FactSet (the “Company”) (NYSE:FDS) (NASDAQ:FDS), a global provider
of integrated financial information, analytical applications, and
industry-leading service, today announced its results for the
fourth quarter ended August 31, 2017.
Fourth Quarter 2017 Highlights
- Revenues increased 13.7% or $39.4 million to $326.6 million
compared with $287.3 million for the same period in 2016. Organic
revenues grew 6.3% to $301.3 million during the fourth quarter of
2017 from the prior year period.
- Operating margin decreased to 25.2% compared to 30.5% in the
prior year period. The decrease in operating margin is primarily
related to $11.2 million in restructuring actions initiated by the
Company and modifications to certain share-based compensation
grants. Adjusted operating margin decreased to 31.2% compared with
33.4% in the prior year period.
- Diluted earnings per share (“EPS”) decreased to $1.52 compared
with $3.55 for the same period in 2016. The prior period diluted
EPS included a one-time gain of $2.01 from the sale of the Market
Metrics business. Adjusted diluted EPS for the fourth quarter rose
12.4% to $1.90.
- Annual Subscription Value (“ASV”) increased to $1.32 billion at
August 31, 2017 compared with prior year ASV of $1.15 billion.
Organic ASV, which excludes the effects of acquisitions,
dispositions and foreign currency increased 5.7%.
- The Company’s effective tax rate for the fourth quarter was
25.3%, as compared to 27.8% a year ago. Excluding income tax
benefits from both periods, the current year annual effective tax
rate was 25.3%, a decrease from 28.3% a year ago, primarily due to
FactSet’s global operational realignment effective September 1,
2016.
“We closed fiscal 2017 with solid ASV growth. We
expanded our product portfolio with exciting new acquisitions in
key growth areas such as analytics and wealth. As we look ahead to
fiscal 2018, we are focused on gaining further value from our
acquisitions and growing our core business,” said Phil Snow,
FactSet CEO.
|
|
|
|
Adjusted
Financial Measures* |
|
|
|
(Condensed and Unaudited) |
|
Three Months Ended August 31, |
|
(In thousands, except
per share data) |
|
2017 |
|
|
2016 |
|
Change |
GAAP revenues |
$ |
326,642 |
|
$ |
287,291 |
|
|
13.7 |
% |
Organic revenues |
$ |
301,311 |
|
$ |
283,432 |
|
|
6.3 |
% |
Adjusted operating
income |
$ |
102,735 |
|
$ |
96,098 |
|
|
6.9 |
% |
Adjusted operating
margin |
|
31.2 |
% |
|
33.4 |
% |
|
|
Adjusted net
income |
$ |
74,721 |
|
$ |
68,607 |
|
|
8.9 |
% |
Adjusted diluted
EPS |
$ |
1.90 |
|
$ |
1.69 |
|
|
12.4 |
% |
|
|
|
|
|
|
|
* See reconciliation of U.S. GAAP to adjusted metrics
measures in the back of this press release
Maurizio Nicolelli, FactSet CFO added, “We ended fiscal 2017
with solid performance across all our key metrics despite the
challenges in our core market. We grew revenue and adjusted
earnings to record levels again this quarter, secured key wins with
global clients and returned over $340 million to shareholders in
this fiscal year.”
Annual Subscription Value (ASV) and Segment Revenue
ASV was $1.32 billion at August 31, 2017, up
5.7% or $65.9 million organically from the prior year. ASV excludes
professional services fees billed in the last 12 months, which are
not subscription-based. Organic ASV, which excludes the effects of
acquisitions, dispositions and foreign currency, increased $31.7
million over the last three months. ASV at any given point in
time represents the forward-looking revenues for the next twelve
months from all subscription services currently supplied to
clients.
Buy-side and sell-side ASV growth rates for the
fourth quarter of fiscal 2017 were 5.9% and 4.6%, respectively.
Buy-side clients accounted for 84% of ASV while the remainder is
derived from sell-side firms that perform mergers and acquisitions
advisory work, capital markets services and equity research.
Supplementary tables covering organic buy-side and sell-side ASV
growth rates may be found on the last page of this earnings
release.
