MICROS Reports Fiscal 2014 First Quarter Results

RECORD FIRST FISCAL QUARTER REVENUE

24 Oct, 2013, 16:02 ET from MICROS Systems, Inc.

COLUMBIA, Md., Oct. 24, 2013 /PRNewswire/ -- MICROS Systems, Inc. (NASDAQ: MCRS), a leading provider of information technology solutions for the hospitality and retail industries, today announced the results for its fiscal 2014 first quarter ended September 30, 2013. 

FINANCIAL HIGHLIGHTS                                                                                                     

  • Revenue for the quarter was $314.7 million, an increase of $14.9 million, or 5.0%, over the same period last year. 
  • GAAP net income for the quarter was $32.3 million, a decrease of $8.8 million, or 21.4%, versus the same period last year
  • GAAP diluted earnings per share (EPS) for the quarter was $0.42 per share, a decrease of $0.08, or 16.0%, versus the same period last year.
  • Non-GAAP financial results, excluding the effect of charges for stock options, a litigation charge and accrued interest, amortization of Torex intangibles, restructuring of Torex, and a one-time gain on a settlement of auction rate securities are as follows:
    • Non-GAAP net income for the quarter was $38.6 million, a decrease of $7.8 million, or 16.9%, versus the same period last year.
    • Non-GAAP diluted EPS for the quarter was $0.50, a decrease of $0.07, or 12.3%, versus the same  period last year.
  • MICROS's revenue was a Company record for a first fiscal quarter.

Peter A. Altabef,  MICROS's  President and CEO, stated, " We are pleased with our revenue growth in this environment, with especially strong growth in the United States and Canada."

MICROS's financial guidance for fiscal 2014 remains the same as previously provided in August 2013 with revenue between $1.295 and $1.32 Billion and Non-GAAP EPS between $2.46 and $2.50.

MICROS's stock is traded through NASDAQ under the symbol MCRS.  Some of the statements contained herein not based on historic facts are forward-looking statements that involve risks and uncertainties  MICROS is subject to, among others, the following uncertainties and risks: product demand and market acceptance; impact of competitive products and pricing on margins; product development delays and technological difficulties; controlling expenses as MICROS continues to expand; the ability to obtain on acceptable terms the right to incorporate in MICROS's products and services technology patented by others; the risk that there are actual or perceived security vulnerabilities in MICROS's products; adverse results in legal disputes resulting in liabilities that exceed reserves; unanticipated tax liabilities; the effects of terrorist activity and armed conflict; the effects of major environmental disasters; weakening in general economic conditions that adversely affect demand for computer hardware or software; and currency fluctuations.

All information in this release is as of October 24, 2013.  MICROS undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in MICROS's expectations.

For further information regarding risks and uncertainties associated with MICROS's business, please refer to the "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business and Investment Risks" sections of MICROS's SEC filings, including, but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q, copies of which may be obtained by contacting MICROS's investor relations department at 443-285-8059 or at MICROS's website at http://www.micros.com.

The MICROS logo is a registered trademark of MICROS Systems, Inc. All other product and brand names are the property of their respective owners.

Contact:

Peter J. Rogers, Jr. 

Executive Vice President,  Investor Relations

443-285-8059

progers@micros.com

 

MICROS SYSTEMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited - in thousands, except per share amounts)

Three Months Ended

September 30,

2013

2012

Revenue:

Hardware

$      66,532

$     63,759

Software

34,361

30,778

Service

213,822

205,314

Total revenue

314,715

299,851

Cost of sales:

Hardware

43,247

43,057

Software

5,401

5,365

Service

103,640

98,096

Stock option expense

99

73

Total cost of sales

152,387

146,591

Gross margin

162,328

153,260

Selling, general and administrative expenses

78,026

72,648

Research and development expenses

18,878

16,366

Depreciation and amortization

4,394

4,117

Stock option expense

4,891

4,137

Torex amortization expense

775

1,408

Torex restructuring charge

216

1,397

Litigation charge

2,800

0

Total operating expenses

109,980

100,073

Income from operations

52,348

53,187

Non-operating income (expense):

Interest income, net

889

1,176

Interest expense - litigation charge

(900)

0

Gain on settlement - auction rate securities

338

0

Other non-operating income, net

152

(329)

Total non-operating income , net

479

847

Income before taxes

52,827

54,034

Income tax provision 

20,496

12,968

Net income

32,331

41,066

Less:  Net income attributable to noncontrolling interest

(60)

(2)

Net Income attributable to MICROS Systems, Inc. (GAAP)

$      32,271

$     41,064

Net Income per diluted common share attributable to MICROS Systems, Inc.

$           0.42

$          0.50

Weighted-average number of shares outstanding - diluted

77,712

81,969

Reconciliation of GAAP Net Income and EPS attributable to MICROS Systems, Inc. to Non-GAAP Net Income and EPS attributable to MICROS Systems, Inc.

Net Income attributable to MICROS Systems, Inc.

$      32,271

$     41,064

Add back:

Stock option expense

    Selling, general and administrative expenses

4,404

3,700

    Research and development expenses

487

437

    Cost of sales

99

73

4,990

4,210

Litigation charge, including accrued interest expense

3,700

0

Torex amortization expense

775

1,408

Torex restructuring charge

216

1,397

Gain on settlement - auction rate securities

(338)

0

Total add back

9,343

7,015

Subtract tax effect on:

Stock option expense

1,558

1,264

Litigation charge, including accrued interest expense

1,410

0

Torex amortization expense

22

59

Torex restructuring charge

49

349

Non-GAAP Net Income attributable to MICROS Systems, Inc.

