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Computer Programs and Systems, Inc.$28.85$.20.70%

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 CPSI Announces Fourth Quarter and Year-End 2014 Results and 2015 Guidance
   Thursday, January 29, 2015 4:30:02 PM ET

Computer Programs and Systems, Inc. (CPSI ):

Highlights:

-- Revenues of $46.3 million for the fourth quarter and $204.7 million for the year;

-- 12-month backlog of $159.4 million;

-- Earnings per diluted share of $0.60 for the quarter and $2.94 for the year;

-- Cash provided by operations of $12.9 million for the quarter and $38.9 million for the year; and

-- Quarterly dividend of $0.64 per share.

Computer Programs and Systems, Inc. (CPSI ), a leading provider of healthcare information solutions, today announced results for the fourth quarter and year ended December 31, 2014.

The Company also announced that its Board of Directors has approved an increase in the regular quarterly cash dividend of $0.07 to $0.64 (sixty-four cents) per share, payable on February 27, 2015, to stockholders of record as of the close of business on February 12, 2015.

Total revenues for the fourth quarter ended December 31, 2014, were $46.3 million, compared with total revenues of $51.3 million for the prior-year fourth quarter. Net income for the quarter ended December 31, 2014, was $6.7 million, or $0.60 per diluted share, compared with $10.0 million, or $0.90 per diluted share, for the quarter ended December 31, 2013. Cash provided by operations for the fourth quarter of 2014 was $12.9 million, compared with $14.7 million for the prior-year fourth quarter. Cash collections for the fourth quarter ended December 31, 2014, were $53.2 million, compared with cash collections of $56.2 million for the prior-year fourth quarter.

Total revenues for the year ended December 31, 2014, were $204.7 million, compared with total revenues of $200.9 million for the prior year. Net income for the year ended December 31, 2014, was $32.9 million, or $2.94 per diluted share, compared with $32.7 million, or $2.95 per diluted share, for the year ended December 31, 2013. Cash provided by operations for 2014 was $38.9 million, compared with $29.0 million for the prior year. Cash collections for 2014 were $207.1 million, compared with cash collections of $189.6 million for the prior year.

For 2015, the Company anticipates total revenues of $196 million to $206 million and net income of approximately $29 million to $31 million, or $2.62 to $2.77 per diluted share. CPSI’s 12-month backlog as of December 31, 2014, was $159.4 million, consisting of $36.1 million in non-recurring system purchases and $123.3 million in recurring payments for support, Business Management Services and SAAS contracts. The backlog total excludes amounts related to systems installed during 2012 under contracts for which a portion of the consideration was to be received and revenue recognized in subsequent periods upon hospitals successfully achieving meaningful use designation. Although the related system installations were substantially completed during 2012, and no additional such contracts have been offered since 2012, the total remaining accumulated unrecognized revenue related to such contracts as of December 31, 2014, was approximately $0.5 million.

CPSI will hold a live webcast to discuss fourth quarter and year-end 2014 results on January 30, 2014, at 9:00 a.m. Eastern time. A 30-day online replay will be available approximately one hour following the conclusion of the live webcast. To listen to the live webcast or access the replay, visit the Company’s website, www.cpsi.com.

About Computer Programs and Systems, Inc.

CPSI is a leading provider of electronic health records systems for more than 650 community, rural and critical access hospitals and their 12,000 providers. Founded in 1979, the Company is dedicated to meeting the ever-changing needs of health IT, while optimizing the quality of care for communities in 46 states and the District of Columbia. CPSI provides a complete information and patient care system from business office to bedside combined with comprehensive implementation, training and ongoing support from our staff of approximately 1,400 healthcare and business professionals. CPSI’s wholly owned subsidiary, TruBridge, LLC, focuses exclusively on providing business office, consulting and managed IT services to rural and community healthcare organizations, regardless of their IT vendor. To join the conversation with CPSI, connect with us on Facebook, Twitter (@cpsiehr) and on the CPSI blog. For more information, visit www.cpsi.com or www.trubridge.com.

This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified generally by the use of forward-looking terminology and words such as "expects," "anticipates," "estimates," "believes," "predicts," "intends," "plans," "potential," "may," "continue," "should," "will" and words of comparable meaning. Without limiting the generality of the preceding statement, all statements in this press release relating to estimated and projected earnings, margins, costs, expenditures, cash flows, growth rates and future financial results are forward-looking statements. We caution investors that any such forward-looking statements are only predictions and are not guarantees of future performance. Certain risks, uncertainties and other factors may cause actual results to differ materially from those projected in the forward-looking statements. Such factors may include: overall business and economic conditions affecting the healthcare industry; government regulation of the healthcare and health insurance industries; government regulation of our products and customers, including changes in healthcare policy affecting Medicare and Medicaid reimbursement rates and qualifying technological standards; the potential effects of the federal healthcare reform legislation enacted in 2010, and implementing regulations, on the businesses of our hospital customers; the funding uncertainties associated with and potential expenditures required by the American Recovery and Reinvestment Act of 2009 in connection with the adoption of electronic health records; saturation of our target market and hospital consolidations; changes in customer purchasing priorities, capital expenditures and demand for information technology systems; competition with companies that have greater financial, technical and marketing resources than we have; failure to develop new technology and products in response to market demands; fluctuations in quarterly financial performance due to, among other factors, timing of customer installations; failure of our products to function properly resulting in claims for medical losses; changes in accounting principles generally accepted in the United States; breaches of security and viruses in our systems resulting in customer claims against us and harm to our reputation; potential intellectual property claims against us; general economic conditions, including changes in the financial and credit markets that may affect the availability and cost of credit to us or our customers; interruptions in our power supply and/or telecommunications capabilities and other risk factors described from time to time in our public releases and reports filed with the Securities and Exchange Commission, including, but not limited to, our most recent Annual Report on Form 10-K. We also caution investors that the forward-looking information described herein represents our outlook only as of this date, and we undertake no obligation to update or revise any forward-looking statements to reflect events or developments after the date of this press release.

