Provides Revenue Outlook for 2007 BURLINGTON, Massachusetts, February 7 /PRNewswire-FirstCall/ -- ClickSoftware Technologies, Ltd., (NasdaqCM: CKSW), the leading provider of mobile workforce management and service optimization solutions, today announced results for the fourth quarter and year ended December 31, 2006. For the fourth quarter ended December 31, 2006, total revenues reached a record $9.3 million, with record net income of $1.1 million, or $0.04 per share. This compares with revenues of $5.9 million and a net loss of $740,000, or a loss of $0.03 per share, for the same period last year, and revenues of $8.7 million and net income of $797,000, or $0.03 per share, for the third quarter of 2006. Excluding the effects of share-based compensation expenses related to the adoption of SFAS-123R, net income was $1.2 million, or $0.04 per share. Software license revenues for the fourth quarter of 2006 were $3.4 million, while service and maintenance revenues were $5.9 million. This compares to software license revenues of $1.7 million and service and maintenance revenues of $4.2 million for the same period last year, and $3.2 million and $5.5 million, respectively, in the third quarter of 2006. Gross profit in the fourth quarter of 2006 was $5.9 million, or 63% of revenues, compared to $3.2 million, or 55% of revenues, in the same period last year, and $5.1 million, or 59% of revenues, in the third quarter of 2006. Cash, cash equivalents and short and long-term investments increased significantly to $19.8 million, up $3.4 million from $16.4 million at the end of the third quarter. Net cash provided from operating activities was $3.2 million during the fourth quarter of 2006. Full Year Results Total revenues for 2006 grew 35% over 2005 to $32.4 million with consolidated net income of $2.1 million, or $0.08 per share. This compares with revenues of $24.1 million and net loss of $2.0 million, or a loss of $0.07 per share, for 2005. Excluding the effects of share-based compensation expenses related to the adoption of SFAS-123R, net income at 2006 was $2.7 million, or $0.09 per share. Management Commentary "2006 was a remarkable year for ClickSoftware. We have substantially improved our business performance, further bolstered our market leadership by signing new major agreements with blue chip customers from a variety of industry verticals, and increased our traction with new and existing partners," said Dr. Moshe BenBassat, Chairman and Chief Executive Officer. "I am thankful for our dedicated employees and management who have all contributed immensely to our great achievements in 2006. We are very excited about the success we experienced in 2006, and looking forward to continued growth in 2007. For 2007 and beyond, our strategy includes furthering the momentum gained in 2006, expanding into new territories and new verticals, and widening the footprint of product offerings," he added. Outlook The company currently believes that revenue in 2007 will grow by approximately 20% over 2006, reaching approximately $39 million. This is based on the current levels of deferred revenue, current backlog of firm commitments, and current visibility into a growing sales pipeline. Investors Conference Call ClickSoftware will host a conference call today at 9:30 a.m. ET to discuss its financial results and other matters discussed in this press release, as well as answer questions from the investment community. To participate, please call (888) 321-3075 and ask for the ClickSoftware conference call. International participants, please call (973) 582-2855. The call will be available live on the internet (in listen mode only) at http://www.clicksoftware.com/. A replay of this call will be available on the ClickSoftware website, or by calling (877) 519-4471 (international callers can dial (973) 341-3080), ID Code: 8337189. About ClickSoftware ClickSoftware is the leading provider of mobile workforce management and service optimization solutions that create business value for service operations through higher levels of productivity, customer satisfaction and cost effectiveness. Combining educational, implementation and support services with