Amdocs Limited (NYSE:DOX) declared better-than-expected financial results for the fourth quarter of fiscal 2009. Total revenue of $707.4 million was down 14.3% year-over-year but well above the Zacks Consensus Estimate of $681 million. The company said its revenue from its managed services business together with cable and satellite businesses have started to stabilize.
Quarterly net income on a GAAP basis was $85.8 million or 42 cents per share, compared to net income of $82.7 million or 38 cents per share in the prior-year quarter. However, fourth quarter adjusted (excluding special items) EPS was 49 cents, significantly above the Zacks Consensus Estimate of 45 cents. This was primarily due to a continuous effort taken by management to streamline the cost structure.
Cost of sales in the reported quarter was $450.7 million, an improvement of 15.1% year-over-year. As a result, gross margin in the reported quarter was 37% compared to 36.4% in the year-ago quarter. Quarterly operating expenses were $159.9, down 11.6% year-over-year. At the end of the reported quarter, total order backlog was $2,385 million compared to $2,370 million at the end of the pervious quarter.
During the fourth quarter, Amdocs generated $183.7 million of cash from operations compared to $178 million in the prior-year quarter. Quarterly free cash flow (cash flow from operations less capital expenditures) was $165.8 million, compared to $145 million in the prior-year quarter. At the end of fiscal 2009, the company had more than $1,173 million of cash and marketable securities and just $1 million of outstanding debt on its balance sheet, compared to $1,244.4 million of cash and marketable securities and just $450 million of outstanding debt at the end of fiscal 2008.
Service revenue was $680.2 million, down 13.2% year-over-year. License revenue was $27.3 million, down 35% year-over-year. Technologically, Customer Experience revenue was $668.6 million, down 11.6% year-over-year. Systems Directory revenue was down year-over-year. Geographically, North America generated $528 million (down 5.5% year-over-year) of fourth quarter revenue, Europe generated $93 million (down 38.4% year-over-year), and the Rest of World generated the remaining $86.4 million (down 25.3% year-over-year).
Future Financial Outlook
Management is expecting first quarter 2010 revenue to be within the range of $705 million - $725 million. Diluted non-GAAP EPS, excluding acquisition-related cost and equity based compensation, is forecasted in the range of $0.51-$0.55. Equity-based compensation is expected at approximately $0.04-$0.05 per diluted share. Diluted EPS, on a GAAP basis, is expected to be within the range of $0.38 - $0.44.