	 	73,555	 	 	 	75,034	 	 	 	74,038	 	 	 	75,841	 	

 

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

 
  	 	Three Months Ended December 31,	 	 	Year Ended December 31,	 	
 	 	2015	 	 	2014	 	 	2015	 	 	2014	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating income	 	$	39,528	 	 	$	29,072	 	 	$	161,446	 	 	$	127,124	 	
Equity-based compensation (a)	 	 	3,441	 	 	 	2,704	 	 	 	14,528	 	 	 	9,671	 	
Purchase amortization (b)	 	 	107	 	 	 	106	 	 	 	432	 	 	 	165	 	
Adjusted operating income (Non-GAAP)	 	$	43,076	 	 	$	31,882	 	 	$	176,406	 	 	$	136,960	 	

Income tax provision	 	$	13,328	 	 	$	9,568	 	 	$	59,366	 	 	$	45,998	 	
Equity-based compensation (a)	 	 	1,216	 	 	 	989	 	 	 	5,385	 	 	 	3,574	 	
Purchase amortization (b)	 	 	38	 	 	 	39	 	 	 	160	 	 	 	61	 	
Adjusted income tax provision (Non-GAAP)	 	$	14,582	 	 	$	10,596	 	 	$	64,911	 	 	$	49,633	 	

Net income	 	$	26,370	 	 	$	20,354	 	 	$	103,475	 	 	$	82,000	 	
Equity-based compensation (a)	 	 	2,225	 	 	 	1,715	 	 	 	9,143	 	 	 	6,097	 	
Purchase amortization (b)	 	 	69	 	 	 	67	 	 	 	272	 	 	 	104	 	
Adjusted net income (Non-GAAP)	 	$	28,664	 	 	$	22,136	 	 	$	112,890	 	 	$	88,201	 	

Diluted EPS	 	$	0.36	 	 	$	0.27	 	 	$	1.40	 	 	$	1.08	 	
Equity-based compensation (a)	 	 	0.03	 	 	 	0.02	 	 	 	0.12	 	 	 	0.08	 	
Purchase amortization (b)	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	
Adjusted diluted EPS (Non-GAAP)	 	$	0.39	 	 	$	0.30	 	 	$	1.52	 	 	$	1.16	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Fully diluted shares	 	 	73,555	 	 	 	75,034	 	 	 	74,038	 	 	 	75,841	 	

(a)	Adjusted results exclude all equity-based compensation, to facilitate comparison with our competitors and peers and for the other reasons explained in our Current Report on Form 8-K filed with the SEC on the date hereof. Equity-based compensation is included in the following GAAP operating expense lines for the three and twelve months ended December 31, 2015 and 2014:	
 
  	 	Three Months Ended December 31,	 	 	Year Ended December 31,	 	
 	 	2015	 	 	2014	 	 	2015	 	 	2014	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cost of services	 	$	524	 	 	$	551	 	 	$	2,548	 	 	$	1,839	 	
Research and development	 	 	625	 	 	 	408	 	 	 	2,128	 	 	 	1,541	 	
Sales and marketing	 	 	850	 	 	 	469	 	 	 	2,577	 	 	 	1,563	 	
General and administrative	 	 	1,442	 	 	 	1,276	 	 	 	7,275	 	 	 	4,728	 	
Total equity-based compensation	 	$	3,441	 	 	$	2,704	 	 	$	14,528	 	 	$	9,671	 	
 
(b)	Adjustments represent purchased intangibles amortization from prior acquisition. Such amortization is excluded from adjusted results to facilitate comparison with our competitors and peers, to facilitate comparisons of the results of our core operations from period to period and for the other reasons explained in our Current Report on Form 8-K filed with the SEC on the date hereof.	

