SS&C Technologies posts Q4 results

SS&C reported for the fourth quarter of 2015 GAAP revenue of $300.9 million, GAAP operating income of $48.3 million, GAAP net income of $12.1 million and GAAP diluted earnings per share of $0.12.

Highlights:

• Adjusted revenue (defined below) for the fourth quarter 2015 was $325.8 million, up 61.9% from the fourth quarter 2014.
• Adjusted operating income (defined below) increased 66.2 percent to $133.3 million, or 40.9 percent of adjusted revenue.
• Adjusted diluted earnings per share for Q4 2015 of $0.72, a 16.1% increase from Q4 2014.
• Annual Run Rate Basis (ARRB) was $1,180.0 million based on adjusted recurring revenue of $295.0 million for the fourth quarter 2015, a 59.9 percent increase from the same period in 2014.
• SS&C received a 17-A exemption from registration as a clearing agent from the SEC that permits us to offer matching and electronic trade confirmation (ECN) services in the U.S. through our SSCNet post-trade communication network.

"2015 was a transformational year and the fourth quarter provides a glimpse of the power of our business model. Adjusted revenue was $325.8 million for the quarter, up $124.6 million from Q4 2014 advancing 62%," says Bill Stone, Chairman and CEO of SS&C Technologies. "Advent, DST Global Solutions, Primatics and Varden all contributed to our robust fourth quarter. The worldwide workforce of SS&C now totals almost 6,100 people and they are a talented, hardworking group. We look forward to adding the 1,400 dedicated Citi Alternative Investor Services employees to our team at the closing of the acquisition, which is expected to occur in the first quarter. "

GAAP Results

SS&C reported GAAP revenue of $300.9 million for the fourth quarter of 2015, compared to $200.7 million in the fourth quarter of 2014. GAAP revenue for the year ended December 31, 2015 was $1,000.3 million, increasing from $767.9 million in 2014. GAAP operating income for the fourth quarter of 2015 was $48.3 million, compared to $53.6 million in 2014's fourth quarter. GAAP operating income for the year ended December 31, 2015 was $164.7 million, down from $200.4 million for 2014. On a fully diluted GAAP basis, earnings per share in the fourth quarter of 2015 was $0.12 compared to fully diluted GAAP earnings per share of $0.42 in the fourth quarter of 2014. On a fully diluted basis, GAAP earnings per share for the year ended December 31, 2015 was $0.45, down from 2014's $1.50 per share.

Adjusted Non-GAAP Results 

Adjusted revenue in the fourth quarter of 2015 was $325.8 million, up 61.9 percent compared to $201.2 million in the fourth quarter of 2014. Adjusted revenue for the year ended December 31, 2015 was $1,056.4 million, up 37.5 percent over $768.4 million for 2014. Adjusted operating income in the fourth quarter of 2015 was $133.3 million, or 40.9 percent of adjusted revenue. This represents a 66.2 percent increase compared to adjusted operating income of $80.2 million and 39.9 percent of adjusted revenue in the fourth quarter of 2014. Adjusted operating income for the year ended December 31, 2015 was $421.5 million, up 38.0 percent from adjusted operating income of $305.5 million in 2014.

Adjusted net income for the fourth quarter of 2015 was $73.6 million, up 34.7 percent compared to $54.7 million in 2014's fourth quarter. Adjusted net income for the year ended December 31, 2015 was $253.6 million, up 23.3% percent compared to $205.8 million for 2014. Adjusted diluted earnings per share in the fourth quarter of 2015 was $0.72 per share, up 16.1 percent compared to $0.62 per share in the fourth quarter of 2014. Adjusted diluted earnings per share for the year ended December 31, 2015 was $2.66, up 12.7 percent compared to $2.36 for 2014.

Annual Run Rate Basis

Annual Run Rate Basis (ARRB) recurring revenue, defined as adjusted recurring revenue on an annualized basis, was $1,180.0 million based on adjusted recurring revenue $295.0 million for the fourth quarter of 2015. This represents an increase of 59.9 percent from $184.5 million and $738.1 million run-rate in the same period in 2014 and an increase of 2.4 percent from $288.0 million for the third quarter of 2015, an annual run rate of $1,152.2 million. We believe ARRB of our recurring revenue is a good indicator of visibility into future revenue.

Operating Cash Flow

SS&C ended the year with $434.2 million in cash, and $2,820.0 million in gross debt for a net debt balance of $2,385.8 million. Net cash from operating activities was $110.1 million in Q4 2015, a 24.7 percent increase from $88.3 million in Q4 2014. For the full year ended December 31, 2015, SS&C generated net cash from operating activities of $230.6 million, compared to $252.5 million for the same period in 2014. The cash from operating activities was affected by $67.0 million of costs related to the financing and acquisition of Advent Software, Primatics Financial and pending acquisitions.