« Back
Second Quarter Results for Fiscal 2013
Apr 30, 2013
Key highlights:
- Second fiscal quarter revenue of
$833 million , within the$820-$850 million guidance range. Foreign currency movements negatively affected revenue by approximately$2 million relative to the first quarter of fiscal 2013 - Second fiscal quarter non-GAAP operating income of
$140 million ; non-GAAP operating margin of 16.8%; GAAP operating income of$123 million - Second fiscal quarter diluted non-GAAP EPS of
$0.73 , compared to the$0.69-$0.75 guidance range, excluding amortization of purchased intangible assets and other acquisition related costs and equity-based compensation expense, net of related tax effects - Diluted GAAP EPS of
$0.64 for the second fiscal quarter, compared to the$0.58-$0.66 guidance range - Free cash flow of
$91 million for the second fiscal quarter - Twelve-month backlog of
$2.81 billion at the end of the second fiscal quarter, up$10 million from the end of the first quarter of fiscal 2013 - Repurchased
$109 million of ordinary shares during the second fiscal quarter - The board of directors approved a
$0.13 per share quarterly cash dividend to be paid onJuly 19, 2013 - Third quarter fiscal 2013 guidance: Expected revenue of approximately
$825-$855 million and diluted non-GAAP EPS of$0.70-$0.76 , excluding amortization of purchased intangible assets and other acquisition-related costs and approximately$0.05-$0.06 per share of equity-based compensation expense, net of related tax effects. Diluted GAAP EPS is expected to be approximately$0.60-$0.68
"We followed-up our strong start to fiscal 2013 by delivering record revenues in the second fiscal quarter. We achieved year-on-year improvement in
Gelman continued, "During the quarter, we continued to sign new business and achieve key milestones with new and existing customers. For example, we have achieved the first of several important delivery milestones under the pivotal managed transformation with
Gelman concluded, "Our free cash flow continues to be strong and we remain focused on efficiently allocating our cash over the long-term. Looking toward the second half of fiscal 2013, we will continue to monitor macroeconomic and industry conditions closely, which include the uncertainty arising from announced M&A activity among operators in
Financial Discussion of Second Fiscal Quarter Results
Free cash flow was
Twelve-month backlog, which includes anticipated revenue related to contracts, estimated revenue from managed services contracts, letters of intent, maintenance and estimated on-going support activities, was
Financial Outlook
Quarterly Cash Dividend Program
On
Conference Call Details
Non-GAAP Financial Measures
This release includes non-GAAP diluted earnings per share and other non-GAAP financial measures, including free cash flow, non-GAAP cost of service, non-GAAP research and development, non-GAAP selling, general and administrative, non-GAAP operating income, non-GAAP operating margin, non-GAAP interest and other (expense) income, net, non-GAAP income taxes and non-GAAP net income. These non-GAAP measures exclude the following items:
- amortization of purchased intangible assets and other acquisition related costs;
- gain on sale of investment;
- equity-based compensation expense; and
- tax effects related to the above.
These non-GAAP financial measures are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from non-GAAP financial measures used by other companies. In addition, these non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles.
