Advent Software Reports Second Quarter 2012 Results

Advent Software Reports Second Quarter 2012 Results

Company Achieves Record Quarterly Revenue of $90 Million and Record Second Quarter Bookings of Over $7 Million

SAN FRANCISCO – July 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 second quarter ended June 30, 2012.

“I am pleased to report Advent’s second quarter financial results and am honored to lead Advent as we embark on an exciting phase in our evolution.  Despite the challenging market environment, we achieved record quarterly revenues, record second quarter bookings and 22% non-GAAP operating margin,” said Pete Hess, Chief Executive Officer of Advent.  “Our strong performance was the result of continued demand for our market-leading solutions as we help transform our clients’ businesses by eliminating boundaries between systems, information and people.”

SECOND QUARTER 2012 RESULTS

GAAP Results for Continuing Operations
The Company reported quarterly revenue of $89.7 million for the second quarter of 2012, compared to $80.1 million in the second quarter of 2011, a 12% increase.
 
Operating income for the second quarter of 2012 was $12.1 million, or 13% of revenue, compared to $10.4 million or 13% of revenue for the second quarter of 2011. 

Net income for the second quarter of 2012 was $7.2 million compared to $7.1 million in the second quarter of 2011.

On a fully diluted basis, earnings per share in the second quarter of 2012 were $0.14, up $0.01 when compared to the second quarter of 2011. 

Operating cash flow in the second quarter of 2012 was $14.9 million, compared with $20.2 million in the second quarter of 2011. Cash, cash equivalents and marketable securities totaled $134.8 million as of June 30, 2012, compared to $136.4 million as of December 31, 2011.

The Company repurchased approximately 745,000 shares of its common stock in the second quarter of 2012 for a total cash outlay of $19.3 million and at an average price of $25.96 per share.

Total deferred revenue as of June 30, 2012 was $163.6 million, compared to $174.9 million as of December 31, 2011.

Non-GAAP Results for Continuing Operations
Non-GAAP operating income for the second quarter of 2012 was $20.0 million, or 22% of revenue. This represents a 14% increase compared to $17.5 million from continuing operations, or 22% of revenue, in the second quarter of 2011.  On a fully diluted basis, non-GAAP earnings per share were $0.24 in the second quarter of 2012 and represent a 14% increase from non-GAAP diluted earnings per share of $0.21 in the second quarter of 2011.

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

SECOND QUARTER HIGHLIGHTS

  • Record Second Quarter Bookings:  The Annual Contract Value (ACV) of our new contract bookings in the second quarter of 2012 will contribute $7.2 million in annual revenue once the contracts are fully implemented. 
  • Continued Momentum:  New clients represented a broad cross-section of the investment management industry across all our platforms, from hedge funds and asset managers to family offices, fund administrators and the growing advisory market.  New clients included Potamus Trading LLC, CI Investments, SeaStone Capital Management, Johns Hopkins University, Kylin Management LLC, H.D. Vest, Good Harbor Financial, LLC, Karpus Investment Management, and Madison Asset Management.  In the second quarter, Advent also expanded into Brazil and signed Vinci Partners, a Brazilian investment management firm, who have chosen Geneva and Geneva World Investor to support management of their offshore investment strategies.
  • Industry Recognition and Award-Winning Solutions: Advent’s technology continued to receive industry awards and win honors around the world. Recent awards include: FTF News's Most Innovative Mobile Technology award; HFM European Hedge Fund Services Awards named Advent as Best Technology for Start-Up Funds; and the Company was named Best Technology Provider in the 2012 Citywealth Magic Circle Awards.

FINANCIAL GUIDANCE    

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

Guidance

Q3 2012

FY 2012

Total Revenue ($M)

$89-$91

$358-$362

YoY Revenue Growth

 5%-8%

 10%-11%

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

$83-$86

Capital Expenditures ($M)

n/a

$11-$13

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 Q2.12 financial statements.

INVESTOR CALL
Advent Software, Inc. will host its Q2 2012 quarterly earnings conference call at 5:00 p.m. Eastern time today.  The Q2 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) 259-0251 and request conference ID #74347526.  Telephone replay will be available through midnight August 8, 2012.  The replay number for domestic callers is (888) 286-8010, and for international callers is (617) 801-6888, with the conference ID of #97737359.

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 Continuing Operations’ 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 Ltd 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, 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:
Amanda Diamondstein-Cieplinska
Advent Software, Inc.
(415) 645-1668
adiamond@advent.com

Investor Relations Contact:
Meg Pardo
Advent Software, Inc.
(415) 645-1584
mpardo@advent.com