Financial Highlights for the Third Quarter Ended
The Company reported a 6% increase in total revenue, an increase of 12% in gross profit and a 19% increase in net income over the third quarter of fiscal 2014. For the first nine months of fiscal 2015, revenue increased 8%, with an increase of 9% in gross profit and an increase of 12% in net income compared to last year. For comparison purposes, we also are providing results under our previous accounting. For the third fiscal quarter, the Company's total revenue under previous accounting increased 7%, gross profit under previous accounting increased by 12%, and net income under previous accounting increased 18%. For the first nine months of fiscal 2015, revenue under previous accounting increased 7%, with an increase of 8% in gross profit and an increase of 11% in net income compared to last year, both under previous accounting.
For the quarter ended
For the nine months ended
"We are pleased to conclude this very technical accounting review," said
Summary Financial Data
The summary financial data below shows results as historically reported compared to the restated results. As the review of revenue recognition is being finalized, these numbers are subject to adjustment.
Summary Financial Data (Unaudited) |
||||||||||
(in Thousands, Except Share Data) |
Three Months Ended |
% Change |
Nine Months Ended |
% Change |
||||||
2015 |
2014 |
2015 |
2014 |
|||||||
Revenue (As Restated) |
|
|
6 |
% |
|
|
8 |
% |
||
Revenue (Previous Accounting) |
|
|
7 |
% |
|
|
7 |
% |
||
Operating Income (As Restated) |
|
|
20 |
% |
|
|
11 |
% |
||
Operating Income (Previous Accounting) |
|
|
18 |
% |
|
|
10 |
% |
||
Net Income (As Restated) |
|
|
19 |
% |
|
|
12 |
% |
||
Net Income (Previous Accounting) |
|
|
18 |
% |
|
|
11 |
% |
||
EPS - diluted (As Restated) |
|
|
26 |
% |
|
|
18 |
% |
||
EPS - diluted (Previous Accounting) |
|
|
24 |
% |
|
|
16 |
% |
Because we have determined there were errors in our previous accounting, we have included a reconciliation of our financial measures under previous accounting to the restated results in the financial tables of this press release.
Operating Results (As Restated)
According to
License revenue was
License revenue was
Cost of sales for the third quarter increased 2% to
Cost of sales for the nine months ended
Gross margin on license revenue was 50% for the third quarter of fiscal 2015, decreasing from 62% in the same period of fiscal 2014. Support and service gross margin was 43% in the third quarter of fiscal 2015, increasing from 41% in the same three months of fiscal 2014. Hardware gross margins remained consistent at 25% in both fiscal years.
Gross margin on license was 36% for the nine months ended
Operating expenses increased 3% in the third quarter of fiscal 2015 compared to the same quarter a year ago primarily due to increased headcount and related salaries. Selling and marketing expenses remained steady in the current year third quarter at$21.7 million, or 7% of total revenue, compared to
For the nine months ended
Operating income increased 20% to
Operating income increased 11% to
Balance Sheet and Cash Flow Review
At
Cash provided by operations totaled
Nine Months Ended |
|||||||
2015 |
2014 |
||||||
Net income |
$ |
150,679 |
$ |
134,188 |
|||
Non-cash expenses |
86,845 |
73,851 |
|||||
Change in receivables |
86,626 |
91,529 |
|||||
Change in deferred revenue |
(120,941) |
(110,224) |
|||||
Change in other assets and liabilities |
(21,623) |
(27,907) |
|||||
Net cash provided by operating activities |
$ |
181,586 |
$ |
161,437 |
Cash used in investing activities for fiscal 2015 of
During fiscal 2015, net cash used in financing activities for the current fiscal year is
Restatement of Previously Filed Financial Statements
On
The restatement described above will result in a decrease in revenue and net income cumulatively over the period with a decrease in retained earnings and deferred tax liabilities, with an increase in prepaid direct costs and current and long-term deferred revenue as of
As a result of the restatement, the Company's management has also concluded that the Company's internal control over financial reporting and disclosure controls and procedures were not effective as of
The Company intends to amend its Form 10-K for the year ended
About
Forward-Looking Statements
Statements made in this news release that are not historical facts are forward-looking information. Forward-looking information includes statements regarding the Company's intent to restate its financial statements and the Company's intent to file the restated financial statements as soon as practicable. Actual results may differ materially from those projected in any forward-looking information. Specifically, there are a number of important factors that could cause actual results to differ materially from those anticipated by any forward-looking information. These factors include the possibility that our restatement of our financial statements could have unanticipated consequences. Additional information on these and other factors, which could affect the Company's financial results, are included in its
