Delaware
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1-11869
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13-3362547
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(State or other jurisdiction of
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(Commission
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(I.R.S. Employer
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incorporation or organization)
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File Number)
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Identification Number)
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¨
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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¨
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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¨
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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¨
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Exhibit No.
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Description
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99.1
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Press Release of FactSet Research Systems Inc., dated March 13, 2012
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FACTSET RESEARCH SYSTEMS INC.
(Registrant)
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Date: March 13, 2012
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By:
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/s/ Maurizio Nicolelli
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Maurizio Nicolelli
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Senior Vice President and Director of Finance
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(Principal Financial Officer)
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Exhibit No.
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Description of Document
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99.1
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Press Release of Registrant, dated March 13, 2012 reporting the results of operations for the Registrant’s second fiscal quarter ended February 29, 2012.
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FactSet Research Systems Inc.
601 Merritt 7
Norwalk, Connecticut 06851
203.810.1000 / 203.810.1001 Fax
News Release
FOR IMMEDIATE RELEASE
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Exhibit 99.1
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·
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ASV grew $22 million to $803 million
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·
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Revenues rose 12% to $199 million
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·
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Non-GAAP diluted EPS grew 16% to $1.14
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(Condensed and Unaudited) | ||||||||||||||||||||||||
Three Months Ended
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Six Months Ended
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|||||||||||||||||||||||
(In thousands, except per share data)
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Feb 29, 2012
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Feb 28, 2011
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Change
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Feb 29, 2012
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Feb 28, 2011
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Change
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||||||||||||||||||
Revenues
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$ | 199,371 | $ | 177,635 | 12.2 | % | $ | 395,819 | $ | 350,924 | 12.8 | % | ||||||||||||
Operating income
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67,117 | 58,093 | 15.5 | % | 133,870 | 117,522 | 13.9 | % | ||||||||||||||||
Provision for income taxes
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20,867 | 12,971 | 60.9 | % | 42,353 | 30,924 | 37.0 | % | ||||||||||||||||
Net income
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$ | 46,746 | $ | 45,254 | 3.3 | % | $ | 92,290 | $ | 86,855 | 6.3 | % | ||||||||||||
Diluted earnings per share
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$ | 1.02 | $ | 0.95 | 7.4 | % | $ | 2.01 | $ | 1.83 | 9.8 | % | ||||||||||||
Diluted weighted average shares
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45,707 | 47,427 | 45,972 | 47,495 | ||||||||||||||||||||
Non-GAAP net income
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$ | 52,180 | $ | 46,465 | 12.3 | % | ||||||||||||||||||
Non-GAAP diluted earnings per share
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$ | 1.14 | $ | 0.98 | 16.3 | % |
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·
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ASV from U.S. operations was $548 million and $255 million was related to international operations.
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·
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U.S. revenues were $136.4 million, up 12.2% from the year ago quarter.
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Non-U.S. revenues also rose 12.2% to $63.0 million as compared to the same period in fiscal 2011.
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Operating margins were 33.7% for the quarter.
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Free cash flow generated over the last twelve months was $209 million, up 12% compared to the same period a year ago. Quarterly free cash flow was $39.1 million.
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Cash and investments were $200 million at February 29, 2012.
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·
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Accounts receivable increased $1 million over the last twelve months while ASV is up $80 million over the same period.
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The effective tax rate was 30.9% as compared to 22.3% a year ago.
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The U.S. Federal R&D tax credit expired on December 31, 2011. The expiration increased the annual effective tax rate by 1.3% and reduced second quarter diluted EPS by $0.02.
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Client count was 2,324 at February 29, a net increase of 53 clients during the quarter.
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Annual client retention was greater than 95% of ASV, consistent with last year. On a client basis, the annual retention rate improved to 92% of clients at February 29 as compared to 90% a year ago, reflecting a reduction in client turnover.
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Employee count was 5,516 at February 29, an increase of 66 employees during the quarter and up 16% from a year ago.
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Capital expenditures were $4.6 million.
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A regular quarterly dividend of $12.1 million or $0.27 per share will be paid on March 20, 2012, to common stockholders of record as of February 29, 2012.
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The Company repurchased 507,800 shares for $45.1 million during the second quarter. At February 29, 2012, $83 million remains authorized for future repurchases.
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Common shares outstanding were 44.8 million at February 29, 2012.
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We entered into a new license agreement with StreetAccount LLC (SA) to complement our news offering with distilled company news and market summaries.
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Revenues are expected to range between $200 million and $204 million, which represents year over year growth of 9% and 11% at each end of the range.
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Operating margin is expected to range between 33.5% and 34.0%.
