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EX-99.2 - EX-99.2 - ACI WORLDWIDE, INC.d89860dex992.htm
8-K - FORM 8-K - ACI WORLDWIDE, INC.d89860d8k.htm

Exhibit 99.1

 

LOGO

  News Release

ACI Worldwide, Inc. Reports Financial

Results for the Quarter Ended June 30, 2015

HIGHLIGHTS

 

    Net new bookings up 18%, total bookings up 24%

 

    Signed Universal Payments contract with large European customer

 

    GAAP revenue of $266 million, up 4% from Q2 last year

 

    $84 million in debt payments made year-to-date

 

    Reiterating 2015 guidance

NAPLES, FLA — July 30, 2015 — ACI Worldwide (NASDAQ: ACIW), a leading global provider of electronic payment and banking solutions, today announced financial results for the period ended June 30, 2015. Management will host a conference call at 8:30 am ET to discuss these results. Interested persons may access a real-time audio broadcast of the teleconference at http://investor.aciworldwide.com/ or use the following numbers for dial-in participation: US/Canada: (866) 914-7436, international: +1 (817) 385-9117. Please provide your name, the conference name ACI Worldwide, Inc. and conference code 87676766. There will be a replay available for two weeks on (855) 859-2056 for US/Canada callers and +1 (404) 537- 3406 for international participants.

“ACI had a busy and successful second quarter. We delivered net new bookings growth of 18% and signed several important renewals, including a five-year extension with the IRS,” commented Phil Heasley, President and CEO, ACI Worldwide. “We also signed another Universal Payments contract, this time with a large existing customer that has decided to upgrade their Faster Payments infrastructure. Looking to the second half of the year, our pipeline remains very strong and we are tracking well to achieve our targets this year and beyond.”


FINANCIAL SUMMARY

Financial Results for Q2

Overall sales bookings, including term extensions, increased 24% compared to the prior year quarter. New sales bookings, net of term extensions (SNET), increased 18% compared to the prior year quarter.

We ended Q2 with a 12-month backlog of $883 million and a 60-month backlog of $4.1 billion. After adjusting for foreign currency fluctuations, our 12-month backlog declined $11 million and our 60-month backlog declined $10 million from Q1 2015. An internal decision to exit one bill payment vertical as a result of regulatory changes negatively impacted our 60-month backlog by approximately $30 million. Excluding this, 60-month backlog grew $20 million.

Non-GAAP revenue in Q2 was $266 million, an increase of $11 million, or 4%, above the prior year quarter.

Adjusted EBITDA of $58 million was up 3% from last year’s $56 million. Net EBITDA margin in Q2 2015 was 25%, or flat with Q2 2014, after adjusting for $38 million and $34 million of pass through interchange fees in Q2 2015 and Q2 2014, respectively.

Q2 non-GAAP net income was $30 million, or $0.26 per diluted share, versus non-GAAP net income of $14 million, or $0.12 per diluted share in Q2 2014.

ACI ended the second quarter with $50 million in cash on hand. Following $84 million in net debt payments during the first half of 2015, ACI ended the quarter with a debt balance of $808 million. Operating free cash flow (OFCF) for the quarter declined from Q2 2014 primarily driven by the timing of Q2 2015 sales receipts now expected in early Q3.

During the quarter, ACI received cash proceeds of $35 million and realized a $24 million gain from the sale of our holding in Yodlee, Inc stock.


Reiterating Guidance

We expect to generate non-GAAP revenue in the range of $1.04 to $1.07 billion for the full year 2015. This range continues to represent 3-6% organic growth after adjusting for foreign currency fluctuations. We expect adjusted EBITDA to be in the range of $280 to $290 million. We expect to generate between $235 and $245 million in non-GAAP revenue in the third quarter. Lastly, we expect full year 2015 net new sales bookings to increase in the upper single digit range.

About ACI Worldwide

ACI Worldwide, the Universal Payments company, powers electronic payments and banking for more than 5,600 financial institutions, retailers, billers and processors around the world. ACI software processes $13 trillion each day in payments and securities transactions for more than 300 of the leading global retailers, and 18 of the top 20 banks worldwide. Through our comprehensive suite of software products and hosted services, we deliver a broad range of solutions for payment processing; card and merchant management; online banking; mobile, branch and voice banking; fraud detection; trade finance; and electronic bill presentment and payment. To learn more about ACI, please visit www.aciworldwide.com. You can also find us on Twitter @ACI_Worldwide.

