MICROS Reports Fiscal 2010 Second Quarter Results
REVENUE, NET INCOME AND EPS EXCEED EXPECTATIONS
COLUMBIA, Md., Feb. 4 /PRNewswire-FirstCall/ -- MICROS Systems, Inc. (Nasdaq: MCRS), a leading supplier of information systems to the hospitality and retail industries, today announced the results for its fiscal 2010 second quarter ended December 31, 2009.
FINANCIAL HIGHLIGHTS
- Revenue for the quarter was $225.6 million.
- Revenue for the six-month period was $437.0 million.
- GAAP net income for the quarter was $26.1 million.
- GAAP net income for the six-month per was $50.3 million.
- GAAP diluted EPS for the quarter was $0.32 per share.
- GAAP diluted EPS for the six-month period was $0.62 per share.
- Non-GAAP financial results, excluding the effect of charges for stock options and impairment on auction rate securities, are as follows:
- Non-GAAP net income for the quarter was $29.0 million.
- Non-GAAP net income for the six-month period was $55.7 million.
- Non-GAAP diluted EPS for the quarter was $0.36 per share.
- Non-GAAP diluted EPS for the six-month period was $0.69 per share.
The financial results for the second fiscal quarter exceeded consensus expectations.
Tom Giannopoulos, MICROS's Chairman and CEO, stated: "We are very pleased with the financial results for the quarter as revenue, net income and earnings per share exceeded expectations. We are hopeful that business conditions will continue to improve."
MICROS expects to file its fiscal 2010 second quarter 10-Q on or before February 16, 2010. The financial statements reported today reflect adjustments necessitated by certain fraudulent activities recently uncovered in our Japanese subsidiary and perpetrated by one employee who is not a member of senior management. The Company immediately initiated an investigation, which is now substantially complete, and determined that the cumulative income statement effect over the last five fiscal years of this activity is an overstatement of revenue of approximately $6.9 million and pre-tax income of approximately $4.4 million. The Company does not believe that adjustments to correct information in any prior reporting period would be material. The condensed consolidated statements of operations and cash flows reported today do not reflect cumulative adjustments, but include adjustments for the periods presented. To the extent that prior period information is included in future SEC filings and in future public statements, the information will reflect the adjustments relevant to those prior periods.
MICROS's stock is traded through NASDAQ under the symbol MCRS. 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 February 4, 2010. 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.
MICROS SYSTEMS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited - in thousands, except per share amounts) Three Months Ended Six Months Ended December 31, December 31, ------------ ------------ 2009 2008 2009 2008 ---- ---- ---- ---- Revenue: Hardware $45,793 $55,646 $89,099 $119,118 Software 30,499 37,679 55,192 75,177 Service 149,355 143,184 292,757 285,846 ------- ------- ------- ------- Total revenue 225,647 236,509 437,048 480,141 ------- ------- ------- ------- Cost of sales: Hardware 30,364 34,326 58,416 77,179 Software 7,045 6,679 12,432 13,737 Service 63,259 69,530 125,396 137,313 ------ ------ ------- ------- Total cost of sales 100,668 110,535 196,244 228,229 ------- ------- ------- ------- Gross margin 124,979 125,974 240,804 251,912 Selling, general and administrative expenses 67,124 68,848 129,339 142,696 Research and development expenses 9,560 10,412 20,430 20,674 Depreciation and amortization 4,319 4,291 8,161 8,378 Stock option expense 4,378 4,099 7,429 7,832 ----- ----- ----- ----- Total operating expenses 85,381 87,650 165,359 179,580 ------ ------ ------- ------- Income from operations 39,598 38,324 75,445 72,332 Non-operating income (expense): Interest income (expense), net 825 2,429 1,877 5,538 Credit based impairment charge - - (387) - Other non-operating (expense) income, net (427) (267) (435) 419 ---- ---- ---- --- Total non-operating income, net 398 2,162 1,055 5,957 --- ----- ----- ----- Income before taxes 39,996 40,486 76,500 78,289 Income tax provision 13,334 14,074 25,471 27,130 ------ ------ ------ ------ Net income 26,662 26,412 51,029 51,159 Less: Net income attributable to noncontrolling interest (532) (234) (755) (683) ---- ---- ---- ---- Net Income attributable to MICROS Systems, Inc. (GAAP) $26,130 $26,178 $50,274 $50,476 ======= ======= ======= ======= Net Income per Diluted Common Share attributable to MICROS Systems, Inc. common shareholder $0.32 $0.32 $0.62 $0.61 ===== ===== ===== ===== Weighted-average number of shares outstanding - diluted 81,234 81,202 81,283 81,691 ====== ====== ====== ====== 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. $26,130 $26,178 $50,274 $50,476 Add back: Stock option expense Selling, general and administrative expenses 4,235 3,886 7,139 7,411 Research and development expenses 143 213 290 421 --- --- --- --- 4,378 4,099 7,429 7,832 Credit based impairment charge - - 387 - --- --- --- --- 4,378 4,099 7,816 7,832 ----- ----- ----- ----- Subtract: Tax effect on Stock option expense 1,464 978 2,406 1,819 ----- --- ----- ----- Non-GAAP Net Income attributable to MICROS Systems, Inc. $29,044 $29,299 $55,684 $56,489 ======= ======= ======= ======= Non-GAAP Net Income per Diluted Common Share attributable to MICROS Systems, Inc. $0.36 $0.36 $0.69 $0.69 ===== ===== ===== ===== 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) December 31, June 30, 2009 2009 --------- -------- ASSETS Current assets: Cash and cash equivalents and short-term investments $466,101 $438,936 Accounts receivable, net 148,856 155,211 Inventory, net 36,994 39,783 Deferred income taxes 21,979 19,438 Prepaid expenses and other current assets 31,687 27,238 ------ ------ Total current assets 705,617 680,606 Long-term investments 64,716 57,823 Property, plant and equipment, net 30,547 30,520 Deferred income taxes, non-current 14,109 11,375 Goodwill 216,305 190,739 Intangible assets, net 23,259 17,709 Purchased and internally developed software costs, net 22,388 25,749 Other assets 6,251 6,345 ----- ----- Total Assets $1,083,192 $1,020,866 ========== ========== LIABILITIES AND EQUITY Current liabilities: Bank lines of credit $1,370 $1,090 Accounts payable 37,571 38,445 Accrued expenses and other current liabilities 112,596 104,821 Income taxes payable 8,340 7,432 Deferred revenue 118,408 112,146 ------- ------- Total current liabilities 278,285 263,934 Income taxes payable, non-current 21,359 19,611 Deferred income taxes, non-current 2,288 1,752 Other non-current liabilities 11,950 10,539 ------ ------ Total liabilities 313,882 295,836 Commitments and contingencies Equity: MICROS Systems, Inc. shareholders’ equity: Common stock 498 502 Capital in excess of par 109,378 127,145 Retained earnings 625,602 575,095 Accumulated other comprehensive income 27,104 16,254 ------ ------ Total MICROS Systems, Inc. shareholders’ equity 762,582 718,996 Noncontrolling interest 6,728 6,034 ----- ----- Total Equity 769,310 725,030 ------- ------- Total Liabilities and Equity $1,083,192 $1,020,866 ========== ==========
SOURCE MICROS Systems, Inc.
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