SS&C Reports Record Fourth Quarter and 2013 Results

Windsor, CT - 11 February 2014

GAAP Diluted Earnings Per Share of $0.31, Up 63.2%; Adjusted Diluted Earnings Per Share of $0.53, Up 26.2% 

SS&C Technologies Holdings, Inc. (Nasdaq:SSNC), a global provider of investment and financial software-enabled services and software, today announced its financial results for the fourth quarter and full year ended December 31, 2013.

Revenue increased to $182.5 million in the fourth quarter 2013, up 6.3 percent, and to $712.7 million for the full year 2013, up 29.1 percent.

GAAP net income increased 67.1 percent to $26.9 million in the fourth quarter 2013 and diluted earnings per share for the fourth quarter 2013 increased 63.2 percent to $0.31.

Adjusted net income (defined below) increased 31.5 percent to $46.0 million for the fourth quarter 2013 and adjusted diluted EPS (defined below) increased 26.2 percent to $0.53 for the same period.

Adjusted consolidated EBITDA (defined below) increased 8.5 percent to $76.0 million in the fourth quarter 2013. For full year 2013, adjusted consolidated EBITDA increased 32.4 percent to $291.9 million.

Annual Run Rate Basis (ARRB) recurring revenue, (defined below), was $665.8 million based on maintenance and software-enabled services revenue of $166.5 million for the fourth quarter of 2013. This represents an increase of 5.9 percent from the $628.7 million run-rate for the same period in 2012.

"I am pleased to announce we set records with our GAAP and adjusted revenues, EBITDA, operating cash flow, and earnings per share in 2013," said Bill Stone, Chairman and Chief Executive Officer, SS&C Technologies. "We added new clients, completed the integration of the PORTIA and GlobeOp acquisitions, added Los Angeles and Luxembourg as key locations and closed our acquisition of Prime Management Limited. We were able to repay $239 million in debt and ended the year with leverage of 2.4x, which is an improvement from leverage of 4.2x at the time of our acquisition of GlobeOp in June 2012."

GAAP Results

SS&C reported GAAP revenue of $182.5 million for the fourth quarter of 2013, up 6.3 percent compared to $171.8 million in the fourth quarter of 2012. Revenue for the year ended December 31, 2013 was $712.7 million, up 29.1 percent over $551.8 million in 2012. GAAP operating income for the fourth quarter of 2013 was $47.8 million, up 11.8 percent from $42.8 million in 2012's fourth quarter. GAAP operating income for the year ended December 31, 2013 was $183.0 million, up 48.5 percent from $123.2 million for 2012. On a fully diluted GAAP basis, earnings per share in the fourth quarter of 2013 was $0.31 compared to fully diluted GAAP earnings per share of $0.19 for the fourth quarter of 2012, an increase of 63.2 percent. On a fully diluted basis, GAAP earnings per share for the year ended December 31, 2013, was $1.38, a 150.9 percent increase over 2012's $0.55 per share.

Adjusted Non-GAAP Results (defined in Notes 1-4 below)

Adjusted revenue in the fourth quarter of 2013 was $182.5 million, up 6.1 percent compared to $172.0 million in the fourth quarter of 2012. Adjusted revenue for the year ended December 31, 2013 was $712.8 million, up 28.9 percent over $552.9 million for 2012. Adjusted operating income in the fourth quarter of 2013 was $72.2 million, or 39.6 percent of adjusted revenue. This represents a 9.2 percent increase compared to adjusted operating income of $66.1 million and 38.4 percent of adjusted revenue in the fourth quarter of 2012. Adjusted operating income for the year ended December 31, 2013 was $276.9 million, up 32.0 percent from adjusted operating income of $209.8 million in 2012.

Adjusted net income for the fourth quarter of 2013 was $46.0 million, up 31.5 percent compared to $35.0 million in 2012's fourth quarter. Adjusted net income for the year ended December 31, 2013 was $169.0 million, up 43.9 percent compared to $117.4 million for 2012. Adjusted diluted earnings per share for the fourth quarter of 2013 was $0.53 per share, up 26.2 percent compared to $0.42 per share for the fourth quarter of 2012. Adjusted diluted earnings per share for the year ended December 31, 2013 was $1.97 per share, up 38.7 percent compared to $1.42 per share for 2012.

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 $665.8 million based on maintenance and software-enabled services revenue of $166.5 million for the fourth quarter of 2013. This represents an increase of 5.9 percent from the $628.7 million run-rate in the same period in 2012 and a sequential increase of 1.3 percent from the $657.2 million run rate for the third quarter of 2013. We believe ARRB of our recurring revenue is a good indicator of visibility into future revenue.

Operating Cash Flow

SS&C ended the year with $84.5 million in cash, and $782.0 million in gross debt for a net debt balance of $697.5 million. SS&C generated net cash from operating activities of $208.3 million for the year ended December 31, 2013, compared to $134.4 million for 2012, an increase of 54.9 percent.

SS&C Investment Accounting Accelerator at USI

On January 24, 2014, SS&C in collaboration with the award winning accounting program at the University of Southern Indiana announced the creation of the SS&C Investment Accounting Accelerator. "SS&C's ability to grow its Evansville, Indiana facility will be predicated on the availability of trained accountants in investments," said Mr. Stone. "Valuation and defined, sophisticated reporting requirements will be taught at the undergraduate level and enhance our ability to fulfill our recruitment goals." The USI announcement comes after SS&C announced it would expand its presence in Evansville, where the University of Southern Indiana is located, by leasing a second office facility.

Guidance

 

Q1 2014

FY 2014

Adjusted Revenue ($M)

$183.0 - $187.0

$755.0 - $775.0

Adjusted Net Income ($M)

$45.5 - $47.0

$195.0 - $204.0

Cash from Operating Activities ($M)

N/A

$220.0 - $230.0

Capital Expenditures (% of revenue)

N/A

2.3% - 2.8%

Diluted Shares (M)

87.2 - 87.4

88.0 - 88.5

Effective Income Tax Rate (%)

28%

28%

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