Atlassian Announces Fourth Quarter and Fiscal Year 2017 Results

July 27, 2017

Quarterly revenue of $174.3 million, up 37% year-over-year

Quarterly IFRS operating margin of (19%) and non-IFRS operating margin of 14%

Quarterly free cash flow of $44.5 million

SAN FRANCISCO, July 27, 2017 (GLOBE NEWSWIRE) -- Atlassian Corporation Plc (NASDAQ:TEAM), a leading provider of team collaboration and productivity software, today announced financial results for its fourth quarter and fiscal year ended June 30, 2017, and released a shareholder letter on the Investor Relations section of its website at https://investors.atlassian.com.

“Fiscal 2017 was an amazing year for Atlassian. Our continued success was driven by our commitment to building great products that help unleash the potential of teams for more than 89,000 customers globally,” said Scott Farquhar, Atlassian’s co-CEO and co-founder. “During the past year, we invested in our products and platform to support more cloud and enterprise customers, and complemented our product family with the additions of StatusPage and Trello - the two largest acquisitions in our history. We also achieved strong financial results, growing annual revenue to more than $619 million, and generating more than $183 million of free cash flow.”

Fourth Quarter Fiscal Year 2017 Financial Highlights

On an IFRS basis, Atlassian reported:

  • Revenue: Total revenue was $174.3 million for the fourth quarter of fiscal 2017, up 37% from $127.6 million for the fourth quarter of fiscal 2016.
  • Operating Loss and Operating Margin: Operating loss was $32.3 million for the fourth quarter of fiscal 2017, compared with $11.4 million for the fourth quarter of fiscal 2016. Operating margin was (19%) for the fourth quarter of fiscal 2017, compared with (9%) for the fourth quarter of fiscal 2016.
  • Net Loss and Net Loss Per Diluted Share: Net loss was $20.7 million for the fourth quarter of fiscal 2017, compared with $4.7 million for the fourth quarter of fiscal 2016. Net loss per diluted share was $0.09 for the fourth quarter of fiscal 2017, compared with $0.02 for the fourth quarter of fiscal 2016.
  • Balance Sheet: Cash and cash equivalents, and short-term investments at the end of the fourth quarter of fiscal 2017 totaled $549.9 million.

On a non-IFRS basis, Atlassian reported:

  • Operating Income and Operating Margin: Operating income was $24.3 million for the fourth quarter of fiscal 2017, compared with $15.6 million for the fourth quarter of fiscal 2016. Operating margin was 14% for the fourth quarter of fiscal 2017, compared with 12% for the fourth quarter of fiscal 2016.
  • Net Income and Net Income Per Diluted Share: Net income was $21.6 million for the fourth quarter of fiscal 2017, compared with $16.9 million for the fourth quarter of fiscal 2016. Net income per diluted share was $0.09 for the fourth quarter of fiscal 2017, compared with $0.07 per diluted share for the fourth quarter of fiscal 2016.
  • Free Cash Flow: Cash flow from operations for the fourth quarter of fiscal 2017 was $50.6 million, while capital expenditures totaled $6.1 million, resulting in free cash flow of $44.5 million, an increase of 153% year-over-year.

Fiscal Year 2017 Financial Highlights

On an IFRS basis, Atlassian reported:

  • Revenue: Total revenue was $619.9 million for fiscal year 2017, up 36% from $457.1 million for fiscal year 2016.
  • Operating Loss and Operating Margin: Operating loss was $63.1 million for fiscal year 2017, compared with $5.9 million for fiscal year 2016. Operating margin was (10%) for fiscal 2017, compared with (1%) for fiscal 2016.
  • Net Income/Loss and Net Income/Loss Per Diluted Share: Net loss was $42.5 million for fiscal year 2017, compared with net income of $4.4 million for fiscal year 2016. Net loss per diluted share was $0.19 for fiscal year 2017, compared with net income per diluted share of $0.02 for fiscal year 2016.

