EX-99.1 2 q22019pressrelease.htm EXHIBIT 99.1 Exhibit
Exhibit 99.1

ebixlogoa43.jpg

Ebix Q2 Revenues Rose 16% to a Record $144.3M

•
GAAP Diluted EPS of $0.94, Non-GAAP Diluted EPS of $1.08
•
GAAP Operating Income of $41.3M, Non-GAAP Operating Income of $43.4M

JOHNS CREEK, GA - August 8, 2019 - Ebix, Inc. (NASDAQ: EBIX), a leading international supplier of On-Demand software and E-commerce services to the insurance, financial, e-learning and healthcare industries, today reported results for its second quarter ended June 30, 2019. Ebix will host a conference call to review its results today at 11:00 a.m. EDT (details below).

Ebix delivered the following results for the second quarter of 2019:

Revenues: Q2 2019 revenue rose 16% to $144.3 million compared to $124.6 million in Q2 2018 and increased 1% over Q1 2019 revenue of $142.9 million. After excluding the revenues from the discontinued e-governance business, Q2 2019 revenues grew 21% in Q2 2019 as compared to Q2 2018.

On a constant currency basis, Ebix Q2 2019 revenue increased 18% to $147.4 million compared to $124.6 million in Q2 2018. Exchanges cumulatively including the insurance and EbixCash financial exchanges accounted for 87% of Q2 2019 revenues. Also, on a constant currency basis, year to date revenue increased 27% to $295.4 million as compared to $232.9 million during the same period in 2018.

The year over year revenue improvement reflected 43% growth in the Company’s EbixCash channel. After excluding the revenues from the discontinued e-governance business, EbixCash Q2 2019 revenues grew 58% in Q2 2019 as compared to Q2 2018.


(dollar amounts in thousands)
 
 
 
 
 
 
Channel
Q2 2019
Q2 2018
Change
YTD
2019
YTD 2018
Change
EbixCash Exchanges
$ 78,948
$ 55,257
+43%
$ 156,685
$ 91,265
+72%
Insurance Exchanges
46,593
47,155
-1%
94,608
96,318
-2%
RCS - Insurance
18,734
22,214
-16%
35,906
45,273
-21%
Total Revenue
$ 144,275
$ 124,626
+16%
$ 287,199
$ 232,856
+23%
 
 
 
 
 
 
 
Total Revenue on Constant Currency Basis
$ 147.4M
$ 124.6M
+18%
$ 295.4M
$ 232.9M
+27%


Net Income and EPS:

Q2 2019 GAAP diluted earnings per share increased 2% to $0.94 compared to $0.92 in Q2 2018. The Non-GAAP diluted earnings per share in Q2 2019 grew 17% to $1.08 as compared to Q2 2018.


Exhibit 99.1



GAAP net income decreased 1% to $28.9 million compared to $29.2 million in Q2 2018, in spite of increased operating income principally due to increased non-operating short-term expenses associated with the Company’s recent investments and growth initiatives in India associated with servicing increased Gross merchandise value. The Q2 2019 Non-GAAP net income increased 14% to $33.2 million after excluding certain non-recurring items

Ebix’s weighted average diluted shares outstanding decreased to 30.67 million in Q2 2019 compared to 31.63 million in Q2 2018, and slightly increased from 30.60 million in Q1 2019.

Operating Income and Margins: Q2 2019 GAAP operating margins were at 29% while the GAAP Operating income for Q2 2019 rose 8% to $41.3 million. Non-GAAP operating margins for Q2 2019 were at 30% while non-GAAP operating income grew 13% to $43.4 million in Q2 2019 as compared to $38.3 million in Q2 2018.

Operating Cash: Cash generated from operations was $(253) thousand in Q2 2019 compared to $14.4 million in Q2 2018 and $38.5 million in Q1 2019. The operating cash in Q2 2019 reflected the $20.5 million Derivative Case Legal Settlement and other related legal fees, funding of new growth initiatives associated with increasing GMV and new receivables from executing certain new contracts in new organic areas like the Bus exchange, Trucking logistics and travel business.