ASV from U.S. operations was $825.1 million,
increasing 9.4% over prior year of $754.3 million and 4.9%
organically. U.S. revenues were $204.1 million compared with $186.7
million. Excluding the effects of acquisitions and dispositions
completed in the last 12 months, the U.S. revenue growth rate was
5.6%. ASV from international operations was $491.5 million,
increasing 24.3% over prior year of $395.5 million and 7.7%
organically. International ASV now represents 37.3% of total ASV,
up from 34.4% a year ago. International revenues were $122.6
million compared with $100.5 million from the fourth quarter of
2016. Excluding the effects of acquisitions and dispositions
completed in the last 12 months and foreign currency, the
international revenue growth rate was 7.6%.
Operational Highlights – Fourth Quarter of Fiscal 2017
- Client count as of August 31, 2017 was 4,744, a net increase of
115 clients in the past three months.
- User count grew 2,821 to 88,846 in the past three months. User
count includes users of FactSet workstations and StreetAccount
users.
- Annual client retention was greater than 95% of ASV. When
expressed as a percentage of clients, annual retention was
91%.
- Employee count was 9,074 at August 31, 2017, up 699 people in
the past 12 months. Excluding workforces acquired in fiscal 2017,
headcount increased 2.4% from a year ago.
- Quarterly free cash flow was $89.3 million compared with $57.0
million for the fourth quarter of 2016. Net cash provided by
operating activities for the fourth quarter was $100.2 million
compared with $70.0 million for the fourth quarter of 2016.
- Capital expenditures decreased to $10.9 million, compared with
$13.1 million a year ago.
- A regular quarterly dividend of $21.9 million, or $0.56 per
share, was paid on September 19, 2017, to common stockholders of
record as of August 31, 2017.
- FactSet integrated its Research Management Solutions with
Liquidnet’s Broker Vote and Commission Management System to offer
MiFID II research unbundling solutions.
- FactSet secured significant wins with global clients across its
product portfolio, including National Bank Investments, Danske
Bank, and Banco Santander Totta.
Full Year 2017 Highlights
- ASV rose to $1.32 billion, up 5.7% organically.
- Revenues increased 8.3% to $1.22 billion, up 6.9%
organically.
- Adjusted diluted EPS increased 14.2% to $7.31.
- Free cash flow totaled $283.7 million.
- Client count increased by 12.8% or 539 during the year, while
users grew by 5.8% or 4,910 from the prior year.
- FactSet returned $342 million to stockholders in the form of
share repurchases and dividends during the fiscal year.
- The Company completed numerous strategic acquisitions,
Vermilion, Cymba, BISAM Technologies S.A and Interactive Data
Managed Solutions (IDMS), renamed to FactSet Digital Solutions
(FDSG), in fiscal 2017 to broaden its suite of products and provide
end-to-end solutions for its clients.
- FactSet was named by Great Place to Work® as one of the UK’s
Best Workplaces™ in the Medium category for the ninth time, ranking
40. This reinforces FactSet’s commitment to being a career
destination for the best and brightest in the UK.
- FactSet, Vermilion, and Portware received awards in more than
nine industry competitions in 2017 including Best Market Data award
for the first time at the Inside Market Data and Inside Reference
Data Awards. The Company was also recognized as Best Analytics
Provider for the second consecutive year.
Share Repurchase Program
FactSet repurchased 270,000 shares for $44.1 million during the
fourth quarter under the Company’s existing share repurchase
program. Over the last 12 months, FactSet has returned $342 million
to stockholders in the form of share repurchases and dividends,
funded by cash generated from operations. As of August 31, 2017,
$244.1 million remained for future share repurchases under the
share repurchase program.
Business Outlook
The following forward-looking statements reflect
FactSet’s expectations as of today’s date. Given the risk factors,
uncertainties and assumptions discussed below, actual results may
differ materially. FactSet does not intend to update its
forward-looking statements until its next quarterly results
announcement, other than in publicly available statements.
First Quarter Fiscal 2018 Expectations:
- GAAP Revenues are expected to be in the range of $327 million
and $333 million.
- GAAP operating margin is expected to be in the range of 28% and
29%. Adjusted operating margin is expected to be in the range of
31% and 32%.
- The annual effective tax rate is expected to be in the range of
25% and 26%.
- GAAP diluted EPS is expected to be in the range of $1.75 and
$1.81. Adjusted diluted EPS is expected to be in the range of $1.93
and $1.99. The midpoint of the adjusted EPS range represents 12%
growth over the prior year.
