JOHNS CREEK, Ga., March 01, 2018 (GLOBE NEWSWIRE) -- Ebix, Inc. (NASDAQ:EBIX), a leading international supplier of On-Demand software and E-commerce services to the insurance, financial, e-governance and healthcare industries, today reported fiscal 2017 fourth quarter (Q4 2017) and full year results for the periods ended December 31, 2017. Ebix will host a conference call to review its results tomorrow, Friday March 2nd at 11:00 a.m. EST (details below).
Ebix delivered the following results for the fourth quarter and full year of 2017:
Revenue: Total Q4 2017 revenue rose 31% to $104.7 million, compared to $80.0 million in Q4 2016 and increased 13% over Q3 2017 revenue of $92.8 million.
Full year 2017 revenue rose 22% to $364.0 million, compared to $298.3 million in 2016. Exchanges including the EbixCash operations in India, continued to be Ebix’s largest channel, accounting for 79% of the Company's Q4 2017 and 71% of full year 2017 Revenue.
|(dollar amounts in thousands)|
|Channel||Q4 2017||Q4 2016||Change||2017||2016||Change|
|Risk Compliance Solutions (RCS)||18,052||20,707||-13||%||86,832||74,196||17||%|
|Total Revenue on Constant Currency Basis||$||102.9M||$||80.0M||+29||%||$||360.0M||$||298.3M||+21||%|
Earnings per Share: Q4 2017 diluted EPS increased 11% to $0.84 from $0.76 in Q4 2016. Full year 2017 diluted EPS increased 11% to $3.17 from $2.86 in 2016. The improvements reflect higher net income and the benefit of previous share repurchase activity.
Operating Cash: Cash generated from operations decreased 13% to $26.7 million in Q4 2017, compared to $30.7 million in Q4 2016. Cash generated from operations decreased 8% to $76.8 million in 2017, compared to $83.7 million in 2016.
Operating Income and Margins: Q4 2017 operating margins were 32%, a decrease over Q4 2016 margins of 35%. Operating income for Q4 2017 rose 20% to $33.1 million compared to $27.7 million in Q4 2016.
Full year 2017 operating margins were at 31%. Operating income for 2017 rose 13% to $113.2 million as compared to $100.3 million in 2016.
Net Income: Q4 2017 net income rose 8% to $26.6 million, compared to $24.6 million in Q4 2016. Net income increased 7% to $100.6 million in 2017, compared to $93.8 million in 2016.
Share Outstanding and Repurchases: Ebix made no repurchases of its common stock in Q4 2017, and repurchased 687,048 shares of its common stock for cash consideration of $39.4 million in the full year 2017. Reflecting its repurchase activity, Ebix’s weighted average diluted shares outstanding decreased to 31.7 million in Q4 2017 compared to 32.5 million in Q4 2016 and decreased to 31.7 million in 2017 compared to 32.9 million in 2016.
Q1 & Q2 2018 Diluted Share Counts: Based on share repurchases completed to date, Ebix expects its diluted share count to be approximately 31.7 million in Q1 2018 and Q2 2018.
Dividend: Ebix paid its regularly quarterly dividend of $0.075 per share in Q4 2017 for a total cost of $2.4 million.
Ebix Chairman, and CEO Robin Raina said, “Our record 2017 results mark Ebix’s 18th consecutive year of revenue and EPS growth for the Company, supported by a strong finish to the year especially from EbixCash with record revenue and EPS in Q4 2017. With an annualized revenue run rate of $418 million, Ebix has a strong foundation from which to conquer new frontiers in terms of revenues, operating margins and EPS.”
Robin added, “We started the year 2017 primarily as an insurance exchange, and have finished the year with a strong presence in the financial exchange sector also through our EbixCash brand in India. Ebix’s Q4 2017 performance did not include full quarter revenues from the recent acquisition of Paul merchant remittance assets, or include any revenues from the recent acquisition of Transcorp, and only a few hundred thousand of revenues from our e-governance division which typically has a quarterly run rate of $6 million. Notwithstanding these factors, Q4 2017 revenues from India operations and the EbixCash Financial Exchange translate to an annualized run rate of $127 million and $125 million respectively. Accordingly, we are encouraged by the momentum we have generated in these businesses in a short time.
