The Advisory Board Company announces fiscal 2010 second-quarter results

Nov 3 2009

The Advisory Board Company (Nasdaq: ABCO) today announced financial results for the second quarter of its fiscal year ending March 31, 2010. Revenue for the quarter increased 1.2% to $58.3 million, from $57.6 million in the second quarter of fiscal 2009. Contract value grew 3.0% to $237.6 million as of September 30, 2009, up from $230.6 million as of September 30, 2008. Net loss was $2.1 million, or $0.14 per diluted share, compared to net income of $5.4 million, or $0.32 per diluted share, for the same period a year ago. Included in net loss for the second quarter of fiscal 2010 are pre-tax one-time charges of $7.4 million for the write-off of capitalized developed software costs and $1.9 million in accelerated compensation costs resulting from the cancellation of certain stock options held by members of the Company's senior management and its directors. Excluding the effects, net of tax, of these one-time non-cash charges, adjusted net income was $4.0 million and adjusted earnings per diluted share was $0.26 for the second quarter of fiscal 2010. Adjusted EBITDA was $7.2 million for the quarter, compared to $8.4 million in the second quarter of fiscal 2009.

For the six months ended September 30, 2009, revenue increased 0.2% to $115.0 million, from $114.8 million for the six months ended September 30, 2008. Net income was $2.1 million, or $0.13 per diluted share, compared to net income of $11.7 million, or $0.68 per diluted share, for the same period a year ago. Excluding the effects, net of tax, of the one-time non-cash charges associated with the write-off of capitalized developed software costs and the cancellation of certain stock options, adjusted net income was $8.2 million and adjusted earnings per diluted share was $0.53 for the six months ending September 30, 2009. Adjusted EBITDA was $14.6 million for the six months ending September 30, 2009, compared to $17.7 million for the same period a year ago.

Robert Musslewhite, Chief Executive Officer of The Advisory Board Company, commented, "Overall, we were pleased with our performance for the quarter. Adjusted earnings were in line with our expectations, and we are encouraged that the period marked our return to positive year-over-year revenue growth. In addition, this quarter's growth in our contract value both illustrates our ability to address our members' most critical issues through programs that deliver tangible value and builds on the stability we have maintained across the year."