SS&C Reports Record Q3 Operating Income; Net Income Rises 42% to $3.0 Million or $0.23 Per Share

WINDSOR, Conn.–(BUSINESS WIRE)–Oct. 16, 2003–SS&C Technologies, Inc. (Nasdaq: SSNC) today announced results for the quarter ended September 30, 2003. Revenues were $16.0 million compared with$15.1 million for the third quarter of 2002. Net income was $3.0 million, or $0.23 diluted earnings per share, compared with $2.1 million, or $0.16 diluted earnings per share, for the third quarterof 2002. The nine-month revenue numbers were $47.7 million and $46.2 million and nine-month net income was $8.1 million, or $0.61 per diluted share, and $4.7 million, or $0.34 per diluted share, for’03 and ’02, respectively.

“We are pleased to have strong operating results for the 10th straight quarter,” remarked CEO Bill Stone. “Our operating income increased to $4.6 million, a record high, up 38% over last year’s third quarter and 276% over Q3 ’01. Recurring revenues, which include maintenance and outsourcing revenues, increased to $11.3 million in Q3, a 14% increase over last year. Our recurring revenue stream continues to improve and we are particularly pleased with our outsourcing revenue, which now represents approximately 20% of our revenue.”

“The quality of our earnings can be seen in the impressive cash flow we generate from operations,” said Stone. “We generated $6.7 million in cash from operations this quarter and year-to-date operating cash flow is $16.4 million, a 44% increase over 2002. These cash flow numbers represent $0.51 and $1.24 per diluted share, respectively.”

“Currently, we are forecasting Q4 2003 revenues to be in the range of $16 to $18 million and net income to be between $0.23 and $0.26 per diluted share,” stated Stone.

Proposed Acquisition Will Contribute to Recurring Revenues and Strengthen Hedge Fund Business

“This week we announced the execution of a non-binding agreement to acquire the fund administration business of Amicorp Fund Services N.V., a wholly owned subsidiary of Amicorp Holding Ltd. This fund administration business, based in Curacao, the Netherlands Antilles, serves the hedge fund community with both on and offshore services. We are excited about getting deeper into the growing hedge fund industry. SS&C will operate the fund administration business, to be renamed SS&C Fund Services, within our Hedge and Family Office market vertical. We anticipate that this acquisition, which is subject to the negotiation and execution of a definitive agreement and the completion of certain regulatory applications, will close in November 2003. We believe we have premium services to offer the hedge community and this acquisition will help round out our offering.”

Earnings Call

SS&C’s Q3 2003 earnings call will take place at 5:00 p.m. Eastern Time today, October 16, 2003. Interested parties may dial 706-643-7858 (US, Canada and International) and request the “SS&C Third Quarter Earnings Call”, conference ID #3185020. A replay will be available after 8:00pm until October 31, 2003. To access, dial 706-645-9291 and enter the access code 3185020. A replay of the call will also be available after October 17, 2003 on our website at www.ssctech.com/about/earnings.asp.

