FactSet Research Q3 Results Top Estimates, Sees Q4 In Line

(RTTNews) - Financial data provider FactSet Research Systems, Inc. (FDS) reported Tuesday a profit for the third quarter that increased from last year, reflecting revenue growth amid continued net addition in subscribers.

Adjusted earnings per share and quarterly revenues topped analysts' expectations by a whisker. The company also provided fourth-quarter earnings and revenues guidance, in line with Street view.

"FactSet continued its strong performance during the third quarter as each key operating metric experienced healthy growth. Our ASV growth rate accelerated to 9%, our highest rate of growth in three years while our 14% EPS increase represented our 20th consecutive quarter of double-digit adjusted EPS growth," Chairman and CEO Philip Hadley said in a statement.

The company said 19-year FactSet veteran Phil Snow will become the company's next CEO on July 1 as Hadley is set to step down after serving at the helm since September 2000.

The Norwalk, Connecticut-based company reported net income of $61.41 million or $1.45 per share for the third quarter, higher than $51.53 million or $1.21 per share in the prior-year quarter.

Excluding items, adjusted net income for the quarter was $60.00 million or $1.42 per share, compared to $53.10 million or $1.25 per share in the year-ago quarter.

On average, 15 analysts polled by Thomson Reuters expected the company to report earnings of $1.41 per share for the quarter. Analysts' estimates typically exclude special items.

Revenue for the quarter increased 9.8 percent to $254.52 million from $231.76 million in the same quarter last year, and topped fourteen Wall Street analysts' consensus estimate of $253.56 million by a whisker.

Organically, U.S. revenues for the quarter grew 8.6 percent to $172.1 million, and international revenues was $82.4 million, up about 10.5 percent from the prior-year quarter.

Annual Subscription Value or ASV for the third quarter increased 8.9 percent organically to $1.02 million from last year. ASV from FactSet's U.S. operations was $688 million, and $333 million were related to international operations.

ASV represents the forward-looking revenues for the next 12 months from all annual subscription services currently being supplied to clients.

Client count at the end of the third quarter totaled 2,915, a net increase of 47 clients during the quarter. Annual client retention rate was greater than 95 percent of ASV and 94 percent of clients, up from 93 percent a year ago.

Looking ahead to the fourth quarter, FactSet expects earnings in a range of $1.46 to $1.48 per share, on projected revenues between $259 million and $263 million.

Analysts expect the company to report earnings of $1.46 per share on revenues of $260.08 million for the quarter.

FDS closed Monday's regular trading session at $165.49, up $0.92 on a volume of 0.33 million shares.