GlobeNewswire Inc | Aug 9, 2021 07:39AM EDT

August 09, 2021

JOHNS CREEK, Ga., Aug. 09, 2021 (GLOBE NEWSWIRE) -- Ebix, Inc. (NASDAQ: EBIX), a leading international supplier of On-Demand software and E-commerce services to the insurance, financial, e-governance and healthcare industries today announced the following results for the quarter ended June 30, 2021:

-- Revenues of $246.3 million -- GAAP operating income of $27.3 million and Non-GAAP operating income of $33.9 million -- GAAP Diluted EPS of $0.51 and Non-GAAP diluted EPS of $0.76

Ebix will host a conference call to review its results today at 11:00 a.m. EDT (details below).

Q2 2021 was severely impacted by the second wave of COVID-19, with most of Brazil and India coming to almost a standstill for two months. This impacted our revenues not only in these two countries but the United States too, as we experienced an acute shortage of personnel to execute business in hand. Our bank interest costs sequentially were higher by $3.3 million in Q2 2021 on lower bank debt than in Q1 2021. We had to restore software developer salaries back from the cuts we had put in place last year, while COVID-19 continued to impact our business. Robin Raina, President & CEO, Ebix Inc. said, Considering that, I am pleased that we still delivered a quarter with $246.3 million of revenues and $27.3 million of operating income. This speaks to the fundamental resilience of our business.

Ebix delivered the following results for the second quarter of 2021:

Revenue: Q2 2021 revenue increased 121% to $246.3 million compared to $111.3 million in Q2 2020. Excluding revenues from the foreign exchange, travel, e-learning, and remittance businesses that have been impacted the most by COVID-19, Q2 2021 revenues grew 125% as compared to Q2 2020.

Out of 11 P&L geographies worldwide, revenues grew in nine regions by double digits or more, while declining in two regions. Despite COVID-19, insurance revenues outside the U.S. grew by a healthy 16% year over year to $19.1 million in the quarter, offset by a 10% year-over-year decline in the U.S. Sequentially, U.S. insurance revenues were essentially flat as compared to Q1 2021. International revenues increased 200% year over year.

Exchanges, including the EbixCash and our worldwide insurance exchanges, continued to be Ebixs largest channel, accounting for 94% of Q2 2021 revenues.

(dollar amounts in thousands) Channel Q2 2021 Q2 2020 ChangeEbixCash Exchanges $189,947 $53,240 +257 %Insurance Exchanges 41,916 42,959 -2 %RCS 14,459 15,113 -4 %Total Revenue $246,322 $111,312 +121 % Total Revenue on Constant Currency Basis $240,003 $111,312 +116 %

Operating Income and Operating Cash: GAAP Operating income for Q2 2021 of $27.3 million decreased 13% sequentially from $31.2 million in Q1 2021 and decreased 14% year-over-year as compared to $31.9 million in Q2 2020, primarily due to the severe impact of the second wave of COVID-19 in April and May 2021. During Q2 2020, the Company reduced compensation levels for many of its employees in the most negatively COVID-19 impacted business areas. The Company reversed the vast majority of 2020s salary adjustments in Q2 2021 and offered salary increases to all software development staff, resulting in an year-over-year increase of approximately $4.1MM in personnel-related costs. These steps were taken to retain and motivate our employee base to support the expected growth in business as the effects of COVID-19 subside over the next few months.

Non-GAAP operating income for Q2 2021 was $33.9 million.

Cash generated from operations in Q2 2021 was $13.1 million, as compared to $28.8 million in Q2 2020 and $8.6 million in Q1 2021. The cash flows reflected the impact of the second wave of COVID-19 on receivable collections, as the majority of India and Brazil were in a complete shut down mode during the months of April and May 2021.

Earnings per Share: Q2 2021 GAAP diluted earnings per share was at $0.51 as compared to $0.76 in Q2 2020. The drop was due to a number of extra-ordinary items detailed out in the GAAP to Non-GAAP reconciliation table below. Additionally, in Q2 2020 the Company decreased its contingent acquisition earn out accrual by $3.3 million, which served to reduce general and administrative expenses in Q2 2020. No such adjustment was made in Q2 2021.

Non-GAAP diluted earnings per share for Q2 2021 was $0.76.

