Ebix Announces Third Quarter 2013 Results

Ebix Announces Third Quarter 2013 Results

ATLANTA, Nov. 8, 2013 (GLOBE NEWSWIRE) -- Ebix, Inc. (Nasdaq:EBIX), a leading
international supplier of On-Demand software and E-commerce services to the
insurance industry, today reported results for the fiscal third quarter ended
September 30, 2013.

Ebix delivered the following results for the third quarter of 2013:

Revenue: Total Q3 2013 revenue was $50.3 million, a decrease of 7% on a
year-over-year basis, as compared to Q3 2012 revenue of $53.8 million. On a
constant currency basis, Ebix revenue increased sequentially to $51.9 million
in Q3 of 2013 as compared to $51.5 million in Q2 of 2013.

On a year-over-year basis, Ebix quarterly revenue was affected negatively by
approximately $1.6 million due to the strengthening of the US dollar, while
the professional services revenues from one of the Company's 2012 acquisitions
- PlanetSoft dropped by $1.3 million due to certain delayed implementations
announced earlier in Q4 of 2012.

During the nine months ended September 30, 2013, revenue increased $8.5
million or 6%, to $153.9 million compared to $145.3 million during the same
period in 2012.

Earnings per Share: Q3 2013 diluted earnings per share decreased 26%
year-over-year to $0.34, as compared to $0.46 in the third quarter of 2012.
For purposes of the Q3 2013 EPS calculation, there was an average of 38.5
million diluted shares outstanding during the quarter compared to 39.1 million
during the same period in 2012.

Operating Cash: Cash generated from operations during Q3 2013 was $12.9
million, down 33% year-over-year as compared to $19.3 million in Q3 2012.
During the nine months ended September 30, 2013, the Company generated $37.8
million of net cash flow from operating activities, a decrease of 30% as
compared to $54.0 million in the first nine months of 2012.

Margins: Operating margins for Q3 2013 were at 37.0% as compared to 38.5% for
Q3 2012, and 37.8% for Q2 2013. The operating margins in Q3 2013 were
positively impacted by a $4.1 million gain from the reduction of the earn out
accrual relating to our acquisition of PlanetSoft and Trisystems, while being
negatively impacted by certain legal and extraordinary operational costs
totaling$3.7 million in Q3 of 2013.

The Company was also negatively impacted by the temporary initial impact of
lower initial operating margins from some of the businesses acquired in 2012
and 2013, as compared to our existing operations. The Company expects legal
costs in future quarters to be lower than Q3 of 2013, although these costs are
expected to continue affecting margins for some additional period of time..

Net Income: Q3 2013 net income was $13.1 million, a 27% decrease on a
year-over-year basis, as compared to Q3 2012 net income of $18.1
million.During the nine months ended September 30, 2013, net income decreased
$7.8 million or 15%, to $44.0 million compared to $51.8 million during the
same period in 2012.The Company's net income in Q3 2013 was impacted by the
one-time charge to earnings associated with a contingent liability of $4.23
million, accrued in Q3 of 2013 for the possible resolution of the federal
class action matter, and also by the Company increasing its reserve for
uncertain tax positions by $1.0 million in Q3 of 2013.

Diversified Revenue Base: Ebix continued to have highly diversified revenue
streams across thousands of clients, with the largest client accounting for
less than 2.5% of the Company's Q3 2013 revenues. The Company also reported
that it is not aware of having lost any existing Exchange client, that
accounted for 0.05% of its annual revenues, to its competition in Q3 of 2013.