The annual effective tax rate and the GAAP
diluted and adjusted diluted EPS guidance do not include the
expected impact from the adoption of an accounting standard update,
which impacts several aspects of the accounting for employee
share-based payment transactions, including income taxes and
classification in the statement of cash flows. This
accounting standard update will be effective for FactSet beginning
in the first quarter of fiscal 2018.
Both GAAP operating margin and GAAP diluted EPS
guidance do not include the effects of any non-recurring benefits
or charges that may arise in the first quarter of fiscal 2018.
Conference Call
The Company will host a conference call today, September 26,
2017 at 11:00 a.m. Eastern Time to discuss the fourth quarter
results with its investors. The call will be webcast live at
http://investor.factset.com/investors/audiocasts. The following
information is provided for investors who would like to
participate:
|
|
|
U.S. Participants: |
|
833.231.8259 |
International
Participants: |
|
647.689.4104 |
Passcode: |
|
71877004 |
Moderator: |
|
Rima Hyder, Vice
President, Investor Relations |
|
|
|
An archived webcast with the accompanying slides will be
available at investor.factset.com for one year after the conclusion
of the live event. The earnings call transcript will also be
available via FactSet CallStreet. An audio replay of this
conference will also be available until October 3, 2017 via the
following telephone numbers: 800.585.8367 in the U.S. and
416.621.4642 internationally using passcode 71877004.
Forward-looking Statements
This news release contains forward-looking
statements based on management's current expectations, estimates
and projections. All statements that address expectations or
projections about the future, including statements about the
Company's strategy for growth, product development, market
position, subscriptions, expected expenditures and financial
results are forward-looking statements. Forward-looking statements
may be identified by words like "expects," "anticipates," "plans,"
"intends," "projects," "should," "indicates," "continues,"
"subscriptions" and similar expressions. These statements are not
guarantees of future performance and involve a number of risks,
uncertainties and assumptions. Many factors, including those
discussed more fully elsewhere in this release and in FactSet's
filings with the Securities and Exchange Commission, particularly
its latest annual report on Form 10-K and quarterly reports on Form
10-Q, as well as others, could cause results to differ materially
from those stated. These factors include, but are not limited to:
the current status of the global economy; the ability to integrate
newly acquired companies and businesses; the stability of global
securities markets; the ability to hire qualified personnel; the
maintenance of the Company's leading technological position and
reputation; the impact of global market trends on the Company's
revenue growth rate and future results of operations; the
negotiation of contract terms with corporate vendors, data
suppliers and potential landlords; the retention of key clients;
the continued employment of key personnel; the absence of U.S. or
foreign governmental regulation restricting international business;
and the sustainability of historical levels of profitability and
growth rates in cash flow generation.
About Non-GAAP Financial Measures
Financial measures in accordance with U.S. GAAP
including revenue, operating income and margin, net income, diluted
earnings per share and cash provided by operating activities have
been adjusted.
FactSet uses these adjusted financial measures,
both in presenting its results to stockholders and the investment
community, and in its internal evaluation and management of the
business. The Company believes that these adjusted financial
measures and the information they provide are useful to investors
because they permit investors to view the Company’s performance
using the same tools that management uses to gauge progress in
achieving its goals. Investors may benefit from referring to these
adjusted financial measures in assessing the Company’s performance
and when planning, forecasting and analyzing future periods and may
also facilitate comparisons to its historical performance. The
presentation of this financial information is not intended to be
considered in isolation or as a substitute for the financial
information prepared and presented in accordance with GAAP.
Organic revenues exclude the effects of
acquisitions and dispositions completed in the last 12 months and
foreign currency in all periods presented. Adjusted operating
income and margin, adjusted net income and adjusted diluted
earnings per share exclude both intangible asset amortization and
non-recurring items, including acquisition costs. The Company
believes that these adjusted financial measures better reflect the
underlying economic performance of FactSet.
The GAAP financial measure, cash flows provided
by operating activities, has been adjusted to report non-GAAP free
cash flow that includes the cash cost for taxes and changes in
working capital, less capital expenditures. FactSet uses this
financial measure, both in presenting its results to stockholders
and the investment community, and in the Company’s internal
evaluation and management of the business. Management believes that
this financial measure is useful to investors because it permits
investors to view the Company’s performance using the same metric
that management uses to gauge progress in achieving its goals and
is an indication of cash flow that may be available to fund further
investments in future growth initiatives.
