Q4 Revenue up 51%, Operating Income up 44%, Net Income up 62%
WINDSOR, CT – January 25, 2005 — SS&C Technologies, Inc. (Nasdaq: SSNC) today announced record results for the fourth quarter and full year ended December 31, 2004. Q4 revenues were $27.1 million, up 51% over the $17.9 million for Q4 2003. Full year revenues were $95.9 million, compared to $65.5 million in 2003, up 46%. Operating income was $8.7 million for Q4, an increase of 44% from the $6.0 million in Q4 2003. 2004 full year operating income was $29.4 million, compared to $18.4 million for 2003. In 2004, Q4 net income was $6.0 million, or $0.25 diluted earnings per share, up 62% over Q4 2003, and full year 2004 net income was $19.0 million, or $0.84 diluted earnings per share. Fourth quarter 2003 net income was $3.7 million, or $0.19 diluted earnings per share, and full year net income for 2003 was $11.8 million, or $0.59 diluted earnings per share.
Commenting on SS&C’s strong performance, CEO Bill Stone said, "Our Company had a very good year in 2004, outstanding in fact. The financial numbers speak for themselves but our non-financial results are equally impressive: servicing our customers, adding new products and services, winning new global customers, dedicating the SS&C Financial Accelerator at the University of Connecticut, completing a Goldman Sachs led $74.4 million dollar secondary, and integrating three successful acquisitions; these are things successful companies recognize and execute. Our Company prides itself on our ability to execute."
"In the last five years we have taken our earnings to $0.84 in 2004 from $0.09 a share in 2000, an increase of 833%. In 2004, our revenues increased by 46%, operating income increased by 60% and net income increased by 61%. These results indicate our business objectives, plans and strategies are aligned with our opportunities and management capabilities," said Stone.
"Our business strategy has produced solid results quarter after quarter," said Stone. "Our key business objective, increasing recurring revenues, which includes maintenance and outsourcing revenues, has continued its momentum in 2004; posting $67.3 million for the year, a 51% increase over 2003. Growth in outsourcing revenues are particularly exciting and are up 134% from 2003 to over $30 million. We have seen encouraging growth in our license revenues this year. At $17.3 million for the year, license revenue is up 21% over 2003, with CAMRA™, Total Return™, SKYLINE®, Altair™ and Debt & Derivatives™ showing distinct growth."
Cash Flow and Marketable Securities
"SS&C generated $28.5 million in operating cash flow. The quality of our earnings remains very high and we are very disciplined with our cash generation and collection process. Days sales outstanding dropped to 45 days in the fourth quarter. Total cash, cash equivalents and investments in marketable securities at year end were $130.8 million," said Stone.
2005 and Q1 Guidance
"Based on the current business outlook, our guidance for 2005 revenues is between $110 and $116 million and earnings per share between $0.96 and $1.00. For Q1, revenue guidance is between $26 and $27.5 million and earnings per share between $0.21 to $0.24."
"The employees, customers and shareholders all benefit when the company performs," remarked Stone. "Throughout 2004, SS&C focused on customer service, product and service excellence and efficient expense management, and we are proud of our accomplishments."
"In Q1, our primary concentration was on expanding our footprint into new markets and strengthening our existing product offerings with the acquisition of Investment Advisory Network (IAN) and NeoVision Hypersystems," said Stone. "IAN has allowed us to tap into the private wealth market and deepen our reach into the asset management market. NeoVision’s data visualization tool "Heatmaps®" has added another layer of product offerings we now provide the trading community. We are just beginning to explore the full potential of Heatmaps and we are excited about the possibilities."
"In Q2 we continued to execute on our acquisition strategy with the purchase of OMR Systems and OMR Systems International," continued Stone. "OMR has strengthened and expanded our outsourcing and international business and is making a significant contribution to our recurring revenue model. We expect OMR will continue to support new opportunities in both the hedge and financial institutions markets." Stone also commented on the completion of the Company’s secondary offering, "In June, we sold 4.05 million shares and added $74.4 million to our cash position, which gives us a significant leverage point when pursuing acquisitions."
"Norm Boulanger was promoted to President and Chief Operating Officer in Q3, and is now responsible for overseeing all enterprise-wide activities relating to day-to-day operations," stated Stone. "Norm’s ability to produce results has served us well and I am confident he will continue to meet future challenges."
"In October, the SS&C Technologies Financial Accelerator was unveiled. The Accelerator is a real-time, real-world laboratory at the University of Connecticut School of Business in downtown Hartford, Connecticut where students and business partners work together to find solutions to market challenges with real market data," said Stone. "We are presently spearheading two research projects and are excited about our participation. The overall scope of one project relates to investment operational risk tools for the financial services industry and another project is researching the value proposition and potential uses for data visualization in financial services."
"The rest of Q4, our concentration was on execution," said Stone. "Our combined efforts were channeled toward meeting our objectives for the quarter and the year, integrating both the processes and people from our acquisitions, on-time delivery of year-end product releases, rolling out new products like SKYLINE 2005 and new services like German transparency tax accounting and reporting, signing several new industry-leading clients, and providing quality customer service to existing clients. We had tremendous challenges in 2004 and successfully met each one. We are now in the process of building on our accomplishments and setting our sites on an equally successful 2005."