More on Bottomline Technologies FQ4, acquisitions

|About: Bottomline Technologies, Inc. (EPAY)|By:, SA News Editor

Bottomline Technologies' (EPAY) core net income was up 28.6% Y/Y to $11.7M. Core income excludes acquisition expenses of $8.3M, equity compensation of $4.5M, and non-cash interest expense of $2.7M.

On the conference call, management said its announced acquisitions of Sterci ($104M net of cash) and Simplex ($5M net of cash) will allow the company to "establish a global leadership position in SWIFT capabilities." The move will give Bottomline access to 350 new customers. The acquisitions are expected to be dilutive to EPS in the next 2 quarters and accretive by FQ4. Management expects FY 2014 revenue contribution from the acquisitions of $25M, growing to $40M in FY 2015.

FY 2014 revenue guidance of  $296.5M ($66M in FQ1, $73M FQ2, $77.5M FQ3, $80M FQ4) is above consensus of $278.6M. FY 2014 EPS is expected to be $1.05 ($$0.16 in FQ1, $0.17 FQ2, $0.32 FQ3, $0.40 FQ4), below consensus of $1.31. Earnings are expected to be negatively impacted by a $4M-$5M revenue haircut due to the acquisitions and an ~$8M increase in tax expense.