MICROS Systems Inc.
) reported adjusted earnings per share of 58 cents for the fourth
quarter of fiscal 2013, which were in line with the Zacks
Although revenues of $328.6 million increased 8.6% year over
year, it came marginally below the Zacks Consensus Estimate of
$330.0 million. Year-over-year improvement in revenues was
primarily attributed to the strong demand across Latin America
and Asia Pacific regions.
Segment wise, Service revenues came in at $217.8 million, up
11.0% from $196.3 million in the previous-year quarter. Hardware
revenues came in at $74.1 million, increasing 7.4% from the
year-ago quarter. However, Software revenues declined 1.4% from
the year-ago quarter to $36.7 million.
Reported gross margin was 52.7%, down from 54.7% in the
year-ago quarter. The year- over-year decline was due to
unfavorable business mix.
Operating expenses increased 25.9% on a year-over-year basis
to $118.9 million due to increase in Selling, general and
administrative expenses and Research and development expenses.
Moreover, as percentage of revenues, operating expenses increased
500 basis points (bps) from the year-ago quarter to 36.2%. This
in turn impacted MICROS' operating performance.
Operating income decreased 23.7% from the year-ago quarter to
$54.1 million while margins contracted 690 bps to 16.5%.
On a GAAP basis, net income came in at $42.0 million or 53
cents per share versus $48.2 million or 59 cents in the year-ago
quarter. Adjusting one-time items and including stock-based
compensation expenses, net income came in at $45.6 million or 58
MICROS ended the quarter with cash and cash equivalents and
short-term investments of $634.1 million versus $669.3 million at
the end of the previous quarter. The company did not have any
long-term debt on its balance sheet.
The company spent around $85.7 million to buy back 2 million
shares for an average price of $42.86 per share.
MICROS has projected its fiscal 2014 revenue guidance in the
range of $1.295 billion to $1.320 billion, while the non-GAAP
earnings per share is expected to hover in the range of $2.46 to
MICROS' fourth-quarter results were modest with in-line
earnings per share and 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
2014 is at a decent range which projects some improvement in
Although MICROS has a decent cash position and is 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,
). Moreover, the company's European exposure and a sluggish macro
economic environment are the other headwinds, going forward.
Currently, MICROS has a Zacks Rank #4 (Sell).
APPLE INC (AAPL): Free Stock Analysis Report
GROUPON INC (GRPN): Free Stock Analysis
MICROS SYS (MCRS): Free Stock Analysis Report
NCR CORP-NEW (NCR): Free Stock Analysis
To read this article on Zacks.com click here.