Amdocs Limited 's ( DOX ) first quarter of
fiscal 2013 adjusted earnings per share (excluding special items)
stood at 65 cents, which was inline with the Zacks Consensus
Estimate. The impressive outcome was primarily based on the
stabilization of Amdocs' business with its major client
AT&T Inc. ( T ) to some extent and
the continuous double-digit growth in the emerging markets.
First Quarter Results in Details
Quarterly net income, on a GAAP basis, was $99 million or 61
cents per share compared with a net income of $92.7 million or 53
cents per share in the prior-year quarter. Quarterly total revenue
came in at $826.4 million, up 2.4% year over year, and slightly
above the Zacks Consensus Estimate of $825 million.
Amdocs posted gross margin of 35.2% in the reported quarter
against 35.9% in the year-ago quarter. Reported operating income
was approximately $112.7 million, up 3.4% year over year. Again,
operating margin was 13.6% against 13.5% in the prior-year quarter.
At the end of the first quarter of fiscal 2013, total order backlog
was $2,800 million compared with $2,690 million at the end of the
year-earlier quarter. In the reported quarter, Amdocs repurchased
shares worth $103.7 million.
During the reported quarter, Amdocs generated around $145.5
million in cash from operations compared with $149.9 million in the
prior-year period. Free cash flow (cash flow from operations less
capital expenditure) at the end of the first quarter of fiscal 2013
stood at $115.6 million compared with $121.6 million at the end of
At the end of the first quarter of fiscal 2013, Amdocs had
approximately $961.3 million in cash and marketable securities and
no outstanding debt on its balance sheet compared with $1,118.2
million of cash and marketable securities and nil outstanding debt
at the end of fiscal 2011.
Segment Wise Results
Service revenue was $807.4 million, up 4.7% year over year.
License revenue was approximately $18.9 million, down 47.2% year
over year. Technologically, Customer Experience Systems revenue was
$783.8 million, up 3.4% year over year while Directory revenue was
$42.6 million, down 13.1% year over year. The company's core
Managed Services revenue came in at $429.8 million, up 2.4% year
Geographically, North America generated $593.6 million, up 3.5%
year over year; Europe generated $99.2 million, down 10.1% year
over year; while the rest of the world contributed the remaining
$133.6 million, up 8.7% year over year. Revenue from the emerging
markets came in at $98.2 million, showing an annualized growth of
Management expects the revenue of the second quarter of fiscal
2013 to be in the range of $820-$850 million. Earnings per share,
on a GAAP basis, are expected to be between 69 cents and 75 cents.
Moreover, non-GAAP earnings per share, including 5-6 cents per
share of equity-based compensation expense, are projected in the
range of 58-66 cents.
Amdocs also decided to make a quarterly cash dividend payment on
April 19, 2013 to its shareholders of record as on March 28,
Amdocs is well positioned in the market as carriers sell bundled
and converged IP-based network solutions to subscribers. There are
huge opportunities that exist with Amdocs as more telecom companies
have started deploying 3G and 4G networks. Moreover, the renewal of
long-term contracts with Sprint-Nextel Corp. ( S ) and new order wins
from America Movil ( AMX ) will further
bolster its top-line growth going forward.
Currently, Amdocs has a Zacks Rank #2 (Buy).AMER MOVIL-ADR (AMX): Free Stock Analysis
ReportAMDOCS LTD (DOX): Free Stock Analysis ReportSPRINT NEXTEL (S): Free Stock Analysis ReportAT&T INC (T): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment