Advent Software Reports First Quarter 2012 Results

Advent Software Reports First Quarter 2012 Results

Company Achieves Record Quarterly Revenue of $87 Million and Record First Quarter Bookings of Over $7 Million

SAN FRANCISCO - April 30, 2012 - Advent Software, Inc. (NASDAQ: ADVS), a leading provider of software and services to the global investment management industry, announced today its financial results for the first quarter ended March 31, 2012.

"I’m very proud of Advent’s terrific first quarter financial performance," said Stephanie DiMarco, Founder and Chief Executive Officer of Advent.  "Headlining our financial results was our best first quarter ever for new bookings with annual contract value of $7.4 million, a 45% increase over the same period last year.  By staying focused on our strategy of broadening our product portfolio and growing our addressable market, 2012 is off to a great start, and we remain confident about the market opportunity ahead of us.”

FIRST QUARTER 2012 RESULTS

GAAP Results for Continuing Operations
The Company reported quarterly revenue of $86.9 million for the first quarter of 2012, compared to $75.3 million in the first quarter of 2011, a 15% increase.
 
Operating income for the first quarter of 2012 was $11.8 million, or 14% of revenue, compared to $11.5 million or 15% of revenue for the first quarter of 2011. 

Net income for the first quarter of 2012 was $7.3 million compared to $7.9 million in the first quarter of 2011.

On a fully diluted basis, earnings per share in the first quarter of 2012 were $0.14 and flat when compared to the first quarter of 2011. 

Operating cash flow in the first quarter of 2012 was $13.6 million, compared with $11.6 million in the first quarter of 2011, a 17% increase. Cash, cash equivalents and marketable securities totaled $141.1 million as of March 31, 2012, compared to $136.3 million as of December 31, 2011, a 3% increase.

The Company repurchased approximately 267,500 shares in the first quarter of 2012 at an average price of $25.38 per share.

Total deferred revenue as of March 31, 2012 was $174.3 million, compared to $174.9 million as of December 31, 2011.

Non-GAAP Results for Continuing Operations
Non-GAAP operating income for the first quarter of 2012 was $19.6 million, or 23% of revenue. This represents an 11% increase over the same period last year.  On a fully diluted basis, non-GAAP earnings per share were $0.24 in the first quarter of 2012 and represent a 14% increase from non-GAAP diluted earnings per share of $0.21 in the first quarter of 2011.

The reconciliation between GAAP and non-GAAP financial measures is provided at the end of this press release.

FIRST QUARTER HIGHLIGHTS

  • Continued Business Momentum in Key Metrics: The Annual Contract Value (ACV) of our new contract bookings in the first quarter of 2012 will contribute $7.4 million in annual revenue once the contracts are fully implemented.  Recurring revenues reached 91% of total revenue in the first quarter and our reported renewal rates are among the highest since the fourth quarter of 2008.
  • Client Success: Advent saw continued success across all of its client segments, from large hedge fund managers and their service providers, to institutional asset managers, family offices, and independent advisory firms.  New clients included: Driehaus Capital Management of Chicago and Hong Kong’s Myriad Asset Management Limited.  Existing clients that expanded their relationship with Advent or migrated to a new Advent platform from Axys® included: The Butterfield Fulcrum Group, Emery Howard Portfolio Management, Fifth Third Asset Management, Northside Capital Management, Sands Capital Management, Scout Investments, and Willis Investment Council.  Additionally, Azentus Capital Management, a Hong Kong-based hedge fund led by former Goldman Sachs executives, went live on Geneva and Tamale RMS® in the first quarter.
  • Enhanced Functionality Across Product Lines: The Company launched a major new release of its platform for asset management today, which is comprised of Advent Portfolio Exchange®, Moxy®, Advent Rules Manager®, and Advent Revenue Center®. Enhancements include a new user experience, business intelligence reporting, dashboards, and more seamless integration across all of the products. Advent also released Syncova Essentials, a lighter, cloud-based version of the Syncova product which delivers automated data aggregation and management of margin and financing costs across multiple counterparties. 
  • Award-Winning Solutions:  Advent continues to win accolades around the world. Recent awards include: FTF News’s Most Innovative Mobile Technology award for Advent’s Black Diamond platform; HFMWeek named Advent as Best Technology for Start-Up Funds; and the Company was named Best IT Provider in the 2012 Hedge Fund Journal Service Provider Awards.

FINANCIAL GUIDANCE    

Advent updates the following financial guidance for the second quarter and fiscal year 2012:

 

Guidance

Q2 2012

FY 2012

Total Revenue ($M)

$88-$90

$361-$368

YoY Revenue Growth

 10%-12%

 11%-13%

GAAP Operating Margin

n/a

14.0%-14.5%

Amortization of Intangibles

(% of revenue)

n/a

3%

Stock Compensation Expense (% of revenue)

n/a

6%

Non-GAAP Operating Margin

n/a

23.0%-23.5%

Operating Cash Flow ($M)

n/a

$90-$96

Capital Expenditures ($M)

n/a

$13-$15

Growth of Weighted Average Shares Outstanding, excluding any share repurchases

n/a

 0.25%-0.75% per quarter

Effective Tax Rate (GAAP)

n/a

35% - 40%

Effective Tax Rate (non-GAAP)

n/a

35%

Click here to view the comprehensive Q1.12 financial statements.

INVESTOR CALL
Advent Software, Inc. will host its Q1 2012 quarterly earnings conference call at 5:00 p.m. Eastern time today.  The Q1 2012 earnings presentation and trended disclosures file, which include highlights and detailed financial information, are currently available at http://investor.advent.com.  To participate via phone, please dial (800) 265-0241 and request conference ID #41807332.  Telephone replay will be available through midnight May 7, 2012.  The replay number for domestic callers is (888) 286-8010, and for international callers is (617) 801-6888, with the conference ID of #12436350.
The conference call will also be webcast live and then archived on http://investor.advent.com.
 
ABOUT ADVENT 
Advent Software, Inc. (www.advent.com), a global firm, has provided trusted solutions to the world’s leading financial professionals since 1983.  Firms in more than 60 countries use Advent technology.  Advent’s quality software, data, services and tools enable financial professionals to improve service and communication to their clients, allowing them to grow their business while controlling costs.  Advent is the only financial services software company to be awarded the Service Capability and Performance certification for being a world-class support organization.  For more information on Advent products visit http://www.advent.com/about/resources/demos/pr.
 
ABOUT NON-GAAP FINANCIAL INFORMATION
This press release includes non-GAAP financial measures. For a description of these non-GAAP financial measures, including the reasons management uses each measure, and reconciliations of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with Generally Accepted Accounting Principles (GAAP), please see the accompanying tables entitled “Reconciliation of Selected GAAP Measures to Non-GAAP Measures.”

FORWARD-LOOKING STATEMENTS 
The financial projections under Financial Guidance, and statements regarding our momentum and market opportunities, and any other forward-looking statements included in this presentation reflect management's best judgment based on factors currently known and involve risks and uncertainties; our actual results may differ materially from those discussed here.  These risks and uncertainties include: potential fluctuations in new contract bookings, renewal rates, operating results and future growth rates; continued market acceptance of our Advent Portfolio Exchange®, Geneva®, and Moxy® products; the successful development, release and market acceptance of new products and product enhancements; uncertainties and fluctuations in the financial markets; the Company’s ability to satisfy contractual performance requirements; difficulties in integrating merged businesses, such as Syncova Solutions Limited and Black Diamond Performance Reporting LLC, and achieving expected synergies and results; and other risks detailed from time to time in our SEC reports including, but not limited to, our quarterly reports on Form 10-Q and our 2011 annual report on Form 10-K.  The Company disclaims any intention or obligation to publicly update or revise any forward-looking statements including any guidance, whether as a result of events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Advent, the Advent logo, Advent Software, Advent Portfolio Exchange, Axys, Geneva and Moxy are registered trademarks of Advent Software, Inc., and Syncova is a mark of Advent Software, Inc.  All other company names or marks mentioned herein are those of their respective owners.

CONTACT
Media Contact:
Smita Topolski
Advent Software, Inc.
(415) 645-1668
stopolsk@advent.com

Investor Relations Contact:
Heidi Flaherty
Advent Software, Inc.
(415) 645-1145
flaherty@advent.com