© Copyright ACI Worldwide, Inc. 2015.

For more information contact:

John Kraft, Vice President, Investor Relations & Strategic Analysis

ACI Worldwide

239-403-4627

john.kraft@aciworldwide.com


To supplement our financial results presented on a GAAP basis, we use the non-GAAP measures indicated in the tables, which exclude certain business combination accounting entries related to the acquisition of Online Resources Corporation and significant transaction-related expenses, as well as other significant non-cash expenses such as depreciation, amortization and share-based compensation, that we believe are helpful in understanding our past financial performance and our future results. The presentation of these non-GAAP financial measures should be considered in addition to our GAAP results and are not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management generally compensates for limitations in the use of non-GAAP financial measures by relying on comparable GAAP financial measures and providing investors with a reconciliation of non-GAAP financial measures only in addition to and in conjunction with results presented in accordance with GAAP. We believe that these non-GAAP financial measures reflect an additional way to view aspects of our operations that, when viewed with our GAAP results, provide a more complete understanding of factors and trends affecting our business. Certain non-GAAP measures include:

 

    Non-GAAP revenue: revenue plus deferred revenue that would have been recognized in the normal course of business by Online Resources if not for GAAP purchase accounting requirements. Non-GAAP revenue should be considered in addition to, rather than as a substitute for, revenue.

 

    Non-GAAP operating income: operating income plus deferred revenue that would have been recognized in the normal course of business by Online Resources if not for GAAP purchase accounting requirements and significant transaction-related expenses. Non-GAAP operating income should be considered in addition to, rather than as a substitute for, operating income.

 

    Adjusted EBITDA: net income plus income tax expense (benefit), net interest income (expense), net other income (expense), depreciation, amortization and non-cash compensation, as well as deferred revenue that would have been recognized in the normal course of business by Online Resources if not for GAAP purchase accounting requirements and significant transaction-related expenses. Adjusted EBITDA should be considered in addition to, rather than as a substitute for, operating income.

ACI is also presenting operating free cash flow, which is defined as net cash provided by operating activities, plus payments associated with acquired opening balance sheet


liabilities, net after-tax payments associated with employee-related actions and facility closures, net after-tax payments associated with significant transaction-related expenses, and less capital expenditures. Operating free cash flow is considered a non-GAAP financial measure as defined by SEC Regulation G. We utilize this non-GAAP financial measure, and believe it is useful to investors, as an indicator of cash flow available for debt repayment and other investing activities, such as capital investments and acquisitions. We utilize operating free cash flow as a further indicator of operating performance and for planning investing activities. Operating free cash flow should be considered in addition to, rather than as a substitute for, net cash provided by operating activities. A limitation of operating free cash flow is that it does not represent the total increase or decrease in the cash balance for the period. This measure also does not exclude mandatory debt service obligations and, therefore, does not represent the residual cash flow available for discretionary expenditures. We believe that operating free cash flow is useful to investors to provide disclosures of our operating results on the same basis as that used by our management.

ACI also includes backlog estimates, which include all software license fees, maintenance fees and service fees specified in executed contracts, as well as revenues from assumed contract renewals to the extent that we believe recognition of the related revenue will occur within the corresponding backlog period. We have historically included assumed renewals in backlog estimates based upon automatic renewal provisions in the executed contract and our historic experience with customer renewal rates.

Backlog is considered a non-GAAP financial measure as defined by SEC Regulation G. Our 60-month backlog estimate represents expected revenues from existing customers using the following key assumptions:

 

    Maintenance fees are assumed to exist for the duration of the license term for those contracts in which the committed maintenance term is less than the committed license term.

 

    License, facilities management, and software hosting arrangements are assumed to renew at the end of their committed term at a rate consistent with our historical experiences.

 

    Non-recurring license arrangements are assumed to renew as recurring revenue streams.


    Foreign currency exchange rates are assumed to remain constant over the 60-month backlog period for those contracts stated in currencies other than the U.S. dollar.

 

    Our pricing policies and practices are assumed to remain constant over the 60-month backlog period.

