ACI Worldwide (ACIW) Q4 2011 earnings summary

Executive summary

• 2011 bookings reached $556m, up 6% YoY; 60-month backlog rose $62m to $1.6b at year-end.

• Record revenue of $465.1m, up 11.2% YoY; 82% came from backlog, supporting more consistent revenue attainment.

• Growth came from organic operations and the strategic S1 acquisition, completed in February 2012; integration and cross-selling are central to the 2012 plan.

Financial highlights

• Revenue was $465.1m vs $418.4m in 2010; software license fees rose 15.4%, maintenance 9.5%, services 7.8% and hosting 6.3%.

• Adjusted EBITDA was $113m, up 28% YoY; operating income was $66.2m, up 36% YoY.

• Net income was $45.9m vs $27.2m; diluted EPS was $1.34 vs $0.80.

• Operating cash flow was $83.5m; operating free cash flow was $67m; cash and equivalents totaled $197.1m at year-end.

Outlook and guidance

• Calendar 2012 combined revenue was expected to reach approximately $700m, including organic growth and S1 integration and repositioning.

• Former S1 operations were expected to reach operating income and Adjusted EBITDA margins in line with organic performance within one year of acquisition.

• Longer-term targets remained 30%+ Adjusted EBITDA margin and 20%+ operating income margin within the five-year planning horizon.