Press Release

For Immediate Release

Contact(s):
  Patrick Pedonti
  Chief Financial Officer
  Tel: +1-860-298-4738

  Justine Stone
  Investor Relations
  Tel: +1- 212-367-4705
  E-mail: InvestorRelations@sscinc.com

SS&C Technologies Reports Record Revenue, Record Earnings, and Record Cash Flow for Q4 and FY 2016

Q4 GAAP revenue $400.9 million, Fully Diluted GAAP Earnings Per Share $0.28,
Adjusted revenue $404.6 million, Adjusted Diluted Earnings Per Share $0.46

WINDSOR, CT, February 15, 2017 (PR Newswire) SS&C Technologies Holdings, Inc. (NASDAQ: SSNC), a global provider of investment and financial software-enabled services and software, today announced its financial results for the fourth quarter and full year ended December 31, 2016.

GAAP Results

SS&C reported GAAP revenue of $400.9 million for the fourth quarter of 2016, compared to $300.9 million in the fourth quarter of 2015. GAAP revenue for the year ended December 31, 2016 was $1,481.4 million, increasing from $1,000.3 million in 2015. GAAP operating income for the fourth quarter of 2016 was $95.3 million, compared to $48.3 million in 2015’s fourth quarter. GAAP operating income for the year ended December 31, 2016 was $288.7 million, an increase from $164.7 million for 2015. On a fully diluted GAAP basis, earnings per share in the fourth quarter of 2016 was $0.28 compared to fully diluted GAAP earnings per share of $0.06 in the fourth quarter of 2015. On a fully diluted GAAP basis, earnings per share for the year ended December 31, 2016 was $0.64, up from 2015’s $0.22 per share.

Adjusted Non-GAAP Results (defined in Notes 1-4 below)

Adjusted revenue in the fourth quarter of 2016 was $404.6 million, up 24.2 percent compared to $325.8 million in the fourth quarter of 2015. Adjusted revenue for the year ended December 31, 2016 was $1,524.0 million, up 44.3 percent over $1,056.4 million for 2015. Adjusted operating income in the fourth quarter of 2016 was $160.4 million, or 39.6 percent of adjusted revenue. This represents a 20.3 percent increase compared to adjusted operating income of $133.3 million and 40.9 percent of adjusted revenue in the fourth quarter of 2015. Adjusted operating income for the year ended December 31, 2016 was $586.6 million, up 39.2 percent from adjusted operating income of $421.5 million in 2015.

Adjusted net income for the fourth quarter of 2016 was $95.2 million, up 29.3 percent compared to $73.6 million in 2015’s fourth quarter. Adjusted net income for the year ended December 31, 2016 was $337.5 million, up 33.1 percent compared to $253.6 million for 2015. Adjusted diluted earnings per share in the fourth quarter of 2016 was $0.46 per share, up 27.8 percent compared to $0.36 per share in the fourth quarter of 2015. Adjusted diluted earnings per share for the year ended December 31, 2016 was $1.64, up 23.3 percent compared to $1.33 for 2015.

Highlights:

  • SS&C adjusted revenue for Q4 2016 was $404.6 million, up 24.2 percent from Q4 2015 revenue of $325.8 million.
  • Adjusted diluted earnings per share was $0.46 for Q4 2016, increasing 27.8 percent from Q4 2015’s $0.36 adjusted diluted earnings per share.
  • Q4 2016 net cash from operating activities was $181.4 million, an increase of 64.8 percent.
  • Net cash from operating activities increased 81.4 percent to $418.4 million for the twelve months ended December 31, 2016.
  • SS&C closed Wells Fargo Global Fund Services and Conifer Financial Services acquisitions in December 2016, adding a total of $159.9 billion in assets under administration.
  • SS&C paid off $263.4 million of debt net of the revolver draw down which was used to fund the fourth quarter acquisitions, bringing our net debt to consolidated EBITDA leverage ratio to 3.93x.

“SS&C closed out 2016 with over $1.5 billion in adjusted revenues, and adjusted consolidated EBITDA margins above 40 percent” says Bill Stone, Chairman and Chief Executive Officer. “Our year is marked by our acquisitions of Citi Alternative Investor Services, Salentica, Wells Fargo Global Fund Services, and Conifer Financial Services – expanding our reach and capability in fund administration and RIAs. The talent we acquired, both organically and through acquisitions, increase our market opportunity and our ability to win bigger, more complex mandates from top financial institutions.”

