- Bookings total $236 million, 6 percent year-over-year
growth
- Recurring revenue increases to 77 from 73 percent of
total revenue year-over-year
- Cash flow from operations totals $59
million
Allscripts Healthcare Solutions, Inc. (Nasdaq:MDRX) (Allscripts)
announced its financial results for the three months ended March
31, 2015.
First Quarter Bookings Highlights:
Bookings(1) in the first quarter of 2015 were a record $236
million compared with $223 million in the first quarter of 2014, a
6 percent increase. First quarter 2015 bookings reflect sales
growth of SunriseTM Acute Care as well as significant contributions
from population health management and Allscripts payer life
sciences solutions.
Approximately 63 percent of first quarter bookings related to
software delivery and recurring transactions, while the remaining
37 percent were derived from sales of client services solutions.
This compares with 54 and 46 percent of bookings attributable to
these revenue categories, respectively, in the first quarter of
2014.
Contract revenue backlog as of March 31, 2015, totaled $3.5
billion, which was flat compared with the prior-year amount.
Paul M. Black, President and Chief Executive Officer of
Allscripts, stated: "We are pleased with first quarter bookings
growth of 6 percent year-over-year. Sunrise bookings growth
reflects both net new client sales and additional sales to existing
clients, as they increase investments in the platform. Enhancements
in Sunrise functionality, increasing client satisfaction and
recent, positive industry recognition are driving growing interest
in Allscripts globally.
"While total revenue declined in the quarter, higher margin
recurring revenue continues to grow year-over-year and constituted
77 percent of total revenue. We also maintained a disciplined focus
on operating expenses, which helped drive a significant
year-over-year increase in operating and free cash flows." Mr.
Black continued, "Looking ahead, Allscripts strategic position is
solid. We are focused on continually enhancing core solutions,
growing population health and international markets and offering
new value-added services. Together, these opportunities provide a
foundation for improving financial performance and value creation
going forward."
First Quarter 2015 Highlights
Revenue totaled $335 million, a decline of 2 percent, compared
with $340 million in the first quarter of 2014.
Software delivery, support & maintenance revenue totaled
$228 million in the first quarter of 2015, flat compared with the
first quarter of 2014. Software delivery, support & maintenance
revenue consists of all software, hardware, and transaction-related
revenue as well as support & maintenance.
Client services revenue totaled $107 million in the first
quarter of 2015, down 5 percent compared with the first quarter of
2014. Client services revenue consists of both managed IT
services as well as other client services.
On a non-GAAP basis, recurring revenue, consisting of
subscriptions, recurring transactions, support, maintenance, and
recurring managed services, increased $7 million compared with the
first quarter of 2014; representing growth of 3 percent
year-over-year. Non-recurring revenue, consisting of systems sales
and other client services revenue, declined $18 million or 19
percent, compared with the first quarter of 2014.
First quarter 2015 gross margin was 42.3 percent on a non-GAAP
basis and 38.8 percent on a GAAP basis, compared with 44.9
percent and 40.6 percent, respectively, in the first quarter of
2014.
Operating expenses, consisting of SG&A and R&D expense,
declined 12 percent on a non-GAAP basis and 9 percent on a GAAP
basis in the first quarter of 2015 compared with the first quarter
of 2014. The decline in operating expenses reflects
initiatives to decrease corporate SG&A expenses, streamline
business functions, and leverage investments in research and
development. GAAP operating expenses in the first quarter of
2015 included severance expense of approximately $6 million.
Reflecting lower operating expenses, Adjusted EBITDA increased 4
percent to $50 million in the first quarter of 2015, compared with
$48 million in the first quarter of 2014.
On a non-GAAP basis, Allscripts effective tax rate was 35
percent in the first quarter of both 2015 and 2014. On a GAAP
basis, Allscripts recorded an income tax benefit of approximately
$1.0 million in the first quarter of 2015, compared with an income
tax provision of $1.5 million in the first quarter of 2014.
First quarter 2015 non-GAAP net income totaled $15 million
compared with $12 million in the first quarter of 2014. First
quarter 2015 GAAP net loss totaled $10 million compared with a net
loss of $21 million in the first quarter of 2014.
