UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of July 2006
Commission File Number 1-14840
AMDOCS LIMITED
Suite 5, Tower Hill House Le Bordage
St. Peter Port, Island of Guernsey, GY1 3QT Channel Islands
Amdocs, Inc.
1390 Timberlake Manor Parkway, Chesterfield, Missouri 63017
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.
FORM 20-F X FORM 40-F
----- -----
Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(1):
-----
Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(7):
-----
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to rule 12g3-2(b) under the Securities Exchange Act of 1934.
YES NO X
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On July 19, 2006, Amdocs Limited ("Amdocs") issued a press release
announcing financial results for the quarter ended June 30, 2006. A copy of the
press release is furnished as Exhibit 99.1 to this Report of Foreign Private
Issuer on Form 6-K.
The information in this Form 6-K (including Exhibit 99.1) shall not be
deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934
(the "Exchange Act") or otherwise subject to the liabilities of that section,
nor shall it be deemed incorporated by reference in any filing under the
Securities Act of 1933 or the Exchange Act.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
AMDOCS LIMITED
/s/ Thomas G. O'Brien
----------------------------------------
Thomas G. O'Brien
Treasurer and Secretary
Authorized U.S. Representative
Date: July 20, 2006
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
- ----------- -----------
99.1 Amdocs Limited Press Release dated July 19, 2006.
Exhibit 99.1
AMDOCS LIMITED REPORTS 23% GROWTH IN REVENUE TO A RECORD $626
MILLION FOR THE THIRD QUARTER OF FISCAL 2006
32% GROWTH IN DILUTED NON-GAAP EARNINGS PER SHARE TO $0.49;
DILUTED GAAP EARNINGS PER SHARE OF $0.39
Key highlights:
- Third quarter revenue grew 23% to $626 million
- 32% increase in third quarter diluted non-GAAP EPS, excluding
acquisition-related costs and equity-based compensation expense, net
of related tax effects, to $0.49; Exceeds guidance of $0.46
- Diluted GAAP EPS of $0.39
- Free cash flow of $94 million for the quarter
- Qpass acquisition positions Amdocs as the leader in the emerging
digital content market
- After the quarter, Amdocs announced that it signed an agreement to
acquire Cramer Systems Group Ltd., a leading provider of operations
support systems (OSS) software and solutions, for approximately $375
million in cash, net of cash on hand
- Fourth quarter fiscal 2006 guidance: Expected revenue of approximately
$657 million and diluted non-GAAP EPS of $0.49, excluding
acquisition-related costs and approximately $0.04-$0.05 per share of
equity-based compensation expense, net of related tax effects. Diluted
GAAP EPS is expected to be approximately $0.41-$0.42. This guidance
excludes any potential impact of the pending acquisition of Cramer
- Preliminary fiscal 2007 guidance: Expected revenue of approximately
$2.880 - $2.980 billion and diluted non-GAAP EPS of $2.06 - $2.16,
which exclude acquisition-related costs and approximately $0.19-$0.22
per share of equity-based compensation expense, net of related tax
effects. This guidance includes the expected impact of the pending
acquisition of Cramer. Amdocs expects to provide guidance for 2007
diluted GAAP EPS after the purchase price accounting for the
acquisition is completed
ST. LOUIS, MO - JULY 19, 2006 - Amdocs Limited (NYSE: DOX) today reported that
for the quarter ended June 30, 2006, revenue was $626.4 million, an increase of
23.5% from last year's third quarter. Excluding acquisition-related costs, which
include amortization of purchased intangible assets and the write-off of
in-process research and development and
excluding equity-based compensation expense, net of related tax effects, of
$20.6 million, net income on a non-GAAP basis was $106.2 million, or $0.49 per
diluted share, compared to non-GAAP net income, excluding $1.7 million of
acquisition-related costs net of related tax effects, of $78.8 million, or $0.37
per diluted share, in the third quarter of fiscal 2005. The Company's net income
was $85.6 million, or $0.39 per diluted share, compared to net income of $77.1
million, or $0.36 per diluted share, in the third quarter of fiscal 2005. Free
cash flow, defined as cash flow from operations less net capital expenditures
and principal payments on capital leases, was $94 million in the quarter.