Net Income Q2 2021 GAAP net income decreased 33% to $15.7 million compared to $23.5 million in Q2 2020. The Q2 2021 non-GAAP net income was $23.5 million.

Q2 2021 Diluted Share Count: As of today, Ebix expects its diluted share count for Q3 2021 to be approximately 30.8 million.

Dividend: Ebix paid its regular quarterly dividend of $0.075 per share in Q2 2021 for a total cost of $2.3 million.

We feel good about the pace at which we are moving towards a prospective EbixCash IPO. We recently announced the addition of a number of independent leading luminaries from the field of Economics, Education, Regulatory and Banking sectors to the EbixCash Board. The 3-year audit by two audit firms, leading to the Draft Red Herring Prospectus (DRHP) are in process at present. Ebix Chairman, President and CEO Robin Raina said. We are targeting the IPO in January or February of 2022, with a DRHP being filed in October or November of 2021.

Ebix continues to weather the COVID-19 storm, but has a very positive view of how this company will perform whenever global life normalizes for businesses and individuals. We intend to focus on maximizing cash flows in the coming quarters and will use those cash flows to both invest in our businesses and reduce our total debt over time. We are also actively engaged in addressing the strategic goal of refinancing our current primary corporate debt capital to a structure that aligns Ebixs strategic goals with both a structure and investor base that will enable us to optimize the growth and performance of Ebix over time. Steve Hamil, EVP and CFO said. We look forward to sharing more details with our stakeholders in the coming months.

Reconciliation of GAAP operating income, net income and diluted earnings per share to non-GAAP operating income, net income and diluted earnings per share. Non-GAAP information is provided to enhance the understanding of the Company's financial performance and is reconciled to the Company's GAAP information in the accompanying tables.

Q2 2021

Net Income Diluted EPSQ2 2021 GAAP Net Income $15,721 $0.51Q2 2021 GAAP Operating Income $27,265 Non-GAAP Adjustments: Amortization of Intangibles (1) $2,757 $0.09Stock-Based Compensation (1) $1,359 $0.04One-time Legal and Professional Services Costs (2) $1,260 $0.04Employee related one-time costs (3) $1,250 $0.04Non-recurring non-operating expense (4) $1,253 $0.04Income Tax Effects of Non?GAAP Adjustments (5) ($136) ($0.0) Total Non-GAAP Adjustments (Operating Income) $6,626 Total Non-GAAP Adjustments (Net Income) $7,743 $0.25 Second Quarter 2021 Non-GAAP Net Income $23,464 $0.76Second Quarter 2021 Non-GAAP Operating Income $33,891

(1) Adjustments related to amortization of acquired intangibles and stock-based compensation recognized during the periods for GAAP purposes. (2) Non-recurring legal and professional services costs recorded during the period for GAAP purposes.(3) Non-recurring employee related costs in Q2 2021.(4) Non-recurring non-operating expense that is unrelated to any operating activities.(5) Non-GAAP adjustment is based on the Q2 2021 effective tax rate, which reflects currently available information and could be subject to change.

Non-GAAP Financial Measures and Other Metrics

This press release contains the following non-GAAP financial measures: non-GAAP net income, non-GAAP operating income and non-GAAP diluted earnings per share. Non-GAAP operating income , non-GAAP net income and non-GAAP diluted earnings per share from operations exclude amortization of intangibles, stock-based compensation, as well as certain non-recurring expenses that are not associated with our ongoing operating business activities.

Ebix believes that these non-GAAP financial measures and other metrics provide useful information to management and investors regarding certain financial and business trends relating to Ebixs financial condition and results of operations. The Companys management uses these non-GAAP measures and other metrics to compare the Companys performance to that of prior periods for trend analysis, for purposes of determining executive and senior management incentive compensation, and for budgeting and planning purposes. The Company believes that the use of these non-GAAP financial measures and other metrics provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Companys financial measures with other software companies, many of which present similar non-GAAP financial measures and other metrics to investors.

Management of the Company does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Companys financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. Ebix urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, including the financial tables at the end of this press release, and not to rely on any single financial measure to evaluate the Companys business.