New Customer Contracts: The Company signed new deals with accounts which
included Walmart, Swiss Re, Sanofi US Services, Pershing LLC, TD Ameritrade,
Ohio Cooperative Exchange, Purdue, Bayer, Pfizer, Glaxo SmithKline, Jazz
Pharma, Northeast Utilities Service Co., Thai Re, HSBC, Zenith Insurance, Four
Seasons Financial Group, LifeMark, American General, Mass Mutual Insurance,
Federal Reserve Bank, Los Angeles County Office, eClinical Works, Security
Life Insurance, Truven Health Analytics, Merrill Lynch, Consolidated Health
Plans, AON, Sempra Energy Utility, Automobile Club of Southern California, QBE
America, City of Roseville, MetLife, Guardian Life, Nationwide Insurance,
Prudential, AIG, Wells Fargo and Omaha Insurance Company. This list of names
is a sample representation of contracts signed by the Company in the third
quarter of 2013. The Company also signed two material 5-year recurring revenue
contracts with one of the largest brokers in the world. With the signing of
these two contracts, this client has the potential to overtake Ebix's largest
client at present, in terms of annual revenues generated for Ebix in future

Channel Revenues: The Exchange channel continued to be the largest channel for
Ebix accounting for 81% of the Company's Q3 2013 Revenues as compared to 81%
in Q3 2012.

                                    Three Months Ended Nine Months Ended
                                    September 30,      September 30,
(dollar amounts in thousands)        2013      2012     2013     2012
Exchanges                            $40,554   $43,592  $122,741 $116,420
Broker Systems                       4,390     4,537    13,878   13,713
Business Process Outsourcing ("BPO") 3,604     4,252    11,781   11,713
Carrier Systems                      1,745     1,423    5,463    3,501
Totals                               $50,293   $53,804  $153,863 $145,347

The quarter over quarter Exchange revenue drop was primarily due to the
considerable strengthening of the US dollar as compared to the Australian
dollar and the Brazilian Real; and the reduced professional services revenues
associated from the delayed implementation of a few client projects associated
with one of its acquisitions, namely PlanetSoft.

The BPO channel's quarter over quarter revenue from its certificate tracking
and creation business was essentially the same, while the professional
services revenue from one of its custom development projects dropped by around
$600 thousand.

Debt Payments: In Q3 the Company used $12.4 million to reduce its bank debt,
thus bringing its total current bank debt down to $ 57.2 million as of
November 8, 2013 date. Our current net debt as of November 8, 2013 is $16.5

Tax Payments: In the first nine months of 2013, the Company paid $13.0 million
of cash in taxes vs. $6.3 million for the same period in 2012.

"Considering the challenges that the Company has recently faced, we are
pleased with the progress we made in Q3 of 2013." Ebix Chairman, President &
CEO Robin Raina said. "On a constant currency basis, the Company revenues grew
sequentially from $51.5 million in Q2 of 2013 to $51.9 million in Q3 of 2013.
We continued to strengthen our recurring business, by signing new clients
while at the same time retaining our existing client base. In fact, the
agreement with one of our new clients has the potential to result in a
relationship that will generate revenues in 2014 and beyond that are larger
than those from any single client that we currently serve."

Robin added, "We remain focused on trying to create and sustain a strong
healthy long term future for Ebix, and thus took many stepstowards that goal
in Q3. While the non-recurring costs associated with some of these steps
affected our short-term profitability, they have the potential to clear up the
air on many fronts. For example, with respect to the earn out litigation filed
in federal court in Ohio related to our acquisition of Peak, the company and
the other parties to the action recently reached a mutually agreeable
resolution, which resulted in the dismissal of the action with prejudice. We
are fully aware that a Company's true strength is measured by its ability to
generate recurring revenue streams with strong operating margins and cash
flows from operations. Our business fundamentals continue to be strong and we
are committed to working towards ensuring that the year 2014 can possibly be
one of our best years in history, in terms of financial performance."

