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8-K - FORM 8-K - NEXTGEN HEALTHCARE, INC.d248742d8k.htm

Exhibit 99.1

LOGO

 

For Further Information, Contact:
Quality Systems, Inc.   Susan J. Lewis

18111 Von Karman Avenue, Suite 700

  Phone: (303) 804-0494

Irvine, CA 92612

  slewis@qsii.com

Phone: (949) 255-2600

 
Paul Holt, CFO, pholt@qsii.com  

FOR IMMEDIATE RELEASE

    OCTOBER 27, 2011

QUALITY SYSTEMS, INC. REPORTS RECORD FISCAL 2012 SECOND QUARTER

RESULTS; BOARD-APPROVED 2:1 STOCK SPLIT EFFECTIVE TODAY

IRVINE, Calif. … October 27, 2011 … Quality Systems, Inc. (NASDAQ:QSII) announced today results for its fiscal 2012 second quarter ended September 30, 2011.

Results reflect the previously announced, Board-approved 2:1 stock split which became effective yesterday for shareholders of record as of October 6, 2011. Each shareholder of record at the close of business on October 6, 2011 received one additional share for every outstanding share held as of the record date. Today, the Company’s shares will begin trading on the Nasdaq Stock Market at the new split-adjusted price. All share and per share data provided herein have been adjusted to reflect the impact of the stock split.

The Company reported record net revenues of $107.6 million for the fiscal 2012 second quarter, an increase of 32 percent versus $81.5 million for the fiscal 2011 second quarter. Net income for the fiscal 2012 second quarter reached a record $20.5 million, up 53 percent compared with $13.4 million for the same period a year ago. Fully diluted earnings per share were $0.35 in the second quarter of fiscal 2012, versus $0.23 for the fiscal 2011 second quarter, an increase of 52 percent.

“The extraordinary growth and our solid performance stem from sales resulting from decisions made, in part based on the stimulus plan. As the stimulus continues to gain momentum, and our pipeline fills, we are realizing the benefits of the positioning and preparation we did in advance. The quarterly results reflect the ongoing acceptance of our solutions and strength of our services in the marketplace,” explained Steven T. Plochocki, Quality Systems’ chief executive officer.

Quality Systems, Inc. also announced that the Company’s Board of Directors declared a quarterly cash dividend of Seventeen and One-Half Cents ($0.175) per share on the Company’s outstanding shares of Common Stock, payable to shareholders of record as of December 20, 2011 with an anticipated distribution date of January 5, 2012. The $0.175 per share cash dividend, which has been adjusted to reflect the 2:1 stock split that became effective yesterday, is consistent with the Company’s current policy to pay a regular quarterly dividend on the Company’s outstanding shares of

 

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Quality Systems, Inc.

Fiscal 2012 Second Quarter Results

Page 2

 

Common Stock, subject to further Board review and approval, and establishment of record and distribution dates by the Board prior to the declaration and payment of each such quarterly dividend.

Quality Systems will host a conference call to discuss its fiscal 2012 second quarter results on Thursday, October 27, 2011 at 10:00 AM ET (7:00 AM PT). All participants should dial 877-941-1468 at least ten minutes prior to the start of the call. International callers should dial 480-629-9869. To hear a live Web simulcast or to listen to the archived webcast following completion of the call, please visit the Company’s website at www.qsii.com, click on the “Investors” tab, then select “Conference Calls,” to access the link to the call. To listen to a telephone replay of the conference call, please dial 800-406-7325 or 303-590-3030 and enter reservation identification number 4478711. The replay will be available from approximately 12:00 PM ET on Thursday, October 27, 2011, through 11:59 PM ET on Thursday, November 3, 2011.

A transcript of the conference call will be made available on the Company’s website at www.qsii.com.

About Quality Systems, Inc.

Irvine, Calif.-based Quality Systems, Inc. and its NextGen Healthcare subsidiary develop and market computer-based practice management, electronic health records and revenue cycle management applications as well as connectivity products and services for medical and dental group practices and small hospitals. Visit www.qsii.com and www.nextgen.com for additional information.