Share Repurchases: In Q2 2019, Ebix had no repurchases of its outstanding common stock.

Q3 2019 Diluted Share Count: As of today, Ebix expects its diluted share count for Q3 2019 to be approximately 30.7 million.

Dividend: Ebix paid its regularly quarterly dividend of $0.075 per share in Q2 2019 for a total cost of $2.3 million.

Ebix Chairman, President and CEO Robin Raina said, “In Q2 2019, we added many new revenues sources organically while consolidating our revenue base in the traditional insurance and financial exchange areas. In spite of having a very strong Q1 2019, we continued to grow our revenues sequentially. We grew EbixCash business by 58% in Q2 2019 as compared to Q2 2018, after excluding the revenues from the discontinued e-governance business line and 43% even if we were to include the e-governance business line. We are very pleased with that.”

“Our constant currency year to date revenues are at $295.4 million, and we expect to continue the revenue growth in coming quarters. We have signed a number of new large insurance related contracts in the US and EbixCash related contracts in the international markets, that should provide us the momentum for further growth. We are pleased to say that we have fulfilled all the financial formalities required from EbixCash to execute the multi-million-dollar Foreign exchange contract signed a few months back, for a premier international airport in the Middle East. We are in the process of securing traditional financial regulatory approvals required by foreign companies from the Central Bank in that country. After Central Bank approval, we will immediately go live at the airport adding a new revenue line to our foreign exchange business.”

Robin added, “We are pursuing a number of other opportunities including the asset purchase of India’s leading Bus exchange company - Trimax from the Indian bankruptcy courts. Trimax is a 35% margin company today with possible revenues of $25 to $30 million a year. Besides Trimax, we are pursuing a number of high margin opportunities in various geographies in the US and abroad. We also look forward to the successful closing of the Yatra acquisition in Q4 2019, which we believe can add $120 million to $150 million in revenues with 30% operating margins to the company once synergies are realized in 6 to 9 months.”



Exhibit 99.1

“We will soon be announcing the engagement of 4 to 5 investment banks to lead our EbixCash IPO targeted for Q2 2020. We have made substantial progress in that direction and will be updating our investors soon.”

Reconciliation of GAAP net income and diluted earnings per share to non-GAAP net income and diluted earnings per share. Non-GAAP information is provided to enhance the understanding of the Company's financial performance and is reconciled to the Company's GAAP information in the accompanying tables.

Net Income
Diluted EPS
Second Quarter 2019 GAAP Results
$28,851
$0.94
 
 
 
Non-GAAP Adjustments:
 
 
  One-time quarterly expenses (Operating Expense)
$1,235
$0.04
  Stock based compensation (Operating Expense)
 $ 847
$0.03
Short term Finance Fees for GMV Growth Funding
$1,620
$0.05
Non-recurring Legal Expenses (Non-Operating Expense)
   $688
$0.02
Total Non-GAAP Adjustments
$4,390
$0.14
Second Quarter 2019 Non-GAAP Results
$33,241
$1.08




Conference Call Details:

Call Date/Time:
Thursday, August 8, 2019 at 11:00 a.m. EST
Call Dial-In:
+1-877-837-3909 or 1-973-409-9690; Call ID # 7368513
Live Audio Webcast:
www.ebix.com/webcast
Audio Replay URL:
www.ebix.com/result_19_Q2 after 2:00 p.m. EDT on August 8th

About Ebix, Inc.

With 50+ offices across 6 continents, Ebix, Inc., (NASDAQ: EBIX) endeavors to provide On-Demand software and E-commerce services to the insurance, financial, healthcare and e-learning industries. In the Insurance sector, Ebix’s main focus is to develop and deploy a wide variety of insurance and reinsurance exchanges on an on-demand basis, while also, providing Software-as-a-Service ("SaaS") enterprise solutions in the area of CRM, front-end & back-end systems, outsourced administration and risk compliance services, around the world.

