SS&C Technologies Reports Record Fourth Quarter and 2012 Results

SS&C Technologies Reports Record Fourth Quarter and 2012 Results

GAAP Diluted Earnings Per Share of $0.19, Up 18.8%, Adjusted Diluted Earnings
Per Share of $0.42, Up 44.8%

WINDSOR, Conn., Feb. 14, 2013 (GLOBE NEWSWIRE) -- SS&C Technologies Holdings,
Inc. (Nasdaq:SSNC), a global provider of investment and financial
software-enabled services and software, today announced its financial results
for the fourth quarter and full year ended December 31, 2012.

Financial Highlights:

  *Revenue increased 79.5% to $171.8 million in fourth quarter 2012 and 48.8%
    to $551.8 million for the full year 2012.
  *GAAP net income increased 21.3% to $16.1 million in fourth quarter 2012
    and diluted EPS for fourth quarter 2012 rose 18.8% to $0.19.
  *Adjusted net income grew 49.8% to $35.0 million for fourth quarter 2012
    and adjusted diluted EPS (defined below) rose 44.8% to $0.42 in the same
    period.
  *Adjusted consolidated EBITDA (defined below) increased 77.2% to $70.1
    million in fourth quarter 2012. For full year 2012, adjusted consolidated
    EBITDA increased 45.8% to $220.5 million.
  *SS&C's Annual Run Rate Basis (ARRB) recurring revenue, defined as the
    addition of maintenance and software-enabled services revenue, was $157.2
    million for the fourth quarter of 2012, an annual run-rate of $628.7
    million. This represents an increase of 88.7% from $83.3 million and
    $333.2 million run-rate for the same period in 2011.

"We are pleased with the progress we have made integrating our GlobeOp and
PORTIA acquisitions. Our technological capabilities combined with our global
operations and accounting expertise is proving to be a winner," said Bill
Stone, Chairman and Chief Executive Officer, SS&C Technologies. "Our
innovative cloud-based services continue to be a strategic focus. We are well
into our fourth release of our portals and mobility apps and we have begun to
roll out a new analytics solution. The power of this solution is its ability
to gather accounting and operational information our clients need to make the
best possible decision on their data – every time, in real-time. We are
branding these integrated capabilities SS&C Investment Intelligence. We
believe SS&C Investment Intelligence complements the investment process and
leverages our client's investment intelligence. SS&C's independence,
transparency and focus are driving larger opportunities and leading to
increased revenues and profit margins. Further we have reduced our leverage
from 4.2x at the close of our GlobeOp acquisition to 3.7x at the end of
December."

Results

SS&C reported GAAP revenue of $171.8 million for the fourth quarter of 2012,
up 79.5 percent compared to $95.7 million in the fourth quarter of 2011.
Revenue for the year ended December 31, 2012 was $551.8 million, up 48.8
percent over $370.8 million in 2011. GAAP operating income for the fourth
quarter of 2012 was $42.8 million, up 80.6 percent from $23.7 million in
2011's fourth quarter. GAAP operating income for the year ended December 31,
2012 was $123.2 million, up 31.4 percent from $93.8 million for 2011.

GAAP net income for the fourth quarter of 2012 was $16.1 million compared to
net income of $13.3 million in the fourth quarter of 2011, an increase of 21.3
percent. GAAP net income for the year ended December 31, 2012 was $45.8
million, or 8.3 percent of revenue, compared to $51.0 million, or 13.8 percent
of revenue, in 2011. On a fully diluted GAAP basis, earnings per share in the
fourth quarter of 2012 was $0.19 compared to fully diluted GAAP earnings per
share of $0.16 in the fourth quarter of 2011, an increase of 18.8 percent. On
a fully diluted basis, GAAP earnings per share for the year ended December 31,
2012, was $0.55, a 12.7 percent decrease over 2011's $0.63 per share.