About FactSet
FactSet (NYSE:FDS) (NASDAQ:FDS) delivers
superior analytics, service, content, and technology to help more
than 88,000 users see and seize opportunity sooner. We are
committed to giving investment professionals the edge to
outperform, with fresh perspectives, informed insights, and the
industry-leading support of our dedicated specialists. We're proud
to have been recognized with multiple awards for our analytical and
data-driven solutions and repeatedly ranked as one of Fortune's 100
Best Companies to Work For and a Best Workplace in the United
Kingdom and France. Subscribe to our thought leadership blog
to get fresh insight delivered daily at insight.factset.com. Learn
more at www.factset.com and follow on
Twitter: www.twitter.com/factset.
|
Consolidated Statements of Income (Unaudited) |
|
|
Three Months EndedAugust 31, |
|
Twelve Months EndedAugust 31, |
(In thousands, except
per share data) |
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
|
|
|
|
|
|
Revenues |
$ |
326,642 |
|
|
$ |
287,291 |
|
|
$ |
1,221,179 |
|
|
$ |
1,127,092 |
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
Cost of
services |
|
161,269 |
|
|
|
124,160 |
|
|
|
566,580 |
|
|
|
487,409 |
|
Selling,
general and administrative |
|
82,945 |
|
|
|
75,397 |
|
|
|
302,464 |
|
|
|
290,007 |
|
Total
operating expenses |
|
244,214 |
|
|
|
199,557 |
|
|
|
869,044 |
|
|
|
777,416 |
|
|
|
|
|
|
|
|
|
Operating income |
|
82,428 |
|
|
|
87,734 |
|
|
|
352,135 |
|
|
|
349,676 |
|
|
|
|
|
|
|
|
|
Other expense |
|
|
|
|
|
|
|
Gain
(loss) on sale of business |
|
― |
|
|
|
112,453 |
|
|
|
(1,223 |
) |
|
|
112,453 |
|
Interest
expense, net of interest income |
|
(2,655 |
) |
|
|
(371 |
) |
|
|
(6,600 |
) |
|
|
(1,136 |
) |
Total
other (expense) income |
|
(2,655 |
) |
|
|
112,082 |
|
|
|
(7,823 |
) |
|
|
111,317 |
|
|
|
|
|
|
|
|
|
Income before income
taxes |
|
79,773 |
|
|
|
199,816 |
|
|
|
344,312 |
|
|
|
460,993 |
|
|
|
|
|
|
|
|
|
Provision for income
taxes |
|
20,221 |
|
|
|
55,510 |
|
|
|
86,053 |
|
|
|
122,178 |
|
Net
income |
$ |
59,552 |
|
|
$ |
144,306 |
|
|
$ |
258,259 |
|
|
$ |
338,815 |
|
|
|
|
|
|
|
|
|
Diluted earnings per
common share |
$ |
1.52 |
|
|
$ |
3.55 |
|
|
$ |
6.51 |
|
|
$ |
8.19 |
|
|
|
|
|
|
|
|
|
Diluted weighted
average common shares |
|
39,281 |
|
|
|
40,673 |
|
|
|
39,642 |
|
|
|
41,365 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statements of Comprehensive Income (Unaudited) |
|
|
Three Months EndedAugust 31, |
|
Twelve Months EndedAugust 31, |
(In thousands) |
|
2017 |
|
|
2016 |
|
|
|
2017 |
|
|
2016 |
|
|
|
|
|
|
|
|
|
Net income |
$ |
59,552 |
|
$ |
144,306 |
|
|
$ |
258,259 |
|
$ |
338,815 |
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss), net of tax |
|
|
|
|
|
|
|
Net
unrealized gain (loss) on cash flow hedges* |
|
784 |
|
|
(1,086 |
) |
|
|
5,017 |
|
|
(857 |
) |
Foreign
currency translation adjustments |
|
18,136 |
|
|
(15,777 |
) |
|
|
28,816 |
|
|
(23,644 |
) |
Other
comprehensive income (loss) |
|
18,920 |
|
|
(16,863 |
) |
|
|
33,833 |
|
|
(24,501 |
) |
Comprehensive
income |
$ |
78,472 |
|
$ |
27,443 |
|
|
$ |
292,092 |
|
$ |
314,314 |
|
|
|
|
|
|
|
|
|
*For the three and twelve months ended August 31, 2017, the
unrealized gain on cash flow hedges was net of tax expense of $486
and $3,047, respectively. For the three and twelve months ended
August 31, 2016, the unrealized loss on cash flow hedges was net of
tax benefit of $634 and $498, respectively.
