6-K
Amdocs Ltd (DOX)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 6-K
REPORT OFFOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR15d-16
OF THE SECURITIES EXCHANGE ACT OF 1934
For the month of February 2022
Commission File Number 1-14840
AMDOCS LIMITED
Hirzel House,Smith Street,
St. Peter Port, Island of Guernsey, GY1 2NG
Amdocs, Inc.
625Maryville Centre Drive, Suite 200, Saint Louis, Missouri 63141
(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 ☒ 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 ☒
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-
On February 1, 2022, Amdocs Limited (“Amdocs”) issued a press release announcing financial results for the quarter ended December 31, 2021. A copy of the press release and the accompanying presentation are furnished as Exhibits 99.1 and 99.2 to this Report of Foreign Private Issuer on Form 6-K.
The information in this Form 6-K (including Exhibits 99.1 and 99.2) 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 | |
|---|---|
| By: | /s/ Matthew E. Smith |
| Matthew E. Smith | |
| Secretary and Authorized Signatory |
Date: February 1, 2022
EXHIBIT INDEX
| EXHIBIT<br>NO. | DESCRIPTION |
|---|---|
| 99.1 | Amdocs Limited Press Release dated February 1, 2022. |
| 99.2 | Fiscal Q1 2022 Earnings Presentation |
EX-99.1
Exhibit 99.1
Amdocs Limited Reports FirstQuarter Fiscal 2022 Results
Record Quarterly Revenue of $1.1 Billion, up 10.6%YoY^(2)(3)^
Strong Sales Momentum & Record 12-Month Backlog of $3.8 Billion, up 9.7% YoY
Tracking at Higher End of Fiscal 2022 Outlook Rangefor Expected Revenue and Diluted
Earnings Per Share Growth
Provides Outlook for Annual Revenue Growth of 6.0%-10.0% YoY^(2)(3)^ for Three Years
Fiscal 2022-2024
First Quarter Fiscal 2022 Highlights
(All comparisonsare against the prior year)
| • | Record revenue of $1,105 million, up 10.6% on a pro<br>forma^(^^2)^ basis in constant currency^(3)^ and up 1.7% as reported, including record revenue<br>of $745 million in North America |
|---|---|
| • | GAAP diluted EPS of $1.07, above the $0.91-$0.99 guidance range,<br>primarily due to a gain of $0.06 per share from final contingent performance-based consideration received in relation to last year’s divesture of OpenMarket |
| --- | --- |
| • | Non-GAAP diluted EPS of $1.20, at the higher end of the $1.15-$1.21 guidance range |
| --- | --- |
| • | GAAP operating income of $160 million; GAAP operating margin of 14.5% |
| --- | --- |
| • | Non-GAAP operating income of $194 million; non-GAAP operating margin of 17.5%, up 20 basis points while accelerating R&D investments |
| --- | --- |
| • | Free cash flow of $147 million, reflecting healthy cash collections, and comprised of cash flow from<br>operations of $204 million, less $57 million in net capital expenditures and other^(1)^ |
| --- | --- |
| • | Normalized free cash flow of $186 million^(1)^<br> |
| --- | --- |
| (1) | Please refer to the Selected Financial Metrics tables below (figures may not sum because of rounding).<br> |
| --- | --- |
| (2) | Pro forma growth rate excludes the financial impact of OpenMarket (which was divested on December 31,<br>2020) from fiscal year 2021 |
| --- | --- |
| (3) | Revenue on a constant currency basis assumes exchange rates in the current period were unchanged from the prior<br>period |
| --- | --- |
| (4) | Adjusted GAAP excludes the gain from the sale of OpenMarket, which was divested on December 31, 2020, from<br>the current and comparable fiscal years |
| --- | --- |
| • | Repurchased $171 million of ordinary shares during the first fiscal quarter, up $31 million<br>sequentially |
| --- | --- |
| • | Record twelve-month backlog of $3.83 billion, up approximately $140 million sequentially and up 9.7% as<br>compared to last year’s first fiscal quarter |
| --- | --- |
JERSEY CITY, NJ – February 1, 2022 – Amdocs Limited (NASDAQ: DOX), a leading provider of software and services to communications and media companies, today reported operating results for the three months ended December 31, 2021.
“We have made a great start to fiscal year 2022. Record revenue was up 10.6% on a pro forma^(^^2)^ constant currency^(3)^ basis from a year ago, driven by our best-ever quarter in North America. Our strategy to deliver market-leading innovation designed to meet the industry’s need for digital modernization, 5G monetization, journey to the cloud and network automation is continuously gaining traction. Strong first quarter sales momentum included notable awards with long-standing customers and several new logos which altogether translated to record twelve-month backlog of $3.83 billion, up 9.7% from a year ago. Additionally, we are pleased to announce the acquisition of DevOpsGroup, a boutique UK-based cloud company which complements the high-end expertise of Amdocs’ Sourced Group by bringing specialist engineering, consultancy and training services for enterprises implementing cloud and DevOps” said Shuky Sheffer, president and chief executive officer of Amdocs Management Limited.
“Amdocs is well-known for exceptional project delivery and we demonstrated this in Q1 with another record number of deployment milestones achieved for our customers. Quarterly invoicing levels and cash collections were healthy, which supported a robust level of free cash flow generation. Demonstrating our confidence in the future success of Amdocs, we also accelerated our buyback activity on a sequential basis in Q1,” said Tamar Rapaport-Dagim, chief financial officer & chief operating officer of Amdocs Management Limited.
Sheffer concluded, “Encouraged by our strong momentum, we believe revenue growth is tracking at the higher-end of our 6.0% to 10.0% guidance range for the full year fiscal 2022 on a pro forma^(2)^, constant currency^(3)^ basis, while delivering healthy operating profitability and strong cash flow generation. Furthermore, we are also projecting annual revenue growth of 6.0% to 10% constant currency^(3)^ in fiscal years 2023 and 2024. Our confidence in this long-term outlook is founded on our market leading position and the durability of Amdocs’ unique business model. Moreover, we have growing visibility to a large and expanding pipeline of opportunities that we are strategically well positioned to monetize by bringing cutting edge technology and impeccable execution to address our customers’ needs.”