For its internal budgeting process and in monitoring the results of the business,
About
For 30 years,
For more information, visit
This press release includes information that constitutes forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995, including statements about
AMDOCS LIMITED
Consolidated Statements of Income | ||||||||
Three months ended |
Six months ended | |||||||
March 31, |
March 31, | |||||||
2013 |
2012 |
2013 |
2012 | |||||
Revenue: |
||||||||
License |
$ 21,901 |
$ 26,238 |
$ 40,817 |
$ 62,034 | ||||
Service |
811,037 |
782,690 |
1,618,480 |
1,553,904 | ||||
832,938 |
808,928 |
1,659,297 |
1,615,938 | |||||
Operating expenses: |
||||||||
Cost of license |
642 |
995 |
1,278 |
1,926 | ||||
Cost of service |
538,094 |
517,549 |
1,073,107 |
1,033,730 | ||||
Research and development |
60,059 |
60,350 |
119,419 |
121,657 | ||||
Selling, general and administrative |
102,683 |
106,842 |
210,143 |
213,179 | ||||
Amortization of purchased intangible assets and other |
8,605 |
13,320 |
19,838 |
26,526 | ||||
710,083 |
699,056 |
1,423,785 |
1,397,018 | |||||
Operating income |
122,855 |
109,872 |
235,512 |
218,920 | ||||
Interest and other (expense) income, net |
(1,757) |
5,286 |
(1,865) |
1,673 | ||||
Income before income taxes |
121,098 |
115,158 |
233,647 |
220,593 | ||||
Income taxes |
16,186 |
13,288 |
29,720 |
25,992 | ||||
Net income |
$ 104,912 |
$ 101,870 |
$ 203,927 |
$ 194,601 | ||||
Basic earnings per share |
$ 0.65 |
$ 0.60 |
$ 1.26 |
$ 1.14 | ||||
Diluted earnings per share |
$ 0.64 |
$ 0.60 |
$ 1.25 |
$ 1.13 | ||||
Basic weighted average number of shares outstanding |
160,955 |
169,739 |
161,569 |
171,231 | ||||
Diluted weighted average number of shares outstanding |
162,884 |
170,971 |
163,239 |
172,397 | ||||
Cash dividends declared per share |
$ 0.13 |
$ - |
$ 0.26 |
$ - |
AMDOCS LIMITED
Selected Financial Metrics (in thousands, except per share data) | ||||||||
Three months ended |
Six months ended | |||||||
March 31, |
March 31, | |||||||
2013 |
2012 |
2013 |
2012 | |||||
Revenue |
$ 832,938 |
$ 808,928 |
$ 1,659,297 |
$ 1,615,938 | ||||
Non-GAAP operating income |
140,169 |
134,312 |
277,384 |
267,119 | ||||
Non-GAAP net income |
119,300 |
114,703 |
238,724 |
225,957 | ||||
Non-GAAP diluted earnings per share |
$ 0.73 |
$ 0.67 |
$ 1.46 |
$ 1.31 | ||||
Diluted weighted average number of shares outstanding |
162,884 |
170,971 |
163,239 |
172,397 |
AMDOCS LIMITED Reconciliation of Selected Financial Metrics from GAAP to Non-GAAP (in thousands) | |||||
Three months ended March 31, 2013 | |||||
Reconciliation items |
|||||
GAAP |
Amortization of |
Equity based |
Tax effect |
Non-GAAP | |
Operating expenses: |
|||||
Cost of license |
$ 642 |
$ - |
$ - |
$ - |
$ 642 |
Cost of service |
538,094 |
- |
(4,470) |
- |
533,624 |
Research and |
60,059 |
- |
(975) |
- |
59,084 |
Selling, general and |
102,683 |
- |
(3,264) |
- |
99,419 |
Amortization of purchased |
8,605 |
(8,605) |
- |
- |
- |
Total operating expenses |
710,083 |
(8,605) |
(8,709) |
- |
692,769 |
Operating income |
122,855 |
8,605 |
8,709 |
- |
140,169 |
Income taxes |
16,186 |
- |
- |
2,926 |
19,112 |
Net income |
$ 104,912 |
$ 8,605 |
$ 8,709 |
$ (2,926) |
$ 119,300 |
Three months ended March 31, 2012 | ||||||
Reconciliation items |
||||||
GAAP |
Amortization of |
Equity based |
Gain on sale |
Tax effect
|
Non-GAAP | |
Operating expenses: |
||||||
Cost of license |
$ 995 |
$ - |
$ - |
$ - |
$ - |
$ 995 |
Cost of service |
517,549 |
- |
(5,763) |
- |
- |
511,786 |
Research and |
60,350 |
- |
(1,172) |
- |
- |