Ebix SVP and CFO Robert Kerris said, "The Company continues to hold
substantial cash, cash equivalent, and short-term investments that in the
aggregate had a combined balance of $37.7 million at September 30^th
consistent with the $37.4 million held at December 31^st 2012, although during
the past nine months we have reduced debt by $22.2 million, paid $13.0 million
in taxes, spent $4.7 million on a strategic business acquisition, and paid
$3.0 million for earn-out obligations in connection with prior business
acquisitions. Our working capital position is $24.7 million at September
30^th, up $12.3 millionfrom Q2 due to lower trade payables and accrued
liabilities. The Company's net debt stood at $22.2 million at September
30^th.The Company intends to use its working capital and cash generated from
operations to support the continued growth of the Company, both organically
and through accretive acquisitions, and to pay down debt thereby further
strengthening our balance sheet. Operating income for the quarter of $18.6
million reflects a 37% operating margin consistent with both the 38% operating
margin from Q2 this year and the 38% operating margin from Q3 2012."

About Ebix, Inc.

A leading international supplier of On-Demand software and E-commerce services
to the insurance industry, Ebix, Inc., (Nasdaq:EBIX) provides end-to-end
solutions ranging from infrastructure exchanges, carrier systems, agency
systems and BPO services to custom software development for all entities
involved in the insurance industry.

With 30+ offices across Brazil, Singapore, Australia, the US, New Zealand,
India and Canada, Ebix powers multiple exchanges across the world in the field
of life, annuity, health and property & casualty insurance while conducting in
excess of $100 billion in insurance premiums on its platforms. Through its
various SaaS-based software platforms, Ebix employs hundreds of insurance and
technology professionals to provide products, support and consultancy to
thousands of customers on six continents.Ebix's focus on quality has enabled
it to be awarded Level 5 status of the Carnegie Mellon Software Engineering
Institute's Capability Maturity Model (CMM). With a recent ISO 27001-security
certification, the Company also has an ISO 9001:27001 certification for both
its development and BPO units in India.For more information, visit the
Company's website at www.ebix.com


As used herein, the terms "Ebix," "the Company," "we," "our" and "us" refer to
Ebix, Inc., a Delaware corporation, and its consolidated subsidiaries as a
combined entity, except where it is clear that the terms mean only Ebix, Inc.

The information contained in this Press Release contains forward-looking
statements and information within the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of
1933, and Section 21E of the Securities Exchange Act of 1934. This information
includes 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. In
addition, certain statements included in this and our future filings with the
Securities and Exchange Commission ("SEC"), in press releases, and in oral and
written statements made by us or with our approval, which are not statements
of historical fact, are forward-looking statements. Words such as "may,"
"could," "should," "would," "believe," "expect," "anticipate," "estimate,"
"intend," "seeks," "plan," "project," "continue," "predict," "will," "should,"
and other words or expressions of similar meaning are intended by the Company
to identify forward-looking statements, although not all forward-looking
statements contain these identifying words. These forward-looking statements
are found at various places throughout this report and in the documents
incorporated herein by reference. These statements are based on our current
expectations about future events or results and information that is currently
available to us, involve assumptions, risks, and uncertainties, and speak only
as of the date on which such statements are made.

Our actual results may differ materially from those expressed or implied in
these forward-looking statements. Factors that may cause such a difference,
include, but are not limited to those discussed in our Annual Report on Form
10-K and subsequent reports filed with the SEC, as well as: the risk of an
unfavorable outcome of the pending governmental investigations or shareholder
class action lawsuits, reputational harm caused by such investigations and
lawsuits, the willingness of independent insurance agencies to outsource their
computer and other processing needs to third parties; pricing and other
competitive pressures and the Company's ability to gain or maintain share of
sales as a result of actions by competitors and others; changes in estimates
in critical accounting judgments; changes in or failure to comply with laws
and regulations, including accounting standards, taxation requirements
(including tax rate changes, new tax laws and revised tax interpretations) in
domestic or foreign jurisdictions; exchange rate fluctuations and other risks
associated with investments and operations in foreign countries (particularly
in Australia and India wherein we have significant operations); equity
markets, including market disruptions and significant interest rate
fluctuations, which may impede our access to, or increase the cost of,
external financing; and international conflict, including terrorist acts.