Revenue
(All comparisons are against the prior yearperiod)
| In Millions | |||||
|---|---|---|---|---|---|
| Three months ended | |||||
| December 31, 2021 | |||||
| Actual | Previous<br>Guidance | ||||
| Revenue | $ | 1,105 | $ | 1,080- $1,120 | |
| Revenue growth, as reported^(a)^ | 1.7 | % | |||
| Pro forma^(2)^ revenue growth, constant<br>currency^(3)^ | 10.6 | % | |||
| • | Revenue for the first fiscal quarter of 2022 was above the midpoint of Amdocs’ guidance, despite an<br>unfavorable impact from foreign currency movements of approximately $2 million compared to our guidance assumptions | ||||
| --- | --- | ||||
| • | Revenue for the first fiscal quarter of 2022 includes an unfavorable impact from foreign currency movements of<br>approximately $4 million relative to the fourth quarter of fiscal 2021 | ||||
| --- | --- |
Net Income and Earnings Per Share
| In thousands, except per sharedata | ||||
|---|---|---|---|---|
| Three months ended | ||||
| December 31, | ||||
| 2021^(a)^ | 2020 | |||
| GAAP Measures | ||||
| Net income | $ | 133,602 | $ | 299,632 |
| Diluted earnings per share | $ | 1.07 | $ | 2.28 |
| Non-GAAP Measures | ||||
| Net income | $ | 150,135 | $ | 152,972 |
| Diluted earnings per share | $ | 1.20 | $ | 1.16 |
| • | Non-GAAP net income excludes amortization of purchased intangible assets<br>and other acquisition-related costs, changes in certain acquisition related liabilities measured at fair value, equity-based compensation expenses, gain from divestiture of OpenMarket and other, net of related tax effects, in all the periods<br>presented | |||
| --- | --- | |||
| • | In the first quarter of 2022 and 2021, the GAAP net income includes a gain from divestiture of OpenMarket, net of<br>related tax effects, at the amount of $0.06 and $1.42 per share, respectively, which is excluded from the Non-GAAP net income | |||
| --- | --- |
For further details of the reconciliation of selected financial metrics from GAAP to Non-GAAP, please refer to the tables below.
Capital Allocation: M&A Investments & Returning Cash to Shareholders
| • | M&A Activity: As previously announced, **** on October 1, 2021, Amdocs completed<br>the acquisition of Roam Digital, a digital consultancy agency in Southeast Asia Pacific, for a net consideration of $28 million in cash; on November 15, 2021, Amdocs completed the acquisition of DevOps Group, a cloud consultancy agency in<br>Europe, for a net consideration of $26 million |
|---|---|
| • | Quarterly Cash Dividend Program: On February 1, 2022, the Board approved the Company’s<br>next quarterly cash dividend payment at the new increased rate of $0.395 per share, as approved at the January 2022 annual general meeting of shareholders and set March 31, 2022 as the record date for determining the shareholders entitled to<br>receive the dividend, which will be payable on April 29, 2022 |
| --- | --- |
| • | Share Repurchase Activity: Repurchased $171 million of ordinary shares during the first<br>quarter of fiscal 2022 |
| --- | --- |
Twelve-month Backlog
Twelve-month backlog was a record $3.83 billion at the end of the first quarter of fiscal 2022, up approximately 9.7% as compared to last year’s first fiscal quarter. Twelve-month backlog includes anticipated revenue related to contracts, estimated revenue from managed services contracts, letters of intent, maintenance and estimated on-going support activities.
Second Quarter Fiscal 2022 Outlook
| In millions, except per share data | ||
|---|---|---|
| Q2 2022 | ||
| Revenue | $1,110-$1,150 | |
| GAAP diluted EPS | $0.96-$1.04 | |
| Non-GAAP diluted EPS | $1.22-$1.28 | |
| • | Second quarter revenue guidance assumes approximately $2 million sequential unfavorable impact from foreign<br>currency fluctuations as compared to the first quarter of fiscal 2022 | |
| --- | --- | |
| • | Second quarter non-GAAP diluted EPS guidance excludes amortization of<br>purchased intangible assets and other acquisition-related costs, changes in certain acquisitions related liabilities measured at fair value, and approximately $0.11-$0.13 per share of equity-based compensation<br>expense, net of related tax effects | |
| --- | --- |
Full Year Fiscal 2022 Outlook
| FY 2022, year-over-year growth | ||
|---|---|---|
| Current Guidance | Previous Guidance | |
| Revenue growth, as reported | 3.4%-7.4% | 3.7%-7.7% |
| Pro forma^(2)^ revenue growth, constant<br>currency^(3)^ | 6.0%-10.0% | 6.0%-10.0% |
| GAAP diluted EPS growth | (23.0)%-(17.5)% | (23.0)%-(17.5)% |
| Adjusted GAAP diluted EPS growth^(4)^ | 6.0%-13.0% | 6.0%-13.0% |
| Non-GAAP diluted EPS growth | 6.3%-10.3% | 6.3%-10.3% |
| Pro forma^(2)^<br>non-GAAP diluted EPS growth | 8.0%-12.0% | 8.0%-12.0% |
| FY 2022, in millions | ||
| Current Guidance | Previous Guidance | |
| Free cash flow^(1)^ | ~$500 | ~$500 |
| Normalized free cash flow^(1)^ | ~$650 | ~$650 |
| • | Full year fiscal 2022 revenue guidance incorporates an expected unfavorable impact from foreign currency<br>fluctuations of approximately 0.6% year-over-year as compared with an unfavorable impact of about 0.3% year-over-year previously | |
| --- | --- | |
| • | Non-GAAP diluted earnings per share growth, and pro forma^(2)^ non-GAAP diluted earnings per share growth, excludes amortization of purchased intangible assets and other acquisition-related costs, changes in certain<br>acquisitions related liabilities measured at fair value, approximately $0.46-$0.52 per share of equity-based compensation expense, gain from divestiture of OpenMarket and other, net of related tax effects.<br>Adjusted GAAP diluted earnings per share growth, excludes gain from divestiture of OpenMarket, net of related tax effects | |
| --- | --- | |
| • | Free cash flow^(1)^ is comprised of cash flow from operations,<br>less net capital expenditures and other | |
| --- | --- | |
| • | Normalized free cash flow excludes expected capital expenditure of $131 million related to the new campus<br>development in Israel, and other items | |
| --- | --- |
Three Year Fiscal 2022-2024 Outlook
| • | In addition to our full year fiscal 2022 revenue guidance, we project revenue growth of 6.0% to 10%<br>year-over-year on a constant currency^(3)^ basis in each of fiscal years 2023 and 2024 |
|---|---|
| • | Projecting revenue growth on an as reported basis in each of fiscal years 2023 and 2024 is not possible without<br>unreasonable efforts given the uncertain impact of foreign exchange rates which cannot be reasonably predicted at this time |
| --- | --- |
Our second fiscal quarter 2022 and full year fiscal 2022, 2023 and 2024 forward looking projections take into consideration the Company’s current expectations regarding macro and industry specific risks and various uncertainties and certain assumptions that we will discuss on our earnings conference call. However, we note that market dynamics continue to shift rapidly and we cannot predict all possible outcomes, including those resulting from the COVID-19 pandemic, including its novel strains, which has created, and continues to create, a significant amount of uncertainty, or from current and potential customer consolidation or their other strategic corporate activities.