|
Consolidated Balance Sheets (Unaudited) |
|
|
August 31, |
|
August 31, |
(In thousands) |
|
2017 |
|
|
|
2016 |
|
|
|
|
|
ASSETS |
|
|
|
Cash and
cash equivalents |
$ |
194,731 |
|
|
$ |
228,407 |
|
Investments |
|
32,444 |
|
|
|
24,217 |
|
Accounts
receivable, net of reserves |
|
148,331 |
|
|
|
97,797 |
|
Prepaid
taxes |
|
7,076 |
|
|
|
― |
|
Deferred
taxes |
|
2,668 |
|
|
|
3,158 |
|
Prepaid
expenses and other current assets |
|
24,126 |
|
|
|
15,697 |
|
Total
current assets |
|
409,376 |
|
|
|
369,276 |
|
Property,
equipment, and leasehold improvements, net |
|
100,454 |
|
|
|
84,622 |
|
Goodwill |
|
707,560 |
|
|
|
452,915 |
|
Intangible assets, net |
|
173,543 |
|
|
|
93,161 |
|
Deferred
taxes |
|
7,412 |
|
|
|
13,406 |
|
Other
assets |
|
14,970 |
|
|
|
5,781 |
|
Total
Assets |
$ |
1,413,315 |
|
|
$ |
1,019,161 |
|
|
|
|
|
LIABILITIES |
|
|
|
Accounts
payable and accrued expenses |
$ |
59,214 |
|
|
$ |
45,836 |
|
Accrued
compensation |
|
61,083 |
|
|
|
51,036 |
|
Deferred
fees |
|
47,495 |
|
|
|
33,247 |
|
Taxes
payable |
|
9,112 |
|
|
|
7,781 |
|
Deferred
taxes |
|
2,382 |
|
|
|
291 |
|
Dividends
payable |
|
21,853 |
|
|
|
20,019 |
|
Total
current liabilities |
|
201,139 |
|
|
|
158,210 |
|
Deferred
taxes |
|
24,892 |
|
|
|
1,708 |
|
Deferred
fees |
|
3,921 |
|
|
|
― |
|
Taxes
payable |
|
11,484 |
|
|
|
8,782 |
|
Long-term
debt |
|
575,000 |
|
|
|
300,000 |
|
Deferred
rent and other non-current liabilities |
|
37,188 |
|
|
|
33,080 |
|
Total
Liabilities |
$ |
853,624 |
|
|
$ |
501,780 |
|
|
|
|
|
STOCKHOLDERS’
EQUITY |
|
|
|
Common
stock |
$ |
518 |
|
|
$ |
512 |
|
Additional paid-in capital |
|
741,748 |
|
|
|
623,195 |
|
Treasury
stock, at cost |
|
(1,606,678 |
) |
|
|
(1,321,700 |
) |
Retained
earnings |
|
1,458,823 |
|
|
|
1,283,927 |
|
Accumulated other comprehensive loss |
|
(34,720 |
) |
|
|
(68,553 |
) |
Total
Stockholders’ Equity |
|
559,691 |
|
|
|
517,381 |
|
Total
Liabilities and Stockholders’ Equity |
$ |
1,413,315 |
|
|
$ |
1,019,161 |
|
|
|
|
|
|
|
|
|
|
Consolidated Statements of Cash Flows (Unaudited) |
(In thousands) |
Twelve Months EndedAugust 31, |
|
|
2017 |
|
|
|
2016 |
|
CASH FLOWS FROM
OPERATING ACTIVITIES |
|
|
|
Net income |
$ |
258,259 |
|
|
$ |
338,815 |
|
Adjustments to
reconcile net income to net cash provided by operating
activities |
|
|
|
Depreciation and amortization |
|
48,294 |
|
|
|
38,052 |
|
Stock-based compensation expense |
|
34,183 |
|
|
|
29,793 |
|
Loss
(gain) on sale of business |
|
1,223 |
|
|
|
(112,453 |
) |
Deferred
income taxes |
|
4,879 |
|
|
|
4,528 |
|
Loss on
sale of assets |
|
59 |
|
|
|
8 |
|
Tax
benefits from share-based payment arrangements |
|
(10,331 |
) |
|
|
(18,205 |
) |
Changes
in assets and liabilities, net of effects of acquisitions |
|
|
|
Accounts
receivable, net of reserves |