On a non-IFRS basis, Atlassian reported:

  • Operating Income and Operating Margin: Operating income was $104.2 million for fiscal year 2017, compared with $77.1 million for fiscal year 2016. Operating margin was 17% for fiscal 2017, compared with 17% for fiscal 2016.
  • Net Income and Net Income Per Diluted Share: Net income was $84.9 million for fiscal year 2017, compared with $71.3 million for fiscal year 2016. Net income per diluted share was $0.36 for fiscal year 2017, compared with $0.35 per diluted share for fiscal year 2016.
  • Free Cash Flow: Cash flow from operations for fiscal year 2017 was $199.4 million while capital expenditures totaled $16.1 million, leading to free cash flow of $183.3 million, an increase of 92% year-over-year.

A reconciliation of IFRS to non-IFRS financial measures has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below, under the heading “About Non-IFRS Financial Measures.”

Recent Business Highlights

  • Customer growth: Atlassian ended the fourth quarter of fiscal 2017 with a total customer count on an active subscription or maintenance agreement basis of 89,237, an increase of 46% year-over-year. Atlassian added 4,206 net-new customers during the quarter.
  • European cloud infrastructure: In May 2017, Atlassian announced the global expansion of its cloud hosting infrastructure with the launch of an Amazon Web Services (AWS) data center in Ireland. European cloud customers will experience improved performance and reduced latency after their migration to the new infrastructure.
  • Summit Europe and AtlasCamp: In May 2017, Atlassian held its first ever European Summit user conference in Barcelona. Atlassian hosted over 1,700 attendees at the sold-out event, which was combined with our 10th AtlasCamp developer conference.

CFO Transition

Atlassian also announced that its Chief Financial Officer, Murray Demo, will be leaving Atlassian on December 31, 2017 to focus on his corporate and non-profit board work. After serving on Atlassian’s board for four years, Demo joined the company as Chief Financial Officer in 2015 to help support Atlassian through its transition to a public company. Atlassian will soon begin a search for a Chief Financial Officer to succeed Demo.

“Over his six years with Atlassian, Murray has been instrumental in helping shape our long-term strategy and operational and financial rigor,” said Scott Farquhar. “Mike and I are both grateful for his leadership and friendship over the many years. Atlassian exists to unleash the potential in every team, and both as a board member, and as our CFO, Murray helped unleash Atlassian’s potential.”

“It's been a privilege to be part of the Atlassian journey over the past six years as both a board member and CFO,” said Murray Demo. “Atlassian’s world-class products, engaging culture, unique business model and talented employees have been the catalyst for Atlassian’s global success. I am excited for the company’s long-term future and look forward to cheering on Scott, Mike and TEAM’s continued strong results.”

Financial Targets

Atlassian is providing its financial targets for the first quarter and full fiscal year 2018. The company’s financial targets are as follows:

  • First Quarter Fiscal Year 2018:
     • Total revenue is expected to be in the range of $184 million to $186 million.
     • Gross margin is expected to be approximately 80% on an IFRS basis and approximately 84% on a non-IFRS basis. 
     • Operating margin is expected to be approximately (18%) on an IFRS basis and approximately 17% on a non-IFRS basis. 
     • Net loss per diluted share is expected to be approximately ($0.11) on an IFRS basis, and net income per diluted share is expected to be approximately $0.09 on a non-IFRS basis.
     • Weighted average share count is expected to be in the range of 228 million to 230 million shares when calculating diluted IFRS net loss per share and in the range of 242 million to 244 million shares when calculating diluted non-IFRS net loss per share. 
  • Fiscal Year 2018: 
     • Total revenue is expected to be in the range of $826 million to $834 million.
     • Gross margin is expected to be approximately 80% on an IFRS basis and approximately 84% on a non-IFRS basis. 
     • Operating margin is expected to be in the range of (16%) to (15%) on an IFRS basis and in the range of 18% to 19% on a non-IFRS basis. 
     • Net loss per diluted share is expected to be in the range of ($0.46) to ($0.44) on an IFRS basis, and net income per diluted share is expected to be in the range of $0.42 to $0.44 on a non-IFRS basis. 
     • Weighted average share count is expected to be in the range of 232 million to 234 million shares when calculating diluted IFRS net loss per share and in the range of 244 million to 246 million shares when calculating diluted non-IFRS net loss per share. 
     • Free cash flow is expected to be in the range of $230 million to $240 million, which includes capital expenditures that are expected to be in the range of $25 million to $30 million in fiscal 2018.

