MICROS Systems Inc.
) reported adjusted earnings per share ("EPS") of 58 cents for
the third quarter of fiscal 2013. This exceeded the Zacks
Consensus Estimate and 8.6% higher than the year-ago quarter.
Revenues were $315.1 million, up 13.3% year over year. Barring
the Torex acquisition in May 2012, revenues for the company
declined 4.0% on a reported basis.
Segment-wise, service revenues came in at $213.7 million,
rising 20.5% from $177.4 million in the previous-year quarter.
Hardware revenues came in at $64.5 million, increasing 2.3% from
the year-ago quarter. Software revenues came in at $36.8 million,
down 2.0% year over year, as software sales were affected while
retail sales was higher.
Reported gross margin was 52.5%, down from 54.9% in the
year-ago quarter. The year- over-year decline was due to the low
margin Torex business. After taking into account the company's
new Torex customers and the legacy outsourcing contracts in the
second half of calendar 2014, the company anticipates Torex
margins to increase.
Selling, general and administrative expenses came in at $78.3
million, increasing 3.0% from the year-earlier quarter. Research
and development expenses amounted to $18.0 million, up 33.9% year
over year. Operating margin dropped 162 basis points year over
year to 18.5%.
On a GAAP basis, earnings came in at 55 cents per share versus
53 cents in the year-ago quarter. Adjusting one-time items and
including stock-based compensation expenses, non-GAAP earnings
were 57 cents versus 53 cents in the year-ago quarter.
MICROS ended the quarter with cash and cash equivalents and
short-term investments of $669.3 million versus $631.8 million at
the end of the previous quarter. Receivables increased 10.8%
sequentially to $238.7 million. Inventory increased 3.5% from the
prior quarter to $54.5million.
The company spent around $37.5 million on repurchase of
shares, thereby buying back 861,000 shares with an average price
of $43.59 per share. Moreover, during the fourth quarter, MICROS
has repurchased 164,000 shares of common stock for a total price
of $7.3 million.
As per the current estimation, MICROS has projected its fiscal
2013 revenue guidance in the range of $1.256 billion and $1.272
billion, while the non-GAAP EPS is expected to hover in the range
of $2.37 to $2.39, this would result in a fourth quarter revenue
of between $317.0 million and $333.0 million, while the non-GAAP
EPS for the same quarter is expected to be between 61 and 63
MICROS third-quarter results were modest, with EPS exceeding
the Zacks Consensus Estimate, while revenues increasing on a
year-over-year basis. The company is expected to take care of its
margin position and control expenses. The revenue guidance for
fiscal 2013 is at a decent range which projects some improvement
Although MICROS has a decent cash position and providing
valuable solutions to
) iPad, we remain concerned due to increasing competition from
innovative (tablet-based) Point-of-Sales (POS) solutions by its
peers Square, Revel,
Currently, MICROS has a Zacks Rank #3 (Hold).
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