                                                                                                                                                                                             
                                                                                                                                                    COMPUTER PROGRAMS AND SYSTEMS, INC.
                                                                                                                                           Unaudited Condensed Consolidated Statements of Income
                                                                                                                                                   (in thousands, except per share data)
                                                                                                                                                            
                                                                                                                                                                                                                  
                                                                                                                       Three Months Ended                                                                                                                               Year Ended
                                                                                                                          December 31,                                                                                                                                 December 31,
                                                                     ----------------------------------------------------------------------------------------------------------------                            ------------------------------------------------------------------------------------------------------------------
                                                                        2014         2013                             2014          2013   
                                                                     -------------------- ------                      -------------------- -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
Sales revenues:
  System sales                                                                          $ 13,226                                                              $ 20,509                                                              $  75,099                                                              $  79,792
  Support and maintenance                                                                 18,610                                                                18,094                                                                 73,553                                                                 71,506
  Business management, consulting and managed IT services              14,431                          12,671                           56,090                           49,565  
                                                                     -------------------- ------                      -------------------- -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
      Total sales revenues                                                                46,267                                                                51,274                                                                204,742                                                                200,863
                                                                                                                                                                                                                                                                                         
Cost of sales:
  System sales                                                                            11,047                                                                10,264                                                                 44,620                                                                 47,840
  Support and maintenance                                                                  7,125                                                                 7,093                                                                 29,080                                                                 28,640
  Business management, consulting and managed IT services               8,993                           8,430                           37,066                           30,646  
                                                                     -------------------- ------                      -------------------- -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
    Total cost of sales                                                27,165                          25,787                          110,766                          107,126  
                                                                     -------------------- ------                      -------------------- -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
      Gross profit                                                                        19,102                                                                25,487                                                                 93,976                                                                 93,737
                                                                                                                                                                                                                                                                                         
Operating expenses:
  Sales and marketing                                                                      3,211                                                                 3,740                                                                 14,370                                                                 14,737
  General and administrative                                            6,549                           5,786                           30,019                           28,756  
                                                                     -------------------- ------                      -------------------- -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
      Total operating expenses                                          9,760                           9,526                           44,389                           43,493  
                                                                     -------------------- ------                      -------------------- -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                                                                                                                                                                         
      Operating income                                                                     9,342                                                                15,961                                                                 49,587                                                                 50,244
Other income                                                               71                              80                              152                              467  
                                                                     -------------------- ------                      -------------------- -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
      Income before taxes                                                                  9,413                                                                16,041                                                                 49,739                                                                 50,711
Provision for income taxes                                              2,669                           5,996                           16,819                           17,968  
                                                                     -------------------- ------                      -------------------- -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
      Net income                                                                           6,744                                                                10,045                                                                 32,920                                                                 32,743
Less: Net income attributable to participating securities (unvested       (96                      )                        (139 )                                              (499 )                                              (299 )
restricted stock)
                                                                     -------------------- ------                      -------------------- -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
Net income attributable to common stockholders                                          $  6,648                                           $  9,906                                           $  32,421                                           $  32,444  
                                                                     ==================== ======                      ==================== ==================== ====== ====================                      ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                         
Basic and diluted earnings per share                                                    $   0.60                                           $   0.90                                           $    2.94                                           $    2.95  
                                                                     ==================== ======                      ==================== ==================== ====== ====================                      ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                         
Weighted average shares outstanding used in basic per common share                        11,048                                                                11,005                                                                 11,026                                                                 10,998
computations
Weighted average shares outstanding used in diluted per common share                      11,050                                                                11,005                                                                 11,026                                                                 10,998
computations
                                                                                                                               
                                                                                  COMPUTER PROGRAMS AND SYSTEMS, INC.
                                                                                 Condensed Consolidated Balance Sheets
                                                                                 (in thousands, except per share data)
                                                                                          
