Advent Q4 revenue and income up

Source: Advent Software

Advent Software (Nasdaq: ADVS), a leading provider of software and services to the investment management industry, announced today its financial results for the fourth quarter and full year ended December 31, 2008.

"I am very pleased to announce that Advent achieved record financial results for the fourth quarter and full year 2008," said Stephanie DiMarco, Founder, Chief Executive Officer and Chief Financial Officer of Advent. "Integral to the Company's outstanding financial performance were Advent's important 2008 strategic achievements, which included strengthening our product portfolio, expanding our global footprint and growing our addressable market. As a result, we head into 2009 with a very solid business foundation."

Added Ms. DiMarco, "In this uncertain market environment, technology is one of the best levers businesses have to increase operational efficiency. As our results demonstrate, Advent clearly benefits from our strong reputation of delivering innovative, reliable and cost effective solutions aimed at meeting our clients' critical business needs."

GAAP RESULTS

The Company reported record quarterly revenue of $74.4 million for the fourth quarter of 2008, compared to $59.4 million in the fourth quarter of 2007, representing a 25% increase. Total annual revenues for the year ended December 31, 2008 were a record $264.8 million, a 23% increase over the $215.3 million recorded in 2007.

Income from operations for the fourth quarter of 2008 was $7.2 million, or 10% of revenue, which represented an increase of 104% compared to $3.5 million, or 6% of revenue, in the fourth quarter of 2007. Income from operations for the year ended December 31, 2008 was $20.7 million, or 8% of revenue, which represented an increase of 68% compared to $12.3 million, or 6% of revenue, for 2007.

On a fully diluted basis, earnings per share in the fourth quarter of 2008 were $0.23 and represent a 72% increase from diluted earnings per share of $0.13 in the fourth quarter of 2007. On a fully diluted basis, earnings per share for the year ended December 31, 2008 were $0.68 and represent a 51% increase compared to $0.45 per share for 2007.

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Ca were $0.68 and represent a 51% increase compared to $0.45 per share for 2007.

Cash flow from operations in the fourth quarter of 2008 was $22.8 million, compared with $24.1 million in the fourth quarter of 2007, a 5% decrease. Cash flow from operations for the year ended December 31, 2008 was a record $77.0 million, which represented an increase of 23% compared to $62.4 million for 2007.

Cash and cash equivalents totaled $48.4 million as of December 31, 2008, compared to $49.6 million as of December 31, 2007. Deferred revenue totaled $153.2 million as of December 31, 2008 compared to $120.3 million as of December 31, 2007. During the fourth quarter of 2008, the Company drew down $25.0 million of debt under its revolving credit facility, resulting in a $25.0 million debt balance as of December 31, 2008.

During the fourth quarter of 2008, the Company repurchased 1.97 million shares of its stock at an average cost of $23.61 per share and, at December 31, 2008, had 1.67 million shares remaining to repurchase under the share repurchase program authorized by the Company's Board of Directors on October 30, 2008.

NON-GAAP RESULTS

Non-GAAP income from operations for the fourth quarter of 2008 was $14.6 million. This represents a 90% increase compared to non-GAAP income from operations of $7.7 million for the fourth quarter of 2007. Non-GAAP income from operations for the year ended December 31, 2008 was $41.9 million, a 44% increase compared to non-GAAP income from operations of $29.1 million for 2007.

Non-GAAP earnings per share were $0.34 in the fourth quarter of 2008 and represent an 88% increase from diluted earnings per share of $0.18 in the fourth quarter of 2007. On a non-GAAP basis, earnings per share were $0.97 for the year ended December 31, 2008, a 40% increase compared to $0.69 per share for 2007.

The reconciliation between GAAP and non-GAAP financial measures is provided at the end of this press release.

FOURTH QUARTER HIGHLIGHTS

  • Annual Contract Value: Annual term license contract value was approximately $9.5 million for the fourth quarter of 2008 and $28.1 million for the full year 2008.
  • Tamale Software Acquisition Completed: Advent completed its acquisition of Tamale Software, Inc. Under the terms of the agreement, which were previously announced on September 4, 2008, Advent acquired all of the outstanding capital stock of Tamale Software for approximately $28 million and 906,000 shares of Advent's common stock. The completion of the acquisition represents a significant step for Advent in its strategy to expand its footprint in the front office and establish itself as a leader in the rapidly growing research management software field.
  • Received Buy-Side Technology Awards: For the second consecutive year, Buy-Side Technology magazine named Advent Portfolio Exchange® 'Best Buy-Side Client Reporting Product' and named Geneva® 'Best Buy-Side Portfolio Accounting Product.'
  • Released Axys® 3.7: Advent released Axys® 3.7, an important update to Advent's turnkey portfolio accounting management and reporting solution. The latest release of Axys® marks Advent's continued commitment to keeping the platform current as technology and regulatory changes impact its client base.
  • Expanded Executive Leadership: Advent expanded its executive leadership by promoting Peter Hess to the position of President of the Company. Stephanie DiMarco will continue to lead the Company as CEO and continue to hold the position of CFO, a role she had temporarily filled since earlier this year. Jim Cox will continue in the role he assumed in July 2008 as Vice President and Advent's Principal Accounting Officer, working with Ms. DiMarco to manage the Company's Finance function. Additionally, Mr. Cox joined the Company's executive management team.

FINANCIAL GUIDANCE

Advent announces the following guidance for the first quarter and the fiscal year 2009:

                                                  Q109               FY09
Total Revenue ($M)                        $68-$70         $280-$290
GAAP Operating Margin                    n/a                7%-8%
Non-GAAP Operating Margin              n/a               15%-16%
Operating Cash Flow ($M)                n/a               $77-$82
Capital Expenditures ($M)                n/a               $12-$14

Please refer to the tables at the end of this release for the reconciliation between GAAP and non-GAAP financial measures.

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