With a "Phygital” strategy that combines 320,000 physical distribution outlets in many Southeast Asian Nations (“ASEAN”) countries, to an Omni-channel online digital platform, the Company’s EbixCash Financial exchange portfolio encompasses leadership in areas of domestic & international money remittance, foreign exchange (Forex), travel, pre-paid & gift cards, utility payments, lending, wealth management etc. in India and other markets. EbixCash’s Forex operations have emerged as a leader in India’s airport Foreign Exchange business with operations in 32 international airports including Delhi, Mumbai, Bangalore, Hyderabad, Chennai and Kolkata, conducting over $4.8 billion in gross transaction value per year. EbixCash’s inward remittance business in India conducts approx. $5 billion gross annual remittance business, confirming its undisputed leadership position in India. EbixCash, through its travel portfolio of Via and Mercury, is also one of Southeast Asia’s leading travel exchanges with over 2,200+ employees, 212,450+ agent network, 25 branches and over 9,800 corporate clients; processing an estimated $2.5 billion in gross merchandise value per year. EbixCash’s technology services Division has emerged as a leader in the areas of lending


Exhibit 99.1

technology, asset & wealth management technology, travel technology in India; besides having grown its international expanse to Europe, Middle East, Africa and ASEAN countries.
Through its various SaaS-based software platforms, Ebix employs thousands of domain-specific technology professionals to provide products, support and consultancy to thousands of customers on six continents. For more information, visit the Company’s website at www.ebix.com


SAFE HARBOR REGARDING FORWARD-LOOKING STATEMENTS
As used herein, the terms “Ebix,” “the Company,” “we,” “our” and “us” refer to Ebix, Inc., a Delaware corporation, and its consolidated subsidiaries as a combined entity, except where it is clear that the terms mean only Ebix, Inc.

The information contained in this Press Release contains forward-looking statements and information within the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. This information includes assumptions made by, and information currently available to management, including statements regarding future economic performance and financial condition, liquidity and capital resources, acceptance of the Company's products by the market, and management's plans and objectives. In addition, certain statements included in this and our future filings with the Securities and Exchange Commission ("SEC"), in press releases, and in oral and written statements made by us or with our approval, which are not statements of historical fact, are forward-looking statements. Words such as "may," "could," "should," "would," "believe," "expect," "anticipate," "estimate," "intend," "seeks," "plan," "project," "continue," "predict," "will," "should," and other words or expressions of similar meaning are intended by the Company to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements are found at various places throughout this report and in the documents incorporated herein by reference. These statements are based on our current expectations about future events or results and information that is currently available to us, involve assumptions, risks, and uncertainties, and speak only as of the date on which such statements are made.

Our actual results may differ materially from those expressed or implied in these forward-looking statements. Factors that may cause such a difference, include, but are not limited to those discussed in our Annual Report on Form 10-K and subsequent reports filed with the SEC, as well as: the risk of an unfavorable outcome of the pending governmental investigations or shareholder class action lawsuits, reputational harm caused by such investigations and lawsuits, the willingness of independent insurance agencies to outsource their computer and other processing needs to third parties; pricing and other competitive pressures and the Company's ability to gain or maintain share of sales as a result of actions by competitors and others; changes in estimates in critical accounting judgments; changes in or failure to comply with laws and regulations, including accounting standards, taxation requirements (including tax rate changes, new tax laws and revised tax interpretations) in domestic or foreign jurisdictions; exchange rate fluctuations and other risks associated with investments and operations in foreign countries (particularly in Australia, UK and India wherein we have significant operations); equity markets, including market disruptions and significant interest rate fluctuations, which may impede our access to, or increase the cost of, external financing; and international conflict, including terrorist acts.

Except as expressly required by the federal securities laws, the Company undertakes no obligation to update any such factors, or to publicly announce the results of, or changes to any of the forward-looking statements contained herein to reflect future events, developments, changed circumstances, or for any other reason.

Readers should carefully review the disclosures and the risk factors described in the documents we file from time to time with the SEC, including future reports on Forms 10-Q and 8-K, and any amendments thereto.