SAFE HARBOR PROVISIONS FOR FORWARD-LOOKING STATEMENTS

This news release may contain forward-looking statements within the meaning of the federal securities laws. Statements regarding future events, developments, the Company’s future performance, as well as management’s expectations, beliefs, intentions, plans, estimates or projections relating to the future (including, without limitation, statements concerning revenue and net income), are forward-looking statements within the meaning of these laws and involve a number of risks and uncertainties. Management believes that these forward looking statements are reasonable and are based on reasonable assumptions and forecasts, however, undue reliance should not be placed on such statements that speak only as of the date hereof. Moreover, these forward-looking statements are subject to a number of risks and uncertainties, some of which are outlined below. As a result, actual results may vary materially from those anticipated by the forward-looking statements. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: the volume and timing of systems sales and installations; length of sales cycles and the installation process; the possibility that products will not achieve or sustain market acceptance; seasonal patterns of sales and customer buying behavior; impact of incentive payments under The American Recovery and Reinvestment Act on sales and the ability of the Company to meet continued certification requirements; the development by competitors of new or superior technologies; the timing, cost and success or failure of new product and service introductions, development and product upgrade releases; undetected errors or bugs in software; product liability; changing economic, political or regulatory influences in the health-care industry; changes in product-pricing policies; availability of third-party products and components; competitive pressures including product offerings, pricing and promotional activities; the Company’s ability or inability to attract and retain qualified personnel; possible regulation of the Company’s software by the U.S. Food and Drug Administration;

 

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Quality Systems, Inc.

Fiscal 2012 Second Quarter Results

Page 3

 

uncertainties concerning threatened, pending and new litigation against the Company including related professional services fees; uncertainties concerning the amount and timing of professional fees incurred by the Company generally; changes of accounting estimates and assumptions used to prepare the prior periods’ financial statements; general economic conditions; and the risk factors detailed from time to time in the Company’s periodic reports and registration statements filed with the Securities and Exchange Commission. A significant portion of the Company’s quarterly sales of software product licenses and computer hardware is concluded in the last month of the fiscal quarter, generally with a concentration of such revenues earned in the final ten business days of that month. Due to these and other factors, the Company’s revenues and operating results are very difficult to forecast. A major portion of the Company’s costs and expenses, such as personnel and facilities, are of a fixed nature and, accordingly, a shortfall or decline in quarterly and/or annual revenues typically results in lower profitability or losses. As a result, comparison of the Company’s period-to-period financial performance is not necessarily meaningful and should not be relied upon as an indicator of future performance. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

FINANCIAL TABLES ATTACHED

 


QUALITY SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF INCOME

(IN THOUSANDS)

(UNAUDITED)

 

     Three Months Ended
September 30,
     Six Months Ended
September 30,
 
     2011     2010      2011     2010  

Revenues:

         

Software, hardware and supplies

   $ 31,860      $ 20,375       $ 60,771      $ 45,131   

Implementation and training services

     6,094        4,499         11,566        8,807   
  

 

 

   

 

 

    

 

 

   

 

 

 

System sales

     37,954        24,874         72,337        53,938   

Maintenance

     35,214        27,529         66,716        53,065   

Electronic data interchange services

     11,985        10,142         24,077        19,906   

Revenue cycle management and related services

     11,142        11,175         23,023        21,947   

Other services

     11,339        7,737         21,923        15,528   
  

 

 

   

 

 

    

 

 

   

 

 

 

Maintenance, EDI, RCM and other services

     69,680        56,583         135,739        110,446   
  

 

 

   

 

 

    

 

 

   

 

 

 

Total revenues

     107,634        81,457         208,076        164,384   
  

 

 

   

 

 

    

 

 

   

 

 

 

Cost of revenue:

         

Software, hardware and supplies

     4,187        4,696         8,801        10,908   

Implementation and training services

     5,050        3,475         9,125        6,465   
  

 

 

   

 

 

    

 

 

   

 

 

 

Total cost of system sales

     9,237        8,171         17,926        17,373   

Maintenance

     3,994        3,238         7,848        6,692   

Electronic data interchange services

     7,964        6,773         15,926        13,482   

Revenue cycle management and related services

     8,456        8,222         17,282        16,367   

Other services

     6,369        3,724         11,966        8,073   
  

 

