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Ebix Announces Quarterly Revenue of $53.8 Million With Third Quarter 2012 Diluted EPS of $0.46(GlobeNewswire - Canada Via Acquire Media NewsEdge) ATLANTA, Nov. 8, 2012 (GLOBE NEWSWIRE) -- Ebix, Inc. (Nasdaq:EBIX), a leading international supplier of On-Demand software and E-commerce services to the insurance industry, today reported its financial results for the third quarter of 2012 and will host a conference call at 11:00 a.m. EST (details below) Ebix delivered the following results for its third quarter, fiscal year 2012: Revenues: Total Q3 2012 revenue was $53.8 million, an increase of 26% on a year-over-year basis, as compared to Q3 2011 revenue of $42.6 million. During the nine months ended September 30, 2012, revenue increased $20.4 million or 16%, to $145.3 million compared to $124.9 million during the same period in 2011. Expenses: The Company's operating expenses for the quarter grew by 34% to $33.1 million as compared to $24.6 million for the third quarter of 2011. Operating Income: Q3 2012 GAAP operating income grew 23% to $20.7 million as compared to the Non-GAAP operating income of $16.8 million in Q3 2011 after excluding a one-time non-recurring gain of $1.2 million in Q3 2011, from the reversal of contingent earn out accrued liabilities related to certain business acquisitions made in 2010. The GAAP operating income for the three months ended September 30, 2011 was $18.0 million. Management believes that excluding certain unique and non-recurring events from reported operating income is useful when comparing the Company's performance on a period to period basis. Year-to-date GAAP operating income through Q3 2012 was $56.7 million, reflecting an increase of 9% when compared to the GAAP operating income of $52.2 million for the same nine-month period in 2011. Operating Cash Flow: Net cash provided by the Company's ongoing operations in Q3 2012 was $19.3 million, a decrease of 13% year-over-year, compared to $22.2 million in Q3 of 2011 due to increased levels of trade receivables and accrued liabilities at 9/30/12. During the nine months ended September 30, 2012, the Company generated $54.0 million of net cash flow from operating activities, an increase of 4% as compared to $51.9 million in the first nine months of 2011. This operating cash flow for these past nine months of 2012 reflects the fact that all of the Company's net income of $51.8 million in the 9-month period has been converted into positive cash flow. Margins: The Company reported an operating margin of 38.5% for Q3 2012 as compared to 39.4% based on the Non-GAAP operating income for the same period during 2011, after excluding the impact of the one-time non-recurring gain in Q3 of 2011 of $1.2 million, discussed above within the operating income section. The operating margin for Q3 2011 based on GAAP was 42.1%. The operating margin for the nine months ending September 30, 2012 was 39.0%. Net Income: GAAP Q3 2012 Net income grew 9% to $18.1 million as compared to the GAAP Q3 2011 net income of $16.5 million. Earnings per Share: Q3 2012 diluted earnings per share rose 13% year-over-year to $0.46 as compared to $0.41 in the third quarter of 2011. For purposes of the Q3 2012 EPS calculation, there was an average of 39.1 million diluted shares outstanding during the quarter, as compared to 40.4 million diluted shares outstanding in Q3 of 2011. Channel Revenues: The Exchange channel continued to be the largest channel for Ebix accounting for 81% of the Company's Q3 2012 revenue as compared to 78% in Q3 of 2011. Three Months EndedNine Months Ended September 30,September 30,(dollar amounts in thousands)2012201120122011 Exchanges $ 43,592 $ 33,021 $ 116,420 $ 96,308 Broker Systems 4,537 4,731 13,713 13,397 Business Process Outsourcing ("BPO") 4,252 3,576 11,713 10,948 Carrier Systems 1,423 1,274 3,501 4,266Totals $ 53,804 $ 42,602 $ 145,347 $ 124,919 Share Repurchases: The Company purchased 280,818 shares of its common stock in July at an average price of $20.49 for an aggregate amount of $5.8 million. The Company currently has approximately $8.6 million remaining in its share repurchase authorization. "Ebix produced another record quarter with revenues of $53.8 million. We are pleased with these results as we have been able to grow our revenues while sustaining our operating margins. In June, we announced our efforts to exceed the quarterly run-rate of $50 million in revenue. We have clearly surpassed that goal owing to the