|
Investor Contact: Allan Kells, (816) 201-2445, akells@cerner.com
Media Contact: Sarah Bond, (816) 885-8020, sarah.bond@cerner.com
Cerner’s Internet Home Page: www.cerner.com
Cerner Reports Fourth Quarter 2009 Results
Record Bookings, Strong Cash Flow and Earnings
KANSAS CITY, Mo. — February 9, 2010 — Cerner Corp. (NASDAQ: CERN) today announced results for the 2009 fourth quarter that ended January 2, 2010, delivering record levels of bookings, and strong cash flow and earnings.
Bookings in the fourth quarter of 2009 were $680.4 million, up 68% from $404.9 million in the fourth quarter of 2008 and an all-time high level of bookings. Full year 2009 bookings were a record $1.83 billion, up 19% compared to 2008 bookings of $1.54 billion.
Fourth quarter revenue was $466.3 million, which is flat compared to $465.7 million in the year-ago period, which included $28.6 million of revenue related to a one-time catch up on the Company’s contract in London as part of the National Health Services (NHS) initiative to automate clinical processes and digitize medical records in England. Excluding this one-time catch up in 2008, fourth quarter revenue increased 7% from the year-ago period. Full year 2009 revenue was $1.67 billion, flat compared to 2008 revenue of $1.68 billion. Excluding the one-time catch up recognized in 2008, full year 2009 revenue increased 1.5%.
On a Generally Accepted Accounting Principles (GAAP) basis, fourth quarter 2009 net earnings were $60.5 million, and diluted earnings per share were $0.71. Fourth quarter 2008 GAAP net earnings were $71.5 million, and diluted earnings per share were $0.86. Full year 2009 GAAP net earnings were $193.5 million and diluted earnings per share were $2.31. Full year 2008 GAAP net earnings were $188.7 million and diluted earnings per share were $2.26.
Adjusted (non-GAAP) Earnings
Adjusted fourth quarter 2009 net earnings were $63.4 million, an increase of 18 percent compared to $53.6 million of adjusted net earnings in the fourth quarter of 2008. Adjusted diluted earnings per share were $0.75 in the fourth quarter of 2009 compared to $0.65 of adjusted diluted earnings per share in the fourth quarter of 2008. Analysts’ consensus estimate for fourth quarter 2009 adjusted diluted earnings per share was $0.71. For the full year 2009, adjusted net earnings were $204.0 million and adjusted diluted earnings per share were $2.43, compared to full year 2008 adjusted net earnings of $182.6 million and adjusted diluted earnings per share were $2.19.
Adjusted Net Earnings is not a recognized term under GAAP and should not be substituted for net earnings as a measure of the Company’s performance but instead should be utilized as a supplemental measure of financial performance in evaluating our business. Following is a description of adjustments made to net earnings. For more detail, please see the accompanying schedule, titled “Reconciliation of Adjusted Net Earnings and Adjusted Diluted Earnings Per Share to GAAP Net Earnings and Diluted Earnings Per Share.”
Adjusted fourth quarter 2009 and 2008 net earnings and diluted earnings per share exclude share based compensation expense, which reduced fourth quarter 2009 net earnings and diluted earnings per share by $2.9 million and $0.04, respectively, and reduced fourth quarter 2008 net earnings and diluted earnings per share by $2.7 million and $0.03, respectively. Share based compensation expense reduced full year 2009 net earnings and diluted earnings per share by $10.6 million and $0.12, respectively, and reduced full year 2008 net earnings and diluted earnings per share by $9.5 million and $0.11, respectively.
Fourth quarter and full year 2008 adjusted net earnings also exclude margin of $28.6 million related to the Company’s contract in London as part of the NHS initiative to automate clinical processes and digitize medical records in England. This represents a one-time catch up resulting from a change in accounting estimate and the ability to separate the support services element of the contract. The after tax effect of this item increased fourth quarter 2008 net earnings and diluted earnings per share by $20.6 million and $0.24, respectively.
Full year 2008 adjusted net earnings and adjusted diluted earnings per share exclude the impact of a third party supplier settlement. The settlement reduced second quarter 2008 net earnings and diluted earnings per share by $5.0 million and $0.06, respectively.
Other Fourth Quarter Highlights:
• Fourth quarter cash collections of $478.2 million and operating cash flow of $108.1 million.