|
(29,502 |
) |
|
|
(3,541 |
) |
Accounts
payable and accrued expenses |
|
(2,226 |
) |
|
|
5,525 |
|
Accrued
compensation |
|
6,427 |
|
|
|
3,961 |
|
Deferred
fees |
|
(229 |
) |
|
|
700 |
|
Taxes
payable, net of prepaid taxes |
|
7,877 |
|
|
|
30,270 |
|
Prepaid
expenses and other assets |
|
(850 |
) |
|
|
7 |
|
Deferred
rent and other non-current liabilities |
|
2,331 |
|
|
|
13,674 |
|
Other
working capital accounts, net |
|
132 |
|
|
|
6 |
|
Net cash
provided by operating activities |
|
320,527 |
|
|
|
331,140 |
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES |
|
|
|
Acquisition of
businesses, net of cash acquired |
|
(303,086 |
) |
|
(262,909 |
) |
Proceeds from the sale
of subsidiaries, net |
|
― |
|
|
153,137 |
|
Purchases of
investments |
|
(30,757) |
|
|
(18,137 |
) |
Proceeds from sales of
investments |
|
23,399 |
|
|
17,241 |
|
Purchases of property,
equipment and leasehold improvements, net of proceeds from
dispositions |
|
(36,862 |
) |
|
(47,740 |
) |
Net cash
used in investing activities |
|
(347,306 |
) |
|
|
(158,408 |
) |
CASH FLOWS FROM
FINANCING ACTIVITIES |
|
|
|
Dividend payments |
|
(80,898 |
) |
|
|
(74,218 |
) |
Repurchase of common
stock |
|
(260,978 |
) |
|
|
(356,828 |
) |
Proceeds from debt |
|
575,000 |
|
|
|
265,000 |
|
Repayment of debt |
|
(300,000 |
) |
|
|
― |
|
Sale of business |
|
(1,223 |
) |
|
|
― |
|
Debt issuance
costs |
|
(438 |
) |
|
|
(12 |
) |
Proceeds from employee
stock plans |
|
50,045 |
|
|
|
56,851 |
|
Tax benefits from
share-based payment arrangements |
|
10,330 |
|
|
|
18,205 |
|
Net cash
used in financing activities |
|
(8,161 |
) |
|
|
(91,002 |
) |
|
|
|
|
Effect of exchange rate
changes on cash and cash equivalents |
|
1,264 |
|
|
|
(12,237 |
) |
Net
(decrease) increase in cash and cash equivalents |
|
(33,676 |
) |
|
|
69,493 |
|
|
|
|
|
Cash and cash
equivalents at beginning of period |
|
228,407 |
|
|
|
158,914 |
|
Cash and cash
equivalents at end of period |
$ |
194,731 |
|
|
$ |
228,407 |
|
|
|
|
|
|
|
|
|
Reconciliation of U.S. GAAP Results to Adjusted Financial
Measures
Financial measures in accordance with U.S. GAAP
including revenues, operating income and margin, net income,
diluted EPS and cash provided by operating activities have been
adjusted below. FactSet uses these adjusted financial measures,
both in presenting its results to stockholders and the investment
community, and in its internal evaluation and management of the
business. The Company believes that these adjusted financial
measures and the information they provide are useful to investors
because they permit investors to view the Company’s performance
using the same tools that management uses to gauge progress in
achieving its goals. Adjusted measures may also facilitate
comparisons to FactSet’s historical performance.
