This Week's IPOs Part I: AuthenTec, comScore, Data Domain, Polypore International, PROS Holdings

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 |  Includes: AUTH, DDUP, PPO, PRO, SCOR
by: Abbi Adest

The following are some of the IPOs on deck for this week. Companies going public include: AuthenTec (NASDAQ:AUTH), a mixed-signal semiconductor company that provides fingerprint authentication sensors; comScore (NASDAQ:SCOR), provider of digital marketing data collection services that track internet activity; Data Domain (DDUP), a provider of capacity-optimized storage appliances for disk-based backup and network-based disaster recovery; Polypore International (NYSE:PPO), maker of specialized microporous membranes used in separation and filtration processes; PROS Holdings (NYSE:PRO), a leading provider of pricing and revenue optimization software.

All quotations are from the companies' most recent S-1 filings with links provided.

AUTHENTEC (AUTH)
Business Overview (from prospectus)

We are a leading mixed-signal semiconductor company providing fingerprint authentication sensors and solutions to the high-volume PC, wireless device and access control markets. Since our inception in 1998, we have shipped over 16 million sensors which have been integrated into over 150 different models of laptops, desktops and PC peripherals as well as over 6 million mobile phones.

Offering: 7.5 million shares at $9.00 - $11.00 per share. According to the company, net proceeds of approximately $50.6 million will be used for

working capital, [to] create a public market for our common stock, facilitate our future access to the public capital markets and increase our visibility in our markets. We intend to use our net proceeds from this offering for general corporate purposes, including working capital, a portion of which we expect to use to increase the number of personnel in our sales and marketing and research and development groups. We may also use a portion of our net proceeds to acquire or invest in new technologies, businesses or other assets. We have no current agreements or commitments with respect to any material acquisitions. We do not have more specific plans for the net proceeds from this offering.

Lead Underwriters: Lehman Brothers, Bear Stearns

Financial Highlights:

Our revenue was $33.2 million in 2006 as compared to $19.2 million in 2005, an increase of $14.0 million, or 72.9%...Our cost of revenue was $19.3 million in 2006 as compared to $11.3 million in 2005, resulting in a gross profit of $13.9 million in 2006 as compared to $7.9 million in 2005, an increase of $6.0 million, or 75.9%. Our gross margin was 41.9% in 2006 as compared to 41.2% in 2005... Research and development expenses were $9.6 million in 2006 as compared to $7.4 million in 2005, an increase of $2.2 million, or 29.7%. Research and development expenses were 29.0% and 38.2% of revenue for 2006 and 2005, respectively.


COMSCORE, INC. (SCOR)

Business Overview (from prospectus)

We provide a leading digital marketing intelligence platform that helps our customers make better-informed business decisions and implement more effective digital business strategies. Our products and solutions offer our customers deep insights into consumer behavior, including objective, detailed information regarding usage of their online properties and those of their competitors, coupled with information on consumer demographic characteristics, attitudes, lifestyles and offline behavior.

Offering: 5.0 million shares at $14.00 - $16.00 per share. Net proceeds of approximately $66.8 million will be used to create a public market for the company's common stock and to facilitate future access to the public equity markets, as well as to obtain additional capital. The company has no specific plans for use of the proceeds at this time.

Lead Underwriters: Credit Suisse, Deutsche Bank

Financial Highlights:

Total revenues increased by approximately $16.0 million for the year ended December 31, 2006 [$66,293,000] as compared to the year ended December 31, 2005 [ $50,267,000] ... Cost of revenues increased in 2006 [$20,560,00] as compared to 2005 [ $18,218, 000] .


DATA DOMAIN, INC. (DDUP)

Business Overview (from prospectus)

Data Domain is a leading provider of capacity-optimized storage appliances for disk-based backup and network-based disaster recovery. Our appliances reduce the storage of redundant copies of data and associated storage costs within enterprises and are an alternative to tape-based protection storage systems. In 2007, revenues from the tape-based storage market are expected to be approximately $4.7 billion based on estimates from Freeman Reports, an industry research firm. Our storage solutions address protection storage requirements with low operating costs, ease of use, high performance, reliability and compatibility with leading enterprise backup software. We sell our appliances through a network of channel partners and our direct sales force. As of March 31, 2007, we had over 100 channel partners and our appliances had been purchased by over 750 enterprises worldwide.

