Company Expected to Post Records in Total Revenue and Revenue from Software and Related Services
CHICAGO, Oct. 23 /PRNewswire-FirstCall/ — Allscripts-Misys Healthcare
Solutions, Inc. (“Allscripts”) today announced preliminary results for
Allscripts Healthcare Solutions, Inc. (“AHS”) for the three and nine months
ended September 30, 2008. This is the last time Allscripts will report
standalone AHS results. The combination of AHS and Misys Healthcare Systems,
LLC, formerly a division of Misys plc, was completed on October 10, 2008, at
which time the Company changed its name to Allscripts-Misys Healthcare
Solutions, Inc.
(Logo: http://www.newscom.com/cgi-bin/prnh/20081013/AQM041LOGO)
Total revenue for the three months ended September 30, 2008 is expected to
be approximately $85.7 million, compared to $73.4 million for the same period
last year. Revenue from software and related services for the three months
ended September 30, 2008 is expected to be approximately $71.8 million,
compared to $59.0 million for the same period last year, increasing by 22%.
Both total revenue and revenue from software and related services are expected
to be new records for the Company.
Gross margin percentage is estimated to be 48.8% for the third quarter of
2008, compared to 50.1% during the third quarter of 2007.
Net income for the three months ended September 30, 2008 is expected to be
approximately $4.0 million, or $0.07 per diluted share, compared to net income
of $4.1 million, or $0.07 per diluted share, for the same period last year.
Net income for the three months ended September 30, 2008 and 2007 reflects
deal-related amortization of $2.1 million and $1.7 million, respectively, or
$0.04 and $0.03 per diluted share for both periods, net of tax, respectively,
and total stock-based compensation of $1.0 million and $0.9 million,
respectively, or $0.02 and $0.01 per diluted share for both reported periods,
net of tax, respectively. Net income for the three months ended September 30,
2008 also includes transaction-related expenses of $3.3 million, or $0.06 per
diluted share, net of tax, and a gain on the sale of the Company’s Physicians
Interactive business of $2.0 million, or $0.03 per diluted share, net of tax.
Non-GAAP adjusted earnings for the three months ended September 30, 2008
are expected to be approximately $8.4 million, or $0.15 per diluted share,
compared to non-GAAP adjusted earnings of $6.7 million, or $0.11 per diluted
share for the same period last year, increasing by 26%. Please see “Non-GAAP
Financial Measures” below for a discussion of non-GAAP adjusted earnings and
earnings per share.
As of September 30, 2008, AHS had cash and marketable securities of
$79.5 million.
“We made solid progress in the third quarter with record revenue and
continued strong investment in new products and better processes,” said Glen
Tullman, Chief Executive Officer of Allscripts. “We’re now focused on driving
results for our newly combined company and I’m pleased that we are already
moving forward with a broader suite of products and solutions, and a fully
trained sales force. We are committed to helping our clients use innovation
technology to access the information they need to improve the quality of care
and better manage costs.”
Total revenue for the nine months ended September 30, 2008 is expected to
be approximately $239.3 million, compared to $208.5 million for the same
period last year. Revenue from software and related services for the nine
months ended September 30, 2008 is expected to be approximately
$198.6 million, compared to $164.9 million for the same period last year,
increasing by 20%.
Gross margin percentage is estimated to be 49.7% for the first nine months
of 2008, compared to 50.1% during the same period of 2007.
Net income for the nine months ended September 30, 2008 is expected to be
approximately $6.5 million, or $0.11 per diluted share, compared to net income
of $14.6 million, or $0.25 per diluted share, for the same period last year.
Expected net income for the nine months ended September 30, 2008 and reported
net income for the nine months ended September 30, 2007 reflects deal-related
amortization of $6.3 million, or $0.11 per diluted share, net of tax, and
$4.7 million, or $0.07 per diluted share, net of tax, respectively, and total
stock-based compensation of $3.2 million or $0.06 per diluted share, net of
tax, and $1.7 million, or $0.03 per diluted share, net of tax, respectively.
Expected net income for the nine months ended September 30, 2008 also includes
transaction-related expenses of $6.7 million, or $0.12 per diluted share, net
of tax, and a gain on the sale of the Company’s Physicians Interactive
business, of $2.0 million, or $0.03 per diluted share, net of tax.
Non-GAAP adjusted earnings for the nine months ended September 30, 2008
are expected to be $20.7 million, or $0.36 per diluted share, compared to
non-GAAP adjusted earnings of $21.0 million, or $0.35 per diluted share for
the same period last year.
Allscripts Healthcare Solutions, Inc.
