Jack Henry Ends Fiscal 2010 on High Notes
September 7, 2010 Timothy Prickett Morgan
The big banks may have taken it on the chin during the economic meltdown, but smaller regional banks and credit unions that are commonly customers of Jack Henry & Associates did comparatively better, and the software company’s numbers for the fiscal year ended in June show it.
In the final quarter of the fiscal year, Jack Henry said that it posted sales of $227.8 million, up 18.7 percent over the year-ago period. Net income rose by a skinnier 7.9 percent, hitting $30 million flat. License revenues plummeted by 29 percent in the quarter, to $12.4 million, and hardware sales (including Power Systems machines running IBM i) were off 10 percent, to $17.1 million. However, thanks to acquisitions and its expanding homegrown services businesses, Jack Henry was able to boost support and services revenues in the quarter by 28 percent to $198.4 million. (Acquisitions are driving revenue growth among many IT companies–at least those that are showing growth.)
For the full fiscal year, which encompassed the recovery period in the wake of the deepest part of the economic downturn, sales were up 12.2 percent, to $836.6 million; net income for the year rose even faster, up 14.4 percent, to $117.9 million. Software licenses dropped by 11 percent, to $52.2 million, and hardware sales were off by 12 percent, to $63.9 million. Support and services revenues came to $720.5 million.
“This year saw us complete three acquisitions, any one of which on its own would have represented one of the largest acquisitions in the company’s history,” said Jack Prim, chief executive officer at the financial application software maker. “The integration of these companies could hardly have gone better, and is substantially complete, including the most recent acquisition of iPay less than 90 days ago. These acquisitions contributed significantly to our electronic payments revenues, which had total revenue of over $200 million in the fiscal year, and to our recurring revenue which is now 78 percent of the total revenue. We welcome the over 600 employees of these companies and the thousands of customers they serve to the JHA family.”