Quality Systems Inc. (QSII, Financial) filed Quarterly Report for the period ended 2012-09-30.
Quality Systems, Inc. has a market cap of $1.02 billion; its shares were traded at around $17.57 with a P/E ratio of 15.1 and P/S ratio of 2.4. The dividend yield of Quality Systems, Inc. stocks is 4.1%. Quality Systems, Inc. had an annual average earning growth of 25.8% over the past 10 years. GuruFocus rated Quality Systems, Inc. the business predictability rank of 4-star.
Gross profit margins at the QSI Dental Division for the three months ended September 30, 2012 decreased to 45.9% from 53.4% for the same prior year period. Gross profit margins at the NextGen Division for three months ended September 30, 2012 decreased to 68.1% compared to 73.0% for the same prior year period primarily due to decreased software sales. Gross margin in the Hospital Solutions Division decreased to 48.1% for the three months ended September 30, 2012 as compared to 72.1% for the same prior year period due to growth in implementation and training revenue which carries lower profit margins compared to software. Implementation and training revenue in the Hospital Solutions Division represented approximately 19.6% of total Hospital Solutions Division revenue compared to 14.4% in the year ago period. Gross margin in the RCM Services Division increased to 30.4% for the three months ended September 30, 2012 as compared to 28.1% for the same prior year period due to increased software sales, partially offset by an increase in RCM revenue which carries lower profit margins.
Our payroll and benefits expense associated with delivering our products and services increased to 17.6% of consolidated revenue in the three months ended September 30, 2012 compared to 16.3% during the same period last year. The absolute level of consolidated payroll and benefit expenses grew from $17.5 million in the three months ended September 30, 2011 to $20.4 million in the three months ended September 30, 2012, an increase of 16.7%, or approximately $2.9 million. Of the $2.9 million increase, approximately $1.4 million of the increase is related to the RCM Services Division as RCM is a service business, which inherently has higher percentage of payroll costs as a percentage of revenue. Increases of approximately $0.8 million in the NextGen Division and $0.8 million for the Hospital Solutions Division are primarily due to headcount additions and increased payroll and benefits expense associated with delivering products and services. Payroll and benefit expenses related to the QSI Dental Division remained consistent period over period. The amount of share-based compensation expense included in cost of revenue was not significant for the three months ended September 30, 2012 and 2011.
Revenue. Revenue for the six months ended September 30, 2012 increased 12.7% to $234.4 million from $208.1 million for the six months ended September 30, 2011. NextGen Division revenue increased 10.5% to $173.5 million from $157.1 million in the six months ended September 30, 2011, QSI Dental Division revenue increased 2.0% to $9.8 million from $9.6 million, RCM Services Division revenue increased 23.3% to $31.6 million from $25.6 million, and Hospital Solutions Division revenue increased 24.1% to $19.5 million from $15.7 million in the same prior year period.
months ended September 30, 2012 compared to 16.5% during the same period last year. The absolute level of consolidated payroll and benefit expenses grew from $34.4 million in the six months ended September 30, 2011 to $40.4 million in the six months ended September 30, 2012, an increase of 17.6%, or approximately $6.0 million. Of the $6.0 million increase, approximately $2.7 million of the increase is related to the RCM Services Division as RCM is a service business, which inherently has higher percentage of payroll costs as a percentage of revenue. Increases of $1.6 million in the NextGen Division, $1.8 million for the Hospital Solutions Division are primarily due to headcount additions and increased payroll and benefits expense associated with delivering products and services. Payroll and benefit expenses related to the QSI Dental Division remained consistent period over period. The amount of share-based compensation expense included in cost of revenue was not significant for six months ended September 30, 2012 and 2011.
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Quality Systems, Inc. has a market cap of $1.02 billion; its shares were traded at around $17.57 with a P/E ratio of 15.1 and P/S ratio of 2.4. The dividend yield of Quality Systems, Inc. stocks is 4.1%. Quality Systems, Inc. had an annual average earning growth of 25.8% over the past 10 years. GuruFocus rated Quality Systems, Inc. the business predictability rank of 4-star.