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The effective tax rate is expected to range between 31.0% and 32.0%.
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·
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GAAP diluted EPS should range between $1.03 and $1.05.
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·
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Non-GAAP diluted EPS should range between $1.14 and $1.16, which represents year over year growth of 12% and 14% at each end of the range.
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·
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Both GAAP diluted EPS and non-GAAP diluted EPS include a $0.02 reduction to reflect the expiration of the U.S. Federal R&D tax credit on December 31, 2011.
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Three Months Ended
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Six Months Ended
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|||||||||||||||
(In thousands, except per share data)
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Feb 29, 2012
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Feb 28, 2011
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Feb 29, 2012
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Feb 28, 2011
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||||||||||||
Revenues
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$ | 199,371 | $ | 177,635 | $ | 395,819 | $ | 350,924 | ||||||||
Operating expenses
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||||||||||||||||
Cost of services
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67,531 | 60,137 | 134,364 | 116,922 | ||||||||||||
Selling, general and administrative
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64,723 | 59,405 | 127,585 | 116,480 | ||||||||||||
Total operating expenses
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132,254 | 119,542 | 261,949 | 233,402 | ||||||||||||
Operating income
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67,117 | 58,093 | 133,870 | 117,522 | ||||||||||||
Other income
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496 | 132 | 773 | 257 | ||||||||||||
Income before income taxes
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67,613 | 58,225 | 134,643 | 117,779 | ||||||||||||
Provision for income taxes
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20,867 | 12,971 | 42,353 | 30,924 | ||||||||||||
Net income
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$ | 46,746 | $ | 45,254 | $ | 92,290 | $ | 86,855 | ||||||||
Diluted earnings per common share
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$ | 1.02 | $ | 0.95 | $ | 2.01 | $ | 1.83 | ||||||||
Diluted weighted average common shares
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45,707 | 47,427 | 45,972 | 47,495 |
February 29,
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August 31,
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|||||||
(In thousands)
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2012
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2011
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ASSETS
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Cash and cash equivalents
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$ | 184,998 | $ | 181,685 | ||||
Investments
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15,185 | - | ||||||
Accounts receivable, net of reserves
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71,459 | 75,004 | ||||||
Prepaid taxes
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3,549 | - | ||||||
Deferred taxes
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3,768 | 4,008 | ||||||
Prepaid expenses and other current assets
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13,078 | 12,473 | ||||||
Total current assets
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292,037 | 273,170 | ||||||
Property, equipment, and leasehold improvements, net
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78,595 | 81,620 | ||||||
Goodwill
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225,275 | 228,265 | ||||||
Intangible assets, net
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41,470 | 46,310 | ||||||
Deferred taxes
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19,638 | 20,166 | ||||||
Other assets
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6,809 | 7,909 | ||||||
TOTAL ASSETS
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$ | 663,824 | $ | 657,440 | ||||
LIABILITIES
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Accounts payable and accrued expenses
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$ | 24,960 | $ | 24,603 | ||||
Accrued compensation
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24,699 | 41,536 | ||||||
Deferred fees
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28,950 | 28,252 | ||||||
Taxes payable
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- | 2,867 | ||||||
Dividends payable
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12,085 | 12,165 | ||||||
Total current liabilities
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90,694 | 109,423 | ||||||
Deferred taxes
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2,853 | 3,712 | ||||||
Taxes payable
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5,513 | 7,204 | ||||||
Deferred rent and other non-current liabilities
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20,740 | 21,913 | ||||||
TOTAL LIABILITIES
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$ | 119,800 | $ | 142,252 | ||||
STOCKHOLDERS’ EQUITY
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Common stock
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$ | 451 | $ | 614 | ||||
Additional paid-in capital
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101,579 | 432,538 | ||||||
Treasury stock, at cost
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(33,242 | ) | (824,382 | ) | ||||
Retained earnings
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490,815 | 912,078 | ||||||
Accumulated other comprehensive loss
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(15,579 | ) | (5,660 | ) | ||||
TOTAL STOCKHOLDERS’ EQUITY
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544,024 | 515,188 | ||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
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$ | 663,824 | $ | 657,440 |
Six Months Ended
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||||||||
(In thousands)
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Feb 29, 2012
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Feb 28, 2011
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CASH FLOWS FROM OPERATING ACTIVITIES
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Net income
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$ | 92,290 | $ | 86,855 | ||||
Adjustments to reconcile net income to net cash provided by operating activities
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||||||||
Depreciation and amortization
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16,692 | 18,758 | ||||||
Stock-based compensation expense
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11,925 | 10,377 | ||||||
Deferred income taxes
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(91 | ) | (1,275 | ) | ||||
Gain on sale of assets
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(1 | ) | (4 | ) | ||||
Tax benefits from share-based payment arrangements
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(4,973 | ) | (12,919 | ) | ||||
Changes in assets and liabilities
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||||||||
Accounts receivable, net of reserves
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3,545 | (10,808 | ) | |||||
Accounts payable and accrued expenses
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155 | (788 | ) | |||||
Accrued compensation
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(16,298 | ) | (19,853 | ) | ||||
Deferred fees
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697 | 2,765 | ||||||
