Allscripts Reports Fiscal 2009 Third Quarter Results

April 2nd, 2009 | Computer & Electronics , Computer Software , Internet , Technology | 0 Comments »

Company Reports Earnings per Share of 9 cents and Non-GAAP Earnings per Share of 15 cents

CHICAGO (April 02, 2009) –

Allscripts-Misys Healthcare Solutions, Inc. (Allscripts) today announced its financial results for the three and nine months ended February 28, 2009.

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The Company’s results for the three months ended February 28, 2009 include results of Allscripts for the complete fiscal quarter. The Company’s results for the three months ended February 29, 2008 include only the results of Misys Healthcare Systems, LLC (Misys). The Company’s results for the nine months ended February 28, 2009 include results from legacy Allscripts for the period of October 11, 2008 through February 28, 2009, and from Misys for all periods presented. A subsidiary of Allscripts merged with Misys, formerly a division of Misys plc, on October 10, 2008, at which time Allscripts changed its legal name to Allscripts-Misys Healthcare Solutions, Inc.

Total revenue for the three months ended February 28, 2009 was $160.7 million, compared to $97.1 million for the same period last year. Non-GAAP revenue for the three months ended February 28, 2009 was $163.8 million, compared to non-GAAP revenue of $165.3 million for the same period last year. Non-GAAP revenue for the three months ended February 28, 2009 and February 29, 2008 are comprised of revenue from Allscripts and Misys for the full three-month period of each respective year, giving effect to the add-back of a deferred revenue adjustment of $3.1 million recorded for GAAP purposes in the three month period ended February 28, 2009. Please see “Explanation of Non-GAAP Financial Measures” below for a discussion of non-GAAP measures.

Total GAAP revenue for software and related services during the three months ended February 28, 2009 was $152.2 million, compared to $97.1 million for the same period last year. Non-GAAP revenue for software and related services for the three months ended February 28, 2009 and February 29, 2008 was $155.3 million and $155.7 million, respectively.

Gross margin percentage was 51.8% for the third quarter of fiscal 2009, compared to 54.0% during the third quarter of fiscal 2008. Based on non-GAAP revenue for each respective quarter, gross margin percentage was 52.7% for the third quarter of fiscal 2009, compared to 52.6% during the third quarter of fiscal 2008.

Net income for the three months ended February 28, 2009 was $13.2 million compared to net income of $10.0 million for the same period last year. Earnings for the three months ended February 28, 2009 were 9 cents per share.

Non-GAAP net income for the three months ended February 28, 2009 was $22.3 million, compared to non-GAAP net income of $16.2 million for the same period last year, representing an increase of 38%. Non-GAAP net income for the three months ended February 28, 2009 and 2008 are comprised of net income giving effect to the add-back of acquisition-related amortization of $3.7 million and $2.1 million, respectively, net of tax; total stock-based compensation expense of $1.4 million and $1.6 million, respectively, net of tax; and transaction-related expenses of $2.1 million and $2.7 million, net of tax. Non-GAAP net income for the three months ended February 28, 2009 also gives effect to the deferred revenue adjustment of $1.9 million, net of tax. Non-GAAP net income for the three months ended February 29, 2008 gives effect to the tax adjustment of ($0.1) million, net of tax, and the add-back of legacy Allscripts net loss for the period prior to the consummation date of the merger of ($0.1) million, net of tax. Non-GAAP earnings for the three months ended February 28, 2009 were 15 cents per share.

As of February 28, 2009 the Company had cash and marketable securities of $77.5 million, of which approximately $24.9 million has been used to fund purchases of shares of the Company’s common stock pursuant to the Company’s previously announced stock buy-back program since February 28, 2009

“Our results reflect the continuing success of the merger of Allscripts and Misys Healthcare and our solid operating performance,” said Glen Tullman, Chief Executive Officer of Allscripts. “I’m especially pleased with the way Allscripts is positioned to capitalize on the substantial incentives that exist for physicians today and that are coming on line as a part of the HITECH provisions of the American Reinvestment and Recovery Act of 2009.”