“We are also pleased to have achieved 32% operating margins in Q4 2017, especially considering that the quarter had many non-recurring acquisition related costs. Once we have fully implemented all our acquisition integration and efficiency related measures, we expect the margins to improve from this level.”
Robin added, “We are in advance stages of review on several acquisition opportunities that have the potential to make material contributions to our 2018 results if we are able to complete these transactions on the contemplated terms. Also, we have executed a number of large new business contracts that are expected to start contributing to our top line in 2018. As a result of our strong business development activity and pipeline, combined with expected organic growth across the business, we believe Ebix is well positioned for another solid year in 2018.”
Sean Donaghy, Ebix’s CFO said “Ebix continues to produce robust operating cash flows, generating $26.7 million during Q4 of 2017 and $76.8 million during 2017. Our financial position remains strong with $89.5 million in aggregate cash, cash equivalents, and short-term cash deposit investments. Combined with available borrowing of $246 million under our syndicated bank facility, Ebix presently has access to approximately $331 million of capital to support continued organic and acquisitive growth as well as dividends and opportunistic share repurchases.”
Conference Call Details:
|Call Date/Time:||Friday, March 2, 2018 at 11:00 a.m. EST|
|Call Dial-In:||+1-877-837-3909 or 1-973-409-9690; Call ID #1064759|
|Live Audio Webcast:||www.ebix.com/webcast |
|Audio Replay URL:||www.ebix.com/result_17_Q4 after 2:00 p.m. EST on Mar 2nd |
About Ebix, Inc.
With 50+ offices across 5 continents, Ebix, Inc., (NASDAQ: EBIX) endeavors to provide On-Demand software and E-commerce services to the insurance, financial and healthcare industries. In the Insurance sector, the Company’s main focus is to develop and deploy a wide variety of insurance and reinsurance exchanges on an on-demand basis, while also, providing Software-as-a-Service ("SaaS") enterprise solutions in the area of CRM, front-end & back-end systems, outsourced administrative and risk compliance, across the world.
With a "Phygital” strategy that combines 231,500 physical distribution outlets in many Southeast Asian Nations (“ASEAN”) countries to an Omni-channel online digital platform, the Company’s EbixCash Financial exchange portfolio encompasses leadership in areas of domestic & international money remittance, travel, pre-paid & gift cards, utility payments, etc., in an emerging country like India. EbixCash, through its travel portal Via.com, is also one of Southeast Asia’s leading travel exchanges with over 110,000 distribution outlets and 8,000 corporate clients processing over 24.5 million transactions every year
Through its various SaaS-based software platforms, Ebix employs thousands of domain-specific technology professionals to provide products, support and consultancy to thousands of customers on six continents. For more information, visit the Company’s website at
SAFE HARBOR REGARDING FORWARD-LOOKING STATEMENTS
As used herein, the terms “Ebix,” “the Company,” “we,” “our” and “us” refer to Ebix, Inc., a Delaware corporation, and its consolidated subsidiaries as a combined entity, except where it is clear that the terms mean only Ebix, Inc.
The information contained in this Press Release contains forward-looking statements and information within the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. This information includes assumptions made by, and information currently available to management, including statements regarding future economic performance and financial condition, liquidity and capital resources, acceptance of the Company’s products by the market, and management’s plans and objectives. In addition, certain statements included in this and our future filings with the Securities and Exchange Commission (“SEC”), in press releases, and in oral and written statements made by us or with our approval, which are not statements of historical fact, are forward-looking statements. Words such as “may,” “could,” “should,” “would,” “believe,” “expect,” “anticipate,” “estimate,” “intend,” “seeks,” “plan,” “project,” “continue,” “predict,” “will,” “should,” and other words or expressions of similar meaning are intended by the Company to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements are found at various places throughout this report and in the documents incorporated herein by reference. These statements are based on our current expectations about future events or results and information that is currently available to us, involve assumptions, risks, and uncertainties, and speak only as of the date on which such statements are made.