|
Revenues (Details may not sum to total due
to rounding) |
|
(Unaudited) |
|
Three Months EndedAugust 31, |
(In thousands) |
|
|
2017 |
|
|
2016 |
|
Change |
GAAP Revenues |
|
$ |
326,642 |
|
$ |
287,291 |
|
13.7 |
% |
Deferred revenue fair
value adjustment (a) |
|
|
2,955 |
|
|
― |
|
|
Acquired revenues
(b) |
|
|
(28,339 |
) |
|
― |
|
|
Market Metrics
revenues |
|
|
― |
|
|
(3,859 |
) |
|
Currency impact
(c) |
|
|
53 |
|
|
― |
|
|
Organic
revenues |
|
$ |
301,311 |
|
$ |
283,432 |
|
6.3 |
% |
|
|
|
|
|
|
|
|
|
|
- The adjustment for the fourth quarter of fiscal 2017 relates to
the deferred revenue fair value adjustments from purchase
accounting.
- Acquired revenues from acquisitions completed within the last
12 months.
- The impact from foreign currency movements over the past 12
months.
|
Operating Income, Margin, Net Income and Diluted
EPS (Details may not sum to total due to
rounding) |
|
(Unaudited) |
Three Months Ended August 31, |
(In thousands, except
per share data) |
|
2017 |
|
|
2016 |
|
Change |
GAAP Operating
income |
$ |
82,428 |
|
$ |
87,734 |
|
(6.0 |
)% |
Intangible asset
amortization (a) |
|
6,159 |
|
|
3,732 |
|
|
Deferred revenue fair
value adjustment (b) |
|
2,955 |
|
|
― |
|
|
Other
non-recurring items (c) |
|
11,193 |
|
|
4,632 |
|
|
Adjusted
operating income |
$ |
102,735 |
|
$ |
96,098 |
|
6.9 |
% |
Adjusted operating margin (d) |
|
31.2 |
% |
|
33.4 |
% |
|
|
|
|
|
GAAP Net income |
$ |
59,552 |
|
$ |
144,306 |
|
(58.7 |
)% |
Intangible asset
amortization (a)(e) |
|
4,601 |
|
|
2,675 |
|
|
Deferred revenue fair
value adjustment (b)(e) |
|
2,207 |
|
|
― |
|
|
Other
non-recurring items (c)(e) |
|
8,361 |
|
|
3,320 |
|
|
Gain on sale of
business (f) |
|
― |
|
|
(81,694 |
) |
|
Adjusted net income |
$ |
74,721 |
|
$ |
68,607 |
|
8.9 |
% |
|
|
|
|
GAAP Diluted earnings
per common share |
$ |
1.52 |
|
$ |
3.55 |
|
(57.2 |
)% |
Intangible asset
amortization (a)(e) |
|
0.12 |
|
|
0.07 |
|
|
Deferred revenue fair
value adjustment (b)(e) |
|
0.06 |
|
|
― |
|
|
Other
non-recurring items (c)(e) |
|
0.21 |
|
|
0.08 |
|
|
Gain on sale of
business (f) |
|
― |
|
|
(2.01 |
) |
|
Adjusted
diluted earnings per common share |
$ |
1.90 |
|
$ |
1.69 |
|
12.4 |
% |
Weighted average common
shares (Diluted) |
|
39,281 |
|
|
40,673 |
|
|
|
|
|
|
|
|
|
|
- GAAP operating income in the fourth quarter of fiscal 2017 was
adjusted to exclude $6.2 million of pre-tax intangible asset
amortization, which reduced net income by $4.6 million and diluted
earnings per share by $0.12. GAAP operating income in the fourth
quarter of fiscal 2016 was adjusted to exclude $3.7 million of
pre-tax intangible asset amortization, which reduced net income by
$2.7 million and diluted earnings per share by $0.07.
- The adjustment for the fourth quarter of fiscal 2017 relates to
the deferred revenue fair value adjustments from purchase
accounting.
- GAAP operating income in the fourth quarter of fiscal 2017 was
adjusted to exclude $11.2 million of pre-tax expenses including
$5.6 million related to modifications of certain share-based
compensation grants, $5.0 million from restructuring actions
initiated by the Company, and $0.6 million in other
acquisition-related costs, which reduced net income by $8.4 million
and diluted earnings per share by $0.21. GAAP operating income in
the fourth quarter of fiscal 2016 was adjusted to exclude $4.6
million of pre-tax non-recurring items primarily related to legal
matters, which reduced net income by $3.3 million and diluted
earnings per share by $0.08.