Conference Call and Earnings Webcast Presentation Details
Amdocs will host a conference call and earnings webcast presentation on February 1, 2022 at 5:00 p.m. Eastern Time to discuss the Company’s first quarter of fiscal 2022 results. To participate, please dial +1 (844) 513-7152, or +1 (508) 637-5600 outside the United States, approximately 15 minutes before the call and enter passcode 1787597. The conference call and webcast will also be carried live on the Internet and may be accessed via the Amdocs website at https://investors.amdocs.com. Presentation slides will be available shortly before the webcast.
Non-GAAP Financial Measures
This release includes non-GAAP diluted earnings per share and other non-GAAP financial measures, including free cash flow and normalized free cash flow, revenue on a constant currency^(3)^ basis, non-GAAP cost of revenue, non-GAAP research and development, non-GAAP selling, general and administrative, non-GAAP operating income, non-GAAP operating margin, non-GAAP interest and other expenses, net, non-GAAP income taxes, non-GAAP effective tax rate, non-GAAP net income and non-GAAP diluted earnings per share growth. These other non-GAAP measures exclude the following items:
| • | amortization of purchased intangible assets and other acquisition-related costs; |
|---|---|
| • | changes in certain acquisition-related liabilities measured at fair value; |
| --- | --- |
| • | non-recurring and unusual charges or benefits (such as a gain from<br>divestiture of OpenMarket); |
| --- | --- |
| • | equity-based compensation expense; |
| --- | --- |
| • | other; and |
| --- | --- |
| • | tax effects related to the above. |
| --- | --- |
Free cash flow equals cash generated by operating activities less net capital expenditures and other. Normalized free cash flow, a measure of our operating performance, is further adjusted to exclude net capital expenditures related to the new campus development, payments for non-recurring and unusual charges (such as capital gains tax in relation to the divestiture of OpenMarket), and payments of acquisition related liabilities. 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 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 financial measures, including free cash flow and normalized free cash flow, non-GAAP cost of revenue, non-GAAP research and development, non-GAAP selling, general and administrative, non-GAAP operating income, non-GAAP operating margin, non-GAAP interest and other expenses, net, non-GAAP income taxes, non-GAAP effective tax rate, non-GAAP net income and non-GAAP diluted earnings per share growth 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, as well as the net amount of cash generated by its business operations after taking into account capital spending required to maintain or expand the business.
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 and other acquisition-related costs, changes in certain acquisition-related liabilities measured at fair value, non-recurring and unusual charges or benefits, equity-based compensation expense, other 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 items in reviewing its results and those of its competitors, because the amounts of the items between companies can vary greatly depending on the assumptions used by an individual company in determining the amounts of the items.
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 revenue, research and development, selling, general and administrative, operating income, interest and other expenses, net, 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. Please refer to the Reconciliation of Selected Financial Metrics from GAAP to Non-GAAP tables below.
Supporting Resources
| • | Keep up with Amdocs news by visiting the Company’s website |
|---|---|
| • | Subscribe to Amdocs’ RSS Feed and follow us on Twitter, Facebook, LinkedIn and<br>YouTube |
| --- | --- |
About Amdocs
Amdocs helps those who build the future to make it amazing. With our market-leading portfolio of software products and services, we unlock our customers’ innovative potential, empowering them to provide next-generation communication and media experiences for both the individual end user and large enterprise customers. Our 29,000 employees around the globe are here to accelerate service providers’ migration to the cloud, enable them to differentiate in the 5G era, and digitalize and automate their operations. Listed on the NASDAQ Global Select Market, Amdocs had revenue of $4.3 billion in fiscal 2021.
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 and years. 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, the duration and severity of the COVID-19 pandemic, and its impact on the global economy, 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, Amdocs specifically disclaims any obligation to do so. These and other risks are discussed at greater length in Amdocs’ filings with the Securities and Exchange Commission, including in our Annual Report on Form 20-F for the fiscal year ended September 30, 2021 filed on December 9, 2021.