With respect to Atlassian’s expectations under “Financial Targets” above, a reconciliation of IFRS to non-IFRS gross margin, operating margin, net income per diluted share, and free cash flow has been provided in the financial statement tables included in this press release.

Investor & Financial Analyst Session at Atlassian Summit U.S. - September 13, 2017

Atlassian will be holding an Investor & Financial Analyst session on Wednesday, September 13, 2017 as part of its Summit U.S. user conference in San Jose, CA. Keynotes and breakout sessions at Summit U.S. will be held at the San Jose Convention Center on September 13-14, 2017, and the Investor & Financial Analyst session will be held at the Hilton San Jose adjoining the Convention Center.

Atlassian's Investor & Financial Analyst session will be available via live webcast on September 13, 2017, beginning at 1:00 p.m. Pacific Time (4:00 p.m. Eastern Time), and an archive version will be available for 12 months. Both will be available on the Investor Relations section of Atlassian’s website at: https://investors.atlassian.com.

Shareholder Letter and Webcast/Conference Call Details

A detailed shareholder letter is available on the Investor Relations section of Atlassian’s website at: https://investors.atlassian.com. Atlassian will host a webcast and conference call to answer questions today:

  • When: Thursday, July 27, 2017 at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time).
  • Webcast: A live webcast of the call can be accessed from the Investor Relations section of Atlassian’s website at: https://investors.atlassian.com. Following the call, a replay will be available on the same website.
  • Dial In: To access the call via telephone in North America, please dial 1-888-346-0688. For international callers, please dial 1-412-902-4250. Participants should request the “Atlassian call” after dialing in.
  • Audio Replay: An audio replay of the call will be available via telephone for seven days, beginning two hours after the call. To listen to the replay in North America, please dial 1-877-344-7529 (access code 10109534). International callers, please dial 1-412-317-0088 (access code 10109534).

Atlassian has used, and will continue to use, its Investor Relations website at https://investors.atlassian.com, as a means of making material information public and for complying with its disclosure obligations.

About Atlassian

Atlassian unleashes the potential in every team. Our collaboration software helps teams organize, discuss and complete shared work. Teams at more than 89,000 customers, across large and small organizations - including Citigroup, eBay, Coca-Cola, Visa, BMW and NASA - use Atlassian's project tracking, content creation and sharing, real-time communication and service management products to work better together and deliver quality results on time. Learn more about our products including JIRA Software, Confluence, HipChat, Trello, Bitbucket and JIRA Service Desk at https://atlassian.com/.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which statements involve substantial risks and uncertainties. All statements other than statements of historical fact could be deemed forward looking, including risks and uncertainties related to statements about our products, customers, technology and other key strategic areas, and our financial targets such as revenue, share count and IFRS and non-IFRS financial measures including gross margin, operating margin, net income per diluted share and free cash flow.

We undertake no obligation to update any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law.

The achievement or success of the matters covered by such forward-looking statements involves known and unknown risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make. You should not rely upon forward-looking statements as predictions of future events. Forward-looking statements represent our management’s beliefs and assumptions only as of the date such statements are made.

Further information on these and other factors that could affect our financial results is included in filings we make with the Securities and Exchange Commission from time to time, including the section titled “Risk Factors” in our most recent Forms 20-F and 6-K (reporting our quarterly results). These documents are available on the SEC Filings section of the Investor Relations section of our website at: https://investors.atlassian.com/.