First quarter 2015 non-GAAP earnings per share were $0.08
compared with $0.07 in the first quarter of 2014. First
quarter 2015 GAAP loss per share was $0.06 compared with a loss per
share of $0.12 in the first quarter of 2014.
Allscripts first quarter 2015 cash flow from operations totaled
$59 million compared with $21 million in the first quarter of
2014. Free cash flow totaled $43 million compared with $0.2
million in the first quarter of 2014.
Allscripts is confirming its full year Adjusted EBITDA and
non-GAAP earnings per diluted share that the Company introduced
earlier this year. The Company is modifying its full year
revenue guidance to a range between $1.40B and $1.43B.
For a complete reconciliation of GAAP and non-GAAP
items, see the explanation of non-GAAP financial measures as well
as the GAAP and non-GAAP reconciliation financial tables in this
release.
Conference Call:
Allscripts will conduct a conference call today, Thursday, May
7, 2015, at 4:30 PM Eastern Time to discuss its earnings release
and other information. Participants may access the conference
call via webcast at http://investor.allscripts.com.
A replay of the call will be available approximately two hours
after the conclusion of the call, for a period of two weeks, on the
Allscripts investor relations website or by calling (855) 859-2056
or +1 (404) 537-3406 - Conference ID # 26615457.
Supplemental and non-GAAP financial information, including
information for historical periods relating to Allscripts revised
presentation of revenue and the associated cost of revenue in its
consolidated statement of operations, also will be available at
http://investor.allscripts.com.
Footnotes
(1) Bookings reflect the value of
executed contracts for software, hardware, other client services,
remote hosting, outsourcing and subscription-based services.
About Allscripts
Allscripts (Nasdaq:MDRX) is a leader in healthcare information
technology solutions that advance clinical, financial and
operational results. Our innovative solutions connect people,
places and data across an Open, Connected Community of Health™.
Connectivity empowers caregivers to make better decisions and
deliver better care for healthier populations. To learn more, visit
www.allscripts.com, Twitter, YouTube and It Takes A Community: The
Allscripts Blog.
© 2015 Allscripts Healthcare, LLC and/or its affiliates. All
Rights Reserved.
Allscripts, the Allscripts logo, and other Allscripts marks are
trademarks of Allscripts Healthcare, LLC and/or its affiliates. All
other products are trademarks of their respective holders, all
rights reserved. Reference to these products is not intended to
imply affiliation with or sponsorship of Allscripts Healthcare, LLC
and/or its affiliates.
This earnings release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements are based on the
current beliefs and expectations of Allscripts management, only
speak as of the date that they are made, and are subject to
significant risks and uncertainties. Such statements can be
identified by the use of words such as "future,"
"anticipates," "believes," "estimates," "expects," "intends,"
"plans," "predicts," "will," "would," "could," "can," "may," and
similar terms. Actual results could differ from those set forth in
the forward-looking statements, and reported results should not be
considered an indication of future performance. Certain
factors that could cause Allscripts' actual results to differ
materially from those described in the forward-looking statements
include, but are not limited to: Allscripts' failure to compete
successfully; consolidation in Allscripts' industry; current and
future laws, regulations and industry initiatives; increased
government involvement in Allscripts' industry; the failure of
markets in which Allscripts operates to develop as quickly as
expected; Allscripts' or its customers' failure to see the benefits
of government programs; changes in interoperability or other
regulatory standards; the effects of the realignment of Allscripts'
sales, services, and support organizations; market acceptance of
Allscripts' products and services; the unpredictability of the
sales and implementation cycles for Allscripts' products and
services; Allscripts' ability to manage future growth; Allscripts'
ability to introduce new products and services; Allscripts' ability
to establish and maintain strategic relationships; risks related to
the acquisition of new companies or technologies; the performance
of Allscripts' products; Allscripts' ability to protect its
intellectual property rights; the outcome of legal proceedings
involving Allscripts; Allscripts' ability to hire, retain and
motivate key personnel; performance by Allscripts' content and
service providers; liability for use of content; security breaches;
price reductions; Allscripts' ability to license and integrate
third party technologies; Allscripts' ability to maintain or expand
its business with existing customers; risks related to
international operations; changes in tax rates or laws; business
disruptions; Allscripts' ability to maintain proper and effective
internal controls; and asset impairment charges. Additional
information about these and other risks, uncertainties, and factors
affecting Allscripts' business is contained in Allscripts' filings
with the Securities and Exchange Commission. Allscripts does
not undertake to update forward-looking statements to reflect
changed assumptions, the impact of circumstances or events that may
arise after the date of the forward-looking statements, or other
changes in its business, financial condition, or operating results
over time.