successful integration of our acquisitions, increased penetration of our client base, and the efforts of our expanded sales and marketing teams," Ebix Chairman, President & CEO Robin Raina said. "Our sales pipeline for 4Q12 and 2013 is larger than we have seen in recent years and our sales teams are fully engaged in providing market leading solutions with the Company's wider array of products and services." Robin added, "The year-to-date operating cash flows through September 30th 2012 were $54.0 million indicating that we can manage our fast growth and generate cash to further strengthen the Company in future quarters. Strategically, London is arguably the second largest insurance market in the world. The Company is excited to be addressing that market now with the launch of EbixEurope and the acquisition of TriSystems in London in August. As we integrate our 2012 acquisitions and increase the sales momentum, we expect increased cross-selling and further increases in operating cash flow in the coming quarters." "Our consistent ability to generate sustainable strong operating cash flows enabled Ebix to return capital to shareholders during the quarter with $5.8 million of shares repurchases, and a $1.8 million quarterly cash dividend," said Ebix SVP and CFO Robert Kerris. "Furthermore, during the quarter the Company continued to invest in the growth of the business with $9.3 million of accretive business acquisitions and $389 thousand of capital expenditures. Our balance sheet remains strong as reflected in the aggregate cash, cash equivalents, and short-term cash deposit investments in the amount of $31.0 million as of September 30, 2012, and working capital of $15.8 million. Our accounts receivable DSO stood at 61 days as of September 30, 2012, continuing an improving trend as this reflects a reduction of 3 days from year-end 2011, and 6 days from a year earlier at September 30, 2011. Our net debt presently stands at $52.2 million as of September 30th 2012. The Company presently has access to approximately $38.2 million of readily available cash resources from its financing facility with Citi Bank combined with cash on hand to support the continued growth of the Company, both organically and with accretive acquisitions." Investor Conference Call Ebix will host a conference call to discuss its third quarter 2012 results at 11:00 a.m. Eastern Standard Time today. A live audio webcast of the conference call, together with detailed financial information, can be accessed through the company's Investor Relations home page at http://www.ebix.com. In addition, an archive of the webcast can be accessed through www.ebix.com/webcast. Participants who choose to call in to the conference call can do so by dialing 1-(973) 409-9690, Passcode: 54980255. A replay of the audio and text of the investor call will be available through the company's Investor Relations home page at http://www.ebix.com About Ebix, Inc. Ebix, Inc. is a leading international supplier of software and e-commerce solutions to the insurance industry. Ebix provides a series of application software products for the insurance industry ranging from carrier systems, agency systems and exchanges to custom software development for all entities involved in the insurance and financial services industries. Ebix works collaboratively with clients to develop innovative technology strategies and solutions that address specific business challenges. Ebix combines the newest technologies with its capabilities in consulting, systems design and integration, IT and business process outsourcing, applications software, and Web and application hosting to meet the individual needs of organizations. With bases in Singapore, Australia, the US, New Zealand, India, Brazil, UK and Canada, Ebix employs more than 2000 insurance and technology professionals who provide products, support and consultancy to hundreds of thousands of users across six continents. Ebix's focus on quality has enabled it be awarded Level 5 status of the Carnegie Mellon Software Engineering Institute's Capability Maturity Model (CMM). Ebix has also earned ISO 9001:2000 certification for both its development and call center units in India. For more information, visit http://www.ebix.com. The Ebix, Inc. logo is available at //www.globenewswire.com/newsroom/prs/ pkgid=12133 Safe Harbor for Forward Looking Statements under the Private Securities Litigation Reform Act of 1995 This press release contains various forward looking statements and information