Contact:
Matthew Smith
Head of Investor Relations
Amdocs
314-212-8328
E-mail: [email protected]
AMDOCS LIMITED
Consolidated Statements of Income
(In thousands, except per share data)
| Three months ended | ||||||
|---|---|---|---|---|---|---|
| December 31, | ||||||
| 2021^(a)^ | 2020 | |||||
| Revenue | $ | 1,104,632 | $ | 1,086,343 | ||
| Operating expenses: | ||||||
| Cost of revenue | 716,718 | 728,716 | ||||
| Research and development | 81,945 | 75,669 | ||||
| Selling, general and administrative | 128,076 | 121,888 | ||||
| Amortization of purchased intangible assets and other | 17,747 | 19,870 | ||||
| 944,486 | 946,143 | |||||
| Operating income | 160,146 | 140,200 | ||||
| Interest and other expense, net | (2,562 | ) | (6,490 | ) | ||
| Gain from sale of a business | 10,000 | 226,410 | ||||
| Income before income taxes | 167,584 | 360,120 | ||||
| Income taxes | 33,982 | 60,488 | ||||
| Net income | $ | 133,602 | $ | 299,632 | ||
| Basic earnings per share | $ | 1.07 | $ | 2.29 | ||
| Diluted earnings per share | $ | 1.07 | $ | 2.28 | ||
| Basic weighted average number of shares outstanding | 124,502 | 131,125 | ||||
| Diluted weighted average number of shares outstanding | 125,304 | 131,582 | ||||
| Cash dividends declared per share | $ | 0.36 | $ | 0.3275 |
AMDOCS LIMITED
Selected Financial Metrics
(In thousands, except per share data)
| Three months ended | ||||
|---|---|---|---|---|
| December 31, | ||||
| 2021^(a)^ | 2020 | |||
| Revenue | $ | 1,104,632 | $ | 1,086,343 |
| Non-GAAP operating income | 193,607 | 187,981 | ||
| Non-GAAP net income | 150,135 | 152,972 | ||
| Non-GAAP diluted earnings per share | $ | 1.20 | $ | 1.16 |
| Diluted weighted average number of shares outstanding | 125,304 | 131,582 |
Free Cash Flows and Normalized Free Cash Flow
(In thousands)
| Three months ended | ||||||
|---|---|---|---|---|---|---|
| December 31, | ||||||
| 2021 | 2020 | |||||
| Net Cash Provided by Operating<br>Activities^(a)^ | $ | 204,118 | $ | 416,485 | ||
| Purchase of property and equipment,<br>net^(b)^ | (57,225 | ) | (50,065 | ) | ||
| Free Cash Flow | 146,893 | 366,420 | ||||
| Net capital expenditures related to the new campus development | 29,307 | 18,334 | ||||
| Payment of acquisition related liability | 9,479 | — | ||||
| Normalized Free Cash Flow | $ | 185,679 | $ | 384,754 | ||
| (a) | Since January 1, 2021, OpenMarket results are not included in the Consolidated Statements of Income given<br>its divestiture. | |||||
| --- | --- | |||||
| (b) | The amounts under “Purchase of property and equipment, net”, include proceeds from sale of property<br>and equipment of $269 and $53 for the three months ended 31 December 2021 and 2020, respectively. | |||||
| --- | --- |
AMDOCS LIMITED
Reconciliation of Selected Financial Metrics from GAAP to Non-GAAP
(In thousands)
| Three months ended December 31, 2021^(a)^ | |||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Reconciliation items | |||||||||||||||||||||||
| GAAP | Amortizationof<br>purchasedintangibleassets andother | Equity basedcompensationexpense | Changes in certainacquisitions relatedliabilities measuredat fair value | Gain fromsale of abusiness | Other | Tax<br>effect | Non-GAAP | ||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Cost of revenue | $ | 716,718 | $ | — | $ | (7,147 | ) | $ | 1,027 | $ | — | $ | — | $ | — | $ | 710,598 | ||||||
| Research and development | 81,945 | — | (1,223 | ) | — | — | — | — | 80,722 | ||||||||||||||
| Selling, general and administrative | 128,076 | — | (8,371 | ) | — | — | — | — | 119,705 | ||||||||||||||
| Amortization of purchased intangible assets and other | 17,747 | (17,747 | ) | — | — | — | — | — | — | ||||||||||||||
| Total operating expenses | 944,486 | (17,747 | ) | (16,741 | ) | 1,027 | — | — | — | 911,025 | |||||||||||||
| Operating income | 160,146 | 17,747 | 16,741 | (1,027 | ) | — | — | — | 193,607 | ||||||||||||||
| Interest and other expense, net | (2,562 | ) | — | — | — | — | (3,605 | ) | — | (6,167 | ) | ||||||||||||
| Gain from sale of a business | 10,000 | — | — | — | (10,000 | ) | — | — | — | ||||||||||||||
| Income taxes | 33,982 | — | — | — | — | — | 3,323 | 37,305 | |||||||||||||||
| Net income | $ | 133,602 | $ | 17,747 | $ | 16,741 | $ | (1,027 | ) | $ | (10,000) | $ | (3,605) | $ | (3,323) | $ | 150,135 | ||||||
| Three months ended December 31, 2020 | |||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Reconciliation items | |||||||||||||||||||||||
| GAAP | Amortizationof purchasedintangibleassets andother | Equity basedcompensationexpense | Changes incertainacquisitionsrelatedliabilitiesmeasuredat fairvalue | Gain fromsale of abusiness | Other | Tax<br>effect | Non-GAAP | ||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Cost of revenue | $ | 728,716 | $ | — | $ | (4,941 | ) | $ | (15,334 | ) | $ | — | $ | — | $ | — | $ | 708,441 | |||||
| Research and development | 75,669 | — | (832 | ) | — | — | — | — | 74,837 | ||||||||||||||
| Selling, general and administrative | 121,888 | — | (6,804 | ) | — | — | — | — | 115,084 | ||||||||||||||
| Amortization of purchased intangible assets and other | 19,870 | (19,870 | ) | — | — | — | — | — | — | ||||||||||||||
| Total operating expenses | 946,143 | (19,870 | ) | (12,577 | ) | (15,334 | ) | — | — | — | 898,362 | ||||||||||||
| Operating income | 140,200 | 19,870 | 12,577 | 15,334 | — | — | — | 187,981 | |||||||||||||||
| Interest and other expense, net | (6,490 | ) | — | — | — | — | 1,199 | — | (5,291 | ) | |||||||||||||
| Gain from sale of a business | 226,410 | — | — | — | (226,410 | ) | — | — | — | ||||||||||||||
| Income taxes | 60,488 | — | — | — | — | — | (30,770 | ) | 29,718 | ||||||||||||||
| Net income | $ | 299,632 | $ | 19,870 | $ | 12,577 | $ | 15,334 | $ | (226,410) | $ | 1,199 | $ | 30,770 | $ | 152,972 |
AMDOCS LIMITED
Condensed Consolidated Balance Sheets
(In thousands)
| September 30,2021 | |||
| ASSETS | |||
| Current assets | |||
| Cash and cash equivalents | 586,490 | $ | 709,064 |
| Short-term interest-bearing investments | 282,347 | 256,527 | |
| Accounts receivable, net, including unbilled of 146,994 and 162,278, respectively | 953,970 | 866,819 | |
| Prepaid expenses and other current assets | 255,984 | 235,089 | |
| Total current assets | 2,078,791 | 2,067,499 | |
| Property and equipment, net | 708,834 | 698,768 | |
| Lease assets | 228,960 | 233,162 | |
| Goodwill and other intangible assets, net | 2,925,988 | 2,881,676 | |
| Other noncurrent assets | 612,904 | 630,669 | |
| Total assets | 6,555,477 | $ | 6,511,774 |
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||
| Current liabilities | |||
| Accounts payable, accruals and other | 994,981 | $ | 1,007,777 |
| Lease liabilities | 59,333 | 58,714 | |
| Deferred revenue | 334,687 | 237,374 | |
| Total current liabilities | 1,389,001 | 1,303,865 | |
| Lease liabilities | 175,093 | 177,906 | |
| Long-term debt, net of unamortized debt issuance costs | 644,694 | 644,553 | |
| Other noncurrent liabilities | 769,883 | 750,266 | |
| Total Amdocs Limited Shareholders’ equity | 3,534,297 | 3,592,675 | |
| Noncontrolling interests | 42,509 | 42,509 | |
| Total equity | 3,576,806 | 3,635,184 | |
| Total liabilities and equity | 6,555,477 | $ | 6,511,774 |
All values are in US Dollars.