About Non-IFRS Financial Measures

Our reported results and financial targets include certain non-IFRS financial measures, including non-IFRS gross profit, non-IFRS operating income, non-IFRS net income, non-IFRS net income per diluted share, and free cash flow. Management believes that the use of these non-IFRS financial measures provides consistency and comparability with our past financial performance, facilitates period-to-period comparisons of our results of operations, and also facilitates comparisons with peer companies, many of which use similar non-IFRS or non-GAAP financial measures to supplement their IFRS or GAAP results. Non-IFRS results are presented for supplemental informational purposes only to aid in understanding our operating results. The non-IFRS results should not be considered a substitute for financial information presented in accordance with IFRS, and may be different from non-IFRS or non-GAAP measures used by other companies.

Our non-IFRS financial measures reflect adjustments based on the items below:

Non-IFRS gross profit. Excludes expenses related to share-based compensation and amortization of acquired intangible assets.

Non-IFRS operating income. Excludes expenses related to share-based compensation and amortization of acquired intangible assets.

Non-IFRS net income and non-IFRS net income per diluted share. Excludes expenses related to share- based compensation, amortization of acquired intangible assets and related income tax effects on these items.

Free cash flow. Free cash flow is defined as net cash provided by operating activities less capital expenditures, which consists of purchases of property and equipment and acquired intangible assets.

We exclude expenses related to share-based compensation, amortization of acquired intangible assets and the related income tax effects on these items from certain of our non-IFRS financial measures as we believe this helps investors understand our operational performance. In addition, share-based compensation expense can be difficult to predict and varies from period to period and company to company due to differing valuation methodologies, subjective assumptions and the variety of equity instruments, as well as changes in stock price. Management believes that providing non-IFRS financial measures that exclude share-based compensation expense, amortization of acquired intangible assets and the related income tax effects on these items allow for more meaningful comparisons between our operating results from period to period.

We include the effect of our outstanding share options and restricted share units (“RSUs”) in weighted-average shares used in computing non-IFRS net income per diluted share. IFRS excludes the impact of the full weighting of these outstanding equity awards until the effectiveness of our initial public offering (“IPO”). We have presented the full weighting impact of these additional shares from previously granted share options and RSUs, as if they were outstanding from the date of grant, in order to provide investors with insight into the full impact of all potentially dilutive awards outstanding and to provide comparability across periods.

Management considers free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by our business that can be used for strategic opportunities, including investing in our business, making strategic acquisitions and strengthening our statement of financial position.

Management uses non-IFRS gross profit, non-IFRS operating income, non-IFRS net income, non-IFRS net income per diluted share and free cash flow:

  • As measures of operating performance, because these financial measures do not include the impact of items not directly resulting from our core operations; 
  • For planning purposes, including the preparation of our annual operating budget; 
  • To allocate resources to enhance the financial performance of our business; 
  • To evaluate the effectiveness of our business strategies; and 
  • In communications with our board of directors concerning our financial performance.

The tables in this press release titled “Reconciliation of IFRS to Non-IFRS Results” and “Reconciliation of IFRS to Non-IFRS Financial Targets” provide reconciliations of non-IFRS financial measures to the most recent directly comparable financial measures calculated and presented in accordance with IFRS.

We understand that although non-IFRS gross profit, non-IFRS operating income, non-IFRS net income, non-IFRS net income per diluted share and free cash flow are frequently used by investors and securities analysts in their evaluation of companies, these measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results of operations as reported under IFRS.

