Allscripts Beats Zacks Estimate - Analyst Blog

Allscripts Healthcare Solutions, Inc. (MDRX) reported third-quarter fiscal 2010 adjusted (excluding one-time items) earnings per share of 19 cents, exceeding both the Zacks Consensus Estimate and the year-ago earnings of 16 cents. Adjusted net income was $36.8 million, up 21% year over year.

On August 24, 2010, Allscripts completed its merger with Eclipsys Corporation following which its Board of Directors changed the company's financial year-end from May 31 to December 31.   

Revenues

Revenue for the quarter increased 47% year over year to $242.4 million (includes $51.2 million of reported revenue from Eclipsys). Total bookings in the third quarter amounted to $215.9 million, which included legacy Allscripts bookings of $112 million.

Growth was registered in all of Allscripts' business segments. Maintenance was up 29.3% year over year to $76.8 million in the third quarter.  Transaction processing and other revenues, consisting of Payerpath Revenue Cycle Management and SaaS sales, jumped 42.1% to $79.7 million.

System sales increased sharply to $46.9 million, up 40% year over year.  Professional services revenues shot up 145.3% to $39 million.

Margins

Total adjusted gross profit was $160.8 million in the reported quarter, up 10% year over year. Adjusted operating income was $63 million, or 19.1% of total adjusted revenue, compared with $49.9 million, or 17% of adjusted sales, in the prior-period quarter. 

Balance Sheet & Cash Flow

Allscripts ended the third quarter with cash and cash equivalents of $120.1 million and long-term debt of $506.5 million.

Outlook

Allscripts updated its guidance for fiscal 2010 and 2011.  For fourth-quarter fiscal 2010, it expects adjusted revenue in a range of $332 million to $337 million, adjusted operating margin of 19% and adjusted earnings per share in a band of 18 cents to 19 cents. The corresponding figures for fiscal 2010 are $1,295 million to $1,300 million, 19% and 73 cents to 74 cents, respectively.

For fiscal 2011, the company expects adjusted revenue between $1,425 million and $1,450 million, adjusted operating margin of 21%, and earnings per share of 85 cents to 89 cents.