This press release contains forward-looking statements relating to, among other things the Company’s expected revenues and earnings per share for the fourth quarter of 2003, and the anticipated acquisition by the Company and the anticipated effect of the acquisition on the Company. Such statements reflect management’s best judgment based on factors currently known but are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated. Such risks and uncertainties include, but are not limited to, the Company’s ability to finalize large client contracts, fluctuations in customer demand for the Company’s products and services, intensity of competition from other application vendors, delays in product development, the Company’s ability to control expenses, general economic and industry conditions, terrorist activities, the company’s ability to complete the acquisition and integrate the acquired business, the effect of the acquisition on customer demand for the Company’s products and services, those liabilities acquired in connection with the acquisition, and those risks described in the Company’s filings with the Securities and Exchange Commission, including without limitation, the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2003. SS&C cautions investors that it may not update any or all of the foregoing forward-looking statements. <pre> SS&C TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (unaudited) Three Months Ended Nine Months Ended Sept. 30, Sept. 30, Sept. 30, Sept. 30, 2003 2002 2003 2002 ——— ——— ——— ——— Revenues: Software licenses $3,032 $3,605 $10,137 $10,982 Maintenance 7,964 6,843 23,297 20,470 Professional services 1,710 1,605 4,629 5,120 Outsourcing 3,302 3,056 9,589 9,624 ——— ——— ——— ——— Total revenues 16,008 15,109 47,652 46,196 ——— ——— ——— ——— Cost of revenues: Software licenses 431 306 1,373 934 Maintenance 1,546 1,294 4,538 4,118 Professional services 1,005 1,359 3,276 4,091 Outsourcing 1,932 2,147 5,960 6,492 ——— ——— ——— ——— Total cost of revenues 4,914 5,106 15,147 15,635 ——— ——— ——— ——— Gross profit 11,094 10,003 32,505 30,561 ——— ——— ——— ——— Operating expenses: Selling and marketing 2,178 1,968 6,319 7,103 Research and development 2,627 2,799 8,506 8,764 General and administrative 1,680 1,897 5,333 5,834 Write-off of purchased in- process research and development – – – 1,744 ——— ——— ——— ——— Total operating expenses 6,485 6,664 20,158 23,445 ——— ——— ——— ——— Operating income 4,609 3,339 12,347 7,116 Interest income 223 323 707 1,164 Other income (expense), net 152 (84) 231 (483) ——— ——— ——— ——— Income before income taxes 4,984 3,578 13,285 7,797 Provision for income taxes 1,943 1,432 5,181 3,119 ——— ——— ——— ——— Net income $3,041 $2,146 $8,104 $4,678 ========= ========= ========= ========= Basic earnings per share $0.25 $0.17 $0.65 $0.36 ========= ========= ========= ========= Basic weighted average number of common shares outstanding 12,329 12,705 12,426 13,065 ========= ========= ========= ========= Diluted earnings per share $0.23 $0.16 $0.61 $0.34 ========= ========= ========= ========= Diluted weighted average number of common and common equivalent shares outstanding 13,210 13,499 13,200 13,809 ========= ========= ========= ========= SS&C TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS (in thousands) (unaudited) Sept. 30, Dec. 31, 2003 2002 ——————- ASSETS Current assets Cash and cash equivalents $22,033 $18,336 Investments in marketable securities 26,344 23,383 Accounts receivable, net 8,686 10,983 Prepaid expenses and other current assets 722 1,065 Deferred income taxes 929 1,142 ——————- Total current assets 58,714 54,909 Property and equipment, net 4,778 5,745 Deferred income taxes 6,600 6,762 Intangible and other assets, net 6,975 8,064 ——————- Total assets $77,067 $75,480 =================== LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Accounts payable $908 $844 Income taxes payable 230 646 Accrued employee compensation and benefits 2,443 3,462 Other accrued expenses 1,938 2,044 Deferred maintenance and other revenue 13,804 11,214 ——————- Total current liabilities 19,323 18,210 ——————- Total stockholders’ equity before treasury stock 107,677 92,992 Less: cost of common stock in treasury 49,933 35,722 ——————- Total stockholders’ equity 57,744 57,270 ——————- Total liabilities and stockholders' equity $77,067 $75,480 =================== SS&C TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited) Nine months ended Sept. 30, Sept. 30, 2003 2002 ——— ——— Cash flow from operating activities: Net income $8,104 $4,678 ——— ——— Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 2,726 2,995 Net realized losses (gains) on marketable securities (259) 424 Loss on sale or disposal of property and equipment 25 2 Deferred income taxes 374 654 Income tax benefit related to exercise of stock options 1,781 - Purchased in-process research and development – 1,744 Provision for doubtful accounts 566 338 Changes in operating assets and liabilities: Accounts receivable 1,776 (1,812) Prepaid expenses and other assets 348 368 Accounts payable 61 (331) Accrued expenses (1,152) (371) Taxes payable (429) 631 Deferred maintenance and other revenues 2,487 2,050 ——— ——— Total adjustments 8,304 6,692 ——— ——— Net cash provided by operating activities 16,408 11,370 ——— ——— Cash flow from investing activities: Additions to property and equipment (672) (473) Proceeds from sale of property and equipment – 3 Cash paid for business acquisitions, net – (3,943) Purchases of marketable securities (23,993) (13,121) Sales of marketable securities 22,197 16,687 ——— ——— Net cash used in investing activities (2,468) (847) ——— ——— Cash flow from financing activities: Repayment of debt and acquired debt – (146) Issuance of common stock 134 120 Exercise of options 4,732 4,099 Purchase of common stock for treasury (14,211) (24,963) Common stock dividends (1,237) - ——— ——— Net cash used in financing activities (10,582) (20,890) ——— ——— Effect of exchange rate changes on cash 339 271 ——— ——— Net increase (decrease) in cash and cash equivalents 3,697 (10,096) Cash and cash equivalents, beginning of period 18,336 28,425 ——— ——— Cash and cash equivalents, end of period $22,033 $18,329 ========= ========= </pre>

SS&C Reports Record Q3 Operating Income; Net Income Rises 42% to $3.0 Million or $0.23 Per Share

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