Perficient, Inc. (PRFT)
Citi 8th Annual Small/Mid Cap Conference
November 15, 2011, 16:00 p.m. ET
Jeff Davis - President and CEO
Previous Statements by PRFT
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[Abrupt Start] Perficient. And from Perficient we have Jeff Davis, who’s the CEO and President. And he’s just going to take us through the presentation and open the floor to questions afterwards. Okay.
Thanks. Good to be here. Thank you all for your time this afternoon. I appreciate it. I’m going to walk around a little bit during presentation. Perficient is an IT and management consulting firm. So we’re solutions based. We don’t do staff augmentations. It’s mostly a project based business, where we own the deliverables, we help clients solve problems that they have and their businesses. They can be solved through either process improvement. As I said we’re branching more in the management consulting, or through some kind of technology under penny, which is more typically the case.
Just to give you a brief overview here, this first slide, I’ll start with revenue experience through the recession. As you can see, we got impacted the most in 2009, primarily in the financial services industry, some of them are going to come back to, because we’re seeing that come back pretty strongly right now for us. But we got down too; we were kind of mid to high teens as a percent of revenue in financial services got it low as 670% in the third quarter of ’09. That’s where got impacted the most, but we’re seeing that come back.
And you can see, in general, nice recovery over the last couple of years in the business and we expect that to continue. Obviously, I’ll dive into more detail there. 17 offices throughout United States; focused mostly in the central corridor, but also branching to California, as well as Mid-Atlantic and to the Southeast.
Good growth and good performance over the past decade, really since the company’s inception, other than 2009 we grown every year. This refers to 18% compound annual growth rate organic only and the company is highly acquisitive. I’ll be doing the deeper dive in that also in a minute. But if we extend that to 2011 to the mid-point for our guidance for this year, that number is still 13.5% even through the recession. So a good, strong growth company, both again organically and through acquisitions.
To take some of the more important things here, highlight from Q3 of this year, the September quarter, revenues at 28%, but I want to point out how margins are up. So we’ve got margin expansion already occurring in the business and we’ve got additional margin expansion opportunity going forward. I’ll touch on that again later. But adjusted earnings per share, which is effectively cash earnings per share or taking out amortized, goodwill, as well stock compensation, is how we arrive that, there’s reconciliation I think in this deck. And then also, EBITDA, net of stock comp up 52%, the net income in GAAP number up 54% with top line growth to 28%. So good margin expansion.
Well, the questions I get off and I’ve gotten on one on ones and I typically do in these conferences is what are we seeing in the macro-environment. And for us right now, we’re not seeing any impact. As a matter of fact I would say, we’ve got stronger momentum than we’ve had, since the recession began. So since 2007, the latter part of the year for us has been kind of a hockey stick. Our organic growth year-over-year in the third quarter was 10%. The mid-point of our guidance for this quarter is 13% organic only, over 30% when you include the two acquisitions that we’ve done this year. So we’re actually seeing strong momentum going into 2012. As a matter of fact, our bookings year to date to the September quarter were up 25% year-over-year. Our revenue for the year is projected to be up about 8% organic, so these are both organic numbers. So the growth in book to bill you can see is pretty dramatic, which means we’ve got a good backlog going into the 2012 calendar year and a good momentum as mentioned before the fourth quarter with 13% year-over-year.
In terms of additional strength, the company’s got strong balance sheet. There’s no debt on the balance sheet. There’s a little bit of cash. We did an acquisition that used quite a bit of cash for the first part of the September quarter, but we still ended with a couple of million dollars and no debt. We do have a nice facility that we can use if we choose to, we never use it for operating depo, we don’t need to, the business generates plenty of cash for that. In spite of the fact that we’ve been pretty aggressive, we’re buying our stock back. We’ve slowed down the buy back slightly as we’ve gotten into more of an acquisition mode. However, we’re continuing it. I would say a little more opportunistic we perhaps than we have in the past. But we want to maintain an up of a buyback to offset the shares that we’re issuing is best we can out of Treasury for these acquisitions. We do have cash, our stock, again, I’m going get into that in a minute, as well some restricted stock grants that we’re doing it thoroughly. So our intention is to maintain minimal or do dilution through those two issuance vehicles.