TeleNav 2015 Annual Report Download - page 65

Table of Contents
costs of $1.3 million. This net decrease was offset by the reimbursement of $1.0 million of costs in connection with a cost recovery contract with
a third party that was included fiscal 2013. As a percentage of revenue, research and development expenses increased to 41% in fiscal 2014
from
31% in fiscal 2013. The total number of research and development personnel decreased 7% to 431 at June 30, 2014 from 464 at June 30, 2013.
Sales and marketing . Our sales and marketing expenses increased 9% to $33.1 million in fiscal 2014 from $30.4 million in fiscal 2013.
The increase was primarily due to increases in compensation, benefits and commissions of $2.3 million and contracted services of $0.7 million,
partially offset by a decrease in advertising and promotion expense of $0.8 million. As a percentage of revenue, sales and marketing expenses
increased to 22% in fiscal 2014 from 16% in fiscal 2013. The total number of sales and marketing personnel increased 9% to 101 at June 30,
2014 from 93 at June 30, 2013.
General and administrative . Our general and administrative expenses increased 6% to $26.2 million in fiscal 2014 from $24.8 million in
fiscal 2013, including $1.1 million in skobbler acquisition related costs. The increase was primarily due to increased compensation and benefits
of $0.8 million, increased stock compensation expense of $0.9 million and increased professional services fees of $0.8 million, partially offset by
decreased legal costs of $1.4 million. The total number of general and administrative personnel decreased 7% to 66 at June 30, 2014 from 71 at
June 30, 2013. As a percentage of revenue, general and administrative expenses increased to 17% in fiscal 2014 from 13% in fiscal 2013. We
anticipate that our general and administrative expenses may vary substantially from period to period as we incur legal expenses associated with
ongoing intellectual property litigation and requests for indemnification related to intellectual property litigation proceed, as well as one-time
costs related to the acquisition of companies such as skobbler.
Restructuring costs . We incurred restructuring costs of $4.4 million in fiscal 2014 in order to further align our resources and consolidate
facilities. We initiated a restructuring plan consisting of reductions of approximately 108 full-time positions in the U.S. and China and we
recorded restructuring charges of $2.4 million related to severance and benefits for the positions eliminated. In addition, we closed our Boston
office and consolidated our Sunnyvale headquarters facilities from two buildings into one and recorded restructuring charges of $2.0 million
related to the impairment of our facility leases.
We incurred restructuring costs of $1.7 million in fiscal 2013 in order to better align and focus our resources around our strategic growth
areas. We initiated a restructuring plan consisting of reductions of approximately 83 full-time positions in the U.S. and China and we recorded
restructuring charges of $1.5 million related to severance and benefits for the positions eliminated. In addition, we consolidated our Shanghai
office facilities and recorded restructuring charges of $0.1 million related to the forfeiture of our lease deposit. We also recorded restructuring
charges of $0.1 million related to the write-off of certain assets that were no longer useful to us based upon the changes in our business.
Other income, net . Our other income, net was $1.3 million in fiscal 2014 and $1.2 million in fiscal 2013.
Income from discontinued operations, net . Our income from discontinued operations, net was $7.5 million in fiscal 2013 and included a
gain of $6.5 million realized on the sale of our enterprise business, net of tax. We had no discontinued operations in fiscal 2014.
Provision (benefit) for income taxes . Our provision (benefit) for income taxes, excluding discontinued operations, decreased to $(4.0)
million in fiscal 2014 from $1.1 million in fiscal 2013. Our effective tax rate, excluding discontinued operations, was 12% in fiscal 2014
compared to 16% in fiscal 2013. Our effective tax rate in fiscal 2014 was lower than the tax computed at the U.S. federal statutory income tax
rate due primarily to the increase to the valuation allowance which resulted in additional federal tax expense of $7.0 million.
Liquidity and capital resources
The following table sets forth the major sources and uses of cash and cash equivalents for each of the periods set forth below:
54
Fiscal Year Ended June 30,
2015 2014 2013
(in thousands)
Net cash provided by (used in) operating activities
$
(7,696
)
$
(22,553
)
$
42,913
Net cash provided by (used in) investing activities
16,052
20,132
(185
)
Net cash used in financing activities
(2,471
)
(8,883
)
(23,874
)
Effect of exchange rate changes on cash and cash equivalents
(1,698
)
51
13
Net increase (decrease) in cash and cash equivalents
$
4,187
$
(11,253
)
$
18,867