Conference Call Details:

Call Date/Time: Monday, August 9, 2021 at 11:00 a.m. EDT

Call Dial-In: +1-877-837-3909 or 1-973-409-9690; Call ID # 6093467

Live Audio Webcast: www.ebix.com/webcast

www.ebix.com/result_21_Q2after 2:00 p.m. EDT on AugustAudio Replay URL: 9th

About Ebix, Inc.

With 150+ offices across 6 continents, Ebix, Inc., (NASDAQ: EBIX) endeavors to provide On-Demand software and E-commerce services to the insurance, financial, healthcare and e-learning industries. In the insurance sector, Ebixs main focus is to develop and deploy a wide variety of insurance and reinsurance exchanges on an on-demand basis, while also, providing Software-as-a-Service ("SaaS") enterprise solutions in the area of CRM, front-end & back-end systems, outsourced administration and risk compliance services, around the world.

With a "Phygital strategy that combines over 320,000 physical distribution outlets in India and Association of Southeast Asian Nations (ASEAN) countries, to an omni-channel online digital platform, the Companys EbixCash Financial exchange portfolio encompasses leadership in the areas of domestic and international money remittance, foreign exchange (Forex), travel, pre-paid & gift cards, utility payments, software solutions for lending, wealth management, travel, bus exchanges and insurance in India and other markets. EbixCashs Forex operations have emerged as a leader in Indias airport Foreign Exchange business with operations in 13 international airports, combined conducting over $4.8 billion in gross transaction value per year (pre-COVID-19). EbixCashs inward remittance business in India processes approximately $5 billion in gross annual remittance volume (pre-COVID-19) and is the clear market leader. EbixCash Travel is also one of Southeast Asias leading travel exchanges with over 200,000 agents, 25 branches and over 9,800 corporate clients, combined processing an estimated $2.5 billion in gross merchandise value per year (pre-COVID-19).

Through its various SaaS-based software platforms, Ebix employs thousands of domain-specific technology professionals to provide products, support and consultancy to thousands of customers on six continents. For more information, visit the Companys website at www.ebix.com

SAFE HARBOR REGARDING FORWARD-LOOKING STATEMENTS

As used herein, the terms Ebix, the Company, we, our and us refer to Ebix, Inc., a Delaware corporation, and its consolidated subsidiaries as a combined entity, except where it is clear that the terms mean only Ebix, Inc.

The information contained in this Press Release contains forward-looking statements and information within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. This information includes assumptions made by, and information currently available to management, including statements regarding future economic performance and financial condition, liquidity and capital resources, acceptance of the Companys products by the market, and managements plans and objectives. In addition, certain statements included in this and our future filings with the Securities and Exchange Commission (SEC), in press releases, and in oral and written statements made by us or with our approval, which are not statements of historical fact, are forward-looking statements. Words such as may, could, should, would, believe, expect, anticipate, estimate, intend, seeks, plan, project, continue, predict, will, and other words or expressions of similar meaning are intended by the Company to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements are found at various places throughout this report and in the documents incorporated herein by reference. These statements are based on our current expectations about future events or results and information that is currently available to us, involve assumptions, risks, and uncertainties, and speak only as of the date on which such statements are made.

Our actual results may differ materially from those expressed or implied in these forward-looking statements. Factors that may cause such a difference, include, but are not limited to those discussed in our Annual Report on Form 10-K and subsequent reports filed with the SEC, as well as: the ongoing effects of the COVID-19 global pandemic, the willingness of independent insurance agencies to outsource their computer and other processing needs to third parties; pricing and other competitive pressures and the Companys ability to gain or maintain share of sales as a result of actions by competitors and others; changes in estimates in critical accounting judgments; changes in or failure to comply with laws and regulations, including accounting standards, taxation requirements (including tax rate changes, new tax laws and revised tax interpretations) in domestic or foreign jurisdictions; exchange rate fluctuations and other risks associated with investments and operations in foreign countries (particularly in India, Australia and Asia, Latin America and Europe wherein we have significant and/or growing operations); fluctuations in the equity markets, including market disruptions and significant interest rate fluctuations, which may impede our access to, or increase the cost of, external financing; ability to secure additional financing to support capital requirements; credit facility provisions that could materially restrict our business; costs and effects of litigation, investigations or similar matters that could affect our business, operating results and financial condition; and international conflict, including terrorist acts.