Highlight of Business Operations:
Total NextGen Division maintenance revenue for the three months ended September 30, 2012 grew 11.5% to $33.1 million from $29.7 million for the same prior year period while NextGen Division EDI revenue grew 26.9% to $13.7 million compared to $10.8 million in the same prior year period. Other services revenue for the NextGen Division, which consists primarily of third-party annual software license renewals, consulting services, SaaS fees and hosting services, increased 43.5% to $13.5 million in the three months ended September 30, 2012 from $9.4 million in the same prior year period. Other services revenue benefited from a strong increase in consulting revenue to existing NextGen Division customers.Gross profit margins at the QSI Dental Division for the three months ended September 30, 2012 decreased to 45.9% from 53.4% for the same prior year period. Gross profit margins at the NextGen Division for three months ended September 30, 2012 decreased to 68.1% compared to 73.0% for the same prior year period primarily due to decreased software sales. Gross margin in the Hospital Solutions Division decreased to 48.1% for the three months ended September 30, 2012 as compared to 72.1% for the same prior year period due to growth in implementation and training revenue which carries lower profit margins compared to software. Implementation and training revenue in the Hospital Solutions Division represented approximately 19.6% of total Hospital Solutions Division revenue compared to 14.4% in the year ago period. Gross margin in the RCM Services Division increased to 30.4% for the three months ended September 30, 2012 as compared to 28.1% for the same prior year period due to increased software sales, partially offset by an increase in RCM revenue which carries lower profit margins.
Our payroll and benefits expense associated with delivering our products and services increased to 17.6% of consolidated revenue in the three months ended September 30, 2012 compared to 16.3% during the same period last year. The absolute level of consolidated payroll and benefit expenses grew from $17.5 million in the three months ended September 30, 2011 to $20.4 million in the three months ended September 30, 2012, an increase of 16.7%, or approximately $2.9 million. Of the $2.9 million increase, approximately $1.4 million of the increase is related to the RCM Services Division as RCM is a service business, which inherently has higher percentage of payroll costs as a percentage of revenue. Increases of approximately $0.8 million in the NextGen Division and $0.8 million for the Hospital Solutions Division are primarily due to headcount additions and increased payroll and benefits expense associated with delivering products and services. Payroll and benefit expenses related to the QSI Dental Division remained consistent period over period. The amount of share-based compensation expense included in cost of revenue was not significant for the three months ended September 30, 2012 and 2011.
Revenue. Revenue for the six months ended September 30, 2012 increased 12.7% to $234.4 million from $208.1 million for the six months ended September 30, 2011. NextGen Division revenue increased 10.5% to $173.5 million from $157.1 million in the six months ended September 30, 2011, QSI Dental Division revenue increased 2.0% to $9.8 million from $9.6 million, RCM Services Division revenue increased 23.3% to $31.6 million from $25.6 million, and Hospital Solutions Division revenue increased 24.1% to $19.5 million from $15.7 million in the same prior year period.
months ended September 30, 2012 compared to 16.5% during the same period last year. The absolute level of consolidated payroll and benefit expenses grew from $34.4 million in the six months ended September 30, 2011 to $40.4 million in the six months ended September 30, 2012, an increase of 17.6%, or approximately $6.0 million. Of the $6.0 million increase, approximately $2.7 million of the increase is related to the RCM Services Division as RCM is a service business, which inherently has higher percentage of payroll costs as a percentage of revenue. Increases of $1.6 million in the NextGen Division, $1.8 million for the Hospital Solutions Division are primarily due to headcount additions and increased payroll and benefits expense associated with delivering products and services. Payroll and benefit expenses related to the QSI Dental Division remained consistent period over period. The amount of share-based compensation expense included in cost of revenue was not significant for six months ended September 30, 2012 and 2011.
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