Allscripts Healthcare Solutions, Inc. has announced that it expects to report the following financial results for the three months ended March 31, 2012.
First Quarter Results:
- Bookings of approximately $194.6 million. This compares to bookings of $212.4 million in the first quarter of 2011.
- GAAP revenue of $364.7 million and non-GAAP revenue of $365.5 million. This compares to GAAP and non-GAAP revenue of $335.3 and $346.1 million, respectively, in the first quarter of 2011.
- GAAP operating income of $13.0 million; non-GAAP operating income of $40.9. This compares to $24.5 million and $72.1 million, respectively, in the first quarter of 2011.
- GAAP net income(1) of $5.8 million; diluted earnings per share of $0.03. This compares to $12.6 million and $0.07, respectively, in the first quarter of 2011.
- Non-GAAP diluted earnings per share of $0.12, compared to $0.21 in the first quarter of 2011.
- $74.6 million in cash flow from operations; reduced debt by another $24.5 million, decreasing total outstanding debt to approximately $343.0 million as of March 31, 2012.
"Our overall results were primarily affected by lower than expected sales and an unfavorable sales mix, which directly impacted revenue and profit," said Glen Tullman, Chief Executive Officer of Allscripts. "In addition, our investments in improving client experience and accelerating product development, as well as higher than expected software development expense, also put pressure on our bottom line.
"While Allscripts continued to win important new clients, including three new Sunrise Clinical Manager contracts in the quarter, a number of our clients and prospects delayed commitments as they wait for us to introduce new releases and demonstrate more robust integration. This dynamic, combined with the recent reorganization of our sales and service teams, were the primary factors that caused sales to be lower than our expectations.
"We believe our revised full-year guidance for the remainder of 2012 gives us flexibility to further invest as necessary to improve client experience and focus on key product requirements and innovation, which will be our highest priority."
First Quarter Results
GAAP revenue for the three months ended March 31, 2012 was $364.7 million. Non-GAAP revenue(2) for the three months ended March 31, 2012 was $365.5 million, compared to non-GAAP revenue of $346.1 million for the three months ended March 31, 2011, a 6 percent increase.
GAAP gross profit for the three months ended March 31, 2012 was $155.7 million. Non-GAAP gross profit(3) was $156.5 million for the three months ended March 31, 2012, compared to $170.6 million for the three months ended March 31, 2011.
GAAP operating income for the three months ended March 31, 2012 was $13.0 million. Non-GAAP operating income(4) was $40.9 million for three months ended March 31, 2012, or 11.2 percent of total non-GAAP revenue. This compares to $72.1 million or 20.8 percent of non-GAAP revenue for the prior year.
GAAP net income for the three months ended March 31, 2012 was $5.8 million. Non-GAAP net income(5) was $23.5 million, after giving effect to deferred revenue adjustments, acquisition-related amortization, stock-based compensation expense and transaction-related expenses totaling $17.7 million, net of tax for the three months ended March 31, 2012. This result compares to $40.6 million of non-GAAP net income for the prior year period.
Diluted earnings per share for the three months ended March 31, 2012 was $0.03. Non-GAAP diluted earnings per share for the three months ended March 31, 2012 was $0.12, after giving effect to deferred revenue adjustments, acquisition-related amortization, stock-based compensation expense and transaction-related expenses totaling $0.09 per share, net of tax for the three months ended March 31, 2012. This result compares to $0.21 of non-GAAP diluted earnings per share for the prior year period.
Allscripts' tax rate on a non-GAAP basis was 36.8 percent for the three months ended March 31, 2012.
For the first quarter of 2012, cash flow from operations totaled $74.6 million. During the first quarter of 2012, Allscripts had repaid approximately $24.5 million of borrowings under its secured term loan and senior secured revolving facilities. As of March 31, 2012, the Company had $343.0 million of borrowings outstanding and cash and marketable securities of approximately $177.4 million.
Allscripts also announced that Bill Davis, Chief Financial Officer, has decided to leave the Company, effective May 18, 2012, to pursue another opportunity with a private company outside of the healthcare industry.
Tullman commented, "We are grateful to Bill for the key role he has played in the company's growth from revenues of nearly $80 million when Bill joined Allscripts to over $1.4 billion last year, and leading several strategic transactions over the past nine years. We thank him for his contributions and wish him the best in his new endeavors."
Dave Morgan, Senior Vice President Finance, will become the Interim Chief Financial Officer while the Company conducts a formal search for Mr. Davis's successor. Mr. Morgan previously served as SVP Finance and Chief Accounting Officer of Eclipsys.
Tullman continued: "I am confident that Dave, who has deep experience in our organization and industry, will ensure a smooth transition."
Departures from Board of Directors
The Company also announced that Phil Pead's service as Chairman of the Board, director and officer of the Company terminated yesterday. Prior to this action, the Board engaged in extensive deliberations regarding the leadership of the Company. Following the deliberations, those who concurred with the consensus regarding such leadership expressed their intention to continue as directors, and those who did not concur (Catherine M. Burzik, Eugene V. Fife and Edward A. Kangas) informed the Company that they have resigned as directors. The Company expects that several additional directors will be appointed shortly.
Allscripts delivers the insights that healthcare providers require to generate world-class outcomes. The company's Electronic Health Record, practice management and other clinical, revenue cycle, connectivity and information solutions create a Connected Community of Health™ for physicians, hospitals and post-acute organizations. To learn more about Allscripts, please visit www.allscripts.com, Twitter, YouTube and It Takes A Community: The Allscripts Blog.