that are based on management's beliefs, as well as assumptions made by, and information currently available to management, including statements regarding future economic performance and financial condition, liquidity and capital resources, acceptance of the Company's products by the market and management's plans and objectives. The Company has tried to identify such forward looking statements by use of words such as "expects," "intends," "anticipates," "plans," "believes," "will," "should," and similar expressions, but these words are not the exclusive means of identifying such statements. Such statements are subject to various risks, uncertainties and other factors which could cause actual results to vary materially from those expressed in, or implied by, the forward looking statements. Such risks, uncertainties and other factors include the extent to which the Company's new products and services can be successfully developed and marketed, the integration and other risks associated with recent and future acquisitions, the willingness of independent insurance agencies to outsource their computer and other processing needs to third parties, the Company's ability to continue to develop new products to effectively address market needs in an industry characterized by rapid technological change, the Company's dependence on the insurance industry (and in particular independent agents), the highly competitive and rapidly changing automation systems market, the Company's ability to effectively protect its applications software and other proprietary information, the Company's ability to attract and retain quality management, and software, technical sales and other personnel, the potential negative impact on the Company's outsourcing business in India from adverse publicity and possible governmental regulation, the risks of disruption of the Company's Internet connections or internal service problems, the possibly adverse effects of a substantial increase in volume of traffic on the Company's website, mainframe and other servers, possible security breaches on the Company's website and the possible effects of insurance regulation on the Company's business. Certain of these, as well as other, risks, uncertainties and other factors, are described in more detail in Ebix's periodic filings with the Securities and Exchange Commission, including the company's annual report on form 10-K for the year ended December 31, 2011, included under "Item 1A. Business Risk Factors." Except as expressly required by the federal securities laws, the Company undertakes no obligation to update any such factors or to publicly update any of the forward looking statements contained herein to reflect future events or developments or changed circumstances or for any other reason. (Financial tables follow) Ebix, Inc. and SubsidiariesCondensed Consolidated Statements of Income (In thousands, except per share data) (Unaudited) Three Months EndedNine Months Ended September 30,September 30, 2012201120122011Operating revenue $ 53,804 $ 42,602 $ 145,347 $ 124,919 Operating expenses: Cost of services provided 9,500 8,710 27,686 24,931 Product development 7,102 4,964 17,188 14,385 Sales and marketing 4,346 3,440 12,454 9,553 General and administrative 9,679 5,785 24,700 18,240 Amortization and depreciation 2,469 1,749 6,571 5,617 Total operating expenses 33,096 24,648 88,599 72,726 Operating income 20,708 17,954 56,748 52,193 Interest income 88 100 365 429 Interest expense (440) (218) (1,005) (592) Other non-operating income (loss) 414 33 676 (785) Foreign currency exchange gain (loss) (536) (230) 1,759 2,635 Income before income taxes 20,234 17,639 58,543 53,880 Income tax benefit (expense) (2,162) (1,103) (6,719) 168Net income $ 18,072 $ 16,536 $ 51,824 $ 54,048 Basic earnings per common share $ 0.49 $ 0.44 $ 1.41 $ 1.41 Diluted earnings per common share $ 0.46 $ 0.41 $ 1.32 $ 1.31 Basic weighted average shares outstanding 37,214 37,345 36,859 38,215 Diluted weighted average shares outstanding 39,120 40,449 39,158 41,400 Ebix, Inc. and SubsidiariesCondensed Consolidated Balance Sheets (In thousands, except share amounts) September 30,December 31, 20122011 ASSETS(Unaudited) Current assets: Cash and cash equivalents $ 29,491 $ 23,696 Short-term investments 1,506 1,505 Trade accounts receivable, less allowances of $1,316 and $1,719, respectively 37,203 31,133 Deferred tax asset, net 1,594 2,981 Other current assets 6,632 4,502 Total current assets 76,426 63,817 Property and equipment, net 10,383 