"We are pleased to again report record revenues and increasing profitability,"
said Dov Baharav, chief executive officer of Amdocs Management Limited. "We see
demand in the market, which continues to be driven by service providers' need to
address competition, consolidation and convergence. We have strengthened our
presence in the digital content area with our acquisition of Qpass and we are
expanding our OSS activities with our pending acquisition of Cramer. Amdocs is
positioned as the only vendor that can provide an end-to-end solution, from
business support systems -- or BSS -- to OSS, for the leading services
providers. This will put us in the leading position to benefit from the growth
opportunities as service providers transform their organizations in order to
offer new products and services. We are confident that our success in 2006 will
continue as we look towards fiscal 2007."
During the third quarter, Amdocs new business included 11 key wins, across
geographies and lines of business. Amdocs expanded its relationship with Rogers
Communications, which will install Amdocs CRM across its cable, wireless and
telecom lines of business as part of a rollout of an integrated customer
management strategy. In Australia, Telstra has selected Amdocs as one of the key
vendors for an OSS transformational program. In the United States, Amdocs was
awarded several projects related to assisting customers in their consolidation
and integration of acquisitions. In broadband cable and satellite, a customer
has signed a contract extension. Several other customers, including some new
logos, have chosen Amdocs for CRM, Amdocs Partner Management and mediation
projects.
FINANCIAL OUTLOOK
Amdocs expects that revenue for the fourth quarter of fiscal 2006 will be
approximately $657 million. Diluted earnings per share on a non-GAAP basis for
the fourth quarter are
expected to be $0.49, excluding acquisition-related costs and the impact of
approximately $0.04-$0.05 per share of equity-based compensation expense, net of
related tax effects. Diluted GAAP EPS is expected to be approximately
$0.41-$0.42. This guidance excludes any potential impact of the pending
acquisition of Cramer. Amdocs expects that it may incur a one-time charge in its
fourth fiscal quarter to account for certain costs related to the Cramer
acquisition.
Preliminary fiscal 2007 guidance: Expected revenue of approximately
$2.880-$2.980 billion and diluted non-GAAP EPS of $2.06-$2.16, which excludes
acquisition-related costs and approximately $0.19-$0.22 per share of
equity-based compensation expense, net of related tax effects. This guidance
includes the expected impact of the pending acquisition of Cramer. Amdocs
expects to provide guidance for diluted GAAP EPS after the purchase price
accounting for the acquisition is completed.
Amdocs will host a conference call on July 19, 2006 at 5 p.m. Eastern Time to
discuss the Company's third quarter results. The call will be carried live on
the Internet via www.InvestorCalendar.com and the Amdocs website,
www.amdocs.com.
NON-GAAP FINANCIAL MEASURES
This release includes non-GAAP diluted earnings per share and other non-GAAP
line items from the Non-GAAP Consolidated Statements of Income, including
non-GAAP cost of service, non-GAAP research and development, non-GAAP selling,
general and administrative, non-GAAP operating income, non-GAAP income before
income taxes, non-GAAP income taxes and non-GAAP net income. These non-GAAP
measures exclude the following items:
- amortization of purchased intangible assets;
- In-process research and development write-off;
- equity-based compensation expense; and
- tax effects related to the above.
These non-GAAP financial measures are not in accordance with, or an alternative
for, generally accepted accounting principles and may be different from non-GAAP
financial measures used by other companies. In addition, these non-GAAP
financial measures and the Non-GAAP Consolidated Statements of Income are not
based on any comprehensive
set of accounting rules or principles. Amdocs believes that non-GAAP financial
measures have limitations in that they do not reflect all of the amounts
associated with Amdocs' results of operations as determined in accordance with
GAAP and that these measures should only be used to evaluate Amdocs' results of
operations in conjunction with the corresponding GAAP measures.
Amdocs believes that the presentation of non-GAAP diluted earnings per share and
other non-GAAP line items from the Non-GAAP Consolidated Statements of Income,
including non-GAAP cost of service, non-GAAP research and development, non-GAAP
selling, general and administrative, non-GAAP operating income, non-GAAP income
before income taxes, non-GAAP income taxes and non-GAAP net income, when shown
in conjunction with the corresponding GAAP measures, provides useful information
to investors and management regarding financial and business trends relating to
its financial condition and results of operations.
For its internal budgeting process and in monitoring the results of the
business, Amdocs' management uses financial statements that do not include
amortization of purchased intangible assets, in-process research and development
write-off, equity-based compensation expense, and related tax effects. Amdocs'
management also uses the foregoing non-GAAP financial measures, in addition to
the corresponding GAAP measures, in reviewing the financial results of Amdocs.
