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EBIX
ANNOUNCES RECORD RESULTS WITH $1.62 Diluted EPS
Friday August 1,
8:17 am ET
Net Income Rises 152 percent to $6.34 Million
in Q2 of 2008
ATLANTA--(BUSINESS WIRE)--Ebix, Inc. (NASDAQ:
EBIX - News):
Conference call: Friday August 1, 2008 at 11:00
A.M. EDT
Audio Replay URL: http://www.ebix.com,
Click on Investor Home Page
Dial-in numbers :1-888-687-3295 Dial pass code
58340272
Ebix, Inc. (NASDAQ: EBIX - News), a leading international
developer and supplier of software and e-commerce
solutions to the insurance industry, today reported
record financial results for the second quarter
of 2008. The results marked the highest EPS in
any one quarter that the company has reported
in its thirty two year history.
The company reported total revenue of $17.80
million for the second quarter of 2008, compared
to $9.82 million for the second quarter of 2007,
marking an 81 percent increase in revenues.
Net income after taxes for the quarter rose 152
percent to $6.34 million, or $1.62 per diluted
share, up from $2.51 million, or $0.75 per diluted
share, in the second quarter of 2007- an earnings
per share growth of 116 percent. Results for the
second quarter of 2008 were based on 3.99 million
weighted average diluted shares outstanding, as
compared to 3.37 million in the second quarter
of 2007. The company also reported basic earnings
per share in the second quarter of 2008 of $1.96
as compared to $0.85 in the second quarter of
2007.
The company's operating expenses for the quarter
grew by 45 percent to $10.90 million as compared
to $7.51 million for the second quarter of 2007.
The company attributed the increase primarily
to the acquisition of IDS in November 2007 and
Telstra eBusiness in January 2008.
The company also reported that its cumulative
net income at the end of six months of 2008 grew
by 168 percent to $12.00 million as compared to
cumulative net income of $4.48 million at the
end of six months of 2007. The six month cumulative
diluted EPS for 2008 also grew by 121 percent
to $3.01 as compared to cumulative diluted EPS
of $1.36 at the end of six months of 2007.
Robin Raina, president and CEO, Ebix said, "We
are pleased that the second quarter results are
in line with our expectations. We are especially
pleased that net margins in the quarter grew to
36% from 26% in the same quarter last year."
Raina added: "The company business can be
broken primarily into four main channels today
- the Insurance Company, Broker, Exchange and
BPO Channels. The second quarter saw the exchange
channel become 53% of our total revenues while
the BPO channel accounted for 10% of our revenues.
Broker systems business accounted for 19% and
the carrier channel accounted for 16% of our worldwide
revenues. All these four channels showed growth
this quarter in terms of revenues. The legacy
support business as predicted earlier continues
to decline and accounted for 2% of our revenues
in the second quarter of 2008."
Raina summarized, "We are pleased with the
continued growth of all our four channels of business.
We are focused on ensuring that we can keep our
net margins high and towards that are selective
in securing new contracts that help us meet those
objectives."
Robert Kerris, the chief financial officer of
Ebix, said, "During the second quarter the
company's revenues grew $1.16 million or 7% and
operating profit grew $762 thousand or 12% over
the first quarter. Our year to date operating
margin of 38% represents a significant improvement
compared to the 24% operating margin experienced
during the first six months of 2007. Furthermore,
during the six months ended June 30, 2008 the
company generated $10.66 million of cash flow
from operating activities which represents a 180%
increase as compared the $3.81 million for same
period a year earlier. At June 30, 2008 our cash
balances stood at $12.07 million. We believe that
anticipated cash flows from our operating activities,
together with current cash balances and access
to our credit facilities and the capital markets
will be sufficient to support our operations and
planned business growth."
About Ebix
A CMMI 5 Company, 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 industries.
Ebix strives to work 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 and Canada, Ebix employs insurance
and technology professionals who provide products,
support and consultancy to more than 3,000 customers
on six continents. Ebix's focus on quality has
enabled its development unit in India to be awarded
Level 5 status of the Carnegie Mellon Software
Engineering Institute's Capability Maturity Model
Integrated (CMMI). Ebix has also earned ISO 9001:2000
certification for both its development and call
center units in India. For more information, visit
the Company's Web site at www.ebix.com.