Table 1 |
Allscripts Healthcare
Solutions, Inc. |
Condensed Consolidated
Balance Sheets |
(In millions) |
(Unaudited) |
|
|
March 31, |
December 31, |
|
2015 |
2014 |
ASSETS |
|
|
Current assets: |
|
|
Cash and cash equivalents |
$88.5 |
$53.2 |
Accounts receivable, net |
325.2 |
331.6 |
Deferred taxes, net |
35.7 |
35.6 |
Prepaid expenses and other current
assets |
108.0 |
102.4 |
Total current assets |
557.4 |
522.8 |
Long-term marketable securities |
0.0 |
1.3 |
Fixed assets, net |
140.1 |
145.8 |
Software development costs, net |
83.5 |
86.2 |
Intangible assets, net |
387.1 |
403.4 |
Goodwill |
1,200.3 |
1,200.7 |
Deferred taxes, net |
0.7 |
0.7 |
Other assets |
135.7 |
147.3 |
Total assets |
$2,504.8 |
$2,508.2 |
|
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY |
|
|
Current liabilities: |
|
|
Accounts payable |
$82.7 |
$70.8 |
Accrued expenses |
63.3 |
79.0 |
Accrued compensation and benefits |
39.8 |
51.1 |
Deferred revenue |
322.1 |
293.0 |
Current maturities of long-term debt and
capital lease obligations |
30.3 |
27.5 |
Total current liabilities |
538.2 |
521.4 |
Long-term debt |
542.4 |
548.7 |
Deferred revenue |
23.1 |
23.2 |
Deferred taxes, net |
56.0 |
55.4 |
Other liabilities |
67.0 |
75.3 |
Total liabilities |
1,226.7 |
1,224.0 |
Total stockholders' equity |
1,278.1 |
1,284.2 |
Total liabilities and stockholders'
equity |
$2,504.8 |
$2,508.2 |
|
|
|
Table 2 |
Allscripts Healthcare
Solutions, Inc. |
Condensed Consolidated
Statements of Operations |
(In millions, except per-share
amounts) |
(Unaudited) |
|
|
Three
Months Ended March 31, |
|
2015 |
2014 |
Revenue: |
|
|
Software delivery, support and
maintenance |
$227.6 |
$227.4 |
Client services |
107.0 |
112.9 |
Total revenue |
334.6 |
340.3 |
Cost of revenue: |
|
|
Software delivery, support and
maintenance |
76.7 |
75.2 |
Client services |
107.2 |
105.9 |
Amortization of software development and
acquisition-related assets (a) |
20.9 |
21.0 |
Total cost of revenue |
204.8 |
202.1 |
Gross profit |
129.8 |
138.2 |
Selling, general and administrative
expenses |
82.1 |
89.9 |
Research and development |
46.7 |
52.3 |
Asset impairment charges |
0.0 |
0.2 |
Amortization of acquisition-related
intangible assets |
6.7 |
7.7 |
Loss from operations |
(5.7) |
(11.9) |
Interest expense (b) |
(7.3) |
(7.3) |
Other income, net |
1.9 |
0.0 |
Loss before income taxes |
(11.1) |
(19.2) |
Income tax benefit (provision) |
1.0 |
(1.5) |
Net loss |
($10.1) |
($20.7) |
|
|
|
Loss per share - basic and diluted |
($0.06) |
($0.12) |
|
|
|
Weighted average common shares
outstanding: |
|
|
Basic |
180.6 |
179.0 |
Diluted |
180.6 |
179.0 |
|
|
|
(a) Amortization of software development and
acquisition-related assets includes: |
|
|
Amortization of capitalized software
development costs |
$11.8 |
$12.2 |
Amortization of acquisition-related
intangible assets |
9.1 |
8.8 |
|
$20.9 |
$21.0 |
|
|
|
(b) Interest expense includes the following
non-cash expenses for the periods presented: |
|
|
|
Three
Months Ended March 31, |
|
2015 |
2014 |
|
|
|
Amortization of 1.25% Cash Convertible
Notes original issue discount |
$ 2.7 |
$ 2.5 |
|
|
|
Table 3 |
Allscripts Healthcare