$      38,575

$     46,407

Non-GAAP Net Income per Diluted Common Share attributable to MICROS Systems, Inc.

$           0.50

$          0.57

We believe the inclusion of the above non-GAAP measure will be useful to investors because it will enhance the comparability of our current period results to prior periods' results without comparable charges.  We also believe inclusion of this measure will enhance comparability of our results to results of our competitors and to the analysts' forecasts because the analysts typically forecast excluding the effect of share-based payment charge and above one time charges, the non-GAAP measure.  In addition, our management uses this measure to evaluate our operating performance and compare our results to our competitors.  Management also uses this measure as a metric to measure performance under our executive compensation program.  

The Company notes that non-GAAP financial measures are not based on a comprehensive set of accounting rules or principles.  Instead, they are based on subjective determinations by management designed to supplement our GAAP financial measures.  They are subject to a number of important limitations and should be considered only in conjunction with our consolidated financial statements prepared in accordance with GAAP.  Among the limitations on the use of the non-GAAP measure are the following:

-   The exclusion of non-GAAP items can have a significant impact on reported GAAP net income and diluted net income per share.

-   Other companies may calculate non-GAAP net income and non-GAAP net income per share differently than MICROS does, limiting the usefulness of those measures for comparative purposes.

 

MICROS SYSTEMS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited - in thousands)

September 30, 2013

June 30, 2013

ASSETS

Current assets:

     Cash and cash equivalents and short-term investments

$        595,559

$        634,069

     Accounts receivable, net

232,281

228,455

     Inventory

54,297

49,273

    Income taxes receivable

11,939

12,771

     Deferred income taxes

15,315

15,022

     Prepaid expenses and other current assets

58,772

44,648

           Total current assets

968,163

984,238

Long-term investments

0

0

Property, plant and equipment, net

51,729

44,127

Deferred income taxes, non-current

48,041

50,186

Goodwill

447,709

432,950

Intangible assets, net

38,151

37,754

Purchased and internally developed software costs, net

34,325

32,543

Other assets

7,488

7,240

Total Assets

$     1,595,606

$     1,589,038

LIABILITIES AND EQUITY

Current liabilities:

     Bank lines of credit

$                    -

$             1,757

     Accounts payable

71,479

73,099

     Accrued expenses and other current liabilities

150,750

155,491

     Income taxes payable

12,009

11,002

     Deferred revenue

203,366

177,236

         Total current liabilities

437,604

418,585

Income taxes payable, non-current

38,052

35,019

Deferred income taxes, non-current

1,186

1,157

Other non-current liabilities

16,004

16,007

         Total liabilities

492,846

470,768

Commitments and contingencies

Equity:

  MICROS Systems, Inc. stockholders' equity:

     Common stock

1,882

1,918

     Capital in excess of par

0

0

     Retained earnings

1,093,614

1,136,763

     Accumulated other comprehensive income (loss)

3,903

(23,625)

          Total MICROS Systems, Inc. stockholders' equity

1,099,399

1,115,056

  Noncontrolling interest

3,361

3,214

Total Equity

1,102,760

1,118,270

Total Liabilities and Equity

$     1,595,606

$     1,589,038

 

MICROS SYSTEMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited - in thousands)

 Three Months Ended 

 September 30, 

2013

2012

Cash flows from operating activities:

Net income

$          32,331

$          41,066

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

5,169

5,525

Share-based compensation

4,990

4,210

Amortization of capitalized software

1,517

972

Provision for losses on accounts receivable

600

1,306

Litigation reserve, including interest expense

3,700

-

Net (gain) loss on disposal of property, plant and equipment

-

(41)

Changes in operating assets and liabilities (net of impact of acquisitions):

Decrease (increase) in accounts receivable

144

(5,957)

Increase in inventory

(4,082)

(3,828)

Increase in prepaid expenses and other assets

(12,851)

(9,033)

Decrease in accounts payable

(2,803)

(7,327)

Decrease in accrued expenses and other current liabilities

(10,074)

(30,379)

Increase (decrease) in income taxes assets and liabilities

7,863

(8,954)

Increase in deferred revenue

22,503

18,462

Net cash flows provided by operating activities

49,007

6,022

Cash flows from investing activities:

Proceeds from maturities of investments

39,369

16,553

Purchases of investments

(46,375)

(4,029)

Purchases of property, plant and equipment

(10,968)

(3,796)

Internally developed software costs

(2,028)

(850)

Net cash paid for acquisitions, net of cash acquired

-

(129)

Other

-

43

Net cash flows (used in) provided by investing activities

(20,002)

7,792

Cash flows from financing activities:

Repurchases of common stock

(91,603)

(13,165)

Proceeds from stock option exercises

10,137

4,364

Realized tax benefits from stock option exercises

886

1,370

Principal payments on line of credit

(1,795)

-

Other

(33)

(26)

Net cash flows used in financing activities

(82,408)

(7,457)

Effect of exchange rate changes on cash and cash equivalents

7,313

4,885

Net (decrease) increase in cash and cash equivalents

(46,090)

11,242

Cash and cash equivalents at beginning of year

486,023

562,786

Cash and cash equivalents at end of year

$        439,933

$        574,028

 

 

SOURCE MICROS Systems, Inc.



RELATED LINKS

http://www.micros.com