 

   

 

 

    

 

 

   

 

 

 

Total cost of maintenance, EDI, RCM and other services

     26,783        21,957         53,022        44,614   
  

 

 

   

 

 

    

 

 

   

 

 

 

Total cost of revenue

     36,020        30,128         70,948        61,987   
  

 

 

   

 

 

    

 

 

   

 

 

 

Gross profit

     71,614        51,329         137,128        102,397   

Operating expenses:

         

Selling, general and administrative

     32,169        24,829         61,555        51,067   

Research and development costs

     7,358        5,232         14,185        10,688   

Amortization of acquired intangible assets

     520        445         1,002        792   
  

 

 

   

 

 

    

 

 

   

 

 

 

Total operating expenses

     40,047        30,506         76,742        62,547   
  

 

 

   

 

 

    

 

 

   

 

 

 

Income from operations

     31,567        20,823         60,386        39,850   

Interest income

     75        129         157        189   

Other income (expense), net

     (144     65         (182     59   
  

 

 

   

 

 

    

 

 

   

 

 

 

Income before provision for income taxes

     31,498        21,017         60,361        40,098   

Provision for income taxes

     11,002        7,587         20,882        14,576   
  

 

 

   

 

 

    

 

 

   

 

 

 

Net income

   $ 20,496      $ 13,430       $ 39,479      $ 25,522   
  

 

 

   

 

 

    

 

 

   

 

 

 

Net income per share:

         

Basic

   $ 0.35      $ 0.23       $ 0.67      $ 0.44   

Diluted

   $ 0.35      $ 0.23       $ 0.67      $ 0.44   

Weighted average shares outstanding:

         

Basic

     58,664        57,870         58,511        57,830   

Diluted

     59,005        58,156         58,902        58,132   

Dividends declared per common share

   $ 0.175      $ 0.15       $ 0.35      $ 0.30   


QUALITY SYSTEMS, INC.

CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT PER SHARE DATA)

(UNAUDITED)

 

     September 30,
2011
     March 31,
2011
 

ASSETS

     

Current assets:

     

Cash and cash equivalents

   $ 125,775       $ 116,617   

Restricted cash

     2,848         3,787   

Marketable securities

     1,098         1,120   

Accounts receivable, net

     150,224         139,772   

Inventories

     2,791         1,933   

Income taxes receivable

     3,230         —     

Deferred income tax assets, net

     10,466         10,397   

Other current assets

     9,814         8,768   
  

 

 

    

 

 

 

Total current assets

     306,246         282,394   

Equipment and improvements, net

     14,853         12,599   

Capitalized software costs, net

     17,395         15,150   

Intangibles, net

     22,541         16,890   

Goodwill

     51,156         46,721   

Other assets

     4,535         4,932   
  

 

 

    

 

 

 

Total assets

   $ 416,726       $ 378,686   
  

 

 

    

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

     

Current liabilities:

     

Accounts payable

   $ 6,369       $ 6,686   

Deferred revenue

     83,291         76,695   

Accrued compensation and related benefits

     9,793         10,247   

Income taxes payable

     —           3,530   

Dividends payable

     10,290         10,162   

Other current liabilities

     18,178         29,316   
  

 

 

    

 

 

 

Total current liabilities

     127,921         136,636   

Deferred revenue, net of current

     1,272         1,099   

Deferred income tax liabilities, net

     11,384         11,384   

Deferred compensation

     2,756         2,488   

Other noncurrent liabilities

     4,334         2,409   
  

 

 

    

 

 

 

Total liabilities

     147,667         154,016   

Commitments and contingencies

     

Shareholders’ equity:

     

Common stock

     

$0.01 par value; authorized 100,000 shares; issued and outstanding 58,818 and 58,068 shares at September 30, 2011 and March 31, 2011, respectively

     588         580   

Additional paid-in capital

     158,394         132,969   

Retained earnings

     110,077         91,121   
  

 

 

    

 

 

 

Total shareholders’ equity

     269,059         224,670   
  

 

 

    

 

 

 

Total liabilities and shareholders’ equity

   $ 416,726       $ 378,686   
  

 

 

    

 

 

 

 

 

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