Adjusted revenue (a non-GAAP measure defined in note 1 to the attached
Condensed Consolidated Financial Information) in the fourth quarter of 2012
was $172.0 million, up 79.8 percent compared to $95.7 million in the fourth
quarter of 2011. Adjusted revenue for the year ended December 31, 2012 was
$552.9 million, up 49.1 percent over $370.9 million for 2011. Adjusted
operating income (a non-GAAP measure defined in note 2 to the attached
Condensed Consolidated Financial Information) in the fourth quarter of 2012
was $66.1 million, or 38.4 percent of adjusted revenue. This represents a 72.3
percent increase compared to adjusted operating income of $38.4 million and
40.1 percent of adjusted revenue in the fourth quarter of 2011. Adjusted
operating income for the year ended December 31, 2012 was $209.8 million, up
43.7 percent from adjusted operating income of $146.0 million in 2011.

Adjusted net income (a non-GAAP measure defined in note 4 to the attached
Condensed Consolidated Financial Information) for the fourth quarter of 2012
was $35.0 million, up 49.8 percent compared to $23.3 million in 2011's fourth
quarter. Adjusted net income for the year ended December 31, 2012 was $117.4
million, up 35.8 percent compared to $86.5 million for 2011. Adjusted diluted
earnings per share (a non-GAAP measure defined in note 4 to the attached
Condensed Consolidated Financial Information) in the fourth quarter of 2012
was $0.42 per share, up 44.8 percent compared to $0.29 per share in the fourth
quarter of 2011. Adjusted diluted earnings per share for the year ended
December 31, 2012 was $1.42, up 32.7 percent compared to $1.07 for 2011.

Annual Run Rate Basis

Annual Run Rate Basis (ARRB) recurring revenue, defined as the sum of
maintenance and software-enabled services revenue on an annualized basis, was
$628.7 million based on maintenance and software-enabled services revenue of
$157.2 million for the fourth quarter of 2012. This represents an increase of
88.7 percent from $83.3 million and $333.2 million run-rate in the same period
in 2011 and an increase of 4.0 percent from $151.1 million for the third
quarter of 2012, an annual run rate of $604.5 million. We believe ARRB of our
recurring revenue is a good indicator of visibility into future revenue.

Operating Cash Flow

SS&C ended the quarter with $86.2 million in cash, and $1,021.0 million in
gross debt for a net debt balance of $934.8 million. SS&C generated net cash
from operating activities of $134.4 million for the year ended December 31,
2012, compared to $110.4 million for the same period in 2011, an increase of
21.8 percent.

Guidance


                                   Q1 2013         FY 2013
Adjusted Revenue ($M)               $171.0 – $175.0 $710.0 – $720.0
Adjusted Net Income ($M)            $35.5 – $36.8   $152.0 – $156.0
Cash from Operating Activities ($M) N/A             $168.0– $175.0
Capital Expenditures (% of revenue) N/A             2.4%– 2.8%
Diluted Shares (M)                  83.8 – 84.2     84.8 – 85.3
Effective Income Tax Rate (%)       30%             30%

Non-GAAP Financial Measures

Adjusted revenue, adjusted operating income, adjusted consolidated EBITDA,
adjusted net income and adjusted diluted earnings per share are non-GAAP
measures. See the accompanying notes to the attached Condensed Consolidated
Financial Information for the reconciliations and definitions for each of
these non-GAAP measures and the reasons our management believes these measures
provide useful information to investors regarding our financial condition and
results of operations.

Earnings Call and Press Release

SS&C's Q4 and Full Year 2012 earnings call will take place at 5:00 p.m.
eastern time today, February 14, 2013. The call will discuss Q4 and Full Year
2012 results and our guidance and business outlook. Interested parties may
dial 877-312-8798 (U.S. and Canada) or 253-237-1193 (International) and
request the "SS&C Technologies Fourth Quarter and 2012 Earnings Conference
Call," conference ID # 88030505. A replay will be available after 8:00 p.m.
eastern time on February 14, 2013, until midnight on February 21, 2013. The
dial-in number is 855-859-2056 (U.S. and Canada) 404-537-3406 (International);
access code # 88030505. The call will also be available for replay on SS&C's
website after February 14, 2013; access:
http://investor.ssctech.com/results.cfm.