Estimates of future financial results are inherently unreliable. Our backlog estimates require substantial judgment and are based on a number of assumptions as described above. These assumptions may turn out to be inaccurate or wrong, including, but not limited to, reasons outside of management’s control. For example, our customers may attempt to renegotiate or terminate their contracts for a number of reasons, including mergers, changes in their financial condition, or general changes in economic conditions in the customer’s industry or geographic location, or we may experience delays in the development or delivery of products or services specified in customer contracts which may cause the actual renewal rates and amounts to differ from historical experiences. Changes in foreign currency exchange rates may also impact the amount of revenue actually recognized in future periods. Accordingly, there can be no assurance that contracts included in backlog estimates will actually generate the specified revenues or that the actual revenues will be generated within the corresponding 60-month period.

Backlog should be considered in addition to, rather than as a substitute for, reported revenue and deferred revenue.


Forward-Looking Statements

This press release contains forward-looking statements based on current expectations that involve a number of risks and uncertainties. Generally, forward-looking statements do not relate strictly to historical or current facts and may include words or phrases such as “believes,” “will,” “expects,” “anticipates,” “intends,” and words and phrases of similar impact. The forward-looking statements are made pursuant to safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Forward-looking statements in this press release include, but are not limited to, statements regarding: (i) expectations regarding pipeline strength; (ii) expectations that ACI is tracking well to achieve targets this year and beyond; (iii) expectations regarding non-GAAP revenue, adjusted EBITDA, and net new sales bookings in 2015; and (iv) expectations regarding Q3 2015 non-GAAP revenue.

All of the foregoing forward-looking statements are expressly qualified by the risk factors discussed in our filings with the Securities and Exchange Commission. Such factors include, but are not limited to, increased competition, the performance of our strategic product, UP BASE24-eps, demand for our products, restrictions and other financial covenants in our credit facility, consolidations and failures in the financial services industry, customer reluctance to switch to a new vendor, the accuracy of management’s backlog estimates, the maturity of certain products, our strategy to migrate customers to our next generation products, ratable or deferred recognition of certain revenue associated with customer migrations and the maturity of certain of our products, failure to obtain renewals of customer contracts or to obtain such renewals on favorable terms, delay or cancellation of customer projects or inaccurate project completion estimates, volatility and disruption of the capital and credit markets and adverse changes in the global economy, our existing levels of debt, impairment of our goodwill or intangible assets, litigation, future acquisitions, strategic partnerships and investments, risks related to the expected benefits to be achieved in the transaction with Retail Decisions, the complexity of our products and services and the risk that they may contain hidden defects or be subjected to security breaches or viruses, compliance of our products with applicable legislation, governmental regulations and industry standards, our compliance with privacy regulations, the protection of our intellectual property in intellectual property


litigation, the cyclical nature of our revenue and earnings and the accuracy of forecasts due to the concentration of revenue-generating activity during the final weeks of each quarter, business interruptions or failure of our information technology and communication systems, our offshore software development activities, risks from operating internationally, including fluctuations in currency exchange rates, exposure to unknown tax liabilities, and volatility in our stock price. For a detailed discussion of these risk factors, parties that are relying on the forward-looking statements should review our filings with the Securities and Exchange Commission, including our most recently filed Annual Report on Form 10-K and our Quarterly Report on Form 10-Q.


ACI WORLDWIDE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited and in thousands, except share and per share amounts)

 

     June 30,
2015
    December 31,
2014
 

ASSETS

    

Current assets

    

Cash and cash equivalents

   $ 50,397      $ 77,301   

Receivables, net of allowances of $5,058 and $4,806, respectively

     220,969        227,106   

Deferred income taxes, net

     55,998        44,349   

Recoverable income taxes

     4,107        4,781   

Prepaid expenses

     25,625        24,314   

Other current assets

     24,361        40,417   
  

 

 

   

 

 

 

Total current assets

     381,457        418,268   
  

 

 

   

 

 

 

Property and equipment, net

     58,309        60,360   

Software, net

     211,016        209,507   

Goodwill

     775,279        781,163   

Intangible assets, net

     248,960        261,436   

Deferred income taxes, net

     54,305        50,187   

Other noncurrent assets, including $33,824 at December 31, 2014 for assets at fair value

     43,132        69,779   
  

 

 

   

 

 

 