59,178 |
Selling, general and |
106,842 |
- |
(4,185) |
- |
- |
102,657 |
Amortization of purchased |
13,320 |
(13,320) |
- |
- |
- |
- |
Total operating expenses |
699,056 |
(13,320) |
(11,120) |
- |
- |
674,616 |
Operating income |
109,872 |
13,320 |
11,120 |
- |
- |
134,312 |
Interest and other |
5,286 |
- |
- |
(6,270) |
- |
(984) |
Income taxes |
13,288 |
- |
- |
- |
5,337 |
18,625 |
Net income |
$ 101,870 |
$ 13,320 |
$ 11,120 |
$ (6,270) |
$ (5,337) |
$ 114,703 |
AMDOCS LIMITED (in thousands) | ||||||||||
Six months ended March 31, 2013 | ||||||||||
Reconciliation items |
||||||||||
GAAP |
Amortization of |
Equity based |
Tax effect |
Non-GAAP | ||||||
Operating expenses: |
||||||||||
Cost of license |
$ 1,278 |
$ - |
$ - |
$ - |
$ 1,278 | |||||
Cost of service |
1,073,107 |
- |
(9,503) |
- |
1,063,604 | |||||
Research and |
119,419 |
- |
(2,000) |
- |
117,419 | |||||
Selling, general and |
210,143 |
- |
(10,531) |
- |
199,612 | |||||
Amortization of purchased |
19,838 |
(19,838) |
- |
- |
- | |||||
Total operating expenses |
1,423,785 |
(19,838) |
(22,034) |
- |
1,381,913 | |||||
Operating income |
235,512 |
19,838 |
22,034 |
- |
277,384 | |||||
Income taxes |
29,720 |
- |
- |
7,075 |
36,795 | |||||
Net income |
$ 203,927 |
$ 19,838 |
$ 22,034 |
$ (7,075) |
$ 238,724 | |||||
Six months ended March 31, 2012 | ||||||||||
Reconciliation items |
||||||||||
GAAP |
Amortization of |
Equity based |
Gain on sale |
Tax effect |
Non-GAAP | |||||
Operating expenses: |
||||||||||
Cost of license |
$ 1,926 |
$ - |
$ - |
$ - |
$ - |
$ 1,926 | ||||
Cost of service |
1,033,730 |
- |
(11,366) |
- |
- |
1,022,364 | ||||
Research and |
121,657 |
- |
(2,213) |
- |
- |
119,444 | ||||
Selling, general and |
213,179 |
- |
(8,094) |
- |
- |
205,085 | ||||
Amortization of purchased |
26,526 |
(26,526) |
- |
- |
- |
- | ||||
Total operating expenses |
1,397,018 |
(26,526) |
(21,673) |
- |
- |
1,348,819 | ||||
Operating income |
218,920 |
26,526 |
21,673 |
- |
- |
267,119 | ||||
Interest and other |
1,673 |
- |
- |
(6,270) |
- |
(4,597) | ||||
Income taxes |
25,992 |
- |
- |
- |
10,573 |
36,565 | ||||
Net income |
$ 194,601 |
$ 26,526 |
$ 21,673 |
$ (6,270) |
$ (10,573) |
$ 225,957 | ||||
AMDOCS LIMITED | ||||
As of | ||||
March 31, |
September 30, | |||
ASSETS |
||||
Current assets |
||||
Cash, cash equivalents and short-term interest-bearing investments |
$ 978,157 |
$ 1,118,177 | ||
Accounts receivable, net, including unbilled of $124,415 |
669,531 |
687,223 | ||
Deferred income taxes and taxes receivable |
123,428 |
109,282 | ||
Prepaid expenses and other current assets |
166,347 |
126,388 | ||
Total current assets |
1,937,463 |
2,041,070 | ||
Equipment and leasehold improvements, net |
268,962 |
277,907 | ||
Goodwill and other intangible assets, net |
1,862,805 |
1,883,064 | ||
Other noncurrent assets |
424,447 |
443,182 | ||
Total assets |
$ 4,493,677 |
$ 4,645,223 | ||
LIABILITIES AND SHAREHOLDERS' EQUITY |
||||
Current Liabilities |
||||
Accounts payable, accruals and other |
$ 587,551 |
$ 690,823 | ||
Short-term financing arrangements |
- |
200,000 | ||
Deferred revenue |
160,681 |
145,184 | ||
Deferred income taxes and taxes payable |
33,126 |
29,551 | ||
Total current liabilities |
781,358 |
1,065,558 | ||
Other noncurrent liabilities |
562,747 |
546,463 | ||
Shareholders' equity |
3,149,572 |
3,033,202 | ||
Total liabilities and shareholders' equity |
$ 4,493,677 |
$ 4,645,223 |
AMDOCS LIMITED Consolidated Statements of Cash Flows (in thousands) | ||||
Six months ended March 31, | ||||
2013 |
2012 | |||