In addition, Amdocs believes that significant groups of investors exclude these
non-cash expenses in reviewing its results and those of its competitors, because
the amounts of the expenses between companies can vary greatly depending on the
assumptions used by an individual company in determining the amounts of the
expenses.
Amdocs further believes that, where the adjustments used in calculating non-GAAP
diluted earnings per share are based on specific, identified amounts that impact
different line items in the Consolidated Statements of Income (including cost of
service, research and development, selling, general and administrative,
operating income, income before income taxes, income taxes and net income), it
is useful to investors to understand how these specific line items in the
Consolidated Statements of Income are affected by these adjustments.
ABOUT AMDOCS
Amdocs combines innovative software and services with deep business knowledge to
accelerate implementation of integrated customer management by the world's
leading service providers. By delivering a comprehensive portfolio of software
and services that
spans the customer lifecycle, Amdocs enables service companies to deliver an
intentional customer experience(TM), which results in stronger, more profitable
customer relationships. Service providers also benefit from a rapid return on
investment, lower total cost of ownership and improved operational efficiencies.
A global company with revenue of more than $2 billion in fiscal 2005, Amdocs has
over 14,000 employees and serves customers in more than 50 countries around the
world. For more information, visit Amdocs at www.amdocs.com.
This press release includes information that constitutes forward-looking
statements made pursuant to the safe harbor provision of the Private Securities
Litigation Reform Act of 1995, including statements about Amdocs growth and
business results in future quarters. Although we believe the expectations
reflected in such forward-looking statements are based upon reasonable
assumptions, we can give no assurance that our expectations will be obtained or
that any deviations will not be material. Such statements involve risks and
uncertainties that may cause future results to differ from those anticipated.
These risks include, but are not limited to, the effects of general economic
conditions, Amdocs ability to grow in the business markets that it serves,
Amdocs ability to successfully integrate acquired businesses, adverse effects of
market competition, rapid technological shifts that may render the Company's
products and services obsolete, potential loss of a major customer, our ability
to develop long-term relationships with our customers, and risks associated with
operating businesses in the international market. Amdocs may elect to update
these forward-looking statements at some point in the future; however, the
Company specifically disclaims any obligation to do so. These and other risks
are discussed at greater length in the Company's filings with the Securities and
Exchange Commission, including in our Annual Report on Form 20-F, filed on
December 28, 2005 and our quarterly 6-K furnished on February 15 and May 15,
2006.
CONTACT:
Thomas G. O'Brien
Treasurer and Vice President of Investor Relations
Amdocs Limited
314-212-8328
E-mail: dox_info@amdocs.com
AMDOCS LIMITED
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED NINE MONTHS ENDED
JUNE 30, JUNE 30,
------------------- -----------------------
2006(1) 2005 2006(2) 2005
-------- -------- ---------- ----------
Revenue:
License $ 23,220 $ 27,199 $ 85,172 $ 74,909
Service 603,228 480,156 1,729,433 1,390,394
-------- -------- ---------- ----------
626,448 507,355 1,814,605 1,465,303
Operating expenses:
Cost of license 995 1,125 2,973 3,278
Cost of service 402,626 324,249 1,165,010 929,487
Research and development 46,455 31,393 131,392 97,567
Selling, general and
administrative 74,940 56,448 227,289 166,000
Amortization of purchased
intangible assets 8,547 2,078 23,588 7,875
In-process research and
development 8,415 -- 8,415 --
-------- -------- ---------- ----------
541,978 415,293 1,558,667 1,204,207
-------- -------- ---------- ----------
Operating income 84,470 92,062 255,938 261,096
Interest income and other, net 14,938 4,305 33,659 14,944
-------- -------- ---------- ----------
Income before income taxes 99,408 96,367 289,597 276,040
Income taxes 13,823 19,270 46,916 55,203
-------- -------- ---------- ----------
Net income $ 85,585 $ 77,097 $ 242,681 $ 220,837
======== ======== ========== ==========
Basic earnings per share $ 0.42 $ 0.38 $ 1.20 $ 1.10
======== ======== ========== ==========
Diluted earnings per share(3) $ 0.39 $ 0.36 $ 1.13 $ 1.03
======== ======== ========== ==========
Basic weighted average number of
shares outstanding 204,404 200,494 202,474 201,453
======== ======== ========== ==========
Diluted weighted average number
of shares outstanding 220,109 216,570 217,633 217,608
======== ======== ========== ==========
(1) The three months ended June 30, 2006 include equity-based compensation
pre-tax expense of $10,948, which was classified as follows: $4,165 to Cost
of service, $1,232 to Research and development and $5,551 to Selling,
general and administrative.