Solutions, Inc. |
Condensed Consolidated
Statements of Cash Flows |
(In millions) |
(Unaudited) |
|
|
Three
Months Ended March 31, |
|
2015 |
2014 |
Cash flows from operating activities: |
|
|
Net loss |
($10.1) |
($20.7) |
Non-cash adjustments to net loss: |
|
|
Depreciation and amortization |
41.7 |
45.1 |
Stock-based compensation expense |
9.1 |
10.1 |
Other non-cash charges, net |
0.0 |
4.9 |
Total non-cash adjustments to income |
50.8 |
60.1 |
Cash impact of changes in operating
assets and liabilities |
17.8 |
(18.1) |
Net cash provided by operating
activities |
58.5 |
21.3 |
Cash flows from investing activities: |
|
|
Capital expenditures |
(6.1) |
(11.9) |
Capitalized software |
(9.3) |
(9.2) |
Purchases of non-marketable securities
and other investments |
(0.7) |
(6.0) |
Sales and maturities of marketable
securities and other investments |
1.3 |
0.0 |
Proceeds from sale of fixed assets |
0.0 |
0.1 |
Net cash used in investing
activities |
(14.8) |
(27.0) |
Cash flows from financing activities: |
|
|
Stock-based compensation-related
payments, net |
(2.2) |
(0.4) |
Senior secured debt borrowings payments,
net |
(5.7) |
(15.4) |
Net cash (used in ) provided by financing
activities |
(7.9) |
(15.8) |
Effect of exchange rate changes on cash
and cash equivalents |
(0.5) |
0.1 |
Net increase (decrease) in cash and cash
equivalents |
35.3 |
(21.4) |
Cash and cash equivalents, beginning of
period |
53.2 |
63.0 |
Cash and cash equivalents, end of period |
$88.5 |
$41.6 |
|
|
|
Table 4 |
Allscripts Healthcare
Solutions, Inc. |
Condensed Non-GAAP
Financial Information |
(In millions, except per share
amounts) |
(Unaudited) |
|
|
Three
Months Ended March 31, |
|
2015 |
2014 |
Total revenue, as reported |
$334.6 |
$340.3 |
|
|
|
Deferred revenue and other
adjustments |
0.0 |
4.5 |
Total non-GAAP revenue |
$334.6 |
$344.8 |
|
|
|
Gross profit, as reported |
$129.8 |
$138.2 |
|
|
|
Deferred revenue and other
adjustments |
0.0 |
4.5 |
Acquisition-related amortization |
9.1 |
8.8 |
Stock-based compensation expense |
2.5 |
1.3 |
Non-recurring expenses and
transaction-related costs (a) |
0.0 |
1.9 |
Total non-GAAP gross
profit |
$141.4 |
$154.7 |
|
|
|
Operating income (loss), as reported |
($5.7) |
($11.9) |
|
|
|
Deferred revenue and other
adjustments |
0.0 |
4.5 |
Acquisition-related amortization |
15.8 |
16.5 |
Stock-based compensation
expense |
9.5 |
10.1 |
Non-recurring expenses and
transaction-related costs (a) |
6.1 |
3.7 |
Non-cash asset impairment charges |
0.0 |
0.2 |
Total non-GAAP operating
income |
$25.7 |
$23.1 |
|
|
|
Net loss, as reported |
($10.1) |
($20.7) |
|
|
|
Deferred revenue and other
adjustments |
0.0 |
2.9 |
Acquisition-related amortization |
10.3 |
10.7 |
Stock-based compensation
expense |
6.2 |
6.5 |
Non-recurring expenses and
transaction-related costs |
3.9 |
2.4 |
Non-cash asset impairment charges |
0.0 |
0.1 |
Non-cash charges to interest expense and
other |
1.7 |
1.8 |
Tax rate alignment |
2.9 |
8.3 |
Non-GAAP net income |
$14.9 |
$12.0 |
|
|
|
Non-GAAP effective tax rate |
35% |
35% |
|
|
|
Weighted shares outstanding - diluted |
180.6 |
179.0 |
|
|
|
Loss per share - diluted, as reported |