This press release contains forward-looking statements relating to, among
other things, our financial guidance for the first quarter and full year for
2013. Such statements reflect management's best judgment based on factors
currently known but are subject to risks and uncertainties, which could cause
actual results to differ materially from those anticipated. Such risks and
uncertainties include, but are not limited to, the state of the economy and
the financial services industry, the Company's ability to finalize large
client contracts, fluctuations in customer demand for the Company's products
and services, intensity of competition from application vendors, delays in
product development, the Company's ability to control expenses, terrorist
activities, exposure to litigation, the Company's ability to integrate
acquired businesses, the effect of the acquisitions on customer demand for the
Company's products and services, and those risks described in the Company's
publicly available filings with the Securities and Exchange Commission. The
Company cautions investors that it may not update any or all of the foregoing
forward-looking statements.

About SS&C Technologies

SS&C is a global provider of investment and financial software-enabled
services and software focused exclusively on the global financial services
industry. Founded in 1986, SS&C has its headquarters in Windsor, Connecticut
and offices around the world. Some 5,500 financial services organizations,
from the world's largest institutions to local firms, manage and account for
their investments using SS&C's products and services. These clients in the
aggregate manage over $26 trillion in assets.

Follow SS&C on Twitter, Linkedin and Facebook.

The SS&C Technologies logo is available at
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SS&C Technologies Holdings, Inc. and Subsidiaries
Condensed Consolidated Statements of Operation
(in thousands, except per share data)
                                                         
                               Three Months Ended Year Ended
                                December  December December  December
                               31,       31,      31,       31,
                                2012      2011     2012      2011
Revenues:                                                 
Software-enabled services       $ 131,408 $ 63,489 $ 406,477 $ 246,007
Software licenses               7,003     6,166    22,466    23,507
Maintenance                     25,767    19,807   93,760    78,266
Professional services           7,577     6,233    29,139    23,048
Total revenues                  171,755   95,695   551,842   370,828
                                                         
Cost of revenues:                                         
Software-enabled services       78,274    33,034   234,214   126,921
Software licenses               1,727     1,736    6,336     6,825
Maintenance                    11,056    8,797    40,394    34,993
Professional services           5,170     4,110    18,973    15,549
Total cost of revenues          96,227    47,677   299,917   184,288
                                                         
Gross profit                    75,528    48,018   251,925   186,540
                                                         
Operating expenses:                                       
Selling and marketing           9,230     7,676    33,858    28,892
Research and development        13,301    9,297    45,779    35,650
General and administrative      10,270    7,360    34,797    28,221
Transaction costs               (47)      --       14,275    --
Total operating expenses        32,754    24,333   128,709   92,763
                                                         
Operating income                42,774    23,685   123,216   93,777
                                                         
Interest expense, net           (13,741)  (2,812)  (32,501)  (14,628)
Other (expense) income, net    350       (603)    (15,875)  (423)
Loss on extinguishment of debt --        (1,906)  (4,355)   (4,787)
                                                         
Income before income taxes      29,383    18,364   70,485    73,939
Provision for income taxes     13,301    5,104    24,665    22,918
                                                         
Net income                      $ 16,082  $ 13,260 $ 45,820  $ 51,021
                                                         
Basic earnings per share        $ 0.20    $ 0.17   $ 0.59    $ 0.67
                                                         
Basic weighted average number   78,912    77,470   78,321    76,482
of common shares outstanding
                                                         
Diluted earnings per share      $ 0.19    $ 0.16   $ 0.55    $ 0.63
                                                         
Diluted weighted average number
of common and common equivalent 83,354    81,194   82,888    80,709
shares outstanding
                                                         
See Notes to Condensed Consolidated Financial Information.                