Except as expressly required by the federal securities laws, the Company
undertakes no obligation to update any such factors, or to publicly announce
the results of, or changes to any of the forward-looking statements contained
herein to reflect future events, developments, changed circumstances, or for
any other reason.

Readers should carefully review the disclosures and the risk factors described
in the documents we file from time to time with the SEC, including future
reports on Forms 10-Q and 8-K, and any amendments thereto.

You may obtain our SEC filings at our website, www.ebix.com under the
"Investor Information" section, or over the Internet at the SEC's web site,

Ebix, Inc. and Subsidiaries
Condensed Consolidated Statements of Income
(In thousands, except per share data)
                                         Three Months Ended Nine Months Ended
                                         September 30,      September30
                                         2013      2012     2013     2012
Operating revenue                         $50,293   $53,804  $153,863 $145,347
Operating expenses:                                                
Cost of services provided                 10,136    9,500    30,385   27,686
Product development                       6,625     7,102    20,384   17,188
Sales and marketing                       4,024     4,346    11,763   12,454
General and administrative, net           8,448     9,679    26,672   24,700
Amortization and depreciation             2,459     2,469    7,459    6,571
Total operating expenses                  31,692    33,096   96,663   88,599
Operating income                          18,601    20,708   57,200   56,748
Interest income                           159       88       343      365
Interest expense                          (318)     (440)    (961)    (1,005)
Non-operating income (loss) - put options 93        414      (1,250)  676
Non-operating expense - securities        (4,226)   —        (4,226)  —
Foreign currency exchange gain (loss)     (33)      (536)    (326)    1,759
Income before income taxes                14,276    20,234   50,780   58,543
Income tax expense                        (1,133)   (2,162)  (6,751)  (6,719)
Net income                                $13,143   $18,072  $44,029  $51,824
Basic earnings per common share           $0.35     $0.49    $1.18    $1.41
Diluted earnings per common share         $0.34     $0.46    $1.14    $1.32
Basic weighted average shares outstanding 37,919    37,214   37,435   36,859
Diluted weighted average shares           38,451    39,120   38,676   39,158

Ebix, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands, except share amounts)
                                                   September30, December31,
                                                   2013          2012
ASSETS                                              (Unaudited)   
Current assets:                                                  
Cash and cash equivalents                           $36,889       $36,449
Short-term investments                              829           971
Trade accounts receivable, less allowances of       40,374        37,298
$1,793 and $1,157, respectively
Deferred tax asset, net                             1,442         1,835
Other current assets                                4,941         5,116
Total current assets                                84,475        81,669
Property and equipment, net                         8,819         10,082
Goodwill                                            337,403       326,748
Intangibles, net                                    52,668        52,591
Indefinite-lived intangibles                        30,887        30,887
Deferred tax asset, net                             15,375        11,245
Other assets                                        3,733         3,724
Total assets                                        $533,360      $516,946
LIABILITIES AND STOCKHOLDERS' EQUITY                             
Current liabilities:                                             
Accounts payable and accrued liabilities            $13,698       $15,497
Accrued payroll and related benefits                4,029         5,431
Short term debt                                     12,719        11,344
Current portion of long term debt and capital lease
obligations, net of discount of $20 and $13,        828           915
Current deferred rent                               237           237
Contingent liability for accrued earn-out           4,168         3,265
acquisition consideration
Contingent liability – securities litigation        4,226         —
Put option liability                                2,437         —
Deferred revenue                                    17,365        19,888
Other current liabilities                           118           113
Total current liabilities                           59,825        56,690
Revolving line of credit                            22,840        37,840
Long term debt and capital lease obligations, less
current portion, net of discount of $38 and $78,    22,948        31,592
Other liabilities                                   9,755         6,429
Contingent liability for accrued earn-out           10,067        14,230
acquisition consideration
Put option liability                                —             1,186
Deferred revenue                                    224           375
Long term deferred rent                             2,239         1,449
Total liabilities                                   127,898       149,791
Temporary equity                                    5,000         5,000
Stockholders' equity:                                            
Preferred stock, $0.10 par value, 500,000 shares
authorized, no shares issued and outstanding at     —             —
September 30, 2013 and December31, 2012
Common stock, $0.10 par value, 60,000,000 shares
authorized, 38,029,530 issued and 37,989,021
outstanding at September 30, 2013 and 37,131,777    3,799         3,709
issued and 37,091,268 outstanding at December31,
Additional paid-in capital                          163,754       164,346
Treasury stock (40,509 shares as of September 30,   (76)          (76)
2013 and December31, 2012)
Retained earnings                                   242,329       201,094
Accumulated other comprehensive loss                (9,344)       (6,918)
Total stockholders' equity                          400,462       362,155
Total liabilities and stockholders' equity          $533,360      $516,946

