SS&C Reports 73% Increase in Total Revenues for Q2 '98 Over Q2 '97- License Revenues for Q2 Increase 55%.WINDSOR, Conn.--(BUSINESS WIRE)--July 16, 1998--SS&C Technologies, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :SSNC SSNC Swedish Society for Nature Conservation (Stockholm, Sweden) SSNC Signaling System Network Control SSNC Status, Entity Data Not Consistent (Alcatel) ) today announced record license and total revenues for its quarter ended June 30, 1998. The Company reported second quarter revenues of $18.1 million, representing a 73% increase from the $10.5 million reported for the same quarter of the prior year, and a 56% increase over the $11.6 million for first quarter 1998. License revenues increased to $9.0 million in the second quarter 1998, from $5.8 million for the same quarter of the prior year, and from $5.8 million for the first quarter 1998, representing an increase of 55% over both periods. Net income for the second quarter 1998, excluding one-time charges primarily related to the previously announced acquisition of Savid International, Inc., was $1.4 million or $0.09 diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of , as compared with $0.9 million or $0.07 diluted earnings per share for the same period in 1997. Including one-time charges, net income and diluted earnings per share for second quarter 1998 were $0.9 million and $0.06, respectively. For the six months ended June 30, 1998, total revenues were $29.7 million, a 65% increase over the $18.0 million reported for the comparable period of 1997. Net income for the first six months of 1998, excluding one-time acquisition-related charges, was $2.2 million or $0.14 diluted earnings per share, as compared with $0.7 million or $0.05 diluted earnings per share for the comparable period in 1997. Including one-time charges, the net loss and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. loss per share for the first six months of 1998 were $3.1 million and $0.20, respectively. "We are pleased about our continued momentum and results for the second quarter. In addition to record license and total revenues, maintenance and professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. revenues were up 118% and 74% over Q2 last year," said William C. Stone, Chairman & CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "Our operating and financial numbers are robust; cash and marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has and current ratio remain strong, with minimal debt levels. DSOs, for instance, during the quarter, dropped from 155 days to 100 days as we collected on receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed which included those associated with the Quantra acquisition, and negotiated favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. terms on new license sales." Earnings announced for the quarter and year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. periods do not include any results attributable to SS&C's equity investment in GFI GFI Ground Fault Interrupter GFI Go For It GFI Government-Furnished Information GFI Growing Families International GFI Goodness of Fit Indices GFI Government Financial Institutions (Philippines) GFI Gross Farm Income Caminus, which closed on May 1, 1998, including any write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of in-process research and development attributable to GFI Caminus' acquisition of two companies. SS&C will report its share of the results of GFI Caminus on the equity method with a delay of one quarter from GFI Caminus' actual results. Company Expansion The company moved into new world headquarters in Windsor, CT in June to facilitate organic growth and growth due to the recent acquisitions. The London and New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of offices, which are also growing rapidly, also moved into larger space. The total workforce for SS&C is now over 450 employees. "SS&C continues to strengthen our international development operations in Toronto, Amsterdam, Malaysia, and London. We are rapidly putting into place a global infrastructure to continue to compete on a global level. The strong growth and market demand we've seen give us optimism that our strategy is working," remarked Bill Stone. New Clients During the quarter, New York-based Metropolitan Life Insurance Company (MetLife), Los Angeles-based SunAmerica Inc., and New York-based Rabobank International N.A., as well as San Francisco-based Osterweis Capital Management, Inc., another former WinDX user, selected CAMRA 2000(tm) as their investment management solution. "We conducted a thorough analysis of our portfolio accounting, management, and trading requirements and an extensive market search of software vendors. We concluded that the wide range of SS&C products, especially with the addition of Shepro Braun, offered the most comprehensive and versatile functionality currently available," stated Pamela Jones Pamela Jones, commonly known as PJ, is the creator and editor of Groklaw, an award-winning website that covers legal news of interest to the free and open-source software community. Jones is a journalist, who previously trained and worked as a paralegal. , Chief Financial