Streamline Health Solutions Management Discusses Q2 2012 Results - Earnings Call Transcript

Streamline Health Solutions (STRM)

Q2 2012 Earnings Call

September 12, 2012 11:00 am ET

Executives

Landon Barretto

Robert E. Watson - Chief Executive Officer, President, Director and Member of Strategy Committee

Stephen H. Murdock - Chief Financial Officer, Principal Accounting Officer, Senior Vice President, Corporate Secretary and Treasurer

Analysts

Matthew Hewitt - Craig-Hallum Capital Group LLC, Research Division

Dennison Theodore Veru - Palisade Capital Management LLC

Frank Sparacino - First Analysis Securities Corporation, Research Division

Joseph Mondillo - Sidoti & Company, LLC

Sam Rebotsky

Presentation

Operator

Greetings, and welcome to the Streamline Health Solutions Second Quarter Fiscal Year 2012 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mr. Landon Barretto. Thank you, Mr. Barretto. You may begin.

Landon Barretto

Thank you, Louis. Thank you for joining us to review the financial results of Streamline Health Solutions for the second quarter of fiscal year 2012, which ended July 31, 2012. As the conference call operator indicated, my name is Landon Barretto with Barretto Pacific Corporation. We're the investor relations consulting firm for Streamline Health. With us on the call representing the company today are Bob Watson, President and Chief Executive Officer; and Steve Murdock, Senior Vice President and Chief Financial Officer. At the conclusion of today's prepared remarks, we'll open the call for a question-and-answer session. If anyone participating on today's call does not have a full text copy of the release, you can retrieve it from the company's website at www.streamlinehealth.net or numerous financial websites.

Before we begin with prepared remarks, we submit, for the record, the following statement: statements made by the management team of Streamline Health Solutions during the course of this conference call that are not historical facts are considered to be forward-looking statements subject to risks and uncertainties.

The Private Securities Litigation Reform Act of 1995 provides a Safe Harbor for such forward-looking statements. The words believe, expect, anticipate, estimate, will and other similar statements of expectation identify forward-looking statements. The forward-looking statements contained herein are subject to certain risks, uncertainties and important factors that could cause actual results to differ materially from those reflected in the forward-looking statements included herein.

These risks and uncertainties include, but are not limited to, the impact of competitive products and pricing, product demand and market acceptance, new product development, key strategic alliances with vendors that resell the company's products, the ability of the company to control costs, availability of products produced from third-party vendors, the health care regulatory environment, health care information systems budgets, availability of health care information systems trained personnel for implementation of new systems, as well as maintenance of legacy systems, fluctuations in operating results and other risks detailed from time to time in the Streamline Health Solutions' filings with the U.S. Securities and Exchange Commission.

Participants on this call are cautioned not to place undue reliance on these forward-looking statements, which reflect the management's analysis only as of the date hereof. The company undertakes no obligation to publicly release the results of any revision to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

With that said, let me turn the call over to Bob Watson, President and Chief Executive Officer of Streamline Health Solutions. Bob?

Robert E. Watson

Good morning to all of you joining us on today's call. Thank you for your time today and for your continued interest and support of the company.

Noted in our press release earlier this morning, we continue to produce demonstrable results as we follow the strategic plan that we laid out at the beginning of this fiscal year. This was another strong quarter for our company. Revenue growth as compared to the same quarter last year remains strong, cash from operations continued to build, and our new sales bookings continue to grow.

After adjusting for certain expenses associated with the previously announced acquisition of Meta Health Technology, Inc. and the addition of 1,500,000 shares to our primary share count related to the Interpoint note conversion announced earlier in the quarter, our year-to-date EPS on a non-GAAP basis remains $0.05 per share, which is in line with our guidance earlier this year. We continue to see and trust, our stakeholders do as well, signs that indicate we are making real and meaningful progress against our strategic and financial initiatives.

At this point, I'd like to turn the call over to Steve Murdock, our Chief Financial Officer, for a summary of our financial results for the quarter ended July 31, 2012. At the conclusion of Steve's remarks, I'll provide additional perspective on the results of the quarter and the fiscal year, and we'll open the call for your questions. Steve?

Stephen H. Murdock

Thank you, Bob. I would like to review some of the more significant aspects of the financial results for the quarter ended July 31, 2012, and the fiscal year-to-date.

Revenue for the second quarter was $5.1 million or 22% increase over the second quarter of last year. This included $630,000 of revenue from the previously acquired Interpoint business. On the same-store basis, revenue increased 7% over the prior year, which included a 4% increase in maintenance revenue and a 21% increase in SaaS revenue. Revenue for the fiscal year-to-date is $10.5 million, a 27% increase over the last year.

As Bob mentioned, our second quarter operating income performance was negatively affected by certain nonrecurring expenses associated with the acquisition of Meta Health Technology. I will detail some of those onetime charges in just a minute.

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