Cash Flow from Operating Activities: |
||||
Net income |
$ 203,927 |
$ 194,601 | ||
Reconciliation of net income to net cash provided by operating activities: |
||||
Depreciation and amortization |
73,623 |
79,873 | ||
Equity-based compensation expense |
22,034 |
21,673 | ||
Deferred income taxes |
2,879 |
(8,283) | ||
Excess tax benefit from equity-based compensation |
(257) |
(127) | ||
Gain on sale of investment |
- |
(6,270) | ||
Loss from short-term interest-bearing investments |
1,680 |
895 | ||
Net changes in operating assets and liabilities: |
||||
Accounts receivable |
30,051 |
(36,831) | ||
Prepaid expenses and other current assets |
(26,919) |
(18,626) | ||
Other noncurrent assets |
3,741 |
(1,299) | ||
Accounts payable, accrued expenses and accrued personnel |
(72,007) |
8,972 | ||
Deferred revenue |
8,456 |
(27,129) | ||
Income taxes payable |
(597) |
13,888 | ||
Other noncurrent liabilities |
18,923 |
3,145 | ||
Net cash provided by operating activities |
265,534 |
224,482 | ||
Cash Flow from Investing Activities: |
||||
Payments for purchase of equipment and leasehold improvements, net |
(58,366) |
(50,204) | ||
Proceeds from sale of short-term interest-bearing investments |
144,612 |
210,703 | ||
Purchase of short-term interest-bearing investments |
(223,077) |
(192,857) | ||
Cash received from sale of investment |
- |
6,270 | ||
Other |
(3,599) |
(4,429) | ||
Net cash used in investing activities |
(140,430) |
(30,517) | ||
Cash Flow from Financing Activities: |
||||
Payments under financing arrangements |
(200,000) |
(250,000) | ||
Repurchase of shares |
(212,512) |
(256,545) | ||
Proceeds from employee stock options exercised |
112,849 |
53,715 | ||
Payments of dividends |
(42,152) |
- | ||
Payments under capital lease and other |
(659) |
(248) | ||
Net cash used in financing activities |
(342,474) |
(453,078) | ||
Net decrease in cash and cash equivalents |
(217,370) |
(259,113) | ||
Cash and cash equivalents at beginning of period |
879,158 |
831,371 | ||
Cash and cash equivalents at end of period |
$ 661,788 |
$ 572,258 | ||
AMDOCS LIMITED | |||||||||||||||
Three months ended | |||||||||||||||
March 31, |
December 31, |
September 30, |
June 30, |
March 31, | |||||||||||
North America |
$ 601.3 |
$ 593.6 |
$ 570.4 |
$ 558.7 |
$ 563.2 | ||||||||||
Europe |
99.3 |
99.2 |
113.1 |
106.5 |
111.8 | ||||||||||
Rest of World |
132.3 |
133.6 |
138.6 |
143.6 |
133.9 | ||||||||||
Total Revenue |
$ 832.9 |
$ 826.4 |
$ 822.1 |
$ 808.8 |
$ 808.9 | ||||||||||
Three months ended | |||||||||||||||
March 31, |
December 31, |
September 30, |
June 30, |
March 31, | |||||||||||
Emerging Markets Revenue |
$ 98.1 |
$ 98.2 |
$ 99.9 |
$ 101.7 |
$ 89.4 | ||||||||||
Three months ended | |||||||||||||||
March 31, |
December 31, |
September 30, |
June 30, |
March 31, | |||||||||||
Managed Services Revenue |
$ 439.8 |
$ 429.8 |
$ 423.7 |
$ 426.8 |
$ 414.4 | ||||||||||
Three months ended | |||||||||||||||
March 31, |
December 31, |
September 30, |
June 30, |
March 31, | |||||||||||
Customer Experience Systems |
$ 789.3 |
$ 783.8 |
$ 783.1 |
$ 766.2 |
$ 758.9 | ||||||||||
Directory |
43.6 |
42.6 |
39.0 |
42.6 |
50.0 | ||||||||||
Total Revenue |
$ 832.9 |
$ 826.4 |
$ 822.1 |
$ 808.8 |
$ 808.9 | ||||||||||
As of | |||||||||||||||
March 31, |
December 31, |
September 30, |
June 30, |
March 31, | |||||||||||
12-Month Backlog |
$ 2,810 |
$ 2,800 |
$ 2,790 |
$ 2,760 |
$ 2,725 |
SOURCE
Elizabeth W. Grausam McDermon, Vice President, Corporate Strategy and Investor Relations, Amdocs, 314-212-8328, dox_info@amdocs.com