Officer at Osterweis. "We have chosen to partner with SS&C due to the strength of their products, and we have confidence that the management team at SS&C can continue to meet the growing needs of the financial community." SS&C's international business continues to grow as well, highlighted by new clients, including: Milan-based San Paolo Fondi Gestioni Mobiliari SpA, and Kuala Lumpur-based Permodalan RISDA RISDA Rubber Industry Smallholders' Development Authority (Malaysia) Berhad. Product Upgrades & Releases SS&C continues to invest heavily in research and development - in the quarter, 28 cents of every revenue dollar was invested in the Company's extensive product line. The Company continues to execute on its long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. plan of adding powerful new products for the institutional investor Institutional Investor A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. , and on delivering its Straight-Through Processing straight-through processing The direct exchange of cash and securities. Straight-through processing is a major objective for cross-border transactions that are generally much more costly to settle compared to domestic transactions. (STP STP or standard temperature and pressure, standard conditions for measurement of the properties of matter. The standard temperature is the freezing point of pure water, 0°C; or 273.15°K;. ) solution. During the quarter, SS&C signed two new Antares(tm) licenses, and began shipping Antares, its real-time, event-driven trade order management and P&L reporting system. In addition, several beta sites An organization or group that is beta testing hardware and/or software. See beta test. moved into production. Antares is fully integrated with SS&C's Total Return(tm) hedge fund hedge fund, in finance, a highly speculative, largely unregulated investment device. Originating in the 1950s, the funds "hedge" by offsetting "short" positions (borrowing a security and then selling it at a higher price before repaying the lender) against "long" accounting system, and the Company expects integration with CAMRA 2000 this fall. During the second quarter, the Company also continued distribution of its CAMRA 2000 "S," version among its CAMRA 2000 client base. CAMRA 2000 S offers the Microsoft SQL Server A relational DBMS from Microsoft that is a major component of the Windows Server System. It is Microsoft's high-end client/server database and is closely integrated with Microsoft Visual Studio and the Microsoft Office System. database option. SS&C also rolled out PTS PTS put to sleep; a common euphemism for euthanasia, but also used to describe general anesthesia. 2000(tm) version 98.0, which features a five-factor model, equity indexed annuity annuity: see insurance. annuity Payment made at a fixed interval. A common example is the payment received by retirees from their pension plan. There are two main classes of annuities: annuities certain and contingent annuities. modeling capabilities, and an enhanced liability model generator. "We are seeing our vision of Straight-Through Processing become reality as Antares has moved into production," stated Mr. Stone. "Antares is now generally available, and our continued heavy investment in R&D is the key to delivering new and updated software to meet the changing needs of institutional investors." SS&C's third quarter development plans include bringing SKYLINE(R) for Windows and PRO-Ject(R) 2.0 to market, both scheduled for release during the middle of the third quarter. Later in the third quarter, SS&C plans to roll out CAMRA 2000 version 3.0, which will include upgrades to several key modules. Corporate Alliances During the second quarter, SS&C completed the acquisition of New York-based Savid International, Inc., a leading supplier of PC/LAN-based financial software specifically for corporate and institutional debt and derivative derivative: see calculus. derivative In mathematics, a fundamental concept of differential calculus representing the instantaneous rate of change of a function. portfolios. The acquisition brings to SS&C enhanced capabilities for CAMRA 2000, specifically in handling derivative instruments Derivative instruments Contracts such as options and futures whose price is derived from the price of an underlying financial asset. , and extends the Company's client base in the corporate treasury, banking, government, and financial institution markets. SS&C recently announced several clients who have upgraded to new versions of the new product, CAMRA 2000 Derivatives derivatives In finance, contracts whose value is derived from another asset, which can include stocks, bonds, currencies, interest rates, commodities, and related indexes. Purchasers of derivatives are essentially wagering on the future performance of that asset. (tm), also known as The Savid System(tm). SS&C also announced a strategic alliance with GFI Caminus, a new enterprise providing comprehensive consulting services Noun 1. consulting service - service provided by a professional advisor (e.g., a lawyer or doctor or CPA etc.) service - work done by one person or group that benefits another; "budget separately for goods and services" and