ACI Worldwide (ACIW) Q4 2004 earnings summary

Executive summary

• FY04 revenue rose 5.6% YoY to $292.8m; net income was $46.7m and diluted EPS was $1.23. Operating cash flow reached $58.1m.

• More than 720 customers used the software across 76 countries; systems processed over 41bn transactions during the year.

• Growth came alongside product launches and customer wins, while management planned continued investment in R&D, service and technology and close expense management for FY05.

Financial highlights

• Revenue was $292.8m, up 5.6% YoY; software license fees rose to $157.4m, maintenance fees to $88.5m, while services declined to $46.9m.

• Operating income increased to $54.8m from $35.3m; net income rose to $46.7m from $14.3m.

• Operating expenses declined 1.7% YoY; FY03 included a $9.3m goodwill impairment charge, with no goodwill impairment recorded in FY04.

• Operating cash flow was $58.1m, versus $37.9m in FY03; cash and cash equivalents totaled $169.6m at FY-end.

Outlook and guidance

• FY05 priorities: extend into new markets, geographies and transaction types; continue R&D and technology investment while managing expenses closely.

• Backlog at September 30, 2004 was $229.6m, including $168.1m non-recurring and $61.5m recurring; timing and realization remained subject to customer and delivery risks.

• The FY04 $12.0m tax benefit from the MDL reorganization is not expected to affect effective tax rates in future periods; the future Jobs Act impact remained under evaluation.