Exhibit 99.1

You may obtain our SEC filings at our website, www.ebix.com under the "Investor Information" section, or over the Internet at the SEC's web site, www.sec.gov.

CONTACT:

Darren Joseph
678 -281-2027 or IR@ebix.com

David Collins or Chris Eddy
Catalyst Global - 212-924-9800 or ebix@catalyst-ir.com




































Exhibit 99.1


Ebix, Inc. and Subsidiaries
Condensed Consolidated Statements of Income
(In thousands, except per share data)
(Unaudited)

 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2019
 
2018
 
2019
 
2018
Operating revenue
$
144,275

 
 
$
124,626

 
 
$
287,199

 
 
$
232,856

 
 
 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 
 
 
Cost of services provided
50,954
 
 
 
43,559
 
 
 
96,883
 
 
 
83,150
 
 
Product development
11,397
 
 
 
8,671
 
 
 
22,639
 
 
 
17,105
 
 
Sales and marketing
4,493
 
 
 
4,823
 
 
 
10,614
 
 
 
8,821
 
 
General and administrative, net
32,866
 
 
 
26,724
 
 
 
54,310
 
 
 
46,228
 
 
Amortization and depreciation
3,283
 
 
 
2,534
 
 
 
7,340
 
 
 
5,341
 
 
Total operating expenses
102,993
 
 
 
86,311
 
 
 
191,786
 
 
 
160,645
 
 
 
 
 
 
 
 
 
 
Operating income
41,282
 
 
 
38,315
 
 
 
95,413
 
 
 
72,211
 
 
Interest income
129
 
 
 
85
 
 
 
479
 
 
 
206
 
 
Interest expense
(11,763
)
 
 
(5,750
)
 
 
(21,581
)
 
 
(10,597
)
 
Non-operating income (loss)
(11
)
 
 
—
 
 
 
(8
)
 
 
53
 
 
Non-operating expense - litigation settlement
(688
)
 
 
—
 
 
 
(21,140
)
 
 
—
 
 
Foreign currency exchange gain (loss)
401
 
 
 
(1,357
)
 
 
146
 
 
 
(1,998
)
 
Income before income taxes
29,350
 
 
 
31,293
 
 
 
53,309
 
 
 
59,875
 
 
Income tax benefit (expense)
(1,004
)
 
 
(2,222
)
 
 
80
 
 
 
(4,348
)
 
Net income including noncontrolling interest
28,346
 
 
 
29,071
 
 
 
53,389
 
 
 
55,527
 
 
Net income (loss) attributable to noncontrolling interest
(505
)
 
 
(109
)
 
 
(1,172
)
 
 
139
 
 
Net income attributable to Ebix, Inc.
$
28,851

 
 
$
29,180

 
 
$
54,561

 
 
$
55,388

 
 
 
 
 
 
 
 
 
Basic earnings per common share attributable to Ebix, Inc.
$
0.95

 
 
$
0.93

 
 
$
1.79

 
 
$
1.76

 
 
 
 
 
 
 
 
 
Diluted earnings per common share attributable to Ebix, Inc.
$
0.94

 
 
$
0.92

 
 
$
1.78

 
 
$
1.75

 
 
 
 
 
 
 
 
 
Basic weighted average shares outstanding
30,528
 
 
 
31,465
 
 
 
30,526
 
 
 
31,474
 
 
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
30,668
 
 
 
31,626
 
 
 
30,636
 
 
 
31,643
 
 








Exhibit 99.1


Ebix, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands, except share amounts)
 
June 30,
 2019
 
December 31,
 2018
ASSETS
(Unaudited)
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
102,210

 
 
$
147,766

 
Short-term investments
4,860
 
 
 
31,192
 
 
Restricted cash
22,641
 
 
 
8,317
 
 
Fiduciary funds- restricted
4,393
 
 
 
6,491
 
 
Trade accounts receivable, less allowances of $9,985 and $6,969, respectively
175,323
 
 
 
174,340
 
 
Other current assets
60,747
 
 
 