Annual Run Rate Basis

Annual Run Rate Basis (ARRB) recurring revenue, defined as adjusted recurring revenue on an annualized basis, was $1,473.8 million based on adjusted recurring revenue $368.5 million for the fourth quarter of 2016. This represents an increase of 24.9 percent from $295.0 million and $1,180.0 million run-rate in the same period in 2015 and an increase of 2.3 percent from $360.3 million for the third quarter of 2016, an annual run rate of $1,441.3 million. We believe ARRB of our recurring revenue is a good indicator of visibility into future revenue.

Operating Cash Flow

SS&C ended the year with $117.6 million in cash, and $2,559.6 million in gross debt for a net debt balance of $2,442.0 million. Net cash from operating activities was $181.4 million in Q4 2016, a 64.8 percent increase from $110.1 million in Q4 2015. For the full year ended December 31, 2016, SS&C generated net cash from operating activities of $418.4 million, compared to $230.6 million for the same period in 2015, an 81.4 percent increase. SS&C’s leverage ratio as defined in our credit agreement stood at 3.93 times consolidated EBITDA as of December 31, 2016.

Guidance

    Q1 2017     FY 2017
Adjusted Revenue ($M)   $402.5 – $408.5     $1,655.0 – $1,685.0  
Adjusted Net Income ($M)   $89.0 – $92.5     $392.0 – $409.0  
Cash from Operating Activities ($M)         $480.0  – $500.0  
Capital Expenditures (% of revenue)         2.5% – 3.0%  
Diluted Shares (M)   207.5 – 208.0     208.0 – 210.0  
Effective Income Tax Rate (%)     29%     29%  
                       

Non-GAAP Financial Measures

Adjusted revenue, adjusted operating income, adjusted consolidated EBITDA, adjusted net income and adjusted diluted earnings per share are non-GAAP measures. See the accompanying notes to the attached Condensed Consolidated Financial Information for the reconciliations and definitions for each of these non-GAAP measures and the reasons our management believes these measures provide useful information to investors regarding our financial condition and results of operations.

Earnings Call and Press Release

SS&C’s Q4 and Full Year 2016 earnings call will take place at 5:00 p.m. eastern time today, February 15, 2017. The call will discuss Q4 and Full Year 2016 results and our guidance and business outlook. Interested parties may dial 877-312-8798 (US and Canada) or 253-237-1193 (International), and request the “SS&C Technologies Fourth Quarter and Full Year 2017 Conference Call”; conference ID #53329711. A replay will be available after 8:00 p.m. eastern time on February 15, 2017, until midnight on February 22, 2017. The dial-in number is 855-859-2056 (US and Canada) or 404-537-3406 (International); access code #53329711. The call will also be available for replay on SS&C’s website after February 15, 2017; access: http://investor.ssctech.com/results.cfm.



Certain information contained in this press release relating to, among other things, our financial guidance for the first quarter and full year of 2017 constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Without limiting the foregoing, the words “believes”, “anticipates”, “plans”, “expects”, “estimates”, “projects”, “forecasts”, “may”, “assume”, “anticipates”, “intend”, “will”, “continue”, “opportunity”, “predict”, “potential”, “future”, “guarantee”, “likely”, “target”, “indicate”, “would”, “could” and “should” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements are accompanied by such words. Such statements reflect management’s best judgment based on factors currently known but are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated. Such risks and uncertainties include, but are not limited to, the state of the economy and the financial services industry, the Company’s ability to finalize large client contracts, fluctuations in customer demand for the Company’s products and services, intensity of competition from application vendors, delays in product development, the Company’s ability to control expenses, terrorist activities, exposure to litigation, the Company’s ability to integrate acquired businesses, the effect of the acquisitions on customer demand for the Company’s products and services, the market price of the Company’s stock prevailing from time to time, the Company’s cash flow from operations, general economic conditions, and those risks discussed in the “Risk Factors” section of the Company’s most recent Annual Report on Form 10-K, which is on file with the Securities and Exchange Commission and can also be accessed on our website. The Company cautions investors that it may not update any or all of the foregoing forward-looking statements.

About SS&C Technologies

SS&C is a global provider of investment and financial software-enabled services and software for the global financial services industry. Founded in 1986, SS&C is headquartered in Windsor, Connecticut and has offices around the world. Some 11,000 financial services organizations, from the world’s largest institutions to local firms, manage and account for their investments using SS&C's products and services. These clients manage an aggregate of over $44 trillion in assets.

Click here to view the financial earnings statement in PDF format.