best practices and its industry leading solutions, ClickSoftware drives service decision making across all levels of the organization. From proactive customer demand forecasting and capacity planning to real-time decision-making, incorporating scheduling, mobility and location based services, ClickSoftware helps service organizations get the most out of their resources. With over 100 customers across a variety of industries and geographies, and strong partnerships with leading platform and system integration partners - ClickSoftware is uniquely positioned to deliver superb business performance to any organization. The company is headquartered in Burlington, MA and Israel, with offices in Europe, and Asia Pacific. For more information about ClickSoftware, please call +1-781-272-5903 or +1-888-438-3308, or visit http://www.clicksoftware.com/. Contacts: Shmuel Arvatz Chief Financial Officer +972-3-765-9467 Howard Kalt Kalt Rosen & Co. +1-415-397-2686 This press release contains express or implied forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. These forward-looking statements include, but are not limited to, those regarding future results of operations, visibility into future periods, continued growth and rate of growth, and expectations regarding future closing of contracts and receipt of orders, recognition of revenues and deferred revenues. Such "forward-looking statements" involve known and unknown risks, uncertainties and other factors, which may cause actual results or performance to be materially different from those projected. Achievement of these results by ClickSoftware and its subsidiaries may be affected by many factors, including among others, the following: risks and uncertainties regarding the general economic outlook; the length of or change in the Company's sales cycle; the Company's ability to close sales to potential customers in a timely manner; the Company's ability to penetrate new markets; the Company's ability to maintain or increase relationships with strategic partners; timing of revenue recognition; and the Company's ability to maintain or increase its sales pipeline. The forward-looking statements contained in this press release are subject to other risks and uncertainties, including those discussed in ClickSoftware's annual report on Form 20F for the year ended December 31, 2005 and subsequent filings with the Securities and Exchange Commission. The Company is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise. ClickSoftware Technologies Ltd. CONSOLIDATED BALANCE SHEETS (In thousands, except share data) December 31 December 31 2006 2005 ASSETS CURRENT ASSETS Cash and cash equivalents $13,385 $10,467 Short-term investments 5,918 3,111 Trade receivables, net 6,465 4,118 Other receivables and prepaid expenses 953 1,083 Total current assets 26,721 18,779 FIXED ASSETS Cost 1,692 3,451 Less - accumulated depreciation 888 2,450 Total fixed assets 804 1,001 Long-term investments 451 264 Severance pay deposits 996 960 Total Assets $28,972 $21,004 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable and accrued expenses $5,945 $ 4,924 Deferred revenues 5,965 5,031 Total current liabilities 11,910 9,955 LONG TERM LIABILITIES Accrued severance pay 2,031 1,786 Deferred revenues - Long term 2,490 - Total long-term liabilities 4,521 1,786 Total liabilities 16,431 11,741 SHAREHOLDERS' EQUITY Ordinary shares of NIS 0.02 par value 113 111 Additional paid-in capital 72,205 71,220 Deferred Stock Compensation (63) (216) Accumulated deficit (59,671) (61,809) Treasury stock, at cost: 39,000 shares (43) (43) Total shareholders' equity 12,541 9,263 Total liability and shareholders' equity $28,972 $21,004 ClickSoftware Technologies Ltd. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share and per share amounts) Three Months Ended December 31, 2006 December 31, 2005 % of % of $ Revenues $ Revenues Revenues: Software license $3,442 37% $1,683 29% Services 5,880 63% 4,176 71% Total revenues 9,322 100% 5,859 100% Cost of revenues: Software license 456 5% 446 8% Services 2,982 32% 2,200 37% Total cost of revenues 3,438 37% 2,646 45% Gross profit 5,884 63% 3,213 55% Operating expenses: Research and development costs, net 1,148 12% 823 14% Selling and Marketing expenses 2,866 31% 2,484 42% General and administrative expenses 874 9% 745 13% Total operating expenses 4,888 52% 4,052 69% Income (Loss) from operations 996 11% (839) (14)% Interest and other income, net 158 1% 99 1% Net income (loss) before taxes $1,154 12% $(740) (13)% Taxes on income 95 1% - - Net income (loss) $1,059 11% $(740) (13)% Net income (loss) per ordinary share: Basic $0.04 $(0.03) Diluted $0.04 $(0.03) Shares used in computing basic Net income (loss) per share 27,932,444 27,618,192 Shares used in computing diluted Net income (loss) per share 29,197,188 27,618,192 ClickSoftware Technologies Ltd. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share and per share amounts) Year Ended December 31, 2006 December 31, 2005 % of % of $ Revenues $ Revenues Revenues: Software license $12,145 37% $8,235 34% Services 20,286 63% 15,832 66% Total revenues 32,431 100% 24,067 100% Cost of revenues: Software license 1,979 6% 1,541 6% Services 10,582 33% 8,251 34% Total cost of revenues 12,561 39% 9,792 40% Gross profit 19,870 61% 14,275 60% Operating expenses: Research and development costs, net 4,113 13% 3,128 13% Selling and Marketing expenses 10,337 32% 10,124 42% General and administrative expenses 3,671 11% 3,138 13% Total operating expenses 18,121 56% 16,390 68% Income (Loss) from operations 1,749 5% (2,115) (8)% Interest and other income, net 484 2% 122 0% Net income (loss) before taxes $2,233 7% $(1,993) (8)% Taxes on income 95 0% - - Net income (loss) $2,138 7% $(1,993) (8)% Net income (loss) per ordinary share: Basic $0.08 $ (0.07) Diluted $0.08 $ (0.07) Shares used in computing basic Net income (loss) per share 27,767,748 27,514,262 Shares used in computing diluted Net income (loss) per share 28,442,887 27,514,262 Use of Non- GAAP financial results In addition to disclosing financial results calculated in accordance with U.S. generally accepted accounting principles (GAAP), the Company's earnings release contains non-GAAP financial measures that exclude the effects of share-based compensation and the requirements of SFAS No. 123R, "Share-based Payment" ("123R"). The non-GAAP financial measures used by management and disclosed by the Company exclude the income statement effects of all forms of share-based compensation .The non-GAAP financial measures disclosed by the Company should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements should be carefully evaluated. ClickSoftware Technologies Ltd. SUPPLEMENTAL RECONCILIATIONS OF GAAP TO NON-GAAP RESULTS (In thousands, except share and per share amounts) Three Months Ended December 31, 2006 December 31, 2005 % of % of $ Revenues $ Revenues GAAP Net income (loss): $1,059 12% $ (740) (13)% Adjustment of share-based compensation within: Cost of Services 22 --- Research and development costs, net 18 --- Selling and Marketing expenses 31 --- General and administrative expenses 85 5 Net income (loss) excluding share-based compensation $1,215 13% $ (735) (13)% GAAP Net income (loss) per ordinary share: Basic $0.04 $(0.03) Diluted $0.04 $(0.03) Net income (loss) per ordinary share excluding share-based compensation: Basic $0.04 $(0.03) Diluted $0.04 $(0.03) ClickSoftware Technologies Ltd. SUPPLEMENTAL RECONCILIATIONS OF GAAP TO NON-GAAP RESULTS (In thousands, except share and per share amounts) Year Ended December 31, 2006 December 31, 2005 % of % of $ Revenues $ Revenues GAAP Net income (loss): $2,138 7% $(1,993) (8)% Adjustment of share-based compensation within: Cost of Services 68 --- Research and development costs, net 61 --- Selling and Marketing expenses 83 --- General and administrative expenses 312 19 Net income (loss) excluding share-based compensation $2,662 8% $ (1,974) (8)% GAAP Net income (loss) per ordinary share: Basic $0.08 $(0.07) Diluted $0.08 $(0.07) Net income (loss) per ordinary share excluding share-based compensation: Basic $0.10 $(0.07) Diluted $0.09 $(0.07) DATASOURCE: ClickSoftware Technologies Ltd CONTACT: Contacts: Shmuel Arvatz, Chief Financial Officer, +972-3-765-9467, ; Howard Kalt, Kalt Rosen & Co., +1-415-397-2686,

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