($0.06) |
($0.12) |
|
|
|
Non-GAAP earnings per share -
diluted |
$0.08 |
$0.07 |
|
|
|
Note: all adjustments to
reconcile GAAP to non-GAAP net income are net of tax. |
(a) Non-recurring expenses and
transaction-related costs included in cost of revenue and operating
expenses are comprised of the following for the periods
presented: |
|
|
Three
Months Ended March 31, |
|
2015 |
2014 |
|
|
|
Cost of revenue: |
|
|
MyWay and other product consolidation costs
included in cost of revenue |
$0.0 |
$1.9 |
Operating expenses: |
|
|
Severance and other costs |
$6.0 |
$0.1 |
MyWay product consolidation |
0.0 |
0.0 |
Transaction-related costs |
0.1 |
1.7 |
Total non-recurring expenses and
transaction-related costs included in operating
expenses |
$6.1 |
$1.8 |
|
|
|
Total non-recurring expenses and
transaction related costs |
$6.1 |
$3.7 |
|
|
|
Table 5 |
Allscripts Healthcare
Solutions, Inc. |
Non-GAAP Financial
Information - Adjusted EBITDA |
(In millions) |
(Unaudited) |
|
|
Three
Months Ended March 31, |
|
2015 |
2014 |
Total revenue, as reported |
$334.6 |
$340.3 |
Deferred revenue and other
adjustments |
0.0 |
4.5 |
Total non-GAAP revenue |
$334.6 |
$344.8 |
|
|
|
Net loss, as reported |
($10.1) |
($20.7) |
|
|
|
Deferred revenue and other
adjustments |
0.0 |
4.5 |
Depreciation and amortization |
41.7 |
45.1 |
Stock-based compensation expense |
9.5 |
10.1 |
Non-recurring expenses and
transaction-related costs (a) |
6.1 |
3.2 |
Non-cash asset impairment charges |
0.0 |
0.2 |
Interest expense and other income net
(b) |
3.7 |
4.0 |
Tax provision/(benefit) |
(1.0) |
1.5 |
|
|
|
Adjusted EBITDA |
$49.9 |
$47.9 |
|
|
|
Adjusted EBITDA margin (c) |
15% |
14% |
|
|
|
(a) Depreciation expense
totaling $0.0 million and $0.5 million has been excluded from
non-recurring expenses for the three months ended March 31, 2015
and 2014 respectively, since these amounts are also included in
depreciation and amortization. |
(b) Interest expense (income) and
other (income) expense has been adjusted from the amounts presented
in the statements of operations in order to remove the amortization
of the fair value of the cash conversion option embedded in the
1.25% Cash Convertible Notes and deferred debt issuance costs from
interest expense since such amortization is also included in
depreciation and amortization. |
(c) Adjusted EBITDA margin is
calculated by dividing adjusted EBITDA by total non-GAAP
revenue. |
Explanation of Non-GAAP Financial Measures
Allscripts reports its financial results in accordance with U.S.
generally accepted accounting principles, or GAAP. To supplement
this information, Allscripts presents in this release non-GAAP
revenue, gross profit, SG&A, operating expense, operating
income and net income, including non-GAAP net income on a per share
basis, non-GAAP effective income tax rate, and Adjusted EBITDA and
free cash flow, which are also considered non-GAAP financial
measures under Section 101 of Regulation G under the Securities
Exchange Act of 1934, as amended.
- Non-GAAP revenue consists of GAAP revenue as reported and adds
back deferred revenue and other adjustments recorded for GAAP
purposes.