AMDOCS LIMITED
Consolidated Statements of Cash Flows
(In thousands)
| Three months ended<br>December 31, | ||||||
|---|---|---|---|---|---|---|
| 2021 | 2020 | |||||
| Cash Flow from Operating Activities: | ||||||
| Net income^(a)^ | $ | 133,602 | $ | 299,632 | ||
| Reconciliation of net income to net cash provided by operating activities: | ||||||
| Depreciation and amortization | 50,876 | 51,706 | ||||
| Amortization of debt issuance costs | 141 | 137 | ||||
| Equity-based compensation expense | 16,741 | 12,577 | ||||
| Gain from sale of a business | (10,000 | ) | (226,410 | ) | ||
| Deferred income taxes | 4,143 | (25,892 | ) | |||
| Loss (Gain) from short-term interest-bearing investments | 647 | (369 | ) | |||
| Net changes in operating assets and liabilities, net of amounts acquired: | ||||||
| Accounts receivable, net | (84,458 | ) | (140,817 | ) | ||
| Prepaid expenses and other current assets | (15,696 | ) | 911 | |||
| Other noncurrent assets | (11,835 | ) | (13,984 | ) | ||
| Lease assets and liabilities, net | 2,030 | 11,225 | ||||
| Accounts payable, accrued expenses and accrued personnel | (3,053 | ) | 155,891 | |||
| Deferred revenue | 86,049 | 219,057 | ||||
| Income taxes payable, net | 16,802 | 61,318 | ||||
| Other noncurrent liabilities | 18,129 | 11,503 | ||||
| Net cash provided by operating activities | 204,118 | 416,485 | ||||
| Cash Flow from Investing Activities: | ||||||
| Purchase of property and equipment,<br>net^(b)^ | (57,225 | ) | (50,065 | ) | ||
| Proceeds from sale of short-term interest-bearing investments | 5,242 | 1,291 | ||||
| Purchase of short-term interest-bearing investments | (34,275 | ) | (176,234 | ) | ||
| Net cash paid for business and intangible assets acquisitions | (23,885 | ) | (9,897 | ) | ||
| Net cash received from sale of a business | — | 290,789 | ||||
| Other | (548 | ) | 1,407 | |||
| Net cash (used in) provided by investing activities | (110,691 | ) | 57,291 | |||
| Cash Flow from Financing Activities: | ||||||
| Repurchase of shares | (170,904 | ) | (90,022 | ) | ||
| Proceeds from employee stock options exercises | 6,012 | 12,711 | ||||
| Payments of dividends | (44,956 | ) | (43,084 | ) | ||
| Payment of contingent consideration from a business acquisition | (6,153 | ) | — | |||
| Net cash used in financing activities | (216,001 | ) | (120,395 | ) | ||
| Net (decrease) increase in cash and cash equivalents | (122,574 | ) | 353,381 | |||
| Cash and cash equivalents at beginning of period | 709,064 | 983,188 | ||||
| Cash and cash equivalents at end of period | $ | 586,490 | $ | 1,336,569 |
AMDOCS LIMITED
Supplementary Information
(In millions)
| Three months ended | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| December 31,2021^(a)^ | September 30,<br>2021^(a)^ | June 30,<br>2021^(a)^ | March 31,<br>2021^(a)^ | December 31,2020 | ||||||
| North America | $ | 745.5 | $ | 722.8 | $ | 686.1 | $ | 679.1 | $ | 703.4 |
| Europe | 142.5 | 146.8 | 155.7 | 148.8 | 171.6 | |||||
| Rest of the World | 216.6 | 217.7 | 224.5 | 220.8 | 211.3 | |||||
| Total Revenue | $ | 1,104.6 | $ | 1,087.3 | $ | 1,066.3 | $ | 1,048.7 | $ | 1,086.3 |
| Three months ended | ||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| December 31,2021 | September 30,<br>2021 | June 30,<br>2021 | March 31,<br>2021 | December 31,2020 | ||||||
| Managed Services Revenue | $ | 659.7 | $ | 637.5 | $ | 650.5 | $ | 634.6 | $ | 623.7 |
| As of | ||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| December 31,2021^(c)^ | September 30,<br>2021^(c)^ | June 30,<br>2021^(c)^ | March 31,<br>2021^(c)^ | December 31,2020^(c)^ | ||||||
| 12-Month Backlog | $ | 3,830 | $ | 3,690 | $ | 3,590 | $ | 3,540 | $ | 3,490 |
| (c) | Excludes OpenMarket, which we divested on December 31, 2020 | |||||||||
| --- | --- |
# # #
EX-99.2
Exhibit 99.2
Fiscal Q1 2022 Earnings Presentation February 1, 2022 Shuky Sheffer President & CEO Tamar Rapaport-Dagim CFO & COO
The information contained herein in this presentation or delivered or to be delivered to you during this presentation does not constitute an offer, expressed or implied, or a recommendation to do any transaction in Amdocs Limited securities or in any securities of its affiliates or subsidiaries. This presentation and the comments made by members of Amdocs management in conjunction with it include 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, the duration and severity of the COVID-19 pandemic, and its impact on the global economy, 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, Amdocs specifically disclaims any obligation to do so. These and other risks are discussed at greater length in Amdocs’ filings with the Securities and Exchange Commission, including in our Annual Report on Form 20-F for the fiscal year ended September 30, 2021 filed on December 9, 2021. This presentation includes non-GAAP financial measures, including non-GAAP operating margin, free cash flow, normalized free cash flow, revenue on a constant currency basis, non-GAAP net income and non-GAAP earnings per share. Free cash flow equals cash generated by operating activities less net capital expenditures and other. Normalized free cash flow, a measure of our operating performance, is further adjusted to exclude net capital expenditures related to the new campus development, payments for non-recurring and unusual charges (such as capital gains tax to be paid in relation to the divestiture of OpenMarket), and payments of acquisition related liabilities. 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 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. Please refer to the appendix for a reconciliation of these metrics to the most comparable GAAP provision. This presentation also includes pro forma metrics which exclude the financial impact of OpenMarket (divested on December 31, 2020) from fiscal year 2021 and comparable fiscal year 2020. Please also review the information contained in Amdocs’ press release dated February 1, 2022 with respect to earnings for fiscal Q1 2022. The press release contains additional information regarding Amdocs’ outlook for fiscal years 2022, 2023 and 2024 and certain non-GAAP metrics and their reconciliations. 2 Information Security Level 0 – Public. © 2022 – Proprietary & Confidential Information of Amdocs