TOTAL ASSETS

   $ 1,772,458      $ 1,850,700   
  

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

    

Current liabilities

    

Accounts payable

   $ 36,284      $ 50,351   

Employee compensation

     40,701        35,299   

Current portion of long-term debt

     95,293        87,352   

Deferred revenue

     135,799        131,808   

Income taxes payable

     1,765        6,276   

Deferred income taxes, net

     282        225   

Other current liabilities

     58,186        67,505   
  

 

 

   

 

 

 

Total current liabilities

     368,310        378,816   
  

 

 

   

 

 

 

Noncurrent liabilities

    

Deferred revenue

     46,291        49,224   

Long-term debt

     712,937        804,583   

Deferred income taxes, net

     15,888        13,217   

Other noncurrent liabilities

     30,472        23,455   
  

 

 

   

 

 

 

Total liabilities

     1,173,898        1,269,295   
  

 

 

   

 

 

 

Commitments and contingencies

    

Stockholders’ equity

    

Preferred stock; $0.01 par value; 5,000,000 shares authorized; no shares issued and outstanding at June 30, 2015 and December 31, 2014

     —          —     

Common stock; $0.005 par value; 280,000,000 shares authorized; 139,820,388 shares issued at June 30, 2015 and December 31, 2014

     698        698   

Additional paid-in capital

     549,866        551,713   

Retained earnings

     358,304        331,415   

Treasury stock, at cost, 22,021,238 and 24,182,584 shares at June 30, 2015 and December 31, 2014, respectively

     (258,910     (282,538

Accumulated other comprehensive loss

     (51,398     (19,883
  

 

 

   

 

 

 

Total stockholders’ equity

     598,560        581,405   
  

 

 

   

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

   $ 1,772,458      $ 1,850,700   
  

 

 

   

 

 

 


ACI WORLDWIDE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(unaudited and in thousands, except per share amounts)

 

     For the Three Months Ended
June 30,
    For the Six Months Ended
June 30,
 
     2015     2014     2015     2014  

Revenues

        

License

   $ 67,161      $ 61,377      $ 106,738      $ 97,079   

Maintenance

     60,141        62,309        119,633        124,808   

Services

     23,110        24,991        46,607        47,579   

Hosting

     115,410        106,131        225,661        206,815   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     265,822        254,808        498,639        476,281   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses

        

Cost of license (1)

     5,939        6,897        12,048        12,633   

Cost of maintenance, services and hosting (1)

     120,484        112,595        233,497        220,482   

Research and development

     39,425        38,876        76,516        76,332   

Selling and marketing

     31,298        28,007        60,209        55,916   

General and administrative

     25,008        24,682        46,583        49,798   

Depreciation and amortization

     20,004        17,010        39,697        34,088   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     242,158        228,067        468,550        449,249   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     23,664        26,741        30,089        27,032   
  

 

 

   

 

 

   

 

 

   

 

 

 

Other income (expense)

        

Interest expense

     (10,505     (9,329     (21,446     (18,504

Interest income

     58        135        160        334   

Other, net

     19,659        (3,901     23,381        (4,958
  

 

 

   

 

 

   

 

 

   

 

 

 

Total other income (expense)

     9,212        (13,095     2,095        (23,128
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before income taxes

     32,876        13,646        32,184        3,904   

Income tax expense (benefit)

     5,825        2,409        5,295        (1,558
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

   $ 27,051      $ 11,237      $ 26,889      $ 5,462   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income per common share

        

Basic

   $ 0.23      $ 0.10      $ 0.23      $ 0.05   

Diluted

   $ 0.23      $ 0.10      $ 0.23      $ 0.05   

Weighted average common shares outstanding

        

Basic

     117,109        113,907        116,584        114,663   

Diluted

     118,575        115,977        118,088        116,812   

 

(1) The cost of software license fees excludes charges for depreciation but includes amortization of purchased and developed software for resale. The cost of maintenance, services and hosting fees excludes charges for depreciation.