Our actual results may differ materially from those expressed or implied in these forward-looking statements. Factors that may cause such a difference, include, but are not limited to those discussed in our Annual Report on Form 10-K and subsequent reports filed with the SEC, as well as: the risk of an unfavorable outcome of the pending governmental investigations or shareholder class action lawsuits, reputational harm caused by such investigations and lawsuits, the willingness of independent insurance agencies to outsource their computer and other processing needs to third parties; pricing and other competitive pressures and the Company’s ability to gain or maintain share of sales as a result of actions by competitors and others; changes in estimates in critical accounting judgments; changes in or failure to comply with laws and regulations, including accounting standards, taxation requirements (including tax rate changes, new tax laws and revised tax interpretations) in domestic or foreign jurisdictions; exchange rate fluctuations and other risks associated with investments and operations in foreign countries (particularly in Australia and India wherein we have significant operations); equity markets, including market disruptions and significant interest rate fluctuations, which may impede our access to, or increase the cost of, external financing; and international conflict, including terrorist acts.
Except as expressly required by the federal securities laws, the Company undertakes no obligation to update any such factors, or to publicly announce the results of, or changes to any of the forward-looking statements contained herein to reflect future events, developments, changed circumstances, or for any other reason.
Readers should carefully review the disclosures and the risk factors described in the documents we file from time to time with the SEC, including future reports on Forms 10-Q and 8-K, and any amendments thereto.
|Ebix, Inc. and Subsidiaries|
|Consolidated Statements of Income|
|(In thousands, except per share data)|
|Three Months Ended||Twelve Months Ended|
|December 31,||December 31,|
|Cost of services provided||38,438||22,522||129,494||85,128|
|Sales and marketing||3,991||4,467||16,303||17,469|
|General and administrative (net)||17,820||14,670||59,976||51,689|
|Amortization and depreciation||2,800||2,658||11,123||10,746|
|Total operating expenses||71,600||52,385||250,750||198,013|
|Non-operating income – (loss)||—||—||—||1,162|
|Foreign currency exchange gain (loss)||(894||)||(839||)||1,811||13|
|Income before income taxes||27,939||25,459||103,360||95,931|
|Income tax expense||(414||)||(516||)||(777||)||(1,637||)|
|Net income including noncontrolling interest||27,525||24,943||102,583||94,294|
|Net income attributable to noncontrolling interest||952||314||1,965||447|
|Net income attributable to Ebix, Inc.||$||26,573||$||24,629||$||100,618||$||93,847|
|Basic earnings per common share||$||0.84||$||0.76||$||3.19||$||2.88|
|Diluted earnings per common share||$||0.84||$||0.76||$||3.17||$||2.86|
|Basic weighted average shares outstanding||31,470||32,279||31,552||32,603|
|Diluted weighted average shares outstanding||31,656||32,483||31,719||32,863|
|Ebix, Inc. and Subsidiaries|
|Consolidated Balance Sheets|
|(In thousands, except share and per share amounts)|
|Cash and cash equivalents||$||63,895||$||114,118|
|Fiduciary funds- restricted||8,035||14,394|
|Trade accounts receivable, less allowances of $4,143 and $2,833, respectively||117,838||62,713|
|Other current assets||33,532||12,716|
|Total current assets||252,932||207,046|
|Property and equipment, net||41,704||37,061|
|Capitalized software development costs, net||8,499||5,955|
|Deferred tax asset, net||43,529||31,345|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Accounts payable and accrued liabilities||$||75,073||$||30,461|
|Accrued payroll and related benefits||8,201||7,474|
|Fiduciary funds- restricted||8,035||14,394|
|Short term debt, net of deferred financing costs of $136||14,364||12,364|
|Contingent liability for accrued earn-out acquisition consideration||4,000||1,921|
|Current portion of long term debt and capital lease obligation||17||9|
|Current deferred rent||278||281|
|Other current liabilities||5,159||244|
|Total current liabilities||146,932||89,712|
|Revolving line of credit||274,529||154,029|
|Long term debt and capital lease obligation, less current portion, net of deferred financing costs of $298 and $452, respectively||110,978||105,824|
|Contingent liability for accrued earn-out acquisition consideration||33,096||6,589|
