F2Q2011 Earnings Call Transcript January 27, 2011 4:45 pm ET Executives Tom Giannopoulos – Chairman, President & CEO Peter Rogers – EVP, IR & Business Development Cindy Russo – EVP & CFO Analysts Mayank Tandon – Signal Hill Capital Alan Weinfeld – Kern Suslow Dan Perlin – RBC Gil Luria – Wedbush Securities Bhavan Suri – William Blair Eric Lemus – Raymond James Ross MacMillan – Jefferies Liam Burke – Janney Brian Murphy – Sidoti & Company Vincent Colicchio – Noble Financial Presentation Operator
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MICROS undertakes no duty to update any forward-looking statements to conform to actual results or changes in MICROS expectations. Other risks and uncertainties associated with MICROS business are identified in the management’s discussion and analysis of financial condition, results of operations and business and investment risk sections of MICROS SEC filings. Tom?Tom Giannopoulos Yes. Thanks, Peter. Looking at the financial results for the quarter and the year-to-date, the six months, and as shown in our press release this afternoon, all key numbers, and that is revenue, income from operations in terms of dollars, income from operations in terms of ratio versus revenue, net income, EPS, all were record numbers for Q2 of any of our fiscal years, pre or post-recession. And all these numbers exceeded our budgeted numbers and any outside expectations. Specifically, if you look at the press release and we go down the numbers there, Q2 revenue came in at $247.177 million, a 9.5% increase over last year’s $225.647 million. If we were to add back about $2.8 million, $2.857 million is the exact number of negative impact from foreign exchange, revenue would have been $249 million or a 10.78% increase. Year-to-date for the first six months of our fiscal year, revenue came in at $480.531 million, a 9.9% increase over last year’s $437.048 million. The negative impact of foreign exchange in the first six months was $5.623 million, so the revenue would have been $486.154 million, which is an 11.24% increase year-to-year six months. Overall, I’m pleased with the revenue performance for the quarter, and also for the first six months. There was better than budgeted growth in almost all of our business units. North America did well, with a nice pick up in the street business. South America did very well. EAME, this is the Europe, Africa, Middle East region, did well. This is on a euro basis, despite all the euro zone problems in the last six months that business unit did very well, and the Asia-Pacific did better than expected as well.
Gross margin for the quarter further down on the press release numbers came in at $137.370 million, a very nice 55.6% ratio versus last year’s $124.979 million, which was 55.4%. We continue to maintain our gross margin close to 55% ratio even in these transitional business times, which is very healthy from our point of view.Total operating expenses on a non-GAAP basis for the quarter were $83.400 million, and the ratio is 33.7%, and that is an improvement over last year’s ratio of 35.9%. For the first six months, operating expenses ratio was as improved from 36.1% a year ago to 33.37% this year. As a result, income from operations again on a non-GAAP basis came in at $53.997 million, which is a very good 21.9% of revenue. That’s the best number ever for us. Last year, in the second quarter, the ratio was 19.5%. Year-to-date, our income from operations ratio is 21.5%, $103.481 million versus 19%; $82 million that we did last year, so from an income from operations perspective, dollar-wise and percentage-wise, spectacular performance. Net income of $36.931 million and EPS of $0.45 for the quarter, both numbers substantially better than expected, a 27.2% improvement from last year’s $29 million, this is non-GAAP again. And, of course, EPS, there was a 25% increase from $0.36 last year to $0.45 this year. The six months year-to-date performance net income was up 26.27% from $55 million to $70 million. And EPS was up 23.2% from $0.69 to $0.85, that’s down on the bottom of the page. Read the rest of this transcript for free on seekingalpha.com