59,274
 
 
Total current assets
370,174
 
 
 
427,380
 
 
 
 
 
 
Property and equipment, net
52,203
 
 
 
50,294
 
 
Right-of-use assets
18,066
 
 
 
0
 
 
Goodwill
971,929
 
 
 
946,685
 
 
Intangibles, net
46,456
 
 
 
51,448
 
 
Indefinite-lived intangibles
42,055
 
 
 
42,055
 
 
Capitalized software development costs, net
13,141
 
 
 
11,742
 
 
Deferred tax asset, net
60,135
 
 
 
54,629
 
 
Other assets
48,344
 
 
 
26,714
 
 
Total assets
$
1,622,503

 
 
$
1,610,947

 
 
 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
Current liabilities:
 
 
 
Accounts payable and accrued liabilities
$
127,202

 
 
$
130,221

 
Accrued payroll and related benefits
7,769
 
 
 
9,227
 
 
Working capital facility
59,902
 
 
 
17,841
 
 
Fiduciary funds- restricted
4,393
 
 
 
6,491
 
 
Short-term debt
1,369
 
 
 
3,990
 
 
Current portion of long term debt and financing lease obligation, net of deferred financing
costs of $575
18,258
 
 
 
14,603
 
 
Lease liability
6,035
 
 
 
0
 
 
Contingent liability for accrued earn-out acquisition consideration
1,315
 
 
 
13,767
 
 
Contract liabilities
30,369
 
 
 
35,609
 
 
Other current liabilities
15,820
 
 
 
85,679
 
 
Total current liabilities
272,432
 
 
 
317,428
 
 
 
 
 
 
Revolving line of credit
438,037
 
 
 
424,537
 
 
Long term debt and financing lease obligations, less current portion, net of deferred financing costs of $1,523 and $1,811, respectively
265,543
 
 
 
274,716
 
 
Other liabilities
28,123
 
 
 
28,287
 
 
Contingent liability for accrued earn-out acquisition consideration
9,504
 
 
 
11,209
 
 
Contract liabilities
8,161
 
 
 
9,051
 
 
Deferred tax liability, net
1,282
 
 
 
1,282
 
 
Lease liability
11,868
 
 
 
0
 
 
Total liabilities
1,034,950
 
 
 
1,066,510
 
 


Exhibit 99.1

 
 
 
 
Commitments and Contingencies
 
 
 
 
 
 
 
Stockholders’ equity:
 
 
 
Preferred stock, $0.10 par value, 500,000 shares authorized, no shares issued and outstanding at June 30, 2019 and December 31, 2018
—
 
 
 
—
 
 
Common stock, $0.10 par value, 220,000,000 shares authorized, 30,529,840 issued and outstanding, at June 30, 2019, and 30,567,725 issued and outstanding at December 31, 2018
3,053
 
 
 
3,057
 
 
Additional paid-in capital
5,189
 
 
 
3,397
 
 
Retained earnings
582,913
 
 
 
535,118
 
 
Accumulated other comprehensive loss
(55,484
)
 
 
(63,377
)
 
Total Ebix, Inc. stockholders’ equity
535,671
 
 
 
478,195
 
 
Noncontrolling interest
51,882
 
 
 
66,242
 
 
Total stockholders’ equity
587,553
 
 
 
544,437
 
 
Total liabilities and stockholders’ equity
$
1,622,503

 
 
$
1,610,947

 
























Exhibit 99.1

Ebix, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
 
Six Months Ended
 
June 30,
 
2019
 
2018
Cash flows from operating activities:
 
 
 
Net income attributable to Ebix, Inc.
$
54,561

 
 
$
55,388

 
Net income (loss) attributable to noncontrolling interest
(1,172
)
 
 
139
 
 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Amortization and depreciation
7,340
 
 
 
5,341
 
 
Benefit for deferred taxes
(5,374
)
 
 
(1,321
)
 
Share based compensation
1,422
 
 
 
1,509
 
 
Provision for doubtful accounts
(1,310
)
 
 
2,098
 
 
Amortization of right-of-use assets
3,517
 
 
 