- Non-GAAP gross profit consists of GAAP gross profit as reported
and adds back deferred revenue and other adjustments booked for
GAAP purposes and excludes acquisition-related amortization,
stock-based compensation expense, and non-recurring expenses and
transaction-related costs. Non-GAAP gross margin consists of
non-GAAP gross profit as a percentage of non-GAAP revenue, as
defined above. For the first quarter of 2015, non-GAAP gross
margin totaled 42.3 percent, consisting of non-GAAP gross profit of
$141.4 million divided by total non-GAAP revenue of $334.6
million. For the first quarter of 2014, non-GAAP gross margin
totaled 44.9, percent consisting of non-GAAP gross profit of $154.7
million divided by total non-GAAP revenue of $344.8
million. Reconciliations to total non-GAAP revenue and total
non-GAAP gross profit are found in Table 4 within this press
release.
- Non-GAAP operating expense consists of GAAP selling, general
and administrative expenses (SG&A) and research and development
expense (R&D), as reported, and excludes non-recurring expenses
and transaction-related costs and stock-based compensation expense
recorded to SG&A and R&D. For the first quarter of
2015, non-GAAP operating expense totaled $115.7 million consisting
of $82.1 million of GAAP SG&A and $46.7 million of GAAP R&D
expense and excludes $6.1 million of total non-recurring expense
and transaction-related costs and $7.0 million of stock-based
compensation expense recorded to SG&A and R&D. For the
first quarter of 2014, non-GAAP operating expense totaled $131.6
million consisting of $89.9 million of GAAP SG&A and $52.3
million of GAAP R&D expense and excludes $1.8 million of total
non-recurring expense and transaction-related costs and $8.8
million of stock-based compensation expense recorded to SG&A
and R&D.
- Adjusted EBITDA is a non-GAAP measure and consists of GAAP net
income (loss) as reported and adjusts for: tax provision (benefit);
interest expense and other income, net; stock-based compensation
expense; depreciation and amortization; deferred revenue and other
adjustments; non-recurring and transaction-related costs; and
non-cash asset impairment charges.
- Non-GAAP effective income tax rate is based on non-GAAP pre-tax
earnings and consists of the statutory federal income rate,
Allscripts effective state income tax rate, and adjustments for
permanent differences.
- Non-GAAP net income consists of GAAP net income/(loss) as
reported, and adds back deferred revenue and other adjustments,
acquisition-related amortization, stock-based compensation expense,
non-recurring expenses and transaction-related costs, non-cash
charges to interest expense and other, and non-cash asset
impairment charges, in each case net of any related tax
effects. Non-GAAP net income also includes a tax rate
alignment adjustment.
Deferred Revenue and Other Adjustments.
Deferred revenue and other adjustments includes acquisition-related
deferred revenue adjustments, which reflect the fair value
adjustments to deferred revenues acquired in business acquisitions.
The fair value of deferred revenue represents an amount equivalent
to the estimated cost plus an appropriate profit margin, to perform
services related to the acquiree's software and product support,
which assumes a legal obligation to do so, based on the deferred
revenue balances as of the acquisition date. Also included are
adjustments for the vesting of a warrant issued to a commercial
partner and the effects of straight-lining contractual pricing
adjustments over the performance period. Allscripts adds back
deferred revenue and other adjustments for its non-GAAP financial
measures because it believes the inclusion of this amount directly
correlates to the underlying performance of Allscripts
operations.
Acquisition-Related
Amortization. Acquisition-related amortization
expense is a non-cash expense arising primarily from the
acquisition of intangible assets in connection with acquisitions or
investments. Allscripts excludes acquisition-related amortization
expense from non-GAAP gross profit, non-GAAP operating income and
non-GAAP net income because it believes (i) the amount of such
expenses in any specific period may not directly correlate to the
underlying performance of Allscripts business operations and (ii)
such expenses can vary significantly between periods as a result of
new acquisitions and full amortization of previously acquired
intangible assets. Investors should note that the use of these
intangible assets contributed to revenue in the periods presented
and will contribute to future revenue generation, and the related
amortization expense will recur in future periods.