(2) The nine months ended June 30, 2006 include equity-based compensation
pre-tax expense of $31,948, which was classified as follows: $12,237 to
Cost of service, $3,041 to Research and development and $16,670 to Selling,
general and administrative.
(3) To reflect the impact of assumed conversion of the convertible notes, $985
and $2,964, representing interest expense and amortization of issuance
costs, were added back to net income for the three and nine months ended
June 30, 2006, respectively, and $988 and $2,955 were added back to net
income for the three and nine months ended June 30, 2005, respectively, for
the purpose of computing diluted earnings per share.
AMDOCS LIMITED
SELECTED FINANCIAL METRICS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED NINE MONTHS ENDED
JUNE 30, JUNE 30,
------------------- -----------------------
2006 2005 2006 2005
-------- -------- ---------- ----------
Revenue $626,448 $507,355 $1,814,605 $1,465,303
Non-GAAP operating income 112,380 94,140 319,889 268,971
Non-GAAP net income 106,169 78,756 291,678 227,132
Non-GAAP diluted earnings per
share $ 0.49 $ 0.37 $ 1.35 $ 1.06
Diluted weighted average number
of shares outstanding 220,109 216,570 217,633 217,608
AMDOCS LIMITED
RECONCILIATION OF SELECTED FINANCIAL METRICS FROM GAAP TO NON-GAAP
(IN THOUSANDS)
THREE MONTHS ENDED
JUNE 30, 2006
-----------------------------------------------------------------------------
RECONCILIATION ITEMS
-------------------------------------------------------
AMORTIZATION
OF PURCHASED IN-PROCESS EQUITY BASED
INTANGIBLE RESEARCH AND COMPENSATION
GAAP ASSETS DEVELOPMENT EXPENSE TAX EFFECT NON-GAAP
-------- ------------ ------------ ------------ ---------- --------
Operating expenses:
Cost of license $ 995 $ -- $ -- $ -- $ -- $ 995
Cost of service 402,626 -- -- (4,165) -- 398,461
Research and
development 46,455 -- -- (1,232) -- 45,223
Selling, general and
administrative 74,940 -- -- (5,551) -- 69,389
Amortization of
purchased intangible
assets 8,547 (8,547) -- -- -- --
In-process research and
development 8,415 -- (8,415) -- -- --
-------- ------- ------- -------- ------- --------
Total operating expenses 541,978 (8,547) (8,415) (10,948) -- 514,068
-------- ------- ------- -------- ------- --------
Operating income 84,470 8,547 8,415 10,948 -- 112,380
-------- ------- ------- -------- ------- --------
Income taxes 13,823 -- -- -- 7,326 21,149
-------- ------- ------- -------- ------- --------
Net income $ 85,585 $ 8,547 $ 8,415 $ 10,948 $(7,326) $106,169
-------- ------- ------- -------- ------- --------
AMDOCS LIMITED
RECONCILIATION OF SELECTED FINANCIAL METRICS FROM GAAP TO NON-GAAP (CONT'D)
(IN THOUSANDS)
THREE MONTHS ENDED
JUNE 30, 2005
-----------------------------------------------
RECONCILIATION ITEMS
-------------------------
AMORTIZATION
OF PURCHASED
INTANGIBLE
GAAP ASSETS TAX EFFECT NON-GAAP
-------- ------------ ---------- --------
Operating expenses:
Cost of license $ 1,125 $ -- $ -- $ 1,125
Cost of service 324,249 -- -- 324,249
Research and
development 31,393 -- -- 31,393
Selling, general and
administrative 56,448 -- -- 56,448
Amortization of
purchased intangible
assets 2,078 (2,078) -- --
In-process research and
development -- -- -- --
-------- ------- ----- --------
Total operating expenses 415,293 (2,078) -- 413,215
-------- ------- ----- --------
Operating income 92,062 2,078 -- 94,140
-------- ------- ----- --------
Income taxes 19,270 -- 419 19,689
-------- ------- ----- --------
Net income $ 77,097 $ 2,078 $(419) $ 78,756
-------- ------- ----- --------
AMDOCS LIMITED
RECONCILIATION OF SELECTED FINANCIAL METRICS FROM GAAP TO NON-GAAP
(IN THOUSANDS)
NINE MONTHS ENDED
JUNE 30, 2006
