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Advent Software Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: May 10, 2012 04:49PM
Advent Software Inc. (ADVS) filed Quarterly Report for the period ended 2012-03-31. Advent Software has a market cap of $1.38 billion; its shares were traded at around $27 with a P/E ratio of 45.9 and P/S ratio of 4.2. Advent Software had an annual average earning growth of 43.9% over the past 5 years.
Highlight of Business Operations:We grew bookings by 45%, revenue by 15% and operating cash flows by 17% during the first quarter of 2012 as compared to the first quarter of 2011. We maintain our expectation of an improved demand environment for the remainder of 2012 and are expecting to grow revenues by 11% to 13% in fiscal 2012 compared to the prior year. As the current economic situation evolves, we will continue to evaluate its impact on our business and we will remain focused on delivering innovative solutions for our customers. We remain positive about our market position, current product portfolio and future product development.
Total net revenues increased by $11.6 million or 15% during the first quarter of 2012, which was primarily due to an increase in term license revenues and other recurring revenues. Term license revenues increased by $8.2 million primarily due to the implementation of our bookings activity from the previous 12 months, growth in sales of our APX, Geneva, Tamale and Moxy products, and $1.2 million of revenues from our recently acquired Syncova business. Other recurring revenues increased by $4.6 million or 25% during the first quarter of 2012 compared to the same period of 2011, due to $3.7 million of revenues from our recently acquired Black Diamond business as well as growth in revenue from our data services, Advent OnDemand and Assets Under Administration (AUA) fees.
Total recurring revenues increased by $11.4 million and represented 91% of total net revenues during the first quarter of 2012, compared to 89% in the same period in 2011. The increase in absolute dollars was driven by the increase in term license and other recurring revenues.
Total expenses from continuing operations, including cost of revenues, increased to $75.1 million in the first quarter of 2012 from $63.8 million in the first quarter of 2011. Our operating income and margin from continuing operations in the first quarter of 2012 was $11.8 million and 13.6%, compared to $11.5 million and 15.3% in the first quarter of 2011. Although we were able to grow revenues and operating income during this period, the 1.7 points decrease in operating margin was primarily the result of the deterioration in gross margins associated with our non-recurring revenue. The decrease in the gross margins associated with non-recurring revenues is primarily the result of lower billable utilization of our professional service resources and service concessions during the first quarter of 2012. Additionally, we incurred additional operating expenses and intangible asset amortization incurred as a result of our acquisitions of Syncova Solutions Ltd (Syncova) and Black Diamond Performance Reporting LLC (Black Diamond) in February 2011 and June 2011, respectively. Also, the timing in the capitalization of our product development costs contributed to the increase in total expenses.
Net income from continuing operations was $7.3 million, resulting in diluted earnings per share of $0.14 for the first quarter of 2012, compared to $7.9 million or $0.14 in the first quarter of 2011.
Stocks Discussed: ADVS,