FactSet Research Systems Inc. (FDS: Quote) Tuesday projected fourth-quarter earnings above Street estimates, after reporting a higher third-quarter profit. The Financial data provider's quarterly revenues grew about 10 percent helped by a double-digit growth in both the U.S. and international revenues.
Philip Hadley, chairman and CEO of the company said, "While the economy remains volatile, results indicate our philosophy of consistently investing for the future is paying off...In addition, our third quarter results mark yet another milestone for the Company as we surpassed $200 million in quarterly revenues."
Revenues for the quarter grew 10.2 percent to $202.31 million, but was slightly lower than analysts' estimate of $202.95 million. The U.S revenues increased 10 percent from last year, while non-U.S revenues were up 11 percent.
Operating margins improved to 33.9 percent from 33.7 percent a year ago.
In the third quarter, the company's net income increased to $47.98 million or $1.05 per share from $43.31 million or $0.92 per share in the previous year.
Excluding stock-based compensation expense and amortization of intangible assets, adjusted earnings were $1.15 per share, higher than $1.02 per share in the prior year.
On average, 10 analysts polled by Thomson Reuters expected earnings per share of $1.04 for the quarter. Analysts' estimates typically exclude one-time items.
The company noted that expiration of the U.S. Federal R&D tax credit on December 31, 2011, increased the annual effective tax rate by 1.3 percent and reduced third quarter earnings per share by $0.02.
Annual Subscription Value, or ASV, as at May 31, grew 9 percent to $811 million. According to the company, 80 percent of the total ASV derived from buy-side clients and the remainder from sell-side firms who perform M&A advisory work and equity research.
During the quarter, FactSet's users increased by 1,100 to 48,400, mainly from additions at sell-side firms. Client count as at May 31, was 2,335, a net increase of 11 clients.
The company repurchased 276,000 shares for $27.3 million during the third quarter.
Looking ahead to the fourth quarter, the company expects GAAP earnings per share of $1.06 - $1.08 and non-GAAP earnings to be between $1.15 and $1.17 per share.
Revenues are anticipated to be in the range of $204 million to $208 million. Analysts project fourth-quarter earnings per share of $1.08, on revenues of $210.19 million.
FDS closed Monday's regular trading at $104.57 on the NYSE. In the pre-market activity, the shares are down 6.29 percent.
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by RTT Staff Writer
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