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Allscripts Healthcare Solutions Inc Reports Operating Results (10-Q)

August 09, 2012 | About:
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10qk

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Allscripts Healthcare Solutions Inc (MDRX) filed Quarterly Report for the period ended 2012-06-30.

Allscripts Healthcare Solutions Inc has a market cap of $1.76 billion; its shares were traded at around $11.39 with a P/E ratio of 12.9 and P/S ratio of 1.2. Allscripts Healthcare Solutions Inc had an annual average earning growth of 2.5% over the past 5 years.
This is the annual revenues and earnings per share of MDRX over the last 10 years. For detailed 10-year financial data and charts, go to 10-Year Financials of MDRX.


Highlight of Business Operations:

Revenue increased to $370 million compared with $357 million in the prior year. Increases in all revenue categories offset a decline in system sales as we experienced a decline in orders as a number of our clients and prospects delayed purchase decisions as we continue our efforts to improve product performance and delivery execution. Revenue increased compared to first quarter revenue of $365 million. Sequentially we realized a $5 million increase in system sales which offset a decrease in professional services revenue as meaningful use upgrade services begin to decline.

Total revenue increased during the three and six months ended June 30, 2012 compared to the prior year comparable periods as we realized increases in all revenue categories with the exception of system sales. The increase in professional services revenue was driven by an increase in professional services headcount which increased our ability to provide more billable services. We increased headcount primarily in response to the demand associated with increases in implementation and consulting services including the implementation of third-party solutions. Maintenance revenue and transaction processing revenue both increased primarily related to growth in our customer base. IT Outsourcing revenues are included in transaction processing and other and contributed $4 million and $11 million of the increase in revenue compared to the three and six months ended June 30, 2011, respectively, as we expanded our services to existing customers while also expanding our customer base. SaaS and hosting revenues also contributed to this increase as we expanded our customer base. Partially offsetting these increases in revenue for the three and six months ended June 30, 2012 is a decrease in system sales which consists of a $15 million and $21 million decrease in software revenue, respectively, and a $4 million and $11 million decrease in hardware revenue, respectively, as we experienced a decline in orders as a number of our clients and prospects delayed purchase decisions as we continue our efforts to improve product performance and delivery execution. Additionally, we continue to experience a shift in sales to smaller physician practices which typically require less robust hardware solutions.

Gross profit decreased during the three and six months ended June 30, 2012 as the increase in total revenue was offset by an increase in costs of revenue compared to the prior year comparable period. During the three and six months ended June 30, 2012, we recognized a $3 million and $7 million increase in the amortization of software development costs, respectively, and an increase in professional services cost of revenue primarily due to the increased use of third-party resources to assist us in meeting demand attributable to increases in implementation and consulting services, including the implementation of third-party solutions, which offset an increase in professional services revenue. Gross profit was further impacted by an increase in transaction processing and other revenue that was offset by higher costs as we added headcount and made infrastructure improvements in response to increased demand for our SaaS and hosting solutions. Gross profit as a percent of revenue declined compared to the prior year due primarily to a higher mix of third-party systems sales which carry lower gross margin and the increases in amortization of software development costs, professional services costs and transaction processing-related costs.

Software delivery revenue decreased during the three and six months ended June 30, 2012 due to a decrease in system sales which consists of a $12 million and $19 million decrease in software revenue, respectively, and a $4 million and $11 million decrease in hardware revenue, respectively, as we experienced a decline in orders as a number of our clients and prospects delayed purchase decisions as we continue our efforts to improve product performance and delivery execution. Additionally, we continue to experience a shift in sales to smaller physician practices which typically require less robust hardware solutions. Partially offsetting these decreases was an increase in SaaS revenues during the three and six months ended June 30, 2012 as we expanded our customer base.

Total contract backlog increased during the six months ended June 30, 2012 compared to the prior year comparable period primarily due to an increase in professional services backlog which was driven by an increase in orders and an increase in maintenance revenue backlog as a result of new client go-lives as well as maintenance renewals in our installed base.

Read the The complete Report

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