A so-so year for Allscripts
The Q4 and full year financial results Allscripts announced on Thursday showed bookings were down with the same quarter a year ago – $244 million compared with $274 million in 2013. However over all of 2014, bookings totaled $923 million, a 2 percent increase over 2013.
Bookings reflect double-digit growth in ambulatory solutions, managed IT services, and international sales compared with the fourth quarter of 2013. Partially offsetting this growth, the company reported, was a decline in client demand for patient portal solutions, a requirement for meeting meaningful use, Stage 2.
SaaS bookings constituted 44 percent of total bookings in 2014 compared with 36 percent in 2013.
Contract revenue backlog as of Dec. 31, 2014, totaled $3.4 billion, which was comparable with the prior-year amount.
Allscripts President and CEO Paul M. Black said in a press statement that Allscripts' fourth quarter non-GAAP EPS increased despite a lack of revenue growth in the quarter.
The company also generated strong operating cash flow in the fourth quarter, which drove a significant improvement in free cash flow for 2014 compared with 2013, he said.
"In addition, the investments we have made to improve our solutions are driving higher client satisfaction and positioning Allscripts for long-term growth," Black added.
[See also: CEO declares Allscripts is 'back']
He said the half billion investment Allscripts made in R&D has paid off over the past two years, and he expects it will continue to add to the company momentum.
"In addition, our improved client execution is driving an increasing interest in and recognition of Allscripts advanced, open technology," he said.
According to Zacks analysts, Black has some reason for optimism.
"Allscripts reported a mixed fourth quarter, recording an earnings beat despite weaker-than-expected revenues," Zacks noted in the analyst blog. "We believe that the Sunrise electronic health record platform is an important growth driver for the company. On the back of Best in KLAS recognition, the Sunrise platform can surely garner more business for Allscripts in the form of new clients."
Additionally, Zacks analysts noted that they were impressed with the company’s cost curtailment efforts.
[See also: CEO declares Allscripts is 'back'.]