Total revenue for the nine months ended February 28, 2009 was $382.2 million, compared to $286.7 million for the nine months ended February 29, 2008. Non-GAAP revenue for the nine months ended February 28, 2009 was $511.7 million, compared to non-GAAP revenue of $494.4 million for the same period last year. Non-GAAP revenue for the nine months ended February 28, 2009 and February 29, 2008 are comprised of revenue from Allscripts and Misys for the first nine months of each respective year giving effect to the add-back of a deferred revenue adjustment of $5.2 million recorded for GAAP purposes in the nine month period ended February 28, 2009. Total GAAP revenue for software and related services during the nine months ended February 28, 2009 was $369.0 million, compared to $286.7 million for the same period last year. Non-GAAP revenue for software and related services for the nine months ended February 28, 2009 and February 29, 2008 was $483.3 million and $462.0 million.

Gross margin percentage was 52.4% for the nine months ended February 28, 2009, compared to 54.4% for the comparable period a year ago. Based on non-GAAP revenue for each respective nine-month period, gross margin percentage was 52.5% for the first nine months of fiscal 2009, compared to 52.8% during the first nine months of fiscal 2008.

Net income for the nine months ended February 28, 2009 was $12.7 million compared to net income of $14.5 million, for the same period last year. Earnings for the nine months ended February 28, 2009 were 11 cents per share.

Non-GAAP net income for the nine months ended February 28, 2009 was $54.5 million compared to non-GAAP net income of $43.5 million for the same period last year, representing an increase of 25%. Non-GAAP net income for the nine months ended February 28, 2009 and February 29, 2008 is comprised of net income giving effect to the add-back of Allscripts net income for respective periods prior to the consummation date of the merger of $6.7 million and $9.5 million, respectively, net of tax; acquisition-related amortization of $8.8 million and $11.8 million, respectively, net of tax; total stock-based compensation expense of $3.5 million and $4.3 million, respectively, net of tax; and transaction-related expenses of $19.6 million and $5.5 million, net of tax. Non-GAAP net income for the nine months ended February 28, 2009 also gives effect to the deferred revenue adjustment of $3.2 million, net of tax. Non-GAAP net income for the nine months ended February 29, 2008 gives effect to the tax adjustment of ($2.1) million, net of tax. Non-GAAP earnings for the nine months ended February 28, 2009 were 46 cents per share.

Conference Call

Allscripts will conduct a conference call on Thursday, April 2, 2009 at 4:30 PM Eastern Time. The conference call can be accessed via the Internet at www.allscripts.com, or by dialing (800) 374-1376 and requesting the Allscripts investor presentation. International callers can access the audio portion of the webcast by dialing (706) 679-4010 and requesting the Allscripts investor presentation. A Microsoft Windows Media Player web replay will be available three hours after the conclusion of the call for a period of two weeks at www.allscripts.com or by calling (800) 642-1687 – or (706) 645-9291 for international callers – ID # 88991513.

Explanation of Non-GAAP Financial Measures

Allscripts reports its financial results in accordance with generally accepted accounting principles, or GAAP. To supplement this information, Allscripts presents in this press release non-GAAP revenue and net income, which are non-GAAP financial measures under Section 101 of Regulation G under the Securities Exchange Act of 1934, as amended. Non-GAAP revenue consists of GAAP revenue but then includes legacy Allscripts revenue for periods prior to the consummation date of the Misys merger and adds-back the deferred revenue adjustment booked for GAAP purposes. Non-GAAP net income consists of GAAP net income but then includes legacy Allscripts net income for periods prior to the consummation date of the Misys merger, adds-back the deferred revenue adjustment and excludes acquisition-related amortization, stock-based compensation expense under SFAS No. 123R, and transaction-related expenses, in each case net of any related tax benefit.

Source: Allscripts