8,834 Goodwill 337,249 259,218 Intangibles, net 51,483 38,386 Indefinite-lived intangibles 30,798 30,453 Deferred tax asset, net 6,011 9,412 Other assets 3,483 1,062 Total assets $ 515,833 $ 411,182 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued liabilities $ 25,956 $ 18,719 Accrued payroll and related benefits 4,620 5,034 Short term debt 11,000 6,667 Current portion of long term debt and capital lease obligations, net of discount of $26 and $0, respectively 876 165 Deferred revenue 17,845 16,460 Current deferred rent 258 266 Other current liabilities 106 2,468 Total current liabilities 60,661 49,779 Revolving line of credit 37,840 31,750 Long term debt and capital lease obligations, less current portion, net of discount of $78 and $0, respectively 33,905 8,468 Other liabilities 4,443 3,803 Contingent liability for accrued earn-out acquisition consideration 23,740 Put option liability 700 Deferred revenue 200 328 Long term deferred rent 1,519 939 Total liabilities 163,008 95,067 Stockholders' equity: Preferred stock, $0.10 par value, 500,000 shares authorized, no shares issued and outstanding at September 30, 2012 and December 31, 2011 Common stock, $0.10 par value, 60,000,000 shares authorized, 37,214,128 issued and 37,173,619 outstanding at September 30, 2012 and 36,418,385 issued and 36,377,876 outstanding at December 31, 2011 3,717 3,638 Additional paid-in capital 171,668 179,518 Treasury stock (40,509 shares as of September 30, 2012 and December 31, 2011) (76) (76) Retained earnings 184,222 137,559 Accumulated other comprehensive loss (6,706) (4,524) Total stockholders' equity 352,825 316,115 Total liabilities and stockholders' equity $ 515,833 $ 411,182 Ebix, Inc. and SubsidiariesCondensedConsolidated Statements of Cash Flows (In thousands) (Unaudited) Nine Months Ended September 30, 20122011 Cash flows from operating activities: Net income $ 51,824 $ 54,048 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 6,571 5,617 Benefit for deferred taxes (605) (5,940) Share based compensation 1,567 1,737 Provision for doubtful accounts 416 747 Debt discount amortization on convertible debt 13 21 Unrealized foreign exchange gain on forward contracts 909 Unrealized foreign exchange (gain) loss 397 (4,047) (Gain) loss on put option (677) 893 Reduction of acquisition earnout accruals (3,048)Changes in assets and liabilities, net of effects from acquisitions: Accounts receivable (1,859) (2,985) Other assets (1,715) 422 Accounts payable and accrued expenses 2,758 1,916 Accrued payroll and related benefits (1,415) (959) Deferred revenue (811) 1,024 Deferred rent (92) (188) Other current liabilities (2,370) 1,696Net cash provided by operating activities 54,002 51,863 Cash flows from investing activities: Acquisition of ADAM, net of cash acquired 3,529 Investment in MCN, net of cash acquired (1,537) (381) Acquisition of BSI, net of cash acquired (992) Acquisition of Taimma, net of cash acquired (5,003) Acquisition of Fintechnix, net of cash acquired (4,713) Acquisition of Planetsoft, net of cash acquired (34,078) Acquisition of TriSystems, net of cash acquired (9,277) Investment in Curepet, Inc. (2,000) Investment in ConfirmNet (184) Maturities of marketable securities 931 7,600 Purchases of marketable securities (785) (2,963) Capital expenditures (1,468) (1,863)Net cash provided by/(used in) investing activities (58,922) 5,738 Cash flows from financing activities: Repayments on revolving line of credit, (net of proceeds) 6,090 (14,750) Proceeds from term loan 45,000 16,250 Principal payments of term loan obligation (17,062) (4,740) Repurchases of common stock (15,150) (56,548) Settlement on conversion of convertible debt (6,761) Excess tax benefit from share-based compensation 73 70 Proceeds from the exercise of stock options 739 14 Dividend payments (5,161) Principal payments of debt obligations (600) Payments of capital lease obligations (229) (253)Net cash provided by/ (used in) financing activities 13,700 (66,718) Effect of foreign exchange rates on cash (2,985) (327)Net change in cash and cash equivalents 5,795 (9,444) Cash and cash equivalents at the beginning of the period 23,696 23,397Cash and cash equivalents at the end of the period $ 29,491 $ 13,953 Supplemental disclosures of cash flow information: Interest paid $ 929 $ 579 Income taxes paid $ 6,308 $ 1,757CONTACT: Investor Relations Contacts: Steven Barlow, 678-281-2043 or [email protected] Aaron Tikkoo, 678-281-2027 or [email protected] Source: Ebix, Inc. 2012 GlobeNewswire, Inc. |