 
Atlassian Corporation Plc
Consolidated Statements of Operations
(U.S. $ and shares in thousands, except per share data)
(unaudited)
 
  Three Months Ended June 30, Fiscal Year Ended June 30,
  2017 2016 2017 2016
Revenues:        
Subscription $72,502  $43,590  $242,128  $146,659 
Maintenance 71,648  58,808  265,521  218,848 
Perpetual license 19,359  17,911  74,565  65,487 
Other 10,822  7,279  37,722  26,064 
Total revenues 174,331  127,588  619,936  457,058 
Cost of revenues (1) (2) 36,805  21,126  119,161  75,783 
Gross profit 137,526  106,462  500,775  381,275 
Operating expenses:        
Research and development (1) 90,691  60,830  310,168  208,306 
Marketing and sales (1) (2) 45,887  30,980  134,908  93,391 
General and administrative (1) 33,204  26,042  118,785  85,458 
Total operating expenses 169,782  117,852  563,861  387,155 
Operating loss (32,256) (11,390) (63,086) (5,880)
Other non-operating income (expense), net (536) (342) (1,342) (1,072)
Finance income 1,048  1,244  4,851  2,116 
Finance costs (24) (9) (75) (71)
Loss before income tax benefit (31,768) (10,497) (59,652) (4,907)
Income tax benefit 11,060  5,795  17,148  9,280 
Net income (loss) $(20,708) $(4,702) $(42,504) $4,373 
Net income (loss) per share attributable to ordinary shareholders:        
Basic $(0.09) $(0.02) $(0.19) $0.02 
Diluted $(0.09) $(0.02) $(0.19) $0.02 
Weighted-average shares outstanding used to compute net income (loss) per share attributable to ordinary shareholders:        
Basic 225,805  214,505  222,224  182,773 
Diluted 225,805  214,505  222,224  193,481 

_____________________

(1)   Amounts include share-based payment expense, as follows:

  Three Months Ended June 30, Fiscal Year Ended June 30,
  2017 2016 2017 2016
Cost of revenues $2,159  $1,606  $6,856  $5,371 
Research and development 24,598  12,542  79,384  35,735 
Marketing and sales 5,455  3,385  17,395  11,945 
General and administrative 9,125  7,553  33,813  22,429 
             
             

(2)   Amounts include amortization of acquired intangible assets, as follows:

  Three Months Ended June 30, Fiscal Year Ended June 30,
  2017 2016 2017 2016
Cost of revenues $5,280  $1,909  $14,587  $7,405 
Marketing and sales 9,988  21  15,269  86 
             


Atlassian Corporation Plc
Consolidated Statements of Financial Position
(U.S. $ in thousands)
(unaudited)
 
  June 30, 2017 June 30, 2016
Assets    
Current assets:    
Cash and cash equivalents $244,420  $259,709 
Short-term investments 305,499  483,405 
Trade receivables 26,807  15,233 
Current tax receivables 12,445  6,013 
Prepaid expenses and other current assets 23,317  14,178 
Total current assets 612,488  778,538 
Non-current assets:    
Property and equipment, net 41,173  58,762 
Deferred tax assets 188,239  127,411 
Goodwill 311,900  7,138 
Intangible assets, net 120,789  13,577 
Other non-current assets 9,269  5,547 
Total non-current assets 671,370  212,435 
Total assets $1,283,858  $990,973 
Liabilities    
Current liabilities:    
Trade and other payables $73,192  $57,886 
Current tax liabilities 2,207  286 
Provisions 6,162  4,716 
Deferred revenue 245,306  173,612 
Total current liabilities 326,867  236,500 
Non-current liabilities:    
Deferred tax liabilities 43,950  6,639 
Provisions 3,333  2,170 
Deferred revenue 10,691  7,456 
Other non-current liabilities 4,969  6,545 
Total non-current liabilities 62,943  22,810 
Total liabilities $389,810  $259,310 
Equity    
Share capital $22,726  $21,620 
Share premium 450,959  441,734 
Other capital reserves 437,346  244,335 
Other components of equity 6,246  4,699 
Retained earnings (accumulated deficit) (23,229) 19,275 
Total equity $894,048  $731,663 
Total liabilities and equity $1,283,858  $990,973 
         


Atlassian Corporation Plc
Consolidated Statements of Cash Flows
(U.S. $ in thousands)
(unaudited)
 