SS&C Technologies Holdings, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands)
                                                      
                                          December 31, December 31,
                                           2012         2011
ASSETS                                                 
Current assets:                                        
Cash                                      $ 86,160     $ 40,318
Accounts receivable, net                  91,690       47,201
Prepaid income taxes                       9,651        788
Deferred income taxes                      5,408        889
Prepaid expenses and other current assets  11,548       5,214
Restricted cash                            2,460        1,149
Total current assets                       206,917      95,559
                                                      
Property and equipment, net                55,039       14,304
                                                      
Deferred income taxes                      1,459        1,111
Goodwill                                   1,566,607    931,639
Intangible and other assets, net          532,883      164,995
                                                      
Total assets                               $ 2,362,905  $ 1,207,608
                                                      
LIABILITIES AND STOCKHOLDERS' EQUITY                   
Current liabilities:                                   
Current portion of long-term debt          $ 22,248     $--
Accounts payable                           10,528       4,170
Income taxes payable                       1,314        --
Accrued employee compensation and benefits 39,812       19,770
Other accrued expenses                     22,650       14,058
Interest payable                           --          95
Deferred maintenance and other revenue     63,700       46,395
Total current liabilities                  160,252      84,488
                                                      
Long-term debt, net of current portion     989,890      100,000
Other long-term liabilities                17,102       14,081
Deferred income taxes                      120,158      28,936
Total liabilities                          1,287,402    227,505
                                                      
Total stockholders' equity                 1,075,503    980,103
                                                      
Total liabilities and stockholders' equity $ 2,362,905  $ 1,207,608
                                                      
See Notes to Condensed Consolidated Financial Information.            


SS&C Technologies Holdings, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(in thousands)
                                                            
                                                Year Ended
                                                December 31, December 31,
                                                 2012         2011
Cash flow from operating activities:                         
Net income                                       $ 45,820     $ 51,021
Adjustments to reconcile net income to net cash              
provided by operating activities:
Depreciation and amortization                    75,814       42,224
Stock-based compensation expense                 5,590        13,493
Income tax benefit related to exercise of stock  (3,531)      (4,934)
options
Amortization of loan origination costs and       9,215        4,485
original issue discount
Loss on sale or disposition of property and      13           11
equipment
Deferred income taxes                            (6,350)      (12,423)
Provision for doubtful accounts                  413          802
Changes in operating assets and liabilities,                 
excluding effects from acquisitions:
Accounts receivable                              (14,051)     (1,818)
Prepaid expenses and other assets                7,579        (324)
Accounts payable                                 1,835        278
Accrued expenses                                3,015        4,076
Income taxes receivable and payable              5,039        9,115
Deferred maintenance and other revenues          4,021        4,401
Net cash provided by operating activities        134,422      110,407
                                                            
Cash flow from investing activities:                         
Additions to property and equipment              (17,187)     (6,222)
Proceeds from sale of property and equipment     374          --
Cash paid for business acquisitions, net of cash (967,149)    (20,577)
acquired
Additions to capitalized software                (1,105)      (1,406)
Other                                            87           (1,149)
Net cash used in investing activities            (984,980)    (29,354)
                                                            
Cash flow from financing activities:                         
Cash received from debt borrowings, net of       1,304,037    100,000
costs
Repayment of debt                               (425,600)    (291,051)
Proceeds from common stock issuance, net         --           51,971
Proceeds from exercise of stock options          14,354       8,788
Payment of contingent consideration              (1,800)      --
Income tax benefit related to exercise of stock  3,531        4,934
options
Net cash provided by (used in) financing         894,522      (125,358)
activities
                                                            
Effect of exchange rate changes on cash          1,877        (220)
                                                            
Net increase (decrease) in cash                 45,841       (44,525)
Cash, beginning of period                        40,318       84,843
Cash, end of period                              $ 86,159     $ 40,318
                                                            
See Notes to Condensed Consolidated Financial Information.                  