Selected Operating Results
(amounts in millions, except per-share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2008 2007 2008 2007
Revenue:
Software and related services $71.8 $59.0 $198.6 $164.9
Prepackaged medications 10.0 10.9 29.1 32.1
Information services 3.9 3.5 11.6 11.5
Total revenue 85.7 73.4 239.3 208.5
Gross margin $41.8 $36.8 $119.0 $104.5
Gross margin % 48.8% 50.1% 49.7% 50.1%
Operating income 8.1 6.9 14.2 21.7
Net income $4.0 $4.1 $6.5 $14.6
Earnings per share - diluted $0.07 $0.07 $0.11 $0.25
Allscripts Healthcare Solutions, Inc.
Reconciliation of Non-GAAP Adjusted Earnings and Non-GAAP Adjusted
Earnings Per Share
(amounts in millions, except per-share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2008 2007 2008 2007
Net Income $4.0 $4.1 $6.5 $14.6
Stock-based compensation expense
(tax effected at 39% for 2008 and
40% for 2007) 1.0 0.9 3.2 1.7
Acquisition-related amortization
(tax effected at 39% for 2008 and
40% for 2007) 2.1 1.7 6.3 4.7
Transaction-related expenses (tax
effected at 39% for 2008) 3.3 - 6.7 -
Gain on sale of Physicians
Interactive business (tax
effected at 39% for 2008) (2.0) - (2.0) -
Non-GAAP Adjusted Earnings $8.4 $6.7 $20.7 $21.0
Weighted average shares of common
stock outstanding used in
computing diluted non-GAAP
adjusted earnings per share 58.2 65.2 57.8 64.5
Non-GAAP Adjusted Earnings Per
Share - diluted $0.15 $0.11 $0.36 $0.35
Final AHS results for the three and nine months ended September 30, 2008
will be completed and filed with the Securities and Exchange Commission on or
before November 10, 2008.
Webcast and Dial-in Facility
Allscripts will host an investor presentation in London on Thursday,
October 23, 2008 at 7:30 a.m. Eastern Daylight Time to cover preliminary AHS
third quarter results as well as provide outlook for Allscripts for the fiscal
year ending May 31, 2009. The presentation will be available via live webcast
and can be accessed by logging onto https://www.allscripts.com. It is
recommended that participants log onto the website approximately 15 minutes
prior to the start of the webcast to download and install any necessary
software. The audio portion of the webcast also can be accessed by dialing
800-374-1376 and requesting the Allscripts Investor Presentation.
International callers can access the audio portion of the webcast by dialing
706-679-4010 and requesting the Allscripts Investor Presentation.
Additionally, callers in the United Kingdom can access the audio portion of
the webcast by dialing 0-800-028-8438 and requesting the Allscripts Investor
Presentation. A Microsoft Windows Media Player web replay will be available
three hours after the conclusion of the call for a period of two weeks at
https://www.allscripts.com or by calling 800-642-1687 — or 706-645-9291 for
international callers — ID # 70079059.
Allscripts will host a second investor presentation on October 27th at
12:30 p.m., Eastern Daylight Time in New York to cover preliminary AHS third
quarter results as well as provide outlook for Allscripts for the fiscal year
ending May 31, 2009. The presentation will be available via live webcast and
can be accessed by logging onto https://www.allscripts.com. It is recommended
that participants log onto the website approximately 15 minutes prior to the
start of the webcast to download and install any necessary software. The
audio portion of the webcast also can be accessed by dialing 800-374-1376 and
requesting the Allscripts Investor Presentation. International callers can
access the audio portion of the webcast by dialing 706-679-4010 and requesting
the Allscripts Investor Presentation. A Microsoft Windows Media Player web
replay will be available three hours after the conclusion of the call for a
period of two weeks at https://www.allscripts.com or by calling 800-642-1687 —
or 706-645-9291 for international callers — ID # 70142383.
(Minimum requirements to listen to the broadcasts are: Microsoft Windows
Media Player software, downloadable free from
http://windowsmedia.com/download/download.asp, an Internet connection, and
speakers or earphones).
Explanation of Non-GAAP Financial Measures
Allscripts reports its financial results in accordance with generally
accepted accounting principles, or GAAP. To supplement this information,
Allscripts presents in this press release non-GAAP net income (and related per
share amounts), which is a non-GAAP financial measure under Section 101 of
Regulation G under the Securities Exchange Act of 1934, as amended. Non-GAAP
net income consists of GAAP net income, excluding acquisition-related
amortization, stock-based compensation expense under SFAS No. 123R, and
transaction-related expenses, in each case net of any related tax benefit.
* Acquisition-Related Amortization. Acquisition-related amortization
expense is a non-cash expense arising from the acquisition of
intangible assets in connection with acquisitions or investments.
Allscripts excludes acquisition-related amortization expense from
non-GAAP net income because it believes (i) the amount of such
expenses in any specific period may not directly correlate to the
underlying performance of Allscripts business operations and (ii)
such expenses can vary significantly between periods as a result of
new acquisitions and full amortization of previously acquired
intangible assets. Investors should note that the use of these
intangible assets contributed to revenue in the periods presented
and will contribute to future revenue generation and should also
note that such expense will recur in future periods.
