Delaware | 0-15946 | 77-0021975 | ||
(State or other jurisdiction | (Commission File Number) | (IRS Employer | ||
of incorporation) | Identification No.) |
5 Concourse Parkway, Suite 3200, Atlanta, Georgia | 30328 | |
(Address of principal executive offices) | (Zip Code) |
EBIX, INC. | |||
By: | /s/ Robert Kerris | ||
Name: | Robert Kerris | ||
Title: | Chief Financial Officer & Corporate Secretary | ||
(dollar amounts in thousands) | Three Months Ended September 30, | Nine Months Ended September 30, | ||
Channel | 2014 | 2013 | 2014 | 2013 |
Exchange | $ 41,757 | $ 40,554 | $ 125,212 | $ 122,741 |
Broker Systems | 4,511 | 4,390 | 13,862 | 13,878 |
Risk Compliance Solutions (RCS) | 3,346 | 3,604 | 10,423 | 11,781 |
Carrier Systems | 1,194 | 1,745 | 4,191 | 5,463 |
Total Revenue | $ 50,808 | $ 50,293 | $ 153,688 | $ 153,863 |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30 | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
Operating revenue | $ | 50,808 | $ | 50,293 | $ | 153,688 | $ | 153,863 | |||||||
Operating expenses: | |||||||||||||||
Cost of services provided | 10,275 | 10,136 | 29,851 | 30,385 | |||||||||||
Product development | 6,779 | 6,625 | 20,230 | 20,384 | |||||||||||
Sales and marketing | 3,559 | 4,024 | 10,644 | 11,763 | |||||||||||
General and administrative, net | 6,008 | 8,448 | 26,917 | 26,672 | |||||||||||
Amortization and depreciation | 2,449 | 2,459 | 7,442 | 7,459 | |||||||||||
Total operating expenses | 29,070 | 31,692 | 95,084 | 96,663 | |||||||||||
Operating income | 21,738 | 18,601 | 58,604 | 57,200 | |||||||||||
Interest income | 61 | 159 | 326 | 343 | |||||||||||
Interest expense | -392 | -318 | -850 | -961 | |||||||||||
Non-operating (loss)/income - put options | -19 | 93 | 296 | -1,250 | |||||||||||
Non-operating expense - securities litigation | -350 | -4,226 | -350 | -4,226 | |||||||||||
Foreign currency exchange gain (loss) | 987 | -33 | 532 | -326 | |||||||||||
Income before income taxes | 22,025 | 14,276 | 58,558 | 50,780 | |||||||||||
Income tax expense | -4,010 | -1,133 | -11,547 | -6,751 | |||||||||||
Net income | $ | 18,015 | $ | 13,143 | $ | 47,011 | $ | 44,029 | |||||||
Basic earnings per common share | $ | 0.47 | $ | 0.35 | $ | 1.23 | $ | 1.18 | |||||||
Diluted earnings per common share | $ | 0.47 | $ | 0.34 | $ | 1.22 | $ | 1.14 | |||||||
Basic weighted average shares outstanding | 38,050 | 37,919 | 38,264 | 37,435 | |||||||||||
Diluted weighted average shares outstanding | 38,253 | 38,451 | 38,499 | 38,676 |
September 30, 2014 | December 31, 2013 | ||||||
ASSETS | (Unaudited) | ||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 47,350 | $ | 56,674 | |||
Short-term investments | 1,326 | 801 | |||||
Trade accounts receivable, less allowances of $1,609 and $1,049, respectively | 38,361 | 39,070 | |||||
Deferred tax asset, net | 997 | 256 | |||||
Other current assets | 6,251 | 5,548 | |||||
Total current assets | 94,285 | 102,349 | |||||
Property and equipment, net | 22,648 | 8,528 | |||||
Goodwill | 350,255 | 337,068 | |||||
Intangibles, net | 46,504 | 50,734 | |||||
Indefinite-lived intangibles | 30,887 | 30,887 | |||||
Deferred tax asset, net | 15,581 | 12,194 | |||||
Other assets | 4,890 | 3,682 | |||||
Total assets | $ | 565,050 | $ | 545,442 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable and accrued liabilities | $ | 11,138 | $ | 17,818 | |||
Accrued payroll and related benefits | 4,251 | 6,482 | |||||
Short term debt | 0 | 13,062 | |||||
Current portion of long term debt and capital lease obligations, net of discount of $14 and $10, respectively | 724 | 827 | |||||
Current deferred rent | 230 | 254 | |||||
Contingent liability for accrued earn-out acquisition consideration | 564 | 4,137 | |||||
Liability - securities litigation settlement | 0 | 4,226 | |||||
Put option liability | 0 | 845 | |||||
Deferred revenue | 18,575 | 18,918 | |||||
Other current liabilities | 84 | 106 | |||||
Total current liabilities | 35,566 | 66,675 | |||||
Revolving line of credit | 63,465 | 22,840 | |||||
Long term debt and capital lease obligations, less current portion, net of discount of $8 and $38, respectively | 898 | 20,124 | |||||
Other liabilities | 16,473 | 4,719 | |||||
Contingent liability for accrued earn-out acquisition consideration | 10,286 | 10,283 | |||||