              SS&C Technologies Holdings, Inc. and Subsidiaries
            Notes to Condensed Consolidated Financial Information

Note 1.Reconciliation of Revenue to Adjusted Revenue

Adjusted revenue represents revenue adjusted for one-time purchase accounting
adjustments to fair value deferred revenue acquired in business combinations.
Adjusted revenue is presented because we use this measure to evaluate
performance of our business against prior periods and believe it is a useful
indicator of the underlying performance of the Company. Adjusted revenue is
not a recognized term under generally accepted accounting principles (GAAP).
Adjusted revenue does not represent revenue, as that term is defined under
GAAP, and should not be considered as an alternative to revenue as an
indicator of our operating performance. Adjusted revenue as presented herein
is not necessarily comparable to similarly titled measures. The following is a
reconciliation between adjusted revenue and revenue, the GAAP measure we
believe to be most directly comparable to adjusted revenue.

                                      Three Months Ended Year Ended
                                       December 31,        December 31,
(in thousands)                         2012       2011     2012      2011
Revenue                                $ 171,755  $ 95,695 $ 551,842 $ 370,828
Purchase accounting adjustments to     285        7        1,100     27
deferred revenue
Adjusted revenue                       $ 172,040  $ 95,702 $ 552,942 $ 370,855

Note 2. Reconciliation of Operating Income to Adjusted Operating Income

Adjusted operating income represents operating income adjusted for
amortization of acquisition-related intangible assets and purchase accounting
adjustments for deferred revenue and other expenses. Adjusted operating income
is presented because we use this measure to evaluate performance of our
business and believe it is a useful indicator of the underlying performance of
the Company.Adjusted operating income is not a recognized term under
GAAP.Adjusted operating income does not represent operating income, as that
term is defined under GAAP, and should not be considered as an alternative to
operating income as an indicator of our operating performance. Adjusted
operating income as presented herein is not necessarily comparable to
similarly titled measures.The following is a reconciliation between adjusted
operating income and operating income, the GAAP measure we believe to be most
directly comparable to adjusted operating income.

                                 Three Months Ended Year Ended
                                  December 31,       December 31,
(in thousands)                    2012      2011     2012      2011
Operating income                 $ 42,774  $ 23,685 $ 123,216 $ 93,777
Amortization of intangible assets 21,373    9,418    65,118    36,826
Stock-based compensation          1,792     4,278    5,590     13,493
Capital-based taxes               --        200      (785)     354
Unusual or non-recurring charges  (37)      863      15,754    1,932
Purchase accounting adjustments   233       (65)     894       (373)
Other                             --        --       --        (30)
Adjusted operating income         $ 66,135  $ 38,379 $ 209,787 $ 145,979

Note 3. Reconciliation of Net Income to EBITDA, Consolidated EBITDA and
Adjusted Consolidated EBITDA

EBITDA represents net income before interest expense, income taxes,
depreciation and amortization.Consolidated EBITDA, defined under our Credit
Agreement entered into in March 2012, is used in calculating covenant
compliance, and is EBITDA adjusted for certain items.Consolidated EBITDA is
calculated by subtracting from or adding to EBITDA items of income or expense
described below.Adjusted consolidated EBITDA is calculated by subtracting
acquired EBITDA from consolidated EBITDA. EBITDA, consolidated EBITDA and
adjusted consolidated EBITDA are presented because we use these measures to
evaluate performance of our business and believe them to be useful indicators
of an entity's debt capacity and its ability to service debt. EBITDA,
consolidated EBITDA and adjusted consolidated EBITDA are not recognized terms
under GAAP and should not be considered in isolation or as alternatives to
operating income, net income or cash flows from operating activities as
indicators of our operating performance.The following is a reconciliation
between EBITDA, consolidated EBITDA and adjusted consolidated EBITDA and net
income.