* Stock-Based Compensation Expense. Stock-based compensation expense
is a non-cash expense arising from the grant of stock awards to
employees. Allscripts excludes stock-based compensation expense from
non-GAAP net income because it believes (i) the amount of such
expenses in any specific period may not directly correlate to the
underlying performance of Allscripts business operations and (ii)
such expenses can vary significantly between periods as a result of
the timing of grants of new stock-based awards, including grants in
connection with acquisitions. Investors should note that stock-
based compensation is a key incentive offered to employees whose
efforts contributed to the operating results in the periods
presented and are expected to contribute to operating results in
future periods and should also note that such expense will recur in
future periods.
* Transaction-Related Expenses. Transaction-related expenses are fees
and expenses, including legal, investment banking and accounting
fees, incurred in connection with announced transactions.
Allscripts excludes transaction-related expenses from non-GAAP net
income because it believes (i) the amount of such expenses in any
specific period may not directly correlate to the underlying
performance of Allscripts business operations and (ii) such expenses
can vary significantly between periods.
* Gain on the sale of the Company's Physicians Interactive business.
The gain on the sale of the Company's Physicians Interactive
business is a cash gain that we have excluded because this gain is
not directly associated with Allscripts' continuing operations and
it will not be recurring. Allscripts believes this adjustment is
useful to investors as a measure of a one-time non-recurring gain
that is not a recurring part of continuing operations.
Management also believes that non-GAAP net income (and related per share
amounts) provides useful supplemental information to management and investors
regarding the underlying performance of the Company’s business operations and
facilitates comparisons to its historical operating results. Management also
uses this information internally for forecasting and budgeting as it believes
that the measure is indicative of the Company’s core operating results. Note
however, that non-GAAP net income is a performance measure only, and it does
not provide any measure of the Company’s cash flow or liquidity. Non-GAAP
financial measures are not in accordance with, or an alternative for, measures
of financial performance prepared in accordance with GAAP and may be different
from non-GAAP measures used by other companies. Non-GAAP measures have
limitations in that they do not reflect all of the amounts associated with
Allscripts results of operations as determined in accordance with GAAP.
Investors and potential investors are encouraged to review the reconciliation
of non-GAAP financial measures with GAAP financial measures contained within
the attached condensed consolidated financial statements.
About Allscripts
Allscripts (Nasdaq: MDRX) uses innovation technology to bring health to
healthcare. More than 150,000 physicians, 700 hospitals and nearly 7,000 post-
acute and homecare organizations utilize Allscripts to improve the health of
their patients and their bottom line. The Company’s award-winning solutions
include electronic health records, electronic prescribing, revenue cycle
management, practice management, document management, medication services,
hospital care management, emergency department information systems and
homecare automation. Allscripts is the brand name of Allscripts-Misys
Healthcare Solutions, Inc. To learn more, visit https://www.allscripts.com.
This news release may contain forward-looking statements within the
meaning of the federal securities laws. Statements regarding future events,
developments, the Company’s future performance, as well as management’s
expectations, beliefs, intentions, plans, estimates or projections relating to
the future are forward-looking statements within the meaning of these laws.
These forward-looking statements are subject to a number of risks and
uncertainties, some of which are outlined below. As a result, actual results
may vary materially from those anticipated by the forward-looking statements.
Among the important factors that could cause actual results to differ
materially from those indicated by such forward-looking statements are: the
volume and timing of systems sales and installations; length of sales cycles
and the installation process; the possibility that products will not achieve
or sustain market acceptance; the timing, cost and success or failure of new
product and service introductions, development and product upgrade releases;
competitive pressures including product offerings, pricing and promotional
activities; our ability to establish and maintain strategic relationships;
undetected errors or similar problems in our software products; compliance
with existing laws, regulations and industry initiatives and future changes in
laws or regulations in the healthcare industry; possible regulation of the
Company’s software by the U.S. Food and Drug Administration; the possibility
of product-related liabilities; our ability to attract and retain qualified
personnel; our ability to identify and complete acquisitions, manage our
growth and integrate acquisitions; the ability to recognize the benefits of
the merger with Misys Healthcare Systems, LLC (“MHS”); the integration of MHS
with the Company and the possible disruption of current plans and operations
as a result thereof; maintaining our intellectual property rights and
litigation involving intellectual property rights; risks related to third-
party suppliers; our ability to obtain, use or successfully integrate third-
party licensed technology; breach of our security by third parties; and the
risk factors detailed from time to time in our reports filed with the
Securities and Exchange Commission, including our 2007 Annual Report on Form
10-K available through the Web site maintained by the Securities and Exchange
Commission at http://www.sec.gov. The Company undertakes no obligation to
update publicly any forward-looking statement, whether as a result of new
information, future events or otherwise.
SOURCE Allscripts