Allscripts Healthcare Solutions (MDRX), a leading player in the healthcare information technology (“HCIT”) market, reported fourth quarter adjusted (excluding one-time items) earnings per share of 20 cents, beating the Zacks Consensus Estimate of 16 cents and surpassing the year-ago earnings of 17 cents. Reported net loss for the quarter was $6.2 million (3 cents per share), partly due to merger-related charges.
On August 24, 2010, Allscripts accomplished its merger with Eclipsys Corporation, following which, its board of directors altered the fiscal year end from May 31 to December 31. As a result, the company’s latest quarterly financial statement includes combined results for both Allscripts and Eclipsys. The corresponding prior-year adjusted results include data from both Allscripts and Eclipsys for the fourth quarter of fiscal 2009, which ended on November 30, 2009, for Allscripts (and Dec. 31, 2009 for Eclipsys).
Allscripts reported revenues of $316.2 million in the fourth quarter. Adjusted revenues were $337.1 million, up 10% year over year, beating the Zacks Consensus Estimate of $336 million.
Bookings amounted to $288.2 million in the reported quarter, up 34% on a sequential basis, with Allscripts contributing $140.4 million and Eclipsys providing $147.8 million.
Segment-wise Data
Reported revenue comprised System Sales, Professional Services, Maintenance and Transaction Processing, each of which contributed a respective 18.3%, 15.4%, 29.5% and 36.8% of sales in the latest quarter.
Adjusted gross profit was $167 million, up 8% year over year. Adjusted operating margin was 20.6%, up from 18% in the year-ago quarter.
Balance Sheet
As of December 31, 2010, Allscripts had cash and marketable securities of $131 million and $489 million of outstanding borrowings.
Outlook
The company expects adjusted revenues in a range of $1,425 million to $1,450 million for fiscal 2011. Adjusted earnings per share are forecast between 86 cents and 90 cents.
The health care information technology market is competitive and price sensitive. Among others, Allscripts faces strong competition from Cerner Corp. (CERN), Quality Systems (QSII) and Athenahealth (ATHN).
However, optimism about the growth prospects of HCIT service providers is high under the Obama Administration, which passed the Stimulus package in May 2009, aimed at increasing the use of electronic health record (“EHR”) systems by medical practitioners.
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