|Long term deferred rent||638||1,009|
|Commitments and Contingencies|
|Convertible Series D Preferred stock, $.10 par value, 500,000 shares authorized, no shares issued and outstanding at December 31, 2017 and 2016||—||—|
|Common stock, $.10 par value, 60,000,000 shares authorized, 31,476,428 issued and outstanding at December 31, 2017 and 32,093,294 issued and outstanding at December 31, 2016||3,148||3,209|
|Additional paid-in capital||1,410||—|
|Accumulated other comprehensive loss||(24,023||)||(33,677||)|
|Total Ebix, Inc. stockholders’ equity||491,510||426,896|
|Total stockholders' equity||$||533,759||$||438,636|
|Total liabilities and stockholders’ equity||$||1,113,013||$||803,755|
|Ebix, Inc. and Subsidiaries|
|Consolidated Statements of Cash Flows|
|Year Ended |
|Year Ended |
|Year Ended |
|Cash flows from operating activities:|
|Net income attributable to Ebix, Inc.||$||100,618||$||93,847||$||79,533|
|Net income attributable to noncontrolling interest||1,965||447||—|
|Adjustments to reconcile net income to cash provided by operating activities:|
|Depreciation and amortization||11,123||10,746||10,634|
|Provision for doubtful accounts||1,713||1,515||3,111|
|Provision for deferred taxes, net of acquisitions and effects of currency translation||(13,667||)||(6,410||)||(10,143||)|
|Unrealized foreign exchange (gain)/losses||1,387||32||(1,743||)|
|Gain on investment interest in IHC/Ebix joint venture||—||(1,162||)||—|
|Amortization of capitalized software development costs||2,175||1,116||—|
|Debt discount amortization on convertible debt||—||—||17|
|Reduction of acquisition earn-out contingent liability||(164||)||(1,344||)||(1,533||)|
|Reduction of rent expense as a result of purchase accounting adjustment||(948||)||—||—|
|Changes in current assets and liabilities, net of acquisitions:|
|Accounts payable and accrued expenses||8,906||(3,703||)||(19,895||)|
|Accrued payroll and related benefits||(3,979||)||170||(60||)|
|Reserve for potential uncertain income tax return positions||5,879||490||95|
|Liability – securities litigation settlement||—||—||(690||)|
|Net cash provided by operating activities||76,807||83,748||48,686|
|Cash flows from investing activities:|
|Investment in Paul Merchants||(37,398||)||—||—|
|Investment in Via, net of cash acquired||(67,835||)||—||—|
|Investment in Wall Street||(6,970||)||—||—|
|Investment in YouFirst, net of cash acquired||(9,657||)||—||—|
|Investment in beBetter||(1,000||)||—||—|
|Investment in ItzCash, net of cash acquired||(69,301||)||—||—|
|Payment of acquisition earn-out contingency, Qatarlyst||(1,921||)||—||—|
|Funding of escrow account for possible future contingent earn-out payment related to business acquisition||(4,040||)||—||—|
|Investment in Hope Health||—||(1,643||)||—|
|Investment in Wdev, net of cash acquired||—||(6,320||)||—|
|Investment in Via Media Health, net of cash acquired||—||—||(1,000||)|
|Investment in P.B. Systems, net of cash acquired||—||—||(11,475||)|
|Investment in EbixHealth JV, net of cash acquired||—||(696||)||(6,000||)|
|Purchases of marketable securities||—||(2,115||)||(1,435||)|
|Maturities of marketable securities||1,201||—||—|
|Capitalized software development costs||(2,805||)||(3,988||)||(3,489||)|
|Net cash used in investing activities||(207,111||)||(20,739||)||(37,393||)|
|Cash flows from financing activities:|
|Proceeds from / (Repayment) to line of credit, net||120,500||(52,436||)||86,000|
|Proceeds from term loan||20,000||125,000||—|
|Principal payments on term loan obligation||(13,000||)||(6,250||)||(642||)|
|Repurchase of common stock||(45,732||)||(59,784||)||(81,653||)|
|Payments of long term debt||—||(600||)||—|
|Payments for capital lease obligations||(11||)||(5||)||(10||)|
|Excess tax benefit from share-based compensation||—||—||463|
|Proceeds from exercise of common stock options||52||824||2,209|
|Forfeiture of certain shares to satisfy exercise costs and the recipients income tax obligations related to stock options exercised and restricted stock vested||(398||)||(998||)||(2,202||)|
|Net cash provided (used) by financing activities||78,028||(4,078||)||(6,307||)|
|Effect of foreign exchange rates on cash and cash equivalents||$||2,053||$||(1,992||)||$||(107||)|
|Net change in cash and cash equivalents||(50,223||)||56,939||4,879|
|Cash and cash equivalents at the beginning of the year||$||114,118||$||57,179||$||52,300|
|Cash and cash equivalents at the end of the year||$||63,895||$||114,118||$||57,179|
|Income taxes paid||10,426||16,634||28,637|