Condensed Consolidated Statements of Income As Restated (Unaudited) |
||||||||||||||||||||
(In Thousands, Except Per Share Data) |
Three Months Ended |
% Change |
Nine Months Ended |
% Change |
||||||||||||||||
2015 |
2014 |
2015 |
2014 |
|||||||||||||||||
REVENUE |
||||||||||||||||||||
License |
$ |
569 |
$ |
603 |
(6)% |
$ |
1,563 |
$ |
1,610 |
(3)% |
||||||||||
Support and service |
296,896 |
276,100 |
8% |
882,017 |
811,972 |
9% |
||||||||||||||
Hardware |
12,244 |
14,731 |
(17)% |
38,897 |
44,425 |
(12)% |
||||||||||||||
Total |
309,709 |
291,434 |
6% |
922,477 |
858,007 |
8% |
||||||||||||||
COST OF SALES |
||||||||||||||||||||
Cost of license |
285 |
227 |
26% |
1,002 |
760 |
32% |
||||||||||||||
Cost of support and service |
168,457 |
162,824 |
3% |
503,925 |
466,749 |
8% |
||||||||||||||
Cost of hardware |
9,152 |
11,008 |
(17)% |
28,111 |
32,816 |
(14)% |
||||||||||||||
Total |
177,894 |
174,059 |
2% |
533,038 |
500,325 |
7% |
||||||||||||||
GROSS PROFIT |
131,815 |
117,375 |
12% |
389,439 |
357,682 |
9% |
||||||||||||||
Gross Profit Margin |
43 |
% |
40 |
% |
42 |
% |
42 |
% |
||||||||||||
OPERATING EXPENSES |
||||||||||||||||||||
Selling and marketing |
21,674 |
21,719 |
—% |
65,512 |
62,960 |
4% |
||||||||||||||
Research and development |
17,522 |
17,485 |
—% |
51,995 |
49,300 |
5% |
||||||||||||||
General and administrative |
15,417 |
13,630 |
13% |
43,442 |
40,011 |
9% |
||||||||||||||
Total |
54,613 |
52,834 |
3% |
160,949 |
152,271 |
6% |
||||||||||||||
OPERATING INCOME |
77,202 |
64,541 |
20% |
228,490 |
205,411 |
11% |
||||||||||||||
INTEREST INCOME (EXPENSE) |
||||||||||||||||||||
Interest income |
14 |
65 |
(78)% |
62 |
288 |
(78)% |
||||||||||||||
Interest expense |
(651) |
(243) |
168% |
(1,217) |
(752) |
62% |
||||||||||||||
Total |
(637) |
(178) |
258% |
(1,155) |
(464) |
149% |
||||||||||||||
INCOME BEFORE INCOME TAXES |
76,565 |
64,363 |
19% |
227,335 |
204,947 |
11% |
||||||||||||||
PROVISION FOR INCOME TAXES |
25,854 |
21,757 |
19% |
76,656 |
70,759 |
8% |
||||||||||||||
NET INCOME |
$ |
50,711 |
$ |
42,606 |
19% |
$ |
150,679 |
$ |
134,188 |
12% |
||||||||||
Diluted net income per share |
$ |
0.63 |
$ |
0.50 |
$ |
1.84 |
$ |
1.56 |
||||||||||||
Diluted weighted average shares outstanding |
81,094 |
85,467 |
81,773 |
85,769 |
||||||||||||||||
Consolidated Balance Sheet Highlights (Unaudited) |
||||||||||||||||||||
(In Thousands) |
|
% Change |
||||||||||||||||||
2015 |
2014 |
|||||||||||||||||||
Cash and cash equivalents |
$ |
52,800 |
$ |
52,244 |
1 |
% |
||||||||||||||
Receivables |
137,415 |
140,010 |
(2) |
% |
||||||||||||||||
Total assets |
1,618,140 |
1,572,022 |
3 |
% |
||||||||||||||||
Accounts payable and accrued expenses |
$ |
71,502 |
$ |
65,235 |
10 |
% |
||||||||||||||
Current and long term debt |
77,447 |
15,454 |
401 |
% |
||||||||||||||||
Deferred revenue |
370,471 |
329,847 |
12 |
% |
||||||||||||||||
Stockholders' Equity |
956,610 |
1,041,847 |
(8) |
% |
As Restated to Previous Accounting (Unaudited) |
|||||||||||||||||||||||
(In Thousands, Except Per Share Data) |
Three Months Ended |
Three Months Ended |
|||||||||||||||||||||
As |
Adjustment |
Previous Accounting |
As |
Adjustment |
Previous Accounting |
||||||||||||||||||
Revenue |
$ |
309,709 |
$ |
11,905 |
$ |
321,614 |
$ |
291,434 |
$ |
9,495 |
$ |
300,929 |
|||||||||||
Operating Income |
$ |
77,202 |
$ |
7,022 |
$ |
84,224 |
$ |
64,541 |
$ |
6,841 |
$ |
71,382 |
|||||||||||
Net Income |
$ |
50,711 |
$ |
4,310 |
$ |
55,021 |
$ |
42,606 |
$ |
4,150 |
$ |
46,756 |
|||||||||||
Diluted net income per share |
$ |
0.63 |
$ |
0.05 |
$ |
0.68 |
$ |
0.50 |
$ |
0.05 |
$ |
0.55 |
|||||||||||
Nine Months Ended |
Nine Months Ended |
||||||||||||||||||||||
As |
Adjustment |
Previous Accounting |
As |
Adjustment |
Previous Accounting |
||||||||||||||||||
Revenue |
$ |
922,477 |
$ |
43,335 |
$ |
965,812 |
$ |
858,007 |
$ |
41,107 |
$ |
899,114 |
|||||||||||
Operating Income |
$ |
228,490 |
$ |
26,996 |
$ |
255,486 |
$ |
205,411 |
$ |
26,788 |
$ |
232,199 |
|||||||||||
Net Income |
$ |
150,679 |
$ |
16,466 |
$ |
167,145 |
$ |
134,188 |
$ |
16,339 |
$ |
150,527 |
|||||||||||
Diluted net income per share |
$ |
1.84 |
$ |
0.20 |
$ |
2.04 |
$ |
1.56 |
$ |
0.19 |
$ |
1.76 |
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/jack-henry--associates-reports-third-quarter-results-and-announces-restatement-of-financial-statements-300079042.html
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