SAFE HARBOR FOR FORWARD-LOOKING STATEMENTS
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, 2007, included
under "Item 1. 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 Subsidiaries
Consolidated Statements of Income
(In thousands, except per share data)
(Unaudited)
Three Months Six Months
Ended June 30, Ended June 30,
-------------- ---------------
2008 2007 2008 2007
------- ------ ------- -------
Operating Revenue 17,803 9,816 34,442 18,834
Operating expenses:
Cost of services provided 3,225 1,718 6,161 3,284
Product development 2,162 2,198 4,240 4,048
Sales and marketing 818 1,078 1,665 2,030
General and administrative 3,856 1,899 7,672 3,686
Amortization and depreciation 837 625 1,656 1,250
------- ------ ------- -------
Total operating expenses 10,898 7,518 21,394 14,298
------- ------ ------- -------
Operating income 6,905 2,298 13,048 4,536
Interest income 140 136 262 207
Interest expense (394) (142) (736) (370)
Foreign exchange gain (loss) 100 122 159 127
------- ------ ------- -------
Income before income taxes 6,751 2,414 12,733 4,500
Income tax (expense)/benefit (415) 99 (727) (25)
------- ------ ------- -------
Net income $ 6,336 $2,513 $12,006 $ 4,475
======= ====== ======= =======
Basic earnings per common share $ 1.96 $ 0.85 $ 3.62 $ 1.54
Diluted earnings per common share $ 1.62 $ 0.75 $ 3.01 $ 1.36
Basic weighted average shares
outstanding 3,229 2,973 3,318 2,911
Diluted weighted average shares
outstanding 3,992 3,366 4,073 3,291
See accompanying notes to condensed consolidated financial statements.
Ebix, Inc. and Subsidiaries
Consolidated Balance Sheets
(In thousands, except share amounts)
December 31,
June 30, 2008 2007
------------- -------------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 12,074 $ 49,466
Accounts receivable, less allowance of
$352 and $146, respectively 13,396 8,809
Other current assets 1,113 1,130
------------- -------------
Total current assets 26,583 59,405
Property and equipment, net 3,427 3,356
Goodwill 84,731 36,408
Intangible assets, net 9,988 7,318
Other assets 2,067 2,023
------------- -------------
Total assets $ 126,796 $ 108,510
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses 3,627 2,231
Accrued payroll and related benefits 2,629 1,517
Short term debt 24,945 15,650
Current portion of long term debt and
capital lease obligations 502 510
Deferred revenue 6,042 5,645
Other current liabilities 207 149
------------- -------------
Total current liabilities 37,952 25,702
Convertible debt 20,000 20,000
Long term debt and capital lease
obligation, less current portion 4 486
Other liabilities 3,140 1,477
Deferred Rent 656 719
Total liabilities 61,752 48,384
Commitments and Contingencies, Note 9
Stockholders' equity:
Convertible Series D Preferred stock,
$.10 par value, 500,000 shares
authorized, no shares issued and
outstanding -- --
Common stock, $.10 par value, 10,000,000
shares authorized, 3,182,261 issued and
3,173,371 outstanding at June 30, 2008
and 3,406,234 issued and 3,397,344
outstanding at December 31, 2007 317 337
Additional paid-in capital 104,147 114,771
Treasury stock (8,890 and 8,890 shares
repurchased as of June 30, 2008 and
December 31, 2007 respectively) (149) (149)
Accumulated deficit (45,507) (57,513)
Accumulated other comprehensive income 6,235 2,680
------------- -------------
Total stockholders' equity 65,044 60,126
------------- -------------
Total liabilities and stockholders'
equity $ 126,796 $ 108,510
============= =============
See accompanying notes to condensed consolidated financial statements.
Ebix, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Six Months Ended
June 30,
-------------------
2008 2007
-------- --------
Cash flows from operating activities:
Net income $ 12,006 $ 4,475
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 1,651 1,250
Stock-based compensation 64 114
Restricted stock compensation 255 58
Provision for doubtful accounts 179 30
Changes in assets and liabilities: -- --
Accounts receivable (2,936) (1761)
Other assets 44 (247)
Accounts payable and accrued expenses (1,085) (378)
Accrued payroll and related benefits 216 (599)
Deferred revenue (368) 766
Deferred taxes 653 --
Customer deposits
Deferred rent & Other Liabilities (20) 98
-------- --------
Net cash provided by operating activities 10,659 3,806
-------- --------
Cash flows from investing activities:
Investment in Telstra eBusiness Services, net of
cash acquired (42,968) --
Investment in Finetre, net of cash acquired -- (15)
Investment in Periculum, net of cash acquired (1,067) --
Deferred Rent -- (5)
Capital expenditures (382) (315)
-------- --------
Net cash used in investing activities (44,417) (335)
-------- --------
Cash flows from financing activities:
Proceeds from (payments on) line of credit 9,295 (10,000)
Proceeds from the issuance of common stock, net of
issuance costs 12,518 13,275
Increase current portion of long term debt -- 55
Proceeds from the exercise of the stock options 514 37
Repurchase of Common Stock (24,000) --
Payments on capital lease obligations (2) (2)
Principal payments of debt obligations (490) (478)
-------- --------
Net cash provided/(used) in financing activities (2,165) 2,887
-------- --------
Effect of foreign exchange rates on cash (1,469) 269
-------- --------
Net change in cash and cash equivalents (37,392) 6,627
Cash and cash equivalents at the beginning of
the period 49,466 5,013
-------- --------
Cash and cash equivalents at the end of the
period $ 12,074 $ 11,640
-------- --------
Supplemental disclosures of cash flow information:
Interest paid $ 459 $ 320
Income taxes paid $ 431 $ 431
Contact:
Ebix, Inc.
Jesenia Jurado, 678-281-2036
jjurado@ebix.com |