 

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

 	 	December 31, 2015	 	 	December 31, 2014	 	
 	 	 	 	 	 	 	 	 	
ASSETS	 	 	 	 	 	 	 	 	
Current Assets:	 	 	 	 	 	 	 	 	
Cash and cash equivalents	 	$	118,416	 	 	$	115,708	 	
Short-term investments	 	 	10,344	 	 	 	8,730	 	
Accounts receivable, net of allowance of $7,031 and $4,164 in 2015 and 2014, respectively	 	 	97,379	 	 	 	86,828	 	
Deferred income taxes	 	 	10,231	 	 	 	9,900	 	
Prepaid expenses and other current assets	 	 	10,772	 	 	 	8,695	 	
Total current assets	 	 	247,142	 	 	 	229,861	 	
 	 	 	 	 	 	 	 	 	
Property and equipment, net	 	 	21,176	 	 	 	17,265	 	
Goodwill, net	 	 	62,233	 	 	 	62,250	 	
Deferred income taxes	 	 	86	 	 	 	270	 	
Other assets	 	 	7,275	 	 	 	8,524	 	
Total assets	 	$	337,912	 	 	$	318,170	 	
 	 	 	 	 	 	 	 	 	
LIABILITIES AND SHAREHOLDERS' EQUITY	 	 	 	 	 	 	 	 	
Current liabilities:	 	 	 	 	 	 	 	 	
Accounts payable	 	$	11,219	 	 	$	12,483	 	
Accrued compensation and benefits	 	 	29,284	 	 	 	30,889	 	
Accrued and other liabilities	 	 	13,853	 	 	 	12,501	 	
Deferred revenue	 	 	68,757	 	 	 	58,968	 	
Income taxes payable	 	 	4,072	 	 	 	7,974	 	
Total current liabilities	 	 	127,185	 	 	 	122,815	 	
 	 	 	 	 	 	 	 	 	
Other non-current liabilities	 	 	15,235	 	 	 	13,332	 	
 	 	 	 	 	 	 	 	 	
Shareholders' equity:	 	 	 	 	 	 	 	 	
Preferred stock, no par value; 20,000,000 shares authorized, no shares issued or
   outstanding in 2015 and 2014	 	 	-	 	 	 	-	 	
Common stock, $.01 par value; 200,000,000 shares authorized; 72,766,383 and
   74,104,064 shares issued and outstanding at December 31, 2015 and
   December 31, 2014, respectively	 	 	728	 	 	 	741	 	
Retained earnings	 	 	207,070	 	 	 	191,305	 	
Accumulated other comprehensive loss	 	 	(12,306	)	 	 	(10,023	)	
Total shareholders' equity	 	 	195,492	 	 	 	182,023	 	
Total liabilities and shareholders' equity	 	$	337,912	 	 	$	318,170	 	

 

 
MANHATTAN ASSOCIATES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(in thousands)
 
 	 	Year Ended December 31,	
 	 	2015	 	 	2014	 	 	
 	 	 	 	 	 	 	 	 	 	
Operating activities:	 	 	 	 	 	 	 	 	 	
Net income	 	$	103,475	 	 	$	82,000	 	 	
Adjustments to reconcile net income to net cash provided by operating activities:	 	 	 	 	 	 	 	 	 	
Depreciation and amortization	 	 	7,764	 	 	 	6,377	 	 	
Equity-based compensation	 	 	14,528	 	 	 	9,671	 	 	
Gain on disposal of equipment	 	 	(30	)	 	 	(13	)	 	
Tax benefit of stock awards exercised/vested	 	 	9,170	 	 	 	8,640	 	 	
Excess tax benefits from equity-based compensation	 	 	(9,147	)	 	 	(8,562	)	 	
Deferred income taxes	 	 	1,532	 	 	 	(1,705	)	 	
Unrealized foreign currency loss (gain)	 	 	49	 	 	 	(624	)	 	
Changes in operating assets and liabilities:	 	 	 	 	 	 	 	 	 	
Accounts receivable, net	 	 	(12,223	)	 	 	(16,758	)	 	
Other assets	 	 	(1,427	)	 	 	(5,198	)	 	
Accounts payable, accrued and other liabilities	 	 	(1,592	)	 	 	13,519	 	 	
Income taxes	 	 	(2,271	)	 	 	338	 	 	
Deferred revenue	 	 	10,325	 	 	 	6,477	 	 	
Net cash provided by operating activities	 	 	120,153	 	 	 	94,162	 	 	
 	 	 	 	 	 	 	 	 	 	