Today’s Speakers Shuky Tamar Sheffer Rapaport-Dagim President & Chief Financial Officer & Chief Executive Officer Chief Operating Officer 3 Information Security Level 0 – Public. © 2022 2022 – Proprietary & Confidential Information of Amdocs
Earnings call agenda Strategy & Business Performance Update 1 Shuky Sheffer, President & Chief Executive Officer Financial Review & Outlook 2 Tamar Rapaport-Dagim, Chief Financial Officer & Chief Operating Officer 3 Q&A 4 Information Security Level 0 – Public. © 2022 – Proprietary & Confidential Information of Amdocs
President & Chief Executive Officer Strategy and business performance update 5 Information Security Level 0 – Public. © 2022 2022 – Proprietary & Confidential Information of Amdocs
Strategy and business performance update 1 Q1 FY2022: business and financial achievements 2 Q1 FY2022 progress in strategic domains: executing against our key growth pillars 3 Financial outlook 6 Information Security Level 0 – Public. © 2022 – Proprietary & Confidential Information of Amdocs
Great start to FY2022 Delivering accelerated revenue growth by bringing market-leading innovation designed to meet the industry’s megatrends Strong sales Execution M&A momentum Additional awards with many of Acquired our long-standing global customers Record number DevOpsGroup of customer milestones deliveries Boutique UK–based cloud Unrivalled reputation company of Industry experts delivering highly specialized for project delivery cloud services Won new logos and expanded Focuses on cloud strategy geographically Geographically complements FY2021 Sourced Group acquisition frica Completed previously announced acquisition of Ongoing commitment to R&D, Roam Digital innovation and extending technological leadership Q1 2020 Q1 2021 Q1 2022 Growing projekt202’s geographical presence, expanding its capabilities in APAC Confiden
Enriching lives, progressing society Our ESG journey Recognized for our diversity & inclusion impact: Peru Mexico Israel Government Human Rights National recognition for Campaign best award Amdocs’s places to work for for diversity in commitment for LGBTQ+ business inclusion For a 3rd year in a row: Included in the Dow Jones Sustainability Index 2019, 2020 & 2021 – North America Promoting employability of diverse populations Hiring & upskilling women in India coming back from career breaks Cloud migration project that supports the expansion of London’s ultra-low emissions zone to improve the city’s air quality Tens of digital inclusion activities worldwide – promoting connectivity, accessibility and employability 8 Information Security Level 0 – Public. © 2022 – Proprietary & Confidential Information of Amdocs
Committed to our people A warm welcome to all those who have recently joined the Amdocs family, and my sincere thanks to all our people for their dedication, resilience and commitment to ensuring a great start to our fiscal year to our 29,000 people worldwide 9 Information Security Level 0 – Public. © 2022 – Proprietary & Confidential Information of Amdocs
Strong performance in Q1-FY2022 Revenue 1,2 12-month backlog 1 Non-GAAP EPS 3 $1,105M, accelerated Record of $3.83B $1.20 growth of 10.6% YoY Driven by North America, Above guidance +9.7% YoY with high activity levels midpoint +$140M QoQ across top customers ($1.15 $1.21) 1. Pro forma. excludes the financial impact of OpenMarket (which was divested on December 31, 2020) from fiscal year 2021. 2. Constant currency. Assumes exchange rates in the current period were unchanged from the prior period 2. Non-GAAP. See reconciliation tables in appendix 10 Information Security Level 0 – Public. © 2022 – Proprietary & Confidential Information of Amdocs
Progress in Strategic Domains Market-leading innovation to support our customer’s critical business needs, and provide an amazing experience to consumer and enterprise customers CLOUD 5G NETWORK DIGITAL MEDIA AUTOMATION Journey to the cloud: 5G monetization: support Digital modernization: Network automation: Monetize partner accelerate cloud exciting new 5G use cases enhance customer deliver and automate ecosystem and retain adoption experience and transform dynamic, real-time customers’ end-users; support content delivery operations network-based services and monetization 5G charging Cloud BSS & OSS OSS Africa & policy migration uplift modernization solution Network IoT and Amdocs Media optimization 5G eSIM solution bundling services Cloud 5G-ready Tier 1 North OSS Quality American transformation CBRS solutions engineering modernization Turkey customer AMERICA ormation Security Level 0 – Public. © 2022 – Proprietary & Confidential Information of Amdocs