Except as expressly required by the federal securities laws, the Company undertakes no obligation to update any such factors, or to publicly announce the results of, or changes to any of the forward-looking statements contained herein to reflect future events, developments, changed circumstances, or for any other reason.

Readers should carefully review the disclosures and the risk factors described in the documents we file from time to time with the SEC, including future reports on Forms 10-Q and 8-K, and any amendments thereto.

You may obtain our SEC filings at our website, www.ebix.com under the Investor Information section, or over the Internet at the SECs web site, www.sec.gov

CONTACT:

Darren Joseph 678 -281-2027 or IR@ebix.com

David Collins or Chris Eddy Catalyst Global - 212-924-9800 or ebix@catalyst-ir.com

Ebix, Inc. and SubsidiariesCondensed Consolidated Statements of Income (In thousands, except per share data) (Unaudited)

Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020Operating $ 246,322 $ 111,312 $ 536,375 $ 249,188 revenue Operating expenses:Cost ofservices 178,203 49,093 398,561 106,550 providedProduct 10,142 8,338 19,687 17,755 developmentSales and 3,392 3,458 7,219 7,262 marketingGeneral andadministrative, 23,335 15,464 44,672 44,708 netAmortizationand 3,985 3,109 7,785 6,750 depreciationTotal operating 219,057 79,462 477,924 183,025 expenses Operating 27,265 31,850 58,451 66,163 incomeInterest income 17 29 25 83 Interest (10,462 ) (7,147 ) (18,541 ) (16,384 )expenseNon-operating (1,253 ) 118 (1,254 ) 99 (loss) incomeForeigncurrency 9 91 (616 ) 709 exchange gain(loss)Income before 15,576 24,941 38,065 50,670 income taxesIncome tax (627 ) (1,677 ) (1,829 ) (2,961 ) expenseNet incomeincluding 14,949 23,264 36,236 47,709 noncontrollinginterestNet lossattributable to (772 ) (211 ) (1,076 ) (489 )noncontrollinginterestNet incomeattributable to $ 15,721 $ 23,475 $ 37,312 $ 48,198 Ebix, Inc. Basic earningsper commonshare $ 0.51 $ 0.77 $ 1.22 $ 1.58 attributable toEbix, Inc. Dilutedearnings percommon share $ 0.51 $ 0.76 $ 1.21 $ 1.57 attributable toEbix, Inc. Basic weightedaverage shares 30,581 30,504 30,570 30,490 outstanding Dilutedweighted 30,713 30,708 30,712 30,696 average sharesoutstanding

Ebix, Inc. and SubsidiariesCondensed Consolidated Balance Sheets (In thousands, except share amounts)

June 30, December 31, 2021 2020ASSETS (Unaudited) Current assets: Cash and cash equivalents $ 85,069 $ 105,035 Receivables from service providers 13,303 4,711 Short-term investments 13,866 25,019 Restricted cash 8,440 8,519 Fiduciary funds - restricted 2,580 4,106 Trade accounts receivable, less allowances of 142,360 142,847 $19,439 and $22,691, respectivelyOther current assets 81,386 71,661 Total current assets 347,004 361,898 Property and equipment, net 53,171 52,521 Right-of-use assets 11,954 12,372 Goodwill 942,062 949,037 Intangibles, net 51,310 50,880 Indefinite-lived intangibles 16,647 21,647 Capitalized software development costs, net 20,657 19,389 Deferred tax asset, net 65,943 63,402 Other assets 37,476 38,707 Total assets $ 1,546,224 $ 1,569,853 LIABILITIES AND STOCKHOLDERS? EQUITY Current liabilities: Accounts payable and accrued liabilities $ 54,677 $ 64,764 Payables to service agents 4,127 5,281 Accrued payroll and related benefits 10,401 11,792 Working capital facility 9,704 16,643 Fiduciary funds - restricted 2,580 4,106 Short-term debt 729 894 Current portion of long term debt and financinglease obligations, net of deferred financing 24,969 23,621 costs of $1,493 and $920, respectivelyContract liabilities 35,399 32,898 Lease liability 3,249 3,905 Other current liabilities 30,868 27,486 Total current liabilities 176,703 191,390