Offering: 7.4 million shares at $11.50-$13.50 per share. Net proceeds of approximately $77.9 million will be used for: expansion of the company's domestic and international sales and marketing activities, including hiring additional personnel and growing the company's network of channel partners; investment in research and development to enhance the capacity and performance of the company's appliances; deployment of the company's products and technology into other sectors of the storage market; and for general corporate opportunities that may arise in the future.

Lead Underwriters: Goldman Sachs, Morgan Stanley

Financial Highlights:

Product revenue increased $33.0 million, from $3.8 million in the year ended December 31, 2005 to $36.9 million in the year ended December 31, 2006...Cost of product revenue increased $7.8 million, from $3.2 million in the year ended December 31, 2005 to $11.1 million in the year ended December 31, 2006... Gross margin increased from 36% in the year ended December 31, 2005 to 69% in the year ended December 31, 2006.

POLYPORE INTERNATIONAL, INC. (PPO)
Business Overview (from prospectus)

We are a leading global high technology filtration company that develops, manufactures and markets specialized microporous membranes used in separation and filtration processes. We believe that we are among the top three in terms of market share (based on revenue and volume) in products comprising a total of approximately 80% of our fiscal 2006 net sales. The microporous membranes we produce are highly engineered polymeric structures that contain millions of pores per square inch, enabling the management of ions, gases and particles that range in size from the cellular to the nano or molecular level. We believe our membrane technology platform is one of the broadest in the industries in which we compete. Our expertise spans multiple membrane configurations, polymers, coatings and process technologies and addresses a wide array of market requirements. We believe that our differentiated membranes will enable us to meet increasing end-market performance requirements, grow with our current customers and application base and pursue new, high-value added markets and applications.

Offering: 15.0 million shares at $20.00-$22.00 per share. Net proceeds of approximately $293.6 million will be used

to purchase our 101/2% senior discount notes due 2012 in connection with the tender offer of the notes and to pay transaction expenses. The accreted value of the discount notes at March 31, 2007 was $257.3 million. We estimate that the premiums and other costs that will be paid in connection with the purchase will be approximately $31.1 million. We may purchase in the open market any notes not purchased in the tender offer. We plan to use the balance of the net proceeds for working capital and for other general corporate purposes. Pending such uses, the net proceeds of this offering may be invested in short-term, investment-grade, interest bearing accounts.

Lead Underwriters: J.P. Morgan, Credit Suisse

Financial Highlights:

Net sales for fiscal 2006 were $479.7 million, an increase of $47.2 million, or 10.9%, from fiscal 2005 [$432.5 million]... Gross profit for fiscal 2006 was $164.9 million, an increase of $14.7 million, or 9.8%, from fiscal 2005 [$150.2 million]. Gross profit as a percent of sales decreased to 34.4% in fiscal 2006 from 34.7% in the prior year...Interest expense, net was $92.3 million for fiscal 2006, an increase of $10.3 million from fiscal 2005 [$82.0 million].

PROS HOLDINGS (PRO)
Business Overview (from prospectus)

We are a leading provider of pricing and revenue optimization software, an emerging category of enterprise applications designed to allow companies to improve financial performance by enabling better pricing. By using our software products, customers gain insight into their pricing strategies, identify detrimental pricing practices, optimize their pricing decision-making and improve their business processes and financial performance. Our software products incorporate advanced pricing science, which includes operations research, forecasting and statistics. Our innovative science-based software products analyze, execute and optimize pricing strategies using data from traditional enterprise applications, often augmenting it with real-time and historical data.

Offering: 6.8 million shares at $10.00 - $12.00 per share. Net proceeds of approximately $50.4 million will be used for general corporate purposes, to repay indebtedness, establish a public market for the company's common stock and to facilitate future access to public capital markets.

Lead Underwriters: J.P. Morgan, Deutsche Bank

Financial Highlights:

License and implementation revenue increased $9.4 million from $20.2 million in 2005 to $29.6 million in 2006, representing a 47% increase...Maintenance and support revenue increased $1.5 million from $14.9 million in 2005 to $16.4 million in 2006, representing a 10% increase... Cost of license and implementation revenue increased $2.0 million from $10.1 million in 2005 to $12.1 million in 2006, representing a 20% increase... Cost of maintenance and support revenue increased $216,000 from $3.3 million in 2005 to $3.5 million in 2006, representing a 7% increase...Gross profit increased $8.7 million from $21.7 million in 2005 to $30.4 million in 2006, representing a 40% increase.