- Adjusted operating margin for the fourth quarter of fiscal 2017
is calculated as adjusted operating income divided by GAAP revenues
plus the deferred revenue fair value adjustment.
- For the purposes of calculating adjusted net income and
adjusted diluted earnings per share, intangible asset amortization,
deferred revenue fair value adjustments and non-recurring
acquisition costs were taxed at the annual effective tax rates of
25.3% for fiscal 2017 and 28.3% for fiscal 2016.
- GAAP net income in the fourth quarter of fiscal 2016 was
adjusted to exclude an after-tax gain of $81.7 million related to
the sale of the Market Metrics business in July 2016, net of tax of
$30.8 million. The gain on sale was taxed at an effective tax rate
of 27.4% and increased diluted earnings per share by $2.01.
|
Free Cash Flow (Details may not sum to
total due to rounding) |
|
(Unaudited) |
|
Three Months Ended August 31, |
|
(In thousands) |
|
|
2017 |
|
|
2016 |
|
Change |
Net cash provided by
operating activities |
|
$ |
100,215 |
|
$ |
70,036 |
|
|
Capital
expenditures |
|
|
(10,880 |
) |
|
(13,069 |
) |
|
Free cash
flow |
|
$ |
89,335 |
|
$ |
56,967 |
|
56.8 |
% |
|
|
|
|
|
|
|
|
|
|
Supplementary Schedules of Historical ASV by Client Type
The following table presents the percentages and
growth rates of organic ASV by client type, excluding currency, and
may be useful to facilitate historical comparisons. Organic ASV
excludes acquisitions and dispositions completed within the last 12
months and the effects of foreign currency.
|
|
|
|
|
|
|
|
Q4’17 |
Q3’17 |
Q2’17 |
Q1’17 |
Q4’16 |
Q3’16 |
% of ASV from buy-side clients |
84.1 |
% |
84.4 |
% |
83.2 |
% |
83.0 |
% |
82.6 |
% |
83.0 |
% |
% of ASV from sell-side clients |
15.9 |
% |
15.6 |
% |
16.8 |
% |
17.0 |
% |
17.4 |
% |
17.0 |
% |
|
|
|
|
|
|
|
ASV Growth rate from buy-side clients |
5.9 |
% |
5.7 |
% |
6.8 |
% |
8.3 |
% |
9.0 |
% |
10.3 |
% |
ASV Growth rate from sell-side clients |
4.6 |
% |
5.8 |
% |
4.9 |
% |
6.3 |
% |
7.6 |
% |
8.1 |
% |
Total Organic ASV Growth Rate |
5.7 |
% |
5.7 |
% |
6.5 |
% |
7.9 |
% |
8.8 |
% |
9.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table presents the calculation of the
above-mentioned ASV growth rates from all clients. (Details
may not sum to total due to rounding)
(In millions) |
Q4’17 |
Q4’16 |
As reported ASV (a) |
$ |
1,316.6 |
|
$ |
1,149.9 |
|
Acquired ASV (b) |
|
(102.8 |
) |
|
― |
|
Professional services fees (c) |
|
― |
|
|
(4.4 |
) |
Currency impact (d) |
|
(2.8 |
) |
|
0.7 |
|
Organic ASV total |
$ |
1,211.1 |
|
$ |
1,146.2 |
|
Total Organic ASV Growth Rate |
|
5.7 |
% |
|
|
|
|
|
|
- Beginning with the fiscal third quarter of 2017, FactSet
excluded professional services fees billed within the last 12
months, which are not subscription based. ASV for the fourth
quarter of 2017 excludes $17.2 million in professional services
fees.
- Acquired ASV from acquisitions completed within the last 12
months.
- The organic ASV for the fourth quarter of fiscal 2016 was
adjusted to exclude professional services fees.
- The impact from foreign currency movements was excluded above
to calculate total organic ASV.
Contact:Rima HyderFactSet857.265.7523
FactSet Research Systems (NYSE:FDS)
Historical Stock Chart
From Apr 2024 to May 2024
FactSet Research Systems (NYSE:FDS)
Historical Stock Chart
From May 2023 to May 2024