SS&C Technologies, a global provider of financial services software and software-enabled services, today announced results for the quarter ended March 31, 2009.
Revenue on a GAAP basis for the first quarter of 2009 was $63.7 million.
This is a decrease of $4.8 million from revenues over the same period in 2008, with $4.2 million of the decline resulting from the negative impact of foreign exchange. Net income, on a GAAP basis, for the first quarter of 2009, was $3.9 million, an increase of 4% over the same period in 2008.
Adjusted operating income (a non-GAAP financial measure defined in note 1 to the attached Consolidated Condensed Financial Information) was $23.1 million for the three months ended March 31, 2009, compared to $24.6 million in the first quarter of the prior year, a decrease of 6%. GAAP operating income in the first quarter of 2009 was $14.5 million and includes amortization of $7.4 million and stock-based compensation of $1.3 million, compared to $15.8 million of operating income for the same period in 2008, a decrease of 9%.
Consolidated EBITDA (a non-GAAP financial measure defined in note 2 of the Consolidated Condensed Financial Information) for the first quarter of 2009 was $25.2 million, compared to $26.8 million in the first quarter of 2008, a decrease of 6%.
"SS&C continues to perform in very difficult markets. Many of our largest customers have reduced capital spending and cut back on information technology projects. The assets under management of many of our fund administration clients have shrunk as markets declined and our clients deleveraged. Given this backdrop, a 6% decline in consolidated EBITDA is an excellent result. Our EBITDA margin has remained strong at 39.6% and our decision to reduce our workforce by 9% on November 1, 2008, appears prescient," said Bill Stone, Chairman and CEO, SS&C Technologies. "While revenue has declined for three straight quarters, we are optimistic this trend will change in Q2. We continue to garner new clients and we are being selected by large, sophisticated organizations foions for our independence, financial strength and the quality of our service and software offerings."
"During the first quarter, we acquired the assets and business of Evare, LLC, a Burlington, Massachusetts-based provider for financial data acquisition, transformation and delivery. Financial institutions spend a considerable amount of time each day in gathering disparate data in disparate formats to conduct reconciliations and communicate with various counterparties and customers. Evare's high powered service and deep understanding of the complexities of these processes offer a broad range of financial service participants considerable operational cost savings," noted Stone. "Our clients have responded well to this deal and we are working diligently on integrating our Securities Valuation Corporation data as well as our SSCNet and Recon product to the Evare offerings."
Balance Sheet and Cash Flow
SS&C ended the quarter with $35.5 million in cash and cash equivalents, and $407.5 million in debt for a net debt balance of $372.0 million. We generated net cash from operating activities of $11.0 million for the three months ended March 31, 2009, compared to $19.4 million for the same period in 2008. This decrease is related in part to an increase in tax payments of $4.3 million. Income taxes paid in the quarter were $7.4 million compared with $3.1 million in same period in 2008. Other items affecting operating cash flow included an increase in accounts receivable DSO and the effect of increased bonus payments in Q1 2009 compared with Q1 2008.
"Our consolidated total leverage, as defined in our senior credit facilities, is now 3.3 times consolidated EBITDA compared to 6.8 times when we went private," said Stone. "We plan to use cash to acquire new businesses and we are seeing many opportunities to buy great businesses at prices unseen over the past few years. We are very diligent and conservative in evaluating new opportunities and we believe this strategy has delivered excellent financial results, during good times and bad."