• Quarterly
Revenue of $52.6 Million, up 20% Year-Over-Year
• Q1 Diluted EPS of $0.45, up 13% Year-Over-Year
ATLANTA, GA – May
10, 2013 – 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 first quarter
ended March 31, 2013.
Ebix delivered the following results for the first quarter
of 2013:
Revenues: Total Q1 2013 revenue was $52.6
million, an increase of 20% on a year-over-year basis, as compared to Q1 2012
revenue of $43.8 million.
Earnings per Share: Q1 2013 diluted earnings
per share rose 13% year-over-year to $0.45, as compared to $0.40 in the first
quarter of 2012. For purposes of the Q1 2013 EPS calculation, there was an average
of 38.8 million diluted shares outstanding during the quarter, as compared to
39.5 million diluted shares outstanding in Q1 2012.
Operating Cash: Cash generated from operations
Q1 2013 was $14.3 million, up 5% year-over-year as compared to $13.7 million
in Q1 2012.
Margins: Operating margins for Q1 2013
were lower at 37% as compared to 42% for Q1 2012. The operating margins in Q1
2013 were impacted by the Company incurring certain onetime legal and travel
costs associated with the recently announced merger with an affiliate of Goldman
Sachs, and the impact of lower initial operating margins from some of the businesses
acquired in 2012, as compared to our existing operations. Furthermore, in Q1
of 2012, the Company realized a net benefit in the approximate amount of $971
thousand related to a termination fee received by the Company in connection
with a failed business acquisition.
Diversified Revenue Base: Ebix continued
to have highly diversified revenue streams across thousands of clients, with
the largest client accounting for only 2.5% of the Company’s Q1 2013 revenues.
Channel Revenues: The Exchange channel
continued to be the largest channel for Ebix accounting for 79% of the Company’s
Q1 2013 Revenues as compared to 79% in Q1 2012.
| |
|
| (dollar amounts
in thousands) |
Three
Months Ended |
| |
March
31, |
| Channel
|
2013
|
2012
|
% Change
|
| Exchanges |
$41,686 |
$34,646 |
20% |
| Broker Systems |
4,722 |
4,754 |
0% |
| Business Process Outsourcing ("BPO") |
4,164 |
3,571 |
17% |
| Carrier Systems |
1,994 |
856 |
133% |
| Total Revenue
|
$52,566
|
$43,827
|
23% |
Net Income: Q1 2013 net income was $17.3
million, an 11% increase on a year-over-year basis, as compared to Q1 2012 net
income of $15.7 million.
Q2 2013 Diluted Share Count: As of today, the Company expects the diluted
share count for Q2 2013 to be approximately 38.8 million.
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. For more information, visit the
Company’s website at www.ebix.com
SAFE HARBOR REGARDING FORWARD-LOOKING STATEMENTS
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 Part I, Item
IA, “Risk Factors”, below, as well as: 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 this and other 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, www.sec.gov.
Investors
Steven Barlow, IR, 678-281-2043 or steve.barlow@ebix.com
Aaron Tikkoo, IR, 678 -281-2027 or atikkoo@ebix.com
| |
| Ebix,
Inc. and Subsidiaries |
| Condensed
Consolidated Statements of Income |
| (In thousands, except per share data) |
| (Unaudited) |
| |
Three
Months Ended |
| |
March
31, |
| |
2013
|
2012
|
| Operating revenue
|
$ 52,566
|
$ 43,827
|
| Operating expenses:
|
|
|
| Cost of services provided |
9,891 |
9,029 |
| Product development |
7,035 |
4,272 |
| Sales and marketing |
3,912 |
3,812 |
| General and administrative |
9,971 |
6,444 |
| Amortization and depreciation |
2,452 |
1,941 |
| Total operating expenses |
33,261 |
25,498 |
| Operating income
|
19,305 |
18,329 |
| Interest income |
93 |
167 |
| Interest expense |
(362) |
(253) |
| Other non-operating income |
82 |
-- |
| Foreign currency exchange loss |
(170) |
(296) |
| Income before income taxes |
18,948 |
17,947 |
| Income tax expense |
(1,604) |
(2,262) |
| Net income
|
$ 17,344
|
$ 15,685
|
| Basic earnings per
common share |
$ 0.47 |
$ 0.43 |
| Diluted earnings per
common share |
$ 0.45 |
$ 0.40 |
| Basic weighted average shares outstanding |
37,168 |
36,450 |
| Diluted weighted average shares outstanding |
38,779 |
39,523 |
| Ebix,
Inc. and Subsidiaries |
| Condensed
Consolidated Balance Sheets |
| (In thousands, except share amounts) |
| |
March 31,
|
December 31,
|
| |
2013
|
2012
|
| ASSETS |
(Unaudited)
|
|
| Current assets: |
|
|
| Cash and cash equivalents |
$ 43,005 |
$ 36,449 |
| Short-term investments |
778 |
971 |
Trade accounts receivable, less allowances
of $1,075 and $1,157, respectively |
39,533 |
37,298 |
| Deferred tax asset, net |
1,899 |
