SS&C posts Q1 net income rise

"Our software-enabled services business continues to grow, up 110.2 percent over the same period in 2012. We see a lot of potential in fund administration and believe we are in an excellent position," said Bill Stone, Chairman and Chief Executive Officer, SS&C Technologies Holdings, Inc. "We continue to win large mandates and we are seeing opportunity throughout hedge, private equity, managed accounts, pension and insurance markets. The best technology, combined with the best people and processes, are clear and convincing winners."

Results

SS&C reported GAAP revenue of $173.2 million for the first quarter of 2013, compared to $93.7 million in the first quarter of 2012, an 84.9 percent increase.

GAAP operating income for the first quarter of 2013 was $42.0 million, or 24.2 percent of revenue. This represents an increase of 90.3 percent compared to $22.1 million, or 23.6 percent of revenue, in the first quarter of 2012. GAAP net income for the first quarter of 2013 was $21.4 million compared to $17.9 million in the first quarter of 2012, a 19.8 percent increase. On a fully diluted GAAP basis, earnings per share in the first quarter of 2013 were $0.26 compared to $0.22 in the first quarter of 2012, an 18.2 percent increase.

Adjusted operating income (a non-GAAP measure defined in note 2 to the attached Condensed Consolidated Financial Information) in the first quarter of 2013 was $64.8 million, or 37.4 percent of revenue. This represents a 79.8 percent increase compared to $36.0 million, or 38.5 percent of revenue, in the first quarter of 2012. Adjusted net income (a non-GAAP measure defined in note 4 to the attached Condensed Consolidated Financial Information) for the first quarter of 2013 was $37.6 million compared to $23.1 million in 2012's first quarter, a 62.6 percent increase. Adjusted diluted earnings per share (a non-GAAP measure defined in note 4 to the attached Condensed Consolidated Financial Information) in the first quarter of 2013 were $0.45 compared to $0.28 in the first quarter of 2012, a 60.7 percent increase.

Annual Run Rate Basis

Annual Run Rate Basis (ARRB) recurring revenue, defined as the sum of maintenance and software-enabled services revenue on an annualized basis, was $647.0 million based on maintenance and software-enabled services revenue of $161.8 million for the first quarter of 2013. This represents an increase of 92.4 percent from $84.1 million and $336.3 million annual run-rate in the same period in 2012 and an increase of 2.9 percent from $157.2 million for the fourth quarter of 2012, an annual run rate of $628.7 million. We believe ARRB of our recurring revenue is a good indicator of visibility into future revenue.

Operating Cash Flow
SS&C ended the quarter with $68.8 million in cash, and $976.0 million in gross debt, for a net debt balance of $907.2 million. SS&C generated net cash from operating activities of $20.6 million for the quarter ended March 31, 2013, compared to $13.1 million for the same period in 2012, representing a 57.1 percent increase.

Guidance