                                                                                                                                                                       
                                                                                                                    Dec. 31,                                                      Dec. 31,
                                                                                                                      2014                                                          2013
                                                                                               -----------------------------------------------                        ------------------------------
                                                                                                                   (Unaudited)
                                                                                                ASSETS
Current assets:
  Cash and cash equivalents                                                                                       $  23,792                                                              $     11,729
  Investments                                                                                                        10,703                                                                    10,703
                                                                                                                     23,102                                                                    20,076
  Accounts receivable, net of allowance for doubtful accounts of
  $1,253 and $1,125, respectively
  Financing receivables, current portion, net                                                                        18,112                                                                    25,388
  Inventories                                                                                                         1,431                                                                     1,589
  Deferred tax assets                                                                                                 2,319                                                                     2,366
  Prepaid income taxes                                                                                                1,120                                                                         -
  Prepaid expenses and other                                                                         937                                 901
                                                                                               -------------------- ------- --------------------                      -------------------- ----------
    Total current assets                                                                                             81,516                                                                    72,752
                                                                                                                                                                       
Financing receivables, net of current portion                                                                           770                                                                       551
Property and equipment, net                                                                       17,039                              19,231
                                                                                               -------------------- ------- --------------------                      -------------------- ----------
    Total assets                                                                                                  $  99,325                                           $     92,534
                                                                                               ==================== ======= ====================                      ==================== ==========
                                                                                                                                                                       
                                                                    LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
  Accounts payable                                                                                                $   3,990                                                              $      3,214
  Deferred revenue                                                                                                    5,891                                                                     9,581
  Accrued vacation                                                                                                    3,931                                                                     3,695
  Income taxes payable                                                                                                    -                                                                       797
  Other accrued liabilities                                                                        4,349                               4,164
                                                                                               -------------------- ------- --------------------                      -------------------- ----------
    Total current liabilities                                                                                        18,161                                                                    21,451
                                                                                                                                                                       
Deferred tax liabilities                                                                                                383                                                                     2,001
                                                                                                                                                                       
Stockholders’ equity:
  Common stock, par value $0.001 per share, 30,000 shares authorized,                                                    11                                                                        11
  11,209 and 11,159 shares issued and outstanding
  Additional paid-in capital                                                                                         38,983                                                                    34,644
  Accumulated other comprehensive (loss) income                                                                         (19 )                                                                      11
  Retained earnings                                                                               41,806                              34,416
                                                                                               -------------------- ------- --------------------                      -------------------- ----------
    Total stockholders’ equity                                         80,781                              69,082
                                                                                               -------------------- ------- --------------------                      -------------------- ----------
    Total liabilities and stockholders’ equity                                         $  99,325                                           $     92,534
                                                                                               ==================== ======= ====================                      ==================== ==========
                                                                                                                                                                                         
                                                                                                                                                                      COMPUTER PROGRAMS AND SYSTEMS, INC.
                                                                                                                                                                   Unaudited Other Supplemental Information
                                                                                                                                                                                (In thousands)
 
The following table summarizes cash flow and
free cash flow for the Company:
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                                                                                 
                                                                                                                            Three Months Ended                                                                                                                                                    Year Ended
                                                                                                                               December 31,                                                                                                                                                      December 31,
                                                                                                                                                                                                                                                                           
                                                               ------------------------------------------------------------------------------------------------------------------------------------                             --------------------------------------------------------------------------------------------------------------------------------------
                                                                  2014           2013                             2014            2013   
                                                               -------------------- ------ -------------------- --------------------                      -------------------- ------ --------------------                      -------------------- ------- -------------------- --------------------                      -------------------- ------- --------------------
Cash Flow Information                                                                                                                                                                                                                                           
Net cash provided by operating activities                                         $ 12,880                                                                                   $ 14,725                                                              $  38,949                                                                                   $  29,047
Net cash used in investing activities                                                 (753 )                                                                                     (325 )                                                               (1,523 )                                                                                    (3,685 )
Net cash used in financing activities                                               (6,342 )                                                                                   (5,585 )                                                              (25,363 )                                                                                   (22,546 )
                                                                                                                                                                                                                                                                                                                             
Free Cash Flow
Net cash provided by operating activities                                         $ 12,880                                                                                   $ 14,725                                                              $  38,949                                                                                   $  29,047
Less: Purchases of capital assets                                  (722 )                                               (314 )                                            (1,473 )                                              (3,630 )
                                                               -------------------- ------ -------------------- --------------------                      -------------------- ------ --------------------                      -------------------- ------- -------------------- --------------------                      -------------------- ------- --------------------
Free cash flow                                                                    $ 12,158                                                                $ 14,411                                           $  37,476                                                                $  25,417  
                                                               ==================== ====== ====================                                           ==================== ====== ====================                      ==================== ======= ====================                                           ==================== ======= ====================

Free cash flow is a non-GAAP financial measure which CPSI defines as net cash provided by operating activities less purchases of capital assets. The most directly comparable GAAP financial measure is net cash provided by operating activities. The Company believes free cash flow is a useful measure of performance and uses this measure as an indication of the financial resources of the Company and its ability to generate cash.

http://cts.businesswire.com/ct/CT?id=bwnews&sty=20150129005123r1&sid=cmtx6&distro=nx&lang=en

SOURCE: Computer Programs and Systems, Inc.

Computer Programs and Systems, Inc. 
Boyd Douglas, 251-639-8100 
President and Chief Executive Officer


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