Deferred revenue | 144 | 391 | |||||
Long term deferred rent | 1,848 | 2,185 | |||||
Total liabilities | 128,680 | 127,217 | |||||
Temporary equity | 0 | 5,000 | |||||
Stockholders’ equity: | |||||||
Preferred stock, $0.10 par value, 500,000 shares authorized, no shares issued and outstanding at September 30, 2014 and December 31, 2013 | 0 | 0 |
Common stock, $0.10 par value, 60,000,000 shares authorized, 37,191,888 issued and 37,151,379 outstanding at September 30, 2014 and 38,088,391 issued and 38,047,882 outstanding at December 31, 2013 | 3,715 | 3,805 | |||||
Additional paid-in capital | 151,039 | 164,216 | |||||
Treasury stock (40,509 shares as of September 30, 2014 and December 31, 2013) | -76 | -76 | |||||
Retained earnings | 295,933 | 257,574 | |||||
Accumulated other comprehensive loss | -14,241 | -12,294 | |||||
Total stockholders’ equity | 436,370 | 413,225 | |||||
Total liabilities and stockholders’ equity | $ | 565,050 | $ | 545,442 |
(In thousands) | Nine Months Ended | ||||||
(Unaudited) | September 30, | ||||||
2014 | 2013 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 47,011 | $ | 44,029 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 7,442 | 7,459 | |||||
Provision (benefit) for deferred taxes | -1,810 | -4,682 | |||||
Share based compensation | 1,333 | 1,481 | |||||
Provision for doubtful accounts | 1,083 | 1,361 | |||||
Debt discount amortization on promissory note payable | 26 | 32 | |||||
Unrealized foreign exchange (gain) | -256 | -94 | |||||
(Gain) loss on put option | -296 | 1,250 | |||||
Reduction of acquisition earnout accruals | -7,533 | -10,253 | |||||
Changes in assets and liabilities, net of effects from acquisitions: | |||||||
Accounts receivable | -1,901 | -4,562 | |||||
Other assets | -3,977 | 845 | |||||
Accounts payable and accrued expenses | -8,064 | -2,568 | |||||
Accrued payroll and related benefits | 1,027 | -1,205 | |||||
Deferred revenue | -704 | -2,802 | |||||
Deferred rent | -272 | -60 | |||||
Reserve for potential uncertain income tax return positions | 9,337 | 3,405 | |||||
Liability - securities litigation settlement payment | -3,868 | 4,226 | |||||
Other liabilities | -188 | -86 | |||||
Net cash provided by operating activities | 38,390 | 37,776 | |||||
Cash flows from investing activities: | |||||||
Acquisition of Qatarlyst, net of cash acquired | 0 | -4,740 | |||||
Acquisition of HealthCare Magic, net of cash acquired | -5,856 | 0 | |||||
Acquisition of CurePet, Inc., net of cash acquired | 3 | 0 | |||||
Payment of acquisition earn-out contingency, Taimma | -2,250 | -2,250 | |||||
Payment of acquisition earn-out contingency, USIX | 0 | -727 | |||||
Maturities of marketable securities | 0 | 104 | |||||
Purchases of marketable securities | -595 | 0 | |||||
Capital expenditures | -15,922 | -887 | |||||
Net cash used in investing activities | -24,620 | -8,500 | |||||
Cash flows from financing activities: | |||||||
Proceeds from / (Repayments) on revolving line of credit, net | 40,625 | -15,000 | |||||
Principal payments of term loan obligation | -31,938 | -6,531 | |||||
Repurchases of common stock | -16,482 | -2,492 | |||||
Excess tax benefit from share-based compensation | -3,200 | 0 | |||||
Proceeds from the exercise of stock options | 788 | 1,425 | |||||
Forfeiture of certain shares to satisfy exercise costs and the recipients income tax obligations related to stock options exercised and restricted stock vested | -37 | -916 | |||||
Dividend payments | -8,652 | -2,794 | |||||
Shares reacquired in connection with put option | -3,535 | 0 | |||||
Principal payments of debt obligations | -336 | -636 | |||||
Payments of capital lease obligations | -144 | -221 | |||||
Net cash used in financing activities | -22,911 | -27,165 | |||||
Effect of foreign exchange rates on cash | -183 | -1,671 | |||||
Net change in cash and cash equivalents | -9,324 | 440 | |||||
Cash and cash equivalents at the beginning of the period | 56,674 | 36,449 | |||||
Cash and cash equivalents at the end of the period | $ | 47,350 | $ | 36,889 | |||
Supplemental disclosures of cash flow information: | |||||||
Interest paid | $ | 849 | $ | 901 | |||
Income taxes paid | $ | 10,782 | $ | 13,009 |
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