1,835 |
| Other current assets |
4,680 |
5,116 |
| Total current assets |
89,895
|
81,669
|
| Property and equipment, net |
9,676 |
10,082 |
| Goodwill |
326,223 |
326,748 |
| Intangibles, net |
50,654 |
52,591 |
| Indefinite-lived intangibles |
30,887 |
30,887 |
| Deferred tax asset, net |
18,764 |
11,245 |
| Other assets |
3,654 |
3,724 |
| Total assets |
$ 529,753
|
$ 516,946
|
| LIABILITIES AND STOCKHOLDERS'
EQUITY |
|
|
| Current liabilities: |
|
|
| Accounts payable and accrued liabilities |
$ 20,151 |
$ 15,497 |
| Accrued payroll and related benefits |
4,800 |
5,431 |
| Short term debt |
9,625 |
11,344 |
Contingent liability for accrued
earn-out acquisition consideration |
2,406 |
3,265 |
| Current portion of long term
debt and
capital lease obligations, net of discount of
$0 and $13, respectively |
905 |
915 |
| Deferred revenue |
19,584 |
19,888 |
| Current deferred rent |
226 |
237 |
| Other current liabilities |
74 |
113 |
| Total current liabilities |
57,771
|
56,690
|
| Revolving line of credit |
37,840 |
37,840 |
Long term debt and capital lease obligations,
less current portion, net of discount of $78 |
29,117 |
31,592 |
| Other liabilities |
6,471 |
6,429 |
Contingent liability for accrued earn-out
acquisition consideration |
14,027 |
14,230 |
| Put option liability |
1,105 |
1,186 |
| Deferred revenue |
270 |
375 |
| Long term deferred rent |
1,465 |
1,449 |
| Total liabilities |
148,066
|
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
March 31, 2013 and December 31, 2012 |
-- |
-- |
Common stock, $0.10 par value, 60,000,000
shares authorized, 37,208,639 issued and 37,168,130
outstanding at March 31, 2013 and 37,131,777 issued
and 37,091,268 outstanding at December 31, 2012 |
3,717 |
3,709 |
| Additional paid-in capital |
164,838 |
164,346 |
Treasury stock (40,509 shares as of March 31, 2013
and December 31, 2012) |
(76) |
(76) |
| Retained earnings |
215,644 |
201,094 |
| Accumulated other comprehensive loss |
(7,436) |
(6,918) |
| Total stockholders' equity |
376,687
|
362,155
|
| Total liabilities and stockholders' equity |
$ 529,753
|
$ 516,946
|
| Ebix,
Inc. and Subsidiaries |
| Condensed
Consolidated Statements of Cash Flows |
| (In thousands) |
| (Unaudited) |
| |
Three
Months Ended |
| |
March
31, |
| |
2013
|
2012
|
| Cash flows from operating activities: |
|
|
| Net income |
$ 17,344 |
$ 15,685 |
Adjustments to reconcile net income to
net cash provided by operating activities: |
|
|
| Depreciation and amortization |
2,452 |
1,941 |
| Benefit for deferred taxes |
(7,538) |
(1,428) |
| Share based compensation |
511 |
548 |
| Provision for doubtful accounts |
-- |
266 |
| Debt discount amortization on convertible debt |
13 |
-- |
| Unrealized foreign exchange loss |
9 |
661 |
| Gain on put option |
(81) |
-- |
| Reduction of acquisition earnout accruals |
(299) |
-- |
Changes in assets
and liabilities,
net of effects from acquisitions: |
|
|
| Accounts receivable |
(2,234) |
1,771 |
| Other assets |
357 |
(302) |
| Accounts payable and accrued expenses |
4,719 |
(861) |
| Accrued payroll and related benefits |
(643) |
(1,575) |
| Deferred revenue |
(350) |
(560) |
| Deferred rent |
44 |
(75) |
| Other current liabilities |
(39) |
(2,336) |
| Net cash provided
by operating activities |
14,265
|
13,735
|
| Cash flows from investing
activities: |
|
|
| Investment in USIX |
(570) |
-- |
| Maturities of marketable securities (net of purchases) |
208 |
979 |
| Capital expenditures |
(345) |
(673) |
| Net cash provided
by/(used in) investing activities |
(707)
|
306 |
| |
|
|
| Cash flows from financing
activities: |
|
|
| Principal payments of term loan obligation |
(4,125) |
-- |
| Excess tax benefit from share-based compensation |
-- |
27 |
| Proceeds from the exercise of stock options |
553 |
14 |
Forfeiture of certain shares to satisfy exercise costs
and the recipients income tax obligations related to
stock options exercised and restricted stock vested |
(564) |
-- |
| Dividend payments |
(2,794) |
(1,464) |
| Principal payments of debt obligations |
(12) |
-- |
| Payments of capital lease obligations |
(80) |
(45) |
| Net cash provided
used in financing activities |
(7,022)
|
(1,468)
|
| Effect of foreign exchange rates on cash |
20 |
871 |
| Net change in
cash and cash equivalents |
6,556 |
13,444 |
| Cash and cash equivalents at the beginning of the
period |
36,449 |
23,696 |
| Cash and cash
equivalents at the end of the period |
$ 43,005
|
$ 37,140
|
| Supplemental disclosures
of cash flow information: |
|
|
| Interest paid |
$ 352 |
$ 312 |
| Income taxes paid |
$ 3,548 |
$ 3,030 |
|