Looking ahead: a new era of accelerated growth Providing three-year FY2022-2024 annual revenue growth outlook of 6%-10%(1)(2) A Highly recurring revenue, strong FY2022-2024 (1)(2) business visibility and durable multi 6.0%-10.0% Revenue year customer engagements Annual three-year revenue growth target Growth Outlook (Guidance does not depend on a material level of M&A activity) Early innings of customer’s multi-year investment cycle driven by industry megatrends B Tracking at higher end of guidance FY2022 range for both revenue and EPS: Revenue and Revenue growth 6.0%-10.0% Right strategy to monetize a large and Pro forma, constant currency 1,2 expanding funnel of opportunity EPS Guidance Non-GAAP 3 EPS growth 8.0%-12.0% Pro forma 1 1. Pro forma excludes the financial impact of OpenMarket (which was divested on December 31, 2020) from fiscal year 2021. 2. Constant currency. Assumes exchange rates in the current period were unchanged from the prior period 3. Pro forma non-GAAP diluted. See reconciliation tables in appendix 12 Information Security Level 0 – Public. © 2022 – Proprietary & Confidential Information of Amdocs
Chief Financial Officer & Chief Operating Officer Financial Update & Outlook 13 Information Security Level 0 – Public. © 2022 2022 – Proprietary & Confidential Information of Amdocs
Q1 2022 Results Q1 2022 Revenue vs. Guidance $ Millions Q1 Revenue $1,105 million +10.6% YoY (1)(2) Above guidance midpoint $1,105 ($1,080M $1,120M) $1,100 Q1 Non-GAAP(3) Operating Margin Record revenue in Q1 2022 Original Q1F22 Q1F22A 17.5%, +20 bps YoY Guidance (midpoint) Best-ever quarter in North America Consistent with midpoint of annual Non-GAAP operating margin +20 basis target range of 17.2% 17.8% points YoY, including accelerated R&D investments Q1 2022 Revenue by Region Q1 GAAP Diluted EPS $ Millions $1.07 Above guidance high-end Rest of World ($0.91 $0.99) $217 1. Pro forma metrics exclude the financial impact of OpenMarket (which was divested on December 31, 2020) from fiscal year 2021. North Q1 Non-GAAP(3) Diluted EPS 2. Constant currency. Assumes exchange rates in the current period were Europe America unchanged from the prior period $1.20 $143 $745 3. Non-GAAP. See reconciliation tables in appendix Above guidance midpoint ($1.15 $1.21) 14 Information Security Level 0– Public© 2022 – Proprietary & Confidential Information of Amdocs
Record Quarterly 12-Month Backlog(1) in Q1F22 12-Month Backlog $ Billions 12-month backlog growth has accelerated year-over-year over the past several quarters $3.83 $3.69 $3.59 +9.7% $3.54 ( (1) record level as of $3.49 YoY December 31, 2021 +9.7% YoY, $140M QoQ Q1F21 Q2F21 Q3F21 (1) Q4F21 Q1F22 Record Managed Services Revenue in Q1F22 $ Millions 57% 60% Leading Indicator $660 million $660 $624 12-month backlog Managed services arrangements may typically covers ~80% include large-scale digital transformation projects, and support business model of forward 12-month resiliency with highly recurring revenue Q1F21 Q1F22 streams, multi-year engagements and high 1. Excludes OpenMarket, revenue renewal rates Revenue which was divested on December 31, 2020 Managed Services as % Total 15 Information Security Level 0– Public© 2022 – Proprietary & Confidential Information of Amdocs
DSO’s Q1 2022 Free cash flow(2) bridge 79 days $ Millions +1 day YoY and +6 days QoQ DSO’s may fluctuate from quarter to quarter $204 $57 $29 $9 $186 $147 Deferred revenue > unbilled +$100 million Deferred revenue: +$86M QoQ Unbilled receivables: -$14M QoQ Items fluctuate from quarter to quarter in line with normal business activities. Cashflow Net capex Reported Israel Other Normalized from & other FCF campus FCF Operations We remain comfortable with our *Figures may not sum due to rounding balance sheet Liquidity: Cash + Credit Facility Cash, Credit Facility & Debt Position $1.4 billion $ Millions, as of December 31, 2021 Ample liquidity to support ongoing business needs while retaining the capacity to fund future strategic Credit Ample liquidity including available Facility $500 growth investments $500M revolving credit facility Baa2 BBB Cash $869 Moody’s $650 S&P 1. $650M senior note, maturing June 2030 2. Non-GAAP. See reconciliation tables in appendix Remain committed to maintaining our Investment grade credit rating Liquidity Debt $0 (1) 16 Information Security Level 0– Public© 2022 – Proprietary & Confidential Information of Amdocs
Q1 2022 Cash Returned to Shareholders FY2022E Normalized FCF outlook(1) $ Millions $ Millions Dividends, $45 $131 $19 $650 $500 Share repurchases, $171 As of December 31, roughly $0.8B of share Reported Israel Other Normalized Reiterating normalized free cash repurchase authorization capacity remained FCF campus FCF flow (FCF) outlook of $650M in FY2022, equating to ~100% cash Normalized FCF(1): Three-year historical trend and FY2022E outlook conversion 140% 103% 100% % Normalized FCF(1)/ 88% 100% Non-GAAP Net Income(1) Expect a majority of normalized free 89% 100% 99% cash flow to be returned to % of Normalized FCF FY2022E guidance: shareholders by way of share Returned to Shareholders return repurchases and quarterly cash majority dividend payments in FY2022 $869 Normalized FCF(1) ($M) $613 $527 $650 FY2019 FY2020 FY2021 FY2022E 1. Non-GAAP. See reconciliation tables in appendix (Guidance) 17 Information Security Level 0– Public© 2022 – Proprietary & Confidential Information of Amdocs
Revenue Growth YoY% Growth Constant Currency(4) FY21 and FY22E revenue is pro forma(1) constant currency(4) 10% Tracking at 7.0% higher end 4.1% of pro forma 2.3% 2.4% 6% guidance Tracking at higher end of pro forma(1) outlooks for revenue (4) (1)(4) (1)(4) FY2018 FY2019 FY2020 FY2021 FY2022E and diluted non-GAAP(2) EPS growth in FY2022E (3) Total Shareholder Return Non-GAAP(2) Diluted EPS Growth YoY % + Dividend Yield Positioned to deliver double FY21 and FY22E non-GAAP EPS growth is presented pro forma(1) digit total shareholder returns for the second year running 11.7% Tracking at 12% higher end 8.6% 7.6% of pro forma 1. Pro forma metrics exclude the financial impact of OpenMarket (which was 9.8% divested on December 31, 2020) from fiscal year 2021. 5.3% guidance 8.0% 6.9% 2. Non-GAAP. See reconciliation tables in appendix 6.1% 3.0% 3. Expected total shareholder return assumes Non-GAAP EPS growth plus dividend yield (based on fiscal year end closing share price); FY2022E 1.5% 1.7% 2.3% 1.9% 2.1% assumed midpoint of pro forma non-GAAP EPS outlook, and dividend yield based on proposed new quarterly rate of $0.395 as of share price on (1) (1) 11/2/21 FY2018 FY2019 FY2020 FY2021 FY2022E 4. Constant currency. Assumes exchange rates in the current period were unchanged from the prior period Non-GAAP Diluted EPS Growth Dividend Yield Total Shareholder Return 18 Information Security Level 0– Public© 2022 – Proprietary & Confidential Information of Amdocs