ACI WORLDWIDE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited and in thousands)

 

     For the Three Months
Ended June 30,
 
     2015     2014  

Cash flows from operating activities:

    

Net income

   $ 27,051      $ 11,237   

Adjustments to reconcile net income to net cash flows from operating activities:

    

Depreciation

     5,257        5,234   

Amortization

     18,324        15,309   

Amortization of deferred debt issuance costs

     1,584        1,332   

Deferred income taxes

     752        (857

Stock-based compensation expense

     5,355        4,416   

Excess tax benefit of stock options exercised

     (1,012     (312

Gain on sale of available-for-sale securities

     (24,465     —     

Other

     601        734   

Changes in operating assets and liabilities, net of impact of acquisitions:

    

Receivables

     (45,833     (6,361

Accounts payable

     (3,386     (1,723

Accrued employee compensation

     9,191        4,239   

Current income taxes

     (5,833     (1,233

Deferred revenue

     2,469        (6,559

Other current and noncurrent assets and liabilities

     10,711        7,610   
  

 

 

   

 

 

 

Net cash flows from operating activities

     766        33,066   
  

 

 

   

 

 

 

Cash flows from investing activities:

    

Purchases of property and equipment

     (4,270     (4,091

Purchases of software and distribution rights

     (5,137     (3,411

Proceeds from available-for-sale equity securities

     35,311        —     

Other

     (5,000     (1,500
  

 

 

   

 

 

 

Net cash flows from investing activities

     20,904        (9,002
  

 

 

   

 

 

 

Cash flows from financing activities:

    

Proceeds from issuance of common stock

     773        686   

Proceeds from exercises of stock options

     3,716        1,230   

Excess tax benefit of stock options exercised

     1,012        312   

Repurchase of restricted stock and performance shares for tax withholdings

     (28     (30

Proceeds from revolving credit facility

     36,000        10,000   

Repayment of revolving credit facility

     (58,000     (27,000

Repayment of term portion of credit agreement

     (19,853     (8,871

Payments on other debt

     (7,291     (6,305

Distribution to noncontrolling interest

     —          (1,391
  

 

 

   

 

 

 

Net cash flows from financing activities

     (43,671     (31,369
  

 

 

   

 

 

 

Effect of exchange rate fluctuations on cash

     3,939        3,351   
  

 

 

   

 

 

 

Net decrease in cash and cash equivalents

     (18,062     (3,954

Cash and cash equivalents, beginning of period

     68,459        58,936   
  

 

 

   

 

 

 

Cash and cash equivalents, end of period

   $ 50,397      $ 54,982   
  

 

 

   

 

 

 


ACI WORLDWIDE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited and in thousands)

 

     For the Six Months
Ended June 30,
 
     2015     2014  

Cash flows from operating activities:

    

Net income

   $ 26,889      $ 5,462   

Adjustments to reconcile net income to net cash flows from operating activities:

    

Depreciation

     10,588        10,558   

Amortization

     36,605        30,591   

Amortization of deferred debt issuance costs

     3,212        2,680   

Deferred income taxes

     (3,961     (12,134

Stock-based compensation expense

     9,291        9,188   

Excess tax benefit of stock options exercised

     (4,407     (4,382

Gain on sale of available-for-sale securities

     (24,465     —     

Other

     1,456        671   

Changes in operating assets and liabilities, net of impact of acquisitions:

    

Receivables

     (3,411     (9,279

Accounts payable

     (7,016     (3,203

Accrued employee compensation

     7,240        659   

Current income taxes

     (3,635     4,728   

Deferred revenue

     2,653        20,337   

Other current and noncurrent assets and liabilities

     (1,106     (7,553
  

 

 

   

 

 

 

Net cash flows from operating activities

     49,933        48,323   
  

 

 

   

 

 

 

Cash flows from investing activities:

    

Purchases of property and equipment

     (13,408     (8,319

Purchases of software and distribution rights

     (8,496     (6,991

Proceeds from available-for-sale equity securities

     35,311        —     

Other

     (7,000     (1,500
  

 

 

   

 

 

 

Net cash flows from investing activities

     6,407        (16,810
  

 

 

   

 

 

 

Cash flows from financing activities:

    

Proceeds from issuance of common stock

     1,524        1,338   

Proceeds from exercises of stock options

     10,634        4,117   

Excess tax benefit of stock options exercised

     4,407        4,382   

Repurchases of common stock

     —          (70,000

Repurchase of restricted stock and performance shares for tax withholdings

     (4,047     (4,533

Proceeds from revolving credit facility

     65,000        50,000   

Repayment of revolving credit facility

     (109,000     (35,000

Repayment of term portion of credit agreement

     (39,706     (17,742

Payments on other debt

     (10,120     (6,687

Payment for debt issuance costs

     —          (163

Distribution to noncontrolling interest

     —          (1,391
  

 