Investing activities:	 	 	 	 	 	 	 	 	 	
Purchases of property and equipment	 	 	(11,492	)	 	 	(9,415	)	 	
Net purchases of short-term investments	 	 	(2,051	)	 	 	(479	)	 	
Payment in connection with acquisition	 	 	-	 	 	 	(2,773	)	 	
Net cash used in investing activities	 	 	(13,543	)	 	 	(12,667	)	 	
 	 	 	 	 	 	 	 	 	 	
Financing activities:	 	 	 	 	 	 	 	 	 	
Purchase of common stock	 	 	(112,138	)	 	 	(99,204	)	 	
Proceeds from issuance of common stock from options exercised	 	 	717	 	 	 	1,571	 	 	
Excess tax benefits from equity-based compensation	 	 	9,147	 	 	 	8,562	 	 	
Net cash used in financing activities	 	 	(102,274	)	 	 	(89,071	)	 	
 	 	 	 	 	 	 	 	 	 	
Foreign currency impact on cash	 	 	(1,628	)	 	 	(1,091	)	 	
 	 	 	 	 	 	 	 	 	 	
Net change in cash and cash equivalents	 	 	2,708	 	 	 	(8,667	)	 	
Cash and cash equivalents at beginning of period	 	 	115,708	 	 	 	124,375	 	 	
Cash and cash equivalents at end of period	 	$	118,416	 	 	$	115,708	 	 	

 

 
MANHATTAN ASSOCIATES, INC.
SUPPLEMENTAL INFORMATION
1.	GAAP and Adjusted earnings per share by quarter are as follows:	
 
 	 	2014	 	 	2015	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	
GAAP Diluted EPS	 	$	0.24	 	 	$	0.27	 	 	$	0.30	 	 	$	0.27	 	 	$	1.08	 	 	$	0.31	 	 	$	0.35	 	 	$	0.38	 	 	$	0.36	 	 	$	1.40	 	
Adjustments to GAAP:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Equity-based
   compensation	 	 	0.02	 	 	 	0.02	 	 	 	0.02	 	 	 	0.02	 	 	 	0.08	 	 	 	0.03	 	 	 	0.02	 	 	 	0.05	 	 	 	0.03	 	 	 	0.12	 	
Purchase amortization	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	 	 	-	 	
Adjusted Diluted EPS	 	$	0.26	 	 	$	0.29	 	 	$	0.32	 	 	$	0.30	 	 	$	1.16	 	 	$	0.34	 	 	$	0.37	 	 	$	0.42	 	 	$	0.39	 	 	$	1.52	 	
Fully Diluted Shares	 	 	76,795	 	 	 	76,037	 	 	 	75,466	 	 	 	75,034	 	 	 	75,841	 	 	 	74,607	 	 	 	74,126	 	 	 	73,761	 	 	 	73,555	 	 	 	74,038	 	