---------------------------------------------------------------------------------
RECONCILIATION ITEMS
-------------------------------------------------------
AMORTIZATION
OF PURCHASED IN-PROCESS EQUITY BASED
INTANGIBLE RESEARCH AND COMPENSATION
GAAP ASSETS DEVELOPMENT EXPENSE TAX EFFECT NON-GAAP
---------- ------------ ------------ ------------ ---------- ----------
Operating expenses:
Cost of license $ 2,973 $ -- $ -- $ -- $ -- $ 2,973
Cost of service 1,165,010 -- -- (12,237) -- 1,152,773
Research and
development 131,392 -- -- (3,041) -- 128,351
Selling, general and
administrative 227,289 -- -- (16,670) -- 210,619
Amortization of
purchased intangible
assets 23,588 (23,588) -- -- -- --
In-process research and
development 8,415 -- (8,415) -- -- --
---------- --------- ------- -------- -------- ----------
Total operating expenses 1,558,667 (23,588) (8,415) (31,948) -- 1,494,716
---------- --------- ------- -------- -------- ----------
Operating income 255,938 23,588 8,415 31,948 -- 319,889
---------- --------- ------- -------- -------- ----------
Income taxes 46,916 -- -- -- 14,954 61,870
---------- --------- ------- -------- -------- ----------
Net income $ 242,681 $ 23,588 $ 8,415 $ 31,948 $(14,954) $ 291,678
---------- --------- ------- -------- -------- ----------
AMDOCS LIMITED
RECONCILIATION OF SELECTED FINANCIAL METRICS FROM GAAP TO NON-GAAP (CONT'D)
(IN THOUSANDS)
NINE MONTHS ENDED
JUNE 30, 2005
---------------------------------------------------
RECONCILIATION ITEMS
-------------------------
AMORTIZATION
OF PURCHASED
INTANGIBLE
GAAP ASSETS TAX EFFECT NON-GAAP
---------- ------------ ---------- ----------
Operating expenses:
Cost of license $ 3,278 $ -- $ -- $ 3,278
Cost of service 929,487 -- -- 929,487
Research and
development 97,567 -- -- 97,567
Selling, general and
administrative 166,000 -- -- 166,000
Amortization of
purchased intangible
assets 7,875 (7,875) -- --
In-process research
and development -- -- -- --
---------- ------- ------- ----------
Total operating expenses 1,204,207 (7,875) -- 1,196,332
---------- ------- ------- ----------
Operating income 261,096 7,875 -- 268,971
---------- ------- ------- ----------
Income taxes 55,203 -- 1,580 56,783
---------- ------- ------- ----------
Net income $ 220,837 $ 7,875 $(1,580) $ 227,132
---------- ------- ------- ----------
AMDOCS LIMITED
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
AS OF
------------------------
JUNE 30, SEPTEMBER
2006 30, 2005
----------- ----------
(Unaudited) (Audited)
ASSETS
Current assets
Cash, cash equivalents and short-term interest-bearing investments $1,207,552 $1,145,563
Accounts receivable, net, including unbilled of $43,925 and
$28,994, respectively 414,154 304,237
Deferred income taxes and taxes receivable 77,653 101,162
Prepaid expenses and other current assets 81,793 76,780
---------- ----------
Total current assets 1,781,152 1,627,742
Equipment, vehicles and leasehold improvements, net 184,878 181,812
Goodwill and other intangible assets, net 1,411,561 1,129,258
Other noncurrent assets 318,740 263,656
---------- ----------
Total assets $3,696,331 $3,202,468
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and accruals $ 512,636 $ 462,276
Short-term portion of capital lease obligations and other financing
arrangements 1,938 8,480
Deferred revenue 243,381 216,770
Deferred income taxes and taxes payable 175,210 171,377
---------- ----------
Total current liabilities 933,165 858,903
0.50% Convertible notes 450,000 450,000
Noncurrent liabilities and other 282,279 237,113
Shareholders' equity 2,030,887 1,656,452
---------- ----------
Total liabilities and shareholders' equity $3,696,331 $3,202,468
========== ==========