 

   

 

 

 

Net cash flows from financing activities

     (81,308     (75,679
  

 

 

   

 

 

 

Effect of exchange rate fluctuations on cash

     (1,936     4,089   
  

 

 

   

 

 

 

Net decrease in cash and cash equivalents

     (26,904     (40,077

Cash and cash equivalents, beginning of period

     77,301        95,059   
  

 

 

   

 

 

 

Cash and cash equivalents, end of period

   $ 50,397      $ 54,982   
  

 

 

   

 

 

 


ACI Worldwide, Inc.

Reconciliation of Selected GAAP Measures to Non-GAAP Measures (1)

(unaudited and in thousands, except per share data)

 

     FOR THE THREE MONTHS ENDED June 30,  
Selected Non-GAAP Financial Data    2015
GAAP
     Adj     2015
Non-GAAP
     2014
GAAP
     Adj     2014
Non-GAAP
     $ Diff     % Diff  

Total revenues (2)

   $ 265,822       $ 191      $ 266,013       $ 254,808       $ 459      $ 255,267       $ 10,746        4

Total expenses (3)

     242,158         (4,818     237,340         228,067         (3,502     224,565         12,775        6

Operating income

     23,664         5,009        28,673         26,741         3,961        30,702         (2,029     -7

Income (Loss) before income taxes

     32,876         5,009        37,885         13,646         3,961        17,607         20,278        115

Income tax expense (benefit) (4)

     5,825         1,753        7,578         2,409         1,386        3,795         3,783        100
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Net income (loss)

   $ 27,051       $ 3,256      $ 30,307       $ 11,237       $ 2,575      $ 13,812       $ 16,495        119
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Depreciation

     5,257         —          5,257         5,234         —          5,234         23        0

Amortization - acquisition related intangibles

     5,625         —          5,625         5,803         —          5,803         (178     -3

Amortization - acquisition related software

     6,158         —          6,158         5,125         —          5,125         1,033        20

Amortization - other

     6,541         —          6,541         4,381         —          4,381         2,160        49

Stock-based compensation

     5,355         —          5,355         4,416         —          4,416         939        21
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Adjusted EBITDA

   $ 52,600       $ 5,009      $ 57,609       $ 51,700       $ 3,961      $ 55,661       $ 1,948        3
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Earnings per share information

                    

Weighted average shares outstanding

                    

Basic

     117,109         117,109        117,109         113,907         113,907        113,907        

Diluted

     118,575         118,575        118,575         115,977         115,977        115,977        

Earnings per share

                    

Basic

   $ 0.23       $ 0.03      $ 0.26       $ 0.10       $ 0.02      $ 0.12       $ 0.14     

Diluted

   $ 0.23       $ 0.03      $ 0.26       $ 0.10       $ 0.02      $ 0.12       $ 0.14     

 

(1) This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP.
(2) Adjustment for ORCC deferred revenue that would have been recognized in the normal course of business but was not recognized due to GAAP purchase accounting requirements.
(3) Expense for significant transaction related expenses, including, $1.4 million for employee related actions, $0.7 million for data center moves, and $2.7 million for transition costs, technology costs and other fees in 2015. Expenses for significant transaction related transactions included $1.4 million for employee related actions, $0.6 million for data center moves and $1.5 million for professional and other fees in 2014.
(4) Adjustments tax effected at 35%.

 

    

Quarter Ended

June 30,

 
Reconciliation of Operating Free Cash Flow (millions)    2015      2014  

Net cash provided by operating activities

   $ 0.8       $ 33.1   

Payments associated with acquired opening balance sheet liabilities

     —           0.3   

Net after-tax payments associated with employee-related actions (4)

     0.4         0.9   

Net after-tax payments associated with lease terminations (4)

     0.2         0.2   

Net after-tax payments associated with significant transaction related expenses (4)

     1.0         1.2   

Less capital expenditures

     (9.4      (7.5
  

 

 

    

 

 

 

Operating Free Cash Flow

   $ (7.0    $ 28.2