Stock-Based Compensation Expense. Stock-based
compensation expense is a non-cash expense arising from the grant
of stock-based awards to employees. Allscripts excludes stock-based
compensation expense from non-GAAP gross profit, non-GAAP operating
income, non-GAAP net income and Adjusted EBITDA because it believes
(i) the amount of such expenses in any specific period may not
directly correlate to the underlying performance of Allscripts
business operations and (ii) such expenses can vary significantly
between periods as a result of the timing of grants of new
stock-based awards, including grants in connection with
acquisitions. Investors should note that stock-based compensation
is a key incentive offered to employees whose efforts contributed
to the operating results in the periods presented and are expected
to contribute to operating results in future periods and such
expense will recur in future periods.
Non-Recurring Expenses and Transaction-Related
Costs. Non-recurring expenses relate to certain
severance, product consolidation, legal proceedings, consulting,
and other charges incurred in connection with activities that are
considered one-time. Transaction-related costs include
deferred compensation expenses incurred in connection with the
acquisition of dbMotion, Ltd.
Allscripts excludes non-recurring expenses and
transaction-related costs from non-GAAP gross profit, non-GAAP
operating income, non-GAAP net income and Adjusted EBITDA because
it believes (i) the amount of such expenses in any specific period
may not directly correlate to the underlying performance of
Allscripts business operations and (ii) such expenses can vary
significantly between periods.
Non-Cash Charges to Interest Expense and
Other. Non-cash charges to interest expense and other
includes non-cash amortization of the fair value of the cash
conversion option embedded in the 1.25 percent Cash Convertible
Notes issued by Allscripts during the second quarter of
2013. Also included in this amount are non-cash adjustments to
reflect changes in the fair value of derivative financial
instruments related to the 1.25 percent Cash Convertible Notes that
do not qualify for hedge accounting treatment.
Non-Cash Asset Impairment Charges. Asset
impairment charges relate primarily to product consolidation
activities.
Tax Rate Alignment. Tax adjustment aligns the
applicable period's effective tax rate to the expected annual
non-GAAP effective tax rate.
Management also believes that non-GAAP revenue, gross profit,
SG&A, operating expense, operating income, net income and
non-GAAP net income on a per share basis, and Adjusted EBITDA,
provide useful supplemental information to management and investors
regarding the underlying performance of Allscripts business
operations. Acquisition accounting adjustments made in accordance
with GAAP can make it difficult to make meaningful comparisons of
the underlying operations of the business without considering the
non-GAAP adjustments provided and discussed herein. Management
also uses this information internally for forecasting and
budgeting, as it believes that these measures are indicative of
core operating results. In addition, management may use non-GAAP
revenue, SG&A, operating expense, operating income, net income
and/or Adjusted EBITDA to measure achievement under Allscripts
stock and cash incentive compensation plans. Note, however, that
non-GAAP revenue, gross profit, operating income and net income and
non-GAAP net income on a per share basis and Adjusted EBITDA are
performance measures only, and they do not provide any measure of
cash flow or liquidity. Non-GAAP financial measures are not in
accordance with, or an alternative for, measures of financial
performance prepared in accordance with GAAP and may be different
from non-GAAP measures used by other companies. Non-GAAP measures
have limitations in that they do not reflect all of the amounts
associated with Allscripts results of operations as determined in
accordance with GAAP. Investors and potential investors are
encouraged to review the reconciliation of non-GAAP financial
measures with GAAP financial measures contained within the attached
condensed consolidated financial statements.
Free Cash Flow. Free cash flow is
calculated based on GAAP cash flows provided by operating
activities in the applicable period, net of capital expenditures
and capitalized software costs. For the first quarter of 2015,
cash flow from operations totaled $58.5 million, capital
expenditures totaled $6.1 million and capitalized software totaled
$9.3 million. For the first quarter of 2014, cash flow from
operations totaled $21.3 million, capital expenditures totaled
$11.9 million and capitalized software totaled $9.2 million.
CONTACT: For more information contact:
Investors:
Seth Frank
312-506-1213
seth.frank@allscripts.com
Media:
Concetta Di Franco
312-447-2466
Concetta.difranco@allscripts.com
Veradigm (NASDAQ:MDRX)
Historical Stock Chart
From Aug 2024 to Sep 2024
Veradigm (NASDAQ:MDRX)
Historical Stock Chart
From Sep 2023 to Sep 2024