Revolving line of credit 439,402 439,402 Long term debt and financing lease obligations,less current portion, net of deferred financing 199,052 232,140 costs of $881 and $1,062, respectivelyContingent liability for accrued earn-out 2,560 ? acquisition considerationContract liabilities 7,647 8,033 Lease liability 8,790 8,540 Deferred tax liability, net 1,358 1,235 Other liabilities 28,909 29,009 Total liabilities 864,421 909,749 Stockholders? equity: Preferred stock, $0.10 par value, 500,000 sharesauthorized, no shares issued and outstanding at ? ? June 30, 2021 and December31, 2020Series Y Convertible preferred stock, $0.10 parvalue, 350,000 shares authorized, no shares ? ? issued and outstanding at June 30, 2021 andDecember31, 2020Common stock, $0.10 par value, 220,000,000 sharesauthorized, 30,558,061 issued and outstanding, at 3,058 3,052 June 30, 2021, and 30,515,334 issued andoutstanding at December31, 2020Additional paid-in capital 13,718 11,126 Retained earnings 732,974 700,304 Accumulated other comprehensive loss (113,996 ) (101,503 )Total Ebix, Inc. stockholders? equity 635,754 612,979 Noncontrolling interest 46,049 47,125 Total stockholders? equity 681,803 660,104 Total liabilities and stockholders? equity $ 1,546,224 $ 1,569,853

Ebix, Inc. and SubsidiariesCondensedConsolidated Statements of Cash Flows (In thousands) (Unaudited)

Six Months Ended June 30, 2021 2020Cash flows from operating activities: Net income attributable to Ebix, Inc. $ 37,312 $ 48,198 Net loss attributable to noncontrolling interest (1.076 ) (489 )Adjustments to reconcile net income to net cash provided by operating activities:Amortization and depreciation 7,785 6,750 (Benefit) provision for deferred taxes (3,175 ) 225 Share based compensation 2,717 2,253 Benefit for doubtful accounts (2,815 ) (50 )Amortization of right-of-use assets 2,507 3,257 Amortization of capitalized software development 1,647 1,670 costsReduction of acquisition accruals ? (3,308 )Changes in assets and liabilities, net of effects from acquisitions:Accounts receivable 2,025 14,190 Receivables from service providers (8,592 ) 12,381 Payables to service agents (1,154 ) (7,802 )Other assets (10,489 ) (1,260 )Accounts payable and accrued expenses (9,469 ) (8,004 )Accrued payroll and related benefits (1,318 ) 2,130 Contract liabilities 2,182 (306 )Lease liabilities (264 ) (3,008 )Reserve for potential uncertain income tax return 334 206 positionsOther liabilities 3,503 (8,634 )Net cash provided by operating activities 21,660 58,399 Cash flows from investing activities: Cash paid for acquisitions, net of cash acquired ? (5,170 )Capitalized software development costs (3,106 ) (3,257 )Maturities (purchases) of unrestricted marketable 11,250 (27,301 )securities, netCapital expenditures (1,705 ) (757 )Net cash provided by (used in) investing activities 6,439 (36,485 ) Cash flows from financing activities: Proceeds from revolving line of credit, net ? 1,364 Principal payments of term loan obligation (31,297 ) (9,414 )Proceeds from the exercise of stock options ? 636 Forfeiture of certain shares to satisfy exercisecosts and the recipients income tax obligations (119 ) (1,841 )related to stock options exercised and restrictedstock vestedDividend payments (4,642 ) (4,605 )Payments of debt obligations (149 ) (119 )Payments of working capital facility, net (6,886 ) (19,763 )Payments of financing lease obligations (48 ) (113 ) Net cash used in financing activities (43,141 ) (33,855 )Effect of foreign exchange rates on cash (4,806 ) (10,030 )Net change in cash and cash equivalents, and (19,848 ) (21,971 )restricted cashCash and cash equivalents, and restricted cash at 120,213 111,369 the beginning of the periodCash and cash equivalents, and restricted cash at $ 100,365 $ 89,398 the end of the periodSupplemental disclosures of cash flow information: Interest paid $ 14,065 $ 15,434 Income taxes paid $ 12,073 $ 2,096