                                Three Months Ended Year Ended
                                 December 31,       December 31,
(in thousands)                   2012      2011     2012      2011
Net income                       $ 16,082  $ 13,260 $ 45,820  $51,021
Interest expense, net            13,741    4,718    36,856    19,415
Taxes                            13,301    5,104    24,665    22,918
Depreciation and amortization    25,194    10,742   75,814    42,224
EBITDA                           68,318    33,824   183,155   135,578
Stock-based compensation         1,792     4,278    5,590     13,493
Capital-based taxes              --        200      (785)     354
Acquired EBITDA and cost savings 40        --       35,531    1,192
Unusual or non-recurring charges (387)     1,465    31,629    2,355
Purchase accounting adjustments  233       (65)     894       (373)
Other                            124       (147)    (17)      (183)
Consolidated EBITDA              70,120    39,555   255,997   152,416
Less: acquired EBITDA            (40)      --       (35,531)  (1,192)
Adjusted Consolidated EBITDA     $ 70,080  $ 39,555 $ 220,466 $ 151,224

Note 4. Reconciliation of Net Income to Adjusted Net Income and Diluted
Earnings Per Share to Adjusted Diluted Earnings Per Share

Adjusted net income and adjusted diluted earnings per share represent net
income and earnings per share before amortization of intangible assets and
deferred financing costs, stock-based compensation, capital-based taxes and
other unusual and non-recurring items. Adjusted net income and adjusted
diluted earnings per share are not recognized terms under GAAP, do not
represent net income or diluted earnings per share, as those terms are defined
under GAAP, and should not be considered as alternatives to net income or
diluted earnings per share as indicators of our operating
performance.Adjusted net income and adjusted diluted earnings per share are
important to management and investors because they represent our operational
performance exclusive of the effects of amortization of intangible assets and
deferred financing costs, stock-based compensation, capital-based taxes and
other unusual and non-recurring items that are not operational in nature or
comparable to those of our competitors.The following is a reconciliation
between adjusted net income and adjusted diluted earnings per share and net
income and diluted earnings per share.

                             Three Months Ended        Year Ended
                              December 31,              December 31,
(in thousands, except per     2012         2011         2012        2011
share data)
GAAP – Net income             $ 16,082     $ 13,260     $ 45,820    $ 51,021
Plus: Amortization of         21,373       9,418        65,118      36,826
intangible assets
Plus: Amortization of
deferred financing costs and  1,401        356          3,360       1,656
original issue discount
Plus: Stock-based             1,792        4,278        5,590       13,493
compensation
Plus: Capital-based taxes     --           200          (785)       354
Plus: Unusual and             (387)        1,465        31,629      2,355
non-recurring items
Plus: Loss on extinguishment  --           1,906        4,355       4,787
of debt
Plus: Purchase accounting     233          (65)         894         (373)
adjustments
Plus: Other                   --           --           --          (30)
Income tax effect (1)         (5,527)      (7,469)      (38,561)    (23,635)
Adjusted net income           $ 34,967     $ 23,349     $ 117,420   $ 86,454
                                                                
Adjusted diluted earnings per $ 0.42       $ 0.29       $ 1.42      $ 1.07
share
                                                                
GAAP diluted earnings per     $ 0.19       $ 0.16       $ 0.55      $ 0.63
share
                                                                
Diluted weighted-average      83,354       81,194       82,888      80,709
shares outstanding
                                                                
(1) An estimated normalized effective tax rate of 35% has been used to adjust
the provision for income taxes for the purposes of computing adjusted net
income.

CONTACT:  For more information
          Patrick Pedonti Chief Financial Officer Tel: +1-860-298-4738
          E-mail: InvestorRelations@sscinc.com

SS&C Technologies
 
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