—
 
 
Unrealized foreign exchange loss
81
 
 
 
1,262
 
 
Amortization of capitalized software development costs
1,243
 
 
 
1,080
 
 
Reduction of acquisition accruals
(17,124
)
 
 
—
 
 
Changes in assets and liabilities, net of effects from acquisitions:
 
 
 
Accounts receivable
(2,166
)
 
 
(22,907
)
 
Other assets
(758
)
 
 
(40
)
 
Accounts payable and accrued expenses
2,824
 
 
 
4,891
 
 
Accrued payroll and related benefits
(1,808
)
 
 
(327
)
 
Contract liabilities
(6,192
)
 
 
(5,544
)
 
Lease liabilities
(3,460
)
 
 
(382
)
 
Reserve for potential uncertain income tax return positions
—
 
 
 
59
 
 
Other liabilities
6,618
 
 
 
(1,353
)
 
Net cash provided by operating activities
38,242
 
 
 
39,893
 
 
 
 
 
 
Cash flows from investing activities:
 
 
 
Acquisition of Transcorp
—
 
 
 
(6,554
)
)
Cash (paid to) received from Paul Merchants for 10% stake in MTSS combined business
(4,925
)
 
 
4,996
 
 
Acquisition of Weizmann, net of cash acquired
(77,350
)
 
 
—
 
 
Acquisition of Pearl
(3,372
)
 
 
—
 
 
Acquisition of Lawson
(2,726
)
 
 
—
 
 
Acquisition of Miles
(982
)
 
 
—
 
 
Acquisition of Business Travels
(689
)
 
 
—
 
 
Cash paid for acquisition of Wahh taxis
(214
)
 
 
—
 
 
Cash paid for acquisition of Zillious, net of cash acquired
(9,816
)
 
 
—
 
 
Cash paid for acquisition of Essel Forex
(7,935
)
 
 
—
 
 
Cash paid for acquisition of Centrum, net of cash acquired
—
 
 
 
(166,017
)
 
Cash paid for acquisition of Smartclass, net of cash acquired
—
 
 
 
(7,593
)
 
Capitalized software development costs paid
(2,588
)
 
 
(2,016
)
 
Maturities of marketable securities
14,488
 
 
 
725
 
 
Capital expenditures
(4,721
)
 
 
(1,472
)
 
Net cash used in investing activities
(100,830
)
 
 
(177,931
)
 
 
 
 
 
Cash flows from financing activities:
 
 
 
Proceeds from revolving line of credit, net
13,500
 
 
 
84,165
 
 
Proceeds from term loan
—
 
 
 
124,250
 
 
Principal payments of term loan obligation
(7,532
)
 
 
(3,125
)
 
Repurchases of common stock
(10,972
)
 
 
(2,226
)
 
Proceeds from the exercise of stock options
—
 
 
 
42
 
 
Forfeiture of certain shares to satisfy exercise costs and the recipients income tax obligations related to stock options exercised and restricted stock vested
(27
)
 
 
(100
)
 
Dividend payments
(4,599
)
 
 
(4,737
)
 


Exhibit 99.1

Other
5,081
 
 
 
—
 
 
Principal payments of debt obligations
(846
)
 
 
—
 
 
Working capital facility
41,588
 
 
 
(4,554
)
 
Payments of financing lease obligations
(129
)
 
 
(6
)
 
Net cash provided by financing activities
36,064
 
 
 
193,709
 
 
Effect of foreign exchange rates on cash
521
 
 
 
(6,545
)
 
Net change in cash and cash equivalents, and restricted cash
(26,003
)
 
 
49,126
 
 
Cash and cash equivalents, and restricted cash at the beginning of the period
159,589
 
 
 
70,867
 
 
Cash and cash equivalents, and restricted cash at the end of the period
$
133,586

 
 
$
119,993

 
Supplemental disclosures of cash flow information:
 
 
 
Interest paid
$
20,984

 
 
$
9,714

 
Income taxes paid
$
6,528

 
 
$
8,357