software technology to the power and gas trading business. The strategic alliance includes an exclusive license with GFI Caminus to market SS&C's asset management software products within the energy-related markets. SS&C is an equity investor in the venture. "We continue to pursue acquisitions and strategic alliances which enhance our ability to deliver Straight-Through Processing to a broad range of sophisticated asset managers," continued Mr. Stone. "The Savid acquisition increases our capabilities in the area of derivative STP. And, we believe the tremendous activity in the electric power and gas trading markets has created, essentially, the raw material for a new asset class, which we expect will require the comprehensive technology capabilities of SS&C, and which will be enhanced by our relationship with GFI Caminus." Headquartered in Windsor, CT, with offices in the US, Canada, Europe, and Asia, SS&C is a leading provider of financial software solutions, services, and expertise to asset managers worldwide. SS&C primarily targets its products and services to large-scale, sophisticated investment enterprises who use the trading, accounting, reporting, and analysis solutions to manage, in aggregate, more than $2 trillion One thousand times one billion, which is 1, followed by 12 zeros, or 10 to the 12th power. See space/time. (mathematics) trillion - In Britain, France, and Germany, 10^18 or a million cubed. In the USA and Canada, 10^12. in assets. Full Company information is located at www.ssctech.com This document contains certain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the integration of Antares with CAMRA 2000 and the introduction of SKYLINE for Windows, PRO-Ject, and CAMRA 2000 Version 3.0. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated. Such risks and uncertainties include, but are not limited to, delays in product development, undetected software errors or bugs, fluctuations in customer demand, timing, size and nature of individual license transactions, intensity of competition from other application vendors, and general economic and industry conditions, as well as other risks detailed in the Company's filings with the Securities and Exchange Commission, including without limitation, the Company's Annual Report and Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 1997. -0-
SS&C TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands)
June 30, December 31,
1998 1997
ASSETS
Current assets:
Cash and cash equivalents $ 11,402 $ 23,660
Marketable securities 35,649 35,058
Accounts receivable, net 9,510 7,591
Unbilled accounts receivable, net 9,595 5,472
Income taxes 478 1,157
Other 2,977 1,563
Total current assets 69,611 74,501
Property and equipment, net 7,458 4,018
Unbilled accounts receivable -
related party 316 420
Unbilled accounts receivable, net 794 828
Deferred income taxes 5,919 3,205
Intangibles, investments and
other assets 8,617 2,336
Total assets $ 92,715 $ 85,308
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt
- related party $ 527 $ 668
Current portion of long-term debt - 313
Accounts payable 1,917 1,440
Accrued bonus payable 839 1,663
Deferred licensing and professional
services revenues 1,622 1,618
Accrued expenses 3,195 4,077
Deferred maintenance revenues 9,485 7,528
Total current liabilities 17,585 17,307
Long-term debt
Related party 250 250
Total liabilities 17,835 17,557
Stockholders' equity:
Common stock 145 137
Additional paid-in capital 79,297 69,089
Accumulated deficit (4,562) (1,475)
Total stockholders' equity 74,880 67,751
Total liabilities and
stockholders' equity $ 92,715 $ 85,308
SS&C TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except share and per share information)
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
1998 1997 1998 1997
Revenues:
Software licenses $ 8,971 $ 5,797 $14,765 $ 8,801
Maintenance 4,802 2,200 8,009 4,355
Professional services 4,365 2,508 6,954 4,880
Total revenues 18,138 10,505 29,728 18,036
Cost of revenues:
Software licenses 42 329 313 604
Maintenance 1,438 785 2,210 1,621
Professional services 2,881 1,429 4,667 2,886
Total cost of revenues 4,361 2,543 7,190 5,111
Gross profit 13,777 7,962 22,538 12,925
Operating expenses:
Selling and marketing 4,136 2,932 7,955 5,130
Research and development 5,091 2,382 7,930 4,631
General and administrative 3,013 1,984 4,458 3,047
Write-off of purchased
in-process research
and development 720 -- 7,980 --
Total operating expenses 12,960 7,298 28,323 12,808
Operating income (loss) 817 664 (5,785) 117
Interest and other income, net 519 572 1,111 1,021
Income before income taxes 1,336 1,236 (4,674) 1,138
Provision for income taxes 454 334 (1,587) 404
Net income (loss) $ 882 $ 902 $(3,087) $ 734
Basic earnings per share $ 0.06 $ 0.07 $ (0.22) $ 0.05
Basic weighted average
number of common
shares outstanding 14,501 13,506 14,198 13,462
Diluted earnings per share $ 0.06 $ 0.07 $ (0.20) $ 0.05
Diluted weighted average
number of common and common
equivalent shares outstanding 15,702 13,841 15,229 13,817
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CONTACT: SS&C Technologies, Inc.
Peg Berry, 860-298-4551
Cindy Lawrence, 212-303-7611
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