Q&A 19
Let’s make it amazing
Appendix Reconciliation Tables 21
Q2 Fiscal 2022E Outlook Revenue $1,110 $1,150 million GAAP EPS $0.96 $1.04 Non-GAAP(2) EPS $1.22 $1.28 Share Count 124 million Effective Tax Rate Above high-end of annual Tracking at higher end of Non-GAAP(2) target range of 13%-17% pro forma(1) outlooks for revenue (3) and diluted non Full Year Fiscal 2022 Outlook GAAP(2) EPS growth in Revenue growth Includes unfavorable foreign currency 3.4% 7.4% FY2022E As reported impact of 0.6% YoY versus 0.3% previously Revenue growth 6.0% 10.0% Pro forma(1), constant currency(3) Non-GAAP(2) EPS growth 6.3% 10.3% As reported 1. Pro forma metrics exclude the financial impact of OpenMarket (which was Non-GAAP(2) EPS growth divested on December 31, 2020) from fiscal year 2021. 8.0% 12.0% Pro forma(1) 2. Non-GAAP. See reconciliation tables in appendix Operating Margin 17.2%-17.8% Non-GAAP(2) 3. Constant currency. Assumes exchange rates in the current period were Effective Tax Rate unchanged from the prior period 13.0%-17.0% Non-GAAP(2) Free cash flow(2) $500 million Normalized free cash flow(2) $650 million 22 Information Security Level 0 – Public © 2022 – Proprietary & Confidential Information of Amdocs
Q2 Fiscal 2022E Outlook Revenue $1,110 $1,150 million GAAP EPS $0.96 $1.04 Non-GAAP(2) EPS $1.22 $1.28 Share Count 124 million Effective Tax Rate Above high-end of annual Tracking at higher end of Non-GAAP(2) target range of 13%-17% pro forma(1) outlooks for revenue (3) and diluted non Full Year Fiscal 2022 Outlook GAAP(2) EPS growth in Revenue growth Includes unfavorable foreign currency 3.4% 7.4% FY2022E As reported impact of 0.6% YoY versus 0.3% previously Revenue growth 6.0% 10.0% Pro forma(1), constant currency(3) Non-GAAP(2) EPS growth 6.3% 10.3% As reported 1. Pro forma metrics exclude the financial impact of OpenMarket (which was Non-GAAP(2) EPS growth divested on December 31, 2020) from fiscal year 2021. 8.0% 12.0% Pro forma(1) 2. Non-GAAP. See reconciliation tables in appendix Operating Margin 17.2%-17.8% Non-GAAP(2) 3. Constant currency. Assumes exchange rates in the current period were Effective Tax Rate unchanged from the prior period 13.0%-17.0% Non-GAAP(2) Free cash flow(2) $500 million Normalized free cash flow(2) $650 million 22 Information Security Level 0 – Public © 2022 – Proprietary & Confidential Information of Amdocs
AMDOCS LIMITED Reconciliation of Selected Financial Metrics from GAAP to Non-GAAP (In thousands) Three months ended December 31, 2021(a) Reconciliation items GAAP Amortization Equity based Changes in certain Gain from Other Tax Non-GAAP of compensation acquisitions related sale of a effect purchased expense liabilities measured business intangible at fair value assets and other Operating expenses: Cost of revenue $ 716,718 $ $ (7,147) $ 1,027 $ $ $ $ 710,598 Research and development 81,945 (1,223) 80,722 Selling, general and administrative 128,076 (8,371) 119,705 Amortization of purchased intangible assets and other 17,747 (17,747) Total operating expenses 944,486 (17,747) (16,741) 1,027 911,025 Operating income 160,146 17,747 16,741 (1,027) 193,607 Interest and other expense, net (2,562) (3,605) (6,167) Gain from sale of a business 10,000 (10,000) a) Since January 1, 2021, OpenMarket results are not included in the Consolidated Statements of Income given its divestiture. Income taxes 33,982 3,323 37,305 b) The amounts under “Purchase of property and equipment, net”, include proceeds from sale of property and equipment of $269 and Net income $ 133,602 $ 17,747 $ 16,741 $ (1,027) $ (10,000) $ (3,605) $ (3,323) $ 150,135 $53 for the three months ended 31 December 2021 and 2020, respectively. 24 Information Security Level 0– Public© 2022 – Proprietary & Confidential Information of Amdocs
AMDOCS LIMITED Reconciliation of Selected Financial Metrics from GAAP to Non-GAAP (In thousands) Three months ended December 31, 2020 Reconciliation items GAAP Amortization Equity based Changes in certain Gain from Other Tax Non-GAAP of compensation acquisitions related sale of a effect purchased expense liabilities measured business intangible at fair value assets and other Operating expenses: Cost of revenue $ 728,716 $ $ (4,941) $ (15,334) $ $ $ $ 708,441 Research and development 75,669 (832) 74,837 Selling, general and administrative 121,888 (6,804) 115,084 Amortization of purchased intangible assets and other 19,870 (19,870) Total operating expenses 946,143 (19,870) (12,577) (15,334) 898,362 Operating income 140,200 19,870 12,577 15,334 187,981 Interest and other expense, net (6,490) 1,199 (5,291) a) Since January 1, 2021, OpenMarket results are not included in the Gain from sale of a Consolidated Statements of Income given its divestiture. business 226,410 (226,410) b) The amounts under “Purchase of property and equipment, net”, include proceeds from sale of property and equipment of $269 and Income taxes 60,488 (30,770) 29,718 $53 for the three months ended 31 December 2021 and 2020, respectively. Net income $ 299,632 $ 19,870 $ 12,577 $ 15,334 $ (226,410) $ 1,199 $ 30,770 $ 152,972 25 Information Security Level 0– Public© 2022 – Proprietary & Confidential Information of Amdocs