  Three Months Ended June 30, Fiscal Year Ended June 30,
  2017 2016 2017 2016
Operating activities        
Loss before income tax $(31,768) $(10,497) $(59,652) $(4,907)
Adjustments to reconcile loss before income tax to net cash provided by operating activities:        
Depreciation and amortization 23,766  6,342  61,546  21,926 
Net loss (gain) on sale of investments and other assets 25  (33) (397) 165 
Net unrealized foreign currency loss 92  160  93  152 
Share-based payment expense 41,337  25,086  137,448  75,480 
Interest income (1,048) (1,244) (4,851) (2,116)
Changes in assets and liabilities:        
Trade receivables (295) (1,101) (10,208) (3,487)
Prepaid expenses and other assets (2,788) (2,454) (5,647) (4,203)
Trade and other payables, provisions and other non-current liabilities 1,639  5,647  10,947  11,622 
Deferred revenue 23,252  14,979  72,604  44,503 
Interest received 1,393  1,381  6,540  2,839 
Income tax paid, net of refunds (5,008) (3,271) (9,042) (12,432)
Net cash provided by operating activities 50,597  34,995  199,381  129,542 
Investing activities        
Business combinations, net of cash acquired     (381,090)  
Purchases of property and equipment (5,208) (17,394) (15,129) (34,213)
Purchases of intangible assets (925)   (925)  
Proceeds from sale of other assets     342   
Purchases of investments (85,155) (133,639) (423,540) (569,067)
Proceeds from maturities of investments 31,215  17,470  111,403  65,294 
Proceeds from sales of investments 54,911  43,140  488,672  49,501 
Increase in restricted cash (2)   (3,371)  
Payment of deferred consideration     (935) (1,025)
Net cash used in investing activities (5,164) (90,423) (224,573) (489,510)
Financing activities        
Proceeds from issuance of ordinary shares upon initial public offering, net of offering costs       431,447 
Proceeds from exercise of share options 2,035  2,466  9,438  6,732 
Employee payroll taxes paid related to net share settlement of equity awards       (5,395)
Net cash provided by financing activities 2,035  2,466  9,438  432,784 
Effect of exchange rate changes on cash and cash equivalents 70  (223) 465  (201)
Net increase (decrease) in cash and cash equivalents 47,538  (53,185) (15,289) 72,615 
Cash and cash equivalents at beginning of period 196,882  312,894  259,709  187,094 
Cash and cash equivalents at end of period $244,420  $259,709  $244,420  $259,709 
                 


Atlassian Corporation Plc
Reconciliation of IFRS to Non-IFRS Results
(U.S. $ and shares in thousands, except per share data)
(unaudited)
 
  Three Months Ended June 30, Fiscal Year Ended June 30,
  2017 2016 2017 2016
Gross profit:        
IFRS gross profit $137,526  $106,462  $500,775  $381,275 
Plus: Share-based payment expense 2,159  1,606  6,856  5,371 
Plus: Amortization of acquired intangible assets 5,280  1,909  14,587  7,405 
Non-IFRS gross profit $144,965  $109,977  $522,218  $394,051 
Operating income:        
IFRS operating loss $(32,256) $(11,390) $(63,086) $(5,880)
Plus: Share-based payment expense 41,337  25,086  137,448  75,480 
Plus: Amortization of acquired intangible assets 15,268  1,930  29,856  7,491 
Non-IFRS operating income $24,349  $15,626  $104,218  $77,091 
Net income:        
IFRS net income (loss) $(20,708) $(4,702) $(42,504) $4,373 
Plus: Share-based payment expense 41,337  25,086  137,448  75,480 
Plus: Amortization of acquired intangible assets 15,268  1,930  29,856  7,491 
Less: Income tax effects and adjustments (14,277) (5,437) (39,864) (16,018)
Non-IFRS net income $21,620  $16,877  $84,936  $71,326 
Net income per share:        
IFRS net income (loss) per share - basic $(0.09) $(0.02) $(0.19) $0.02 
Plus: Share-based payment expense 0.18  0.12  0.62  0.42 
Plus: Amortization of acquired intangible assets 0.07  0.01  0.13  0.04 
Less: Income tax effects and adjustments (0.06) (0.03) (0.18) (0.09)
Non-IFRS net income per share - basic $0.10  $0.08  $0.38  $0.39 
         
