Bottomline Technologies (NASDAQ: EPAY), a leading provider of collaborative payment, invoice and document automation solutions, today reported financial results for the third quarter ended March 31, 2010.
Revenues for the third quarter were $39.8 million, an increase of $6.5 million, or 20%, from the third quarter of last year. Subscriptions and transactions revenue increased 44% from the third quarter of last year to $10.8 million.
Gross margin for the third quarter was $22.3 million, an increase of $3.4 million from the third quarter of last year. Net income for the third quarter was $1.0 million, or diluted net income per share of $0.03.
Core net income for the third quarter was $6.5 million after excluding acquisition-related and restructuring expenses of $3.2 million and equity-based compensation of $2.4 million. Core net income increased $3.0 million, or 86%, from the third quarter of last year. Core earnings per share was $0.24 as compared with $0.15 in the third quarter of last year.
"Revenue growth of 20% highlighted a very strong quarter," said Rob Eberle, President and CEO of Bottomline Technologies. "In addition to the strong revenue growth, we also advanced our business strategically by deepening our relationship with Bank of America through the acquisition of its travel commission payments service and launching important new product releases for WebSeries and Legal eXchange. We also continued our investment in future growth opportunities including the integration and build out of the PayMode® platform. With an attractive mix of current results and initiatives which will drive further growth, we are confident our execution and plan will deliver even greater value in the future."
Revenues for the nine months ended March 31, 2010 increased to $116.5 million as compared with $103.1 million in the same period last year. Net income for the nine months ended March 31, 2010 was $2.8 million, or net income per share of $0.11.
Core net income for the nine months ended March 31, 2010 was $19.9 million after excluding acquisition-related and restructuring expenses of $10.4 million and equity-based compensation of $6.7 tion of $6.7 million. Core net income was more than double the $9.6 million reported for the nine months ended March 31, 2009. Core earnings per share was $0.75 for the nine months ended March 31, 2010 as compared with $0.40 in the same period last year.
Third Quarter Customer Highlights
• Added new customers who selected Bottomline solutions for increased efficiency, security and visibility to payment and transactional document processes including: Occidental Petroleum, Service Corporation International, Continental Resources, Kamehameha Schools, Dobbies, Stoner, Inc., Taylor Corporation, West Central, Inc. and WaterFurnace Renewable Energy.
• Expanded customer relationships with orders for Bottomline's enterprise payments and document processing solutions from Georgia Construction Products, Spirax Sarco, Washington Companies, Bibby and BGC Contracting.
• One of Australia's leading banks began work with Bottomline to extend their use of WebSeries Global Cash Management into New Zealand. Working towards a single global transaction banking system, this implementation will enable the bank to better service clients conducting cross-border trade between Australia and New Zealand and significantly reduce operating costs.
• Added new customers to the Legal eXchange roster including: Markel Insurance, an A.M. Best-ranked property and casualty company, Admiral Insurance and Berkley Aviation Insurance.
• Accelerated adoption of Bottomline's healthcare solutions among healthcare organizations through new orders and expanded deployments at Baptist Healthcare System and University Healthcare System.
Third Quarter Strategic Corporate Highlights
• Recognized by Global Finance as a member of the "World's Best Treasury & Cash Management Providers."
• Expanded the PayMode network by acquiring Bank of America's travel commission payments service, reinforcing the strategic relationship between Bank of America and Bottomline and adding strength in the important travel vertical.
• Migrated the PayMode production environment from Bank of America to Bottomline and continued to invest in the integration and expansion of the PayMode and Business eXchange product offerings.
• Released a new check lifecycle management module on Bottomline's next generation WebSeries platform. With this addition, WebSeries continues to solidify an upgrade path for existing clients and provide yet another offering for new clients to deploy a flexible, global payments hub.
• Announced the availability of powerful new Legal eXchange reporting tools, Analyzer and SmartReports, which allow users to strategically analyze their legal spend and law firm performance. These new tools, coupled with the unique auditing functionality available through Legal eXchange Explorer, create a comprehensive reporting suite for the entire lifecycle of a legal matter.
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