• Days sales outstanding of 90 days compared to 105 days in the third quarter of 2009 and 92 days in the year-ago quarter.
• Total revenue backlog of $4.21 billion, up 21 percent over the year-ago quarter. This is comprised of $3.59 billion of contract backlog and $621 million of support and maintenance backlog.
“Our fourth quarter results reflect a very strong finish to the year, with record bookings, and strong earnings and cash flow,” said Neal Patterson, Cerner co-founder, chairman and chief executive officer. “2009 represents the end of a decade of strong performance for Cerner, including growing our revenue and adjusted earnings per share at compound annual growth rates of 17 percent and 37 percent, respectively. We enter the new decade very well positioned to benefit from demand driven by the Health Information Technology for Economic and Clinical Health (HITECH) provisions in the American Recovery and Reinvestment Act of 2009 (ARRA). Beyond opportunities associated with HITECH, we are investing in several long-term growth initiatives that position us to build upon the stimulus-driven growth and deliver another decade of strong performance,” Patterson said.
Future Period Guidance
Cerner currently expects:
• First quarter 2010 revenue between $420 million and $435 million.
• First quarter 2010 adjusted diluted earnings per share before share based compensation expense between $0.57 and $0.62.
• First quarter 2010 new business bookings between $380 million and $410 million.
• Full-year 2010 revenue between $1.80 billion and $1.875 billion.
• Full-year 2010 adjusted diluted earnings per share before share based compensation expense between $2.80 and $2.90.
• Share based compensation expense to reduce diluted earnings per share by approximately $0.04 in the first quarter of 2010 and between $0.16 and $0.18 for the year.
Earnings Conference Call
Cerner will host an earnings conference call to provide additional detail on fourth quarter results at 3:30 p.m. CT on February 9. The dial-in number for the conference call is (617) 847-8708; the passcode is Cerner. The company recommends joining the call 15 minutes early for registration. The re-broadcast of the call will be available from 6:30 p.m. CT, February 9 through 11:59 p.m. CT, February 12. The dial-in number for the re-broadcast is (888) 286-8010; the passcode is 15651669.
An audio webcast will be available live and archived on Cerner’s Web site at www.cerner.com under the About Cerner section (click Investors, then Presentations and Webcasts).
About Cerner
Cerner is transforming healthcare by eliminating error, variance and waste for healthcare providers and consumers around the world. Cerner solutions optimize processes for healthcare organizations ranging in size from single-doctor practices, to health systems, to entire countries, for the pharmaceutical and medical device industries, and for the healthcare commerce system. These solutions are licensed by more than 8,000 facilities around the world, including approximately 2,100 hospitals; 3,300 physician practices covering more than 30,000 physicians; 500 ambulatory facilities, such as laboratories, ambulatory centers, cardiac facilities, radiology clinics and surgery centers; 600 home-health facilities; and 1,500 retail pharmacies. The following are trademarks of Cerner: Cerner and Cerner’s logo. Nasdaq: CERN. For more information about Cerner, please visit our Web site at www.cerner.com.
This release contains forward-looking statements that involve a number of risks and uncertainties. It is important to note that the Company's performance, and actual results, financial condition or business could differ materially from those expressed in such forward-looking statements. The words “position,” “opportunity,” “guidance,” and “expects” or the negative of these words, variations thereof or similar expressions are intended to identify such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: the possibility of product-related liabilities; potential claims for system errors and warranties; the possibility of interruption at our data centers or client support facilities; our proprietary technology may be subject to claims for infringement or misappropriation of intellectual property rights of others, or may be infringed or misappropriated by others; risks associated with our non-U.S. operations; risks associated with our ability to effectively hedge exposure to fluctuations in foreign currency exchange rates; risks associated with our recruitment and retention of key personnel; risks related to our reliance on third party suppliers; risks inherent with business acquisitions; changing political, economic and regulatory influences; government regulation; significant competition and market changes; the current adverse financial market environment and uncertainty in global economic conditions; variations in our quarterly operating results; potential inconsistencies in our sales forecasts compared to actual sales; and the volatility in the trading price of our common stock. Additional discussion of these and other factors affecting the Company's business is contained in the Company's periodic filings with the Securities and Exchange Commission. The Company undertakes no obligation to update forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes in future operating results, financial condition or business over time.
Statement of Earnings, GAAP Reconciliation and Condensed Consolidated Balance Sheets
|