2.	Revenues and operating income by reportable segment are as follows (in thousands):	
 
 	 	2014	 	 	2015	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	
Revenue:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Americas	 	$	91,355	 	 	$	98,633	 	 	$	103,419	 	 	$	108,557	 	 	$	401,964	 	 	$	109,959	 	 	$	117,154	 	 	$	120,118	 	 	$	117,245	 	 	$	464,476	 	
EMEA	 	 	15,679	 	 	 	15,911	 	 	 	14,253	 	 	 	15,012	 	 	 	60,855	 	 	 	18,305	 	 	 	17,175	 	 	 	16,829	 	 	 	17,767	 	 	 	70,076	 	
APAC	 	 	6,529	 	 	 	7,986	 	 	 	7,936	 	 	 	6,834	 	 	 	29,285	 	 	 	5,259	 	 	 	4,780	 	 	 	5,357	 	 	 	6,423	 	 	 	21,819	 	
 	 	$	113,563	 	 	$	122,530	 	 	$	125,608	 	 	$	130,403	 	 	$	492,104	 	 	$	133,523	 	 	$	139,109	 	 	$	142,304	 	 	$	141,435	 	 	$	556,371	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
GAAP Operating
   Income:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Americas	 	$	24,133	 	 	$	25,127	 	 	$	28,750	 	 	$	23,926	 	 	$	101,936	 	 	$	30,182	 	 	$	36,214	 	 	$	36,407	 	 	$	31,020	 	 	$	133,823	 	
EMEA	 	 	4,058	 	 	 	4,239	 	 	 	3,617	 	 	 	3,399	 	 	 	15,313	 	 	 	5,522	 	 	 	4,516	 	 	 	5,909	 	 	 	6,363	 	 	 	22,310	 	
APAC	 	 	1,860	 	 	 	3,134	 	 	 	3,134	 	 	 	1,747	 	 	 	9,875	 	 	 	1,160	 	 	 	644	 	 	 	1,364	 	 	 	2,145	 	 	 	5,313	 	
 	 	$	30,051	 	 	$	32,500	 	 	$	35,501	 	 	$	29,072	 	 	$	127,124	 	 	$	36,864	 	 	$	41,374	 	 	$	43,680	 	 	$	39,528	 	 	$	161,446	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Adjustments (pre-tax):	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Americas:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Equity-based
   compensation	 	$	2,274	 	 	$	2,396	 	 	$	2,297	 	 	$	2,704	 	 	$	9,671	 	 	$	3,078	 	 	$	2,661	 	 	$	5,348	 	 	$	3,441	 	 	$	14,528	 	
Purchase
   amortization	 	 	1	 	 	 	-	 	 	 	58	 	 	 	106	 	 	 	165	 	 	 	106	 	 	 	106	 	 	 	113	 	 	 	107	 	 	 	432	 	
 	 	$	2,275	 	 	$	2,396	 	 	$	2,355	 	 	$	2,810	 	 	$	9,836	 	 	$	3,184	 	 	$	2,767	 	 	$	5,461	 	 	$	3,548	 	 	$	14,960	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Adjusted non-GAAP
   Operating Income:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Americas	 	$	26,408	 	 	$	27,523	 	 	$	31,105	 	 	$	26,736	 	 	$	111,772	 	 	$	33,366	 	 	$	38,981	 	 	$	41,868	 	 	$	34,568	 	 	$	148,783	 	
EMEA	 	 	4,058	 	 	 	4,239	 	 	 	3,617	 	 	 	3,399	 	 	 	15,313	 	 	 	5,522	 	 	 	4,516	 	 	 	5,909	 	 	 	6,363	 	 	 	22,310	 	
APAC	 	 	1,860	 	 	 	3,134	 	 	 	3,134	 	 	 	1,747	 	 	 	9,875	 	 	 	1,160	 	 	 	644	 	 	 	1,364	 	 	 	2,145	 	 	 	5,313	 	
 	 	$	32,326	 	 	$	34,896	 	 	$	37,856	 	 	$	31,882	 	 	$	136,960	 	 	$	40,048	 	 	$	44,141	 	 	$	49,141	 	 	$	43,076	 	 	$	176,406	 	

 

 
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): 	
 
 	 	2014	 	 	2015	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	
Professional services	 	$	59,422	 	 	$	65,702	 	 	$	69,398	 	 	$	65,536	 	 	$	260,058	 	 	$	72,659	 	 	$	76,548	 	 	$	80,994	 	 	$	74,423	 	 	$	304,624	 	
Customer support and
   software enhancements	 	 	27,491	 	 	 	27,817	 	 	 	29,120	 	 	 	31,537	 	 	 	115,965	 	 	 	28,544	 	 	 	30,796	 	 	 	31,555	 	 	 	32,559	 	 	 	123,454	 	
Total services revenue	 	$	86,913	 	 	$	93,519	 	 	$	98,518	 	 	$	97,073	 	 	$	376,023	 	 	$	101,203	 	 	$	107,344	 	 	$	112,549	 	 	$	106,982	 	 	$	428,078	 	

4.	Hardware and other revenue includes the following items (in thousands):	
 
 	 	2014	 	 	2015	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	
Hardware revenue	 	$	5,946	 	 	$	6,114	 	 	$	4,707	 	 	$	8,856	 	 	$	25,623	 	 	$	7,730	 	 	$	7,080	 	 	$	5,462	 	 	$	9,243	 	 	$	29,515	 	
Billed travel	 	 	3,597	 	 	 	4,908	 	 	 	5,438	 	 	 	4,932	 	 	 	18,875	 	 	 	5,276	 	 	 	4,927	 	 	 	5,163	 	 	 	4,797	 	 	 	20,163	 	
Total hardware and
   other revenue	 	$	9,543	 	 	$	11,022	 	 	$	10,145	 	 	$	13,788	 	 	$	44,498	 	 	$	13,006	 	 	$	12,007	 	 	$	10,625	 	 	$	14,040	 	 	$	49,678	 	

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):
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	2014	 	 	2015	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	
Revenue	 	$	202	 	 	$	696	 	 	$	479	 	 	$	(1,397	)	 	$	(20	)	 	$	(3,426	)	 	$	(3,599	)	 	$	(3,421	)	 	$	(2,263	)	 	$	(12,709	)	
Costs and expenses	 	 	(713	)	 	 	73	 	 	 	522	 	 	 	(1,097	)	 	 	(1,215	)	 	 	(2,546	)	 	 	(3,201	)	 	 	(2,820	)	 	 	(2,058	)	 	 	(10,625	)	
Operating income	 	 	915	 	 	 	623	 	 	 	(43	)	 	 	(300	)	 	 	1,195	 	 	 	(880	)	 	 	(398	)	 	 	(601	)	 	 	(205	)	 	 	(2,084	)	
Foreign currency
   (losses) gains in
   other income	 	 	(516	)	 	 	12	 	 	 	(415	)	 	 	491	 	 	 	(428	)	 	 	(86	)	 	 	(4	)	 	 	213	 	 	 	(199	)	 	 	(76	)	
 	 	$	399	 	 	$	635	 	 	$	(458	)	 	$	191	 	 	$	767	 	 	$	(966	)	 	$	(402	)	 	$	(388	)	 	$	(404	)	 	$	(2,160	)	
 
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):
 
 	 	2014	 	 	2015	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	
Operating income	 	$	898	 	 	$	505	 	 	$	(171	)	 	$	24	 	 	$	1,256	 	 	$	72	 	 	$	468	 	 	$	571	 	 	$	492	 	 	$	1,603	 	
Foreign currency
   (losses) gains in
   other income	 	 	(141	)	 	 	(129	)	 	 	191	 	 	 	342	 	 	 	263	 	 	 	45	 	 	 	182	 	 	 	423	 	 	 	2	 	 	 	652	 	
Total impact of
   changes in the
   Indian Rupee	 	$	757	 	 	$	376	 	 	$	20	 	 	$	366	 	 	$	1,519	 	 	$	117	 	 	$	650	 	 	$	994	 	 	$	494	 	 	$	2,255	 	

 

 
6.	Other (loss) income includes the following components (in thousands): 	
 
 	 	2014	 	 	2015	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	
Interest income	 	$	267	 	 	$	302	 	 	$	349	 	 	$	350	 	 	$	1,268	 	 	$	324	 	 	$	335	 	 	$	336	 	 	$	336	 	 	$	1,331	 	
Foreign currency
   (losses) gains	 	 	(516	)	 	 	12	 	 	 	(415	)	 	 	491	 	 	 	(428	)	 	 	(86	)	 	 	(4	)	 	 	213	 	 	 	(199	)	 	 	(76	)	
Other non-operating
   income (expense)	 	 	16	 	 	 	(2	)	 	 	11	 	 	 	9	 	 	 	34	 	 	 	24	 	 	 	28	 	 	 	55	 	 	 	33	 	 	 	140	 	
Total other (loss) income	 	$	(233	)	 	$	312	 	 	$	(55	)	 	$	850	 	 	$	874	 	 	$	262	 	 	$	359	 	 	$	604	 	 	$	170	 	 	$	1,395	 	

