SS&C Technologies Holdings, Inc. (Nasdaq:SSNC), a global provider of financial services software and software-enabled services, today announced results for the quarter ended March 31, 2010. Revenue on a GAAP basis for the first quarter of 2010 was $78.2 million. This is an increase of $14.5 million, or 22.7%, from revenues over the same period in 2009. Net income, on a GAAP basis, for the first quarter of 2010, was $9.0 million, an increase of $5.1 million, or 131.4%, over the same period in 2009. Diluted earnings per share for Q1 2010 were $0.14, 133.3% higher than the Q1 2009 $0.06 diluted earnings per share (EPS).
Adjusted revenue, which is adjusted for one-time purchase accounting adjustments (a non-GAAP measure defined in note 1 to the attached Consolidated Condensed Financial Information), was $78.3 million, an increase of $14.5 million or 22.8% from $63.7 million in the same period of 2009.
Adjusted operating income (a non-GAAP financial measure defined in note 2 to the attached Consolidated Condensed Financial Information) was $30.1 million for the three months ended March 31, 2010, compared to $23.9 million in the first quarter of the prior year, an increase of 26.2%. GAAP operating income in the first quarter of 2010 was $19.4 million and includes amortization of $8.7 million and stock-based compensation of $1.4 million, compared to $14.5 million of operating income for the same period in 2009, an increase of 34.2%. Adjusted Consolidated EBITDA (a non-GAAP financial measure defined in note 3 to the Consolidated Condensed Financial Information) for the first quarter of 2010 was $31.6 million, compared to $25.0 million in the first quarter of 2009, an increase of 26.2%.
Adjusted net income and adjusted diluted earnings per share (non-GAAP measures defined in note 4 to the attached Consolidated Condensed Financial Information) was $14.1 million and $0.22 compared to $9.8 million and $0.16 in Q1 2009.
"We are pleased with our first quarter results and our 22.8% increase in adjusted revenues," said Bill Stone, Chairman and CEO, SS&C Technologies. "We continue to execute on our strategy to grow our software-enabled services revenues, both organically and from our acquisitions, and in Q1 achieved a 32.3% increase in software-enabled services revenues over the same period last year."
"Our strong 34% increase in operating income is an indication we are beginning to reap the rewards of our focus over the past 12 months to improve our operating margins," continued Stone.
SS&C generated net cash from operating activities of $15.5 million for the three months ended March 31, 2010, compared to $11.0 million, for the same period in 2009, representing a 40.9% increase.
"Our balance sheet and cash flow position is strong and the quality of our earnings is high. We generated $15.5 million in net cash from operations during the first quarter," said Stone. "We continue to focus on paying down debt and in May we will be using a portion of the cash proceeds from the initial public offering of SS&C Technologies Holdings, Inc. to redeem $71,750,000 in aggregate principal amount outstanding of our 11 3/4% Senior Subordinated Notes due 2013."
"During the past two quarters, SS&C completed three acquisitions," said Stone. "In the first quarter, we acquired certain assets of Geller Investment Partnership Services. Geller Investment Partnership Services (GIPS) provides accounting and reporting, performance, tax, administrative and investor services for private equity funds, funds of hedge funds and limited partners that invest in alternatives," continued Stone. "This transaction favorably positions us, in combination with our existing private equity fund administration business as well as our Q4 2009 acquisition of TheNextRound private equity software, to further establish private equity as a major growth initiative."
"On December 31, 2009, we acquired New York City based Tradeware Global Corp., a leading broker-neutral solution provider. The acquisition is part of our plan to round out our trading capabilities and we are excited about this strategic fit and future opportunities," said Stone. "In February of this year, SS&C unveiled Antares Traderâ¢, an integrated buy-side Order and Execution Management System (OEMS). Antares Traderâ¢ is a successful integration of our trade order management system, Antaresâ¢, with enhanced execution management capabilities of TradewareÂ®, Heatmapsâ¢ displays, and Micro Design Services (MDS), an SS&C acquisition in October 2008, Advanced Component Architectureâ¢ (ACA)."
Based on the information available as of May 12, 2010, we currently expect second quarter revenues to be in the range of $80.0 to $81.0 million, and adjusted net income to be in the range of $15.8 to $16.2 million, assuming an effective tax rate of 35% and 74.5 to 75.0 million diluted shares outstanding for the quarter ending June 30, 2010. For full year 2010, our expectation is for revenues to be in the range of $324.0 to $328.0 million and adjusted net income in the range of $62.0 to $63.0 million. We currently expect the number of diluted shares outstanding to increase by approximately 0.5 million per quarter for the third and the fourth quarters of 2010.
Results of SS&C Technologies, Inc.
Our operating subsidiary, SS&C Technologies, Inc., posted the same revenues and net income for the first quarter of 2010 as the Company.
Non-GAAP Financial Measures
Adjusted revenue, adjusted operating income, adjusted consolidated EBITDA, adjusted net income, and adjusted diluted earnings per share are non-GAAP measures. See the accompanying notes to the attached Consolidated Condensed Financial Information for the reconciliations and definitions for each of these non-GAAP measures and the reasons our management believes that these measures provide useful information to investors regarding our financial condition and results of operations.