Taxes payable, net of prepaid taxes
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(3,372 | ) | 2,849 | |||||
Prepaid expenses and other assets
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(456 | ) | (3,052 | ) | ||||
Deferred rent and other non-current liabilities
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(922 | ) | 139 | |||||
Other working capital accounts, net
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(732 | ) | (563 | ) | ||||
Net cash provided by operating activities
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98,459 | 72,481 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES
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Purchases of investments
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(15,000 | ) | - | |||||
Purchases of property, equipment and leasehold improvements, net of proceeds from dispositions
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(10,644 | ) | (15,433 | ) | ||||
Net cash used in investing activities
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(25,644 | ) | (15,433 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES
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Dividend payments
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(24,182 | ) | (21,110 | ) | ||||
Repurchase of common stock
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(59,795 | ) | (75,145 | ) | ||||
Proceeds from employee stock plans
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13,843 | 27,961 | ||||||
Tax benefits from share-based payment arrangements
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4,973 | 12,919 | ||||||
Net cash used in financing activities
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(65,161 | ) | (55,375 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents
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(4,341 | ) | 5,691 | |||||
Net increase in cash and cash equivalents
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3,313 | 7,364 | ||||||
Cash and cash equivalents at beginning of period
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181,685 | 195,741 | ||||||
Cash and cash equivalents at end of period
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$ | 184,998 | $ | 203,105 |
(Unaudited)
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|||||||||||
Three Months Ended
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|||||||||||
(In thousands, except per share data) |
Feb 29, 2012
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Feb 28, 2011
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Change | ||||||||
GAAP Net income
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$ | 46,746 | $ | 45,254 | |||||||
Stock-based compensation (a)
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6,044 | 6,701 | |||||||||
Amortization of intangible assets from acquisitions
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1,820 | 2,136 | |||||||||
Tax effect of stock-based compensation and amortization of intangible assets (b)
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(2,430 | ) | (2,714 | ) | |||||||
Income tax benefits (c)
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- | (4,912 | ) | ||||||||
Non-GAAP net income
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$ | 52,180 | $ | 46,465 | |||||||
GAAP Diluted earnings per common share
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$ | 1.02 | $ | 0.95 | |||||||
Stock-based compensation (a)
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0.13 | 0.14 | |||||||||
Amortization of intangible assets from acquisitions
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0.04 | 0.05 | |||||||||
Tax effect of stock-based compensation and amortization of intangible assets (b)
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(0.05 | ) | (0.06 | ) | |||||||
Income tax benefits (c)
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- | (0.10 | ) | ||||||||
Non-GAAP diluted earnings per share
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$ | 1.14 | $ | 0.98 |
16.3%
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(a)
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Included in the second quarter of fiscal 2011 was a pre-tax charge of $2.5 million related to an increase in the estimated number of performance-based stock options that became eligible to vest. This change increased stock-based compensation, net of tax by $1.7 million and reduced diluted earnings per share by $0.04.
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(b)
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For the purposes of calculating the non-GAAP measures above, stock-based compensation expense and amortization of intangible assets are assumed to be taxed at the effective tax rates excluding income tax benefits. For the three months ended February 29, 2012, the effective tax rate was 30.9%. For the three months ended February 28, 2011, the effective tax rate, excluding income tax benefits of $4.9 million, was 30.7%.
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(c)
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Income tax benefits were from the reenactment of the U.S. Federal R&D tax credit retroactive to prior years.
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Q2‘12
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Q1‘12
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Q4’11
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Q3’11
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Q2’11
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Q1’11
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Q4’10
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Q3’10
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Q2’10
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Q1’10
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Q4’09
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Q3’09
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Q2’09
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Q1’09
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Q4’08
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% of ASV from buy-side clients
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81%
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80%
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79%
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80%
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80%
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80%
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80%
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82%
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82%
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82%
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82%
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81%
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80%
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79%
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79%
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% of ASV from sell-side clients
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19%
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20%
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21%
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20%
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20%
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20%
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20%
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18%
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18%
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18%
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18%
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19%
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20%
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21%
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21%
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