7.	Total equity-based compensation is as follows (in thousands except per share amounts):	
 
 	 	2014	 	 	2015	 	
 	 	1st Qtr	 	 	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	
Total equity-based
   compensation -
   restricted stock	 	$	2,274	 	 	 	 	$	2,396	 	 	$	2,297	 	 	$	2,704	 	 	$	9,671	 	 	$	3,078	 	 	 	 	$	2,661	 	 	$	5,348	 	 	$	3,441	 	 	$	14,528	 	
Income tax provision	 	 	844	 	 	 	 	 	889	 	 	 	852	 	 	 	989	 	 	 	3,574	 	 	 	1,154	 	 	 	 	 	1,004	 	 	 	2,011	 	 	 	1,216	 	 	 	5,385	 	
Net income	 	$	1,430	 	 	 	 	$	1,507	 	 	$	1,445	 	 	$	1,715	 	 	$	6,097	 	 	$	1,924	 	 	 	 	$	1,657	 	 	$	3,337	 	 	$	2,225	 	 	$	9,143	 	
Diluted earnings
   per share -
   restricted stock	 	$	0.02	 	 	 	 	$	0.02	 	 	$	0.02	 	 	$	0.02	 	 	$	0.08	 	 	$	0.03	 	 	 	 	$	0.02	 	 	$	0.05	 	 	$	0.03	 	 	$	0.12	 	

8.	Capital expenditures are as follows (in thousands):	
 
 	 	2014	 	 	2015	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	
Capital expenditures	 	$	1,156	 	 	$	2,424	 	 	$	3,096	 	 	$	2,739	 	 	$	9,415	 	 	$	3,098	 	 	$	2,671	 	 	$	3,850	 	 	$	1,873	 	 	$	11,492	 	

9.	Stock Repurchase Activity (in thousands):	
 
 	 	2014	 	 	2015	 	
 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	 	1st Qtr	 	 	2nd Qtr	 	 	3rd Qtr	 	 	4th Qtr	 	 	Full Year	 	
Shares purchased under
   publicly-announced
   buy-back program	 	 	695	 	 	 	782	 	 	 	504	 	 	 	639	 	 	 	2,620	 	 	 	524	 	 	 	458	 	 	 	399	 	 	 	340	 	 	 	1,721	 	
Shares withheld for
   taxes due upon
   vesting of restricted stock	 	 	235	 	 	 	1	 	 	 	10	 	 	 	3	 	 	 	249	 	 	 	212	 	 	 	2	 	 	 	9	 	 	 	3	 	 	 	226	 	
Total shares purchased	 	 	930	 	 	 	783	 	 	 	514	 	 	 	642	 	 	 	2,869	 	 	 	736	 	 	 	460	 	 	 	408	 	 	 	343	 	 	 	1,947	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total cash paid for
   shares purchased
   under publicly-
   announced
   buy-back program	 	$	25,459	 	 	$	25,090	 	 	$	15,112	 	 	$	25,422	 	 	$	91,083	 	 	$	26,306	 	 	$	25,214	 	 	$	25,001	 	 	$	25,078	 	 	$	101,599	 	
Total cash paid for
   shares withheld for
   taxes due upon
   vesting of
   restricted stock	 	 	7,720	 	 	 	36	 	 	 	289	 	 	 	76	 	 	 	8,121	 	 	 	9,727	 	 	 	83	 	 	 	508	 	 	 	221	 	 	 	10,539	 	
Total cash paid for
   shares repurchased	 	$	33,179	 	 	$	25,126	 	 	$	15,401	 	 	$	25,498	 	 	$	99,204	 	 	$	36,033	 	 	$	25,297	 	 	$	25,509	 	 	$	25,299	 	 	$	112,138