Billing and business support systems company Amdocs Ltd. (NYSE: DOX) missed on revenue but beat the analysts in its report for the third fiscal quarter of 2012 which was published last night. Amdocs reported revenue of $808.8 million for the third fiscal quarter, 0.9% higher than the corresponding quarter of 2011, and unchanged from the preceding quarter. Revenue was below the Wall Street analysts' consensus estimate of $816.72 million. Amdocs blamed the slightly lower than expected revenue on "Foreign currency movements negatively affected revenue by approximately $5 million."
Amdocs non-GAAP net profit in the third fiscal quarter was $118.4 million ($0.70 per share) compared with non-GAAP net profit of $113.3 million ($0.61 per share) in the corresponding fiscal quarter of 2011. This was above the Wall Street analysts' consensus estimate of $0.67 per share.
The company said that it repurchased $122 million of ordinary shares during the third fiscal quarter.
Regarding guidance, Amdocs expects that revenue for the fourth quarter of fiscal 2012 will be $815-$835 million beneath analysts' expectations of $838.21 million. Earnings per share on a non-GAAP basis for the fourth fiscal quarter are expected to be $0.66-$0.72. For full year 2012, Amdocs expects earnings per share to rise by 14-16% compared with its previous guidance of a rise of 12-14%. The company sees an annual rise in revenue of 3.5% compared with the previous guidance of 3-4%.
Free cash flow was $108 million for the quarter, comprised of cash flow from operations of $138 million less $30 million in net capital expenditures and other. Twelve-month backlog, which includes anticipated revenue related to contracts, estimated revenue from managed services contracts, letters of intent, maintenance and estimated on-going support activities, was $2.76 billion at the end of the third quarter of fiscal 2012, up $35 million from the end of the second fiscal quarter of 2012.
Amdocs added that at a special shareholders meeting yesterday, shareholders approved the institution of a quarterly cash dividend program at the quarterly rate of $0.13 per share. This morning the board approved the first dividend payment and set September 30 as the record date for determining the shareholders entitled to receive the dividend, which will be payable on October 19.
Following publication of the results Amdocs CEO Eli Gelman said, "Demonstrating our confidence in the future success of Amdocs and our commitment to delivering a compelling total return to our shareholders, we continued to execute on our share repurchase plan during the third fiscal quarter and will initiate our first quarterly dividend in the coming months."
He continued, "Our third fiscal quarter results reflect on-going momentum in the emerging markets and managed services, steady business activity in Europe, tempered spending in North America, and greater currency headwinds. Overall, this led to revenue performance roughly in-line with the midpoint of our expectations, excluding the impact of currency fluctuations. In the emerging markets, we continue to see solid momentum across Southeast Asia and Latin America with both new and existing customers. In Latin America, we signed our first managed services engagement. In Europe, we gained some additional traction in managed services during the third quarter. North American results were consistent with our expectations and reflect stable activity with AT&T compared to the previous quarter."
Gelman concluded, "During the quarter, we signed several key strategic wins. In our broadband, cable and satellite group, we extended our long-term agreement with DIRECTV, the largest satellite company in North America, for an additional 5 years and expanded the scope of our activities with this key customer. We won additional business in the North American pre-paid wireless market which is a growing segment for communications service providers. In the emerging markets, we announced an agreement with TIM Brasil that marks our first BSS and OSS managed services win in Latin America as well as our first ever OSS managed services agreement. We have built a solid relationship with TIM Brasil over the years, including serving its wireless, wireline and, most recently, residential broadband operations, which are now all captured under this managed services engagement. Additionally, in Europe we won an important new managed services deal with a large wireless service provider during the third quarter."
Amdocs share price fell 0.84% yesterday on the NYSE to $29.50, giving a market cap of $4.98 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on August 2, 2012
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