Ebix, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In thousands)

                                                            Nine Months Ended
                                                            September 30,
                                                            2013     2012
Cash flows from operating activities:                                
Net income                                                   $44,029  $51,824
Adjustments to reconcile net income to net cash provided by operating 
Depreciation and amortization                                7,459    6,571
Benefit for deferred taxes                                   (4,682)  (605)
Share based compensation                                     1,481    1,567
Provision for doubtful accounts                              1,361    416
Debt discount amortization on convertible debt               32       13
Unrealized foreign exchange (gain) loss                      (95)     397
(Gain) loss on put option                                    1,251    (677)
Reduction of acquisition earnout accruals                    (10,253) —
Changes in assets and liabilities, net of effects from acquisitions:  
Accounts receivable                                          (4,562)  (1,859)
Other assets                                                 845      (1,715)
Accounts payable and accrued expenses                        (2,568)  2,758
Accrued payroll and related benefits                         (1,205)  (1,415)
Deferred revenue                                             (2,802)  (811)
Deferred rent                                                (60)     (92)
Other liabilities                                            7,545    (2,370)
Net cash provided by operating activities                    37,776   54,002
Cash flows from investing activities:                                
Acquisition of Qatarlyst, net of cash acquired               (4,740)  —
Investment in MCN                                            —        (1,537)
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 Taimma                                         (2,250)  —
Investment in USIX                                           (727)    —
Maturities of marketable securities                          104      931
Purchases of marketable securities                           —        (785)
Capital expenditures                                         (887)    (1,468)
Net cash used in investing activities                        (8,500)  (58,922)
Cash flows from financing activities:                                
Repayments on revolving line of credit, (net of proceeds)    (15,000) 6,090
Proceeds from term loan                                      —        45,000
Principal payments of term loan obligation                   (6,531)  (17,062)
Repurchases of common stock                                  (2,492)  (15,150)
Excess tax benefit from share-based compensation             —        73
Proceeds from the exercise of stock options                  1,425    739
Forfeiture of certain shares to satisfy exercise costs and
the recipients income tax obligations related to stock       (916)    —
options exercised and restricted stock vested
Dividend payments                                            (2,794)  (5,161)
Principal payments of debt obligations                       (636)    (600)
Payments of capital lease obligations                        (221)    (229)
Net cash provided by/ (used in) financing activities         (27,165) 13,700
Effect of foreign exchange rates on cash                     (1,671)  (2,985)
Net change in cash and cash equivalents                      440      5,795
Cash and cash equivalents at the beginning of the period     36,449   23,696
Cash and cash equivalents at the end of the period           $36,889  $29,491
Supplemental disclosures of cash flow information:                   
Interest paid                                                $901     $929
Income taxes paid                                            $13,009  $6,308

CONTACT: Investors
         Steven Barlow, Vice President - Investor Relations
         678-281-2043 or steve.barlow@ebix.com
         Aaron Tikkoo
         678 -281-2027 or atikkoo@ebix.com

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