IFRS net income (loss) per share - diluted $(0.09) $(0.02) $(0.19) $0.02 
Plus: Share-based payment expense 0.18  0.11  0.59  0.37 
Plus: Amortization of acquired intangible assets 0.06  0.01  0.13  0.04 
Less: Income tax effects and adjustments (0.06) (0.03) (0.17) (0.08)
Non-IFRS net income per share - diluted $0.09  $0.07  $0.36  $0.35 
Weighted-average diluted shares outstanding:        
Weighted-average shares used in computing diluted IFRS net income (loss) per share 225,805  214,505  222,224  193,481 
Dilution from share options and RSUs (1) 13,596  17,417  13,833   
Dilution from share options and RSUs granted in periods prior to IPO (2)       8,205 
Weighted-average shares used in computing diluted non-IFRS net income per share 239,401  231,922  236,057  201,686 
Free cash flow:        
IFRS net cash provided by operating activities $50,597  $34,995  $199,381  $129,542 
Less: Capital expenditures (6,133) (17,394) (16,054) (34,213)
Free cash flow $44,464  $17,601  $183,327  $95,329 


(1)The effects of these dilutive securities were not included in the IFRS calculation of diluted net loss per share for the three months ended June 30, 2017 and 2016 and the fiscal year ended June 30, 2017 because the effect would have been anti-dilutive.
(2)Gives effect to share options and RSUs in periods prior to our IPO for comparability.


Atlassian Corporation Plc
Reconciliation of IFRS to Non-IFRS Results
(as a percentage of total revenues)
(unaudited)
 
  Three Months Ended June 30, Fiscal Year Ended June 30,
  2017 2016 2017 2016
Operating margin        
IFRS operating margin (19%) (9%) (10%) (1%)
Plus: Share-based payment expense 24  20  22  17 
Plus: Amortization of acquired intangible assets 9  2  5  2 
Non-IFRS operating margin 14% 12% 17% 17%
             


Atlassian Corporation Plc
Reconciliation of IFRS to Non-IFRS Financial Targets
(U.S. $)
 
  Three Months Ending
September 30, 2017
 Fiscal Year Ending
June 30, 2018
Revenue $184 million to $186 million $826 million to $834 million
     
IFRS gross margin 80% 80%
Share-based payment expense 1 1
Amortization of acquired intangible assets 3 3
Non-IFRS gross margin 84% 84%
     
IFRS operating margin (18%) (16%) to (15%)
Share-based payment expense 27 27
Amortization of acquired intangible assets 8 7
Non-IFRS operating margin 17% 18% to 19%
     
IFRS net loss per share - diluted ($0.11) ($0.46) to ($0.44)
Share-based payment expense 0.21 0.95
Amortization of acquired intangible assets 0.06 0.23
  Income tax effects and adjustments (0.07) (0.30)
Non-IFRS net income per share - diluted $0.09
 $0.42 to $0.44
     
Weighted-average shares used in computing diluted IFRS net income per share 228 million to 230 million 232 million to 234 million
Dilution from share options and RSUs (1) 14 million 12 million
Weighted-average shares used in computing diluted non-IFRS net income per share 242 million to 244 million 244 million to 246 million
     
IFRS net cash provided by operations   $255 million to $270 million
Less: Capital expenditures   (25 million) to (30 million)
Free cash flow   $230 million to $240 million


(1)The effect of these dilutive securities are not included in our IFRS calculation of diluted net loss per share for the three months ending September 30, 2017 and fiscal year ending June 30, 2018 because the effect would be anti-dilutive. 
    
Investor Relations Contact
Ian Lee
IR@atlassian.com

Media Contact
Paul Loeffler
press@atlassian.com

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Source: Atlassian Corporation Plc