HMS Holdings Corp. (HMSY) Tops Q4 EPS by 6c, Slight Miss on Revenues; Offers FY19 Revenue Mid-Point Guidance Above Consensus

HMS Holdings Corp. (NASDAQ: HMSY) reported Q4 EPS of $0.31, $0.06 better than the analyst estimate of $0.25. Revenue for the quarter came in at $155.83 million versus the consensus estimate of $155.84 million.

• Record 4Q’18 Total Revenue of $155.8 Million and Record Full Year 2018 Revenue of $598.3 Million
• 4Q’18 GAAP EPS of $0.38 Per Diluted Share, Including Discrete Tax Benefits of $0.17 Per Diluted Share
• 4Q’18 Adjusted EPS of $0.31 Per Diluted Share Excluding Discrete Tax Benefits of $0.17 Per Diluted Share
• 4Q’18 Net Income of $33.4 Million and Adjusted EBITDA of $46.1 Million
• 2019 Outlook Includes Projected Total Revenue of $640-650 Million, Net Income of $64-70 Million and Adjusted EBITDA of $170-175 Million

“Our fourth quarter results capped a very strong year of growth in 2018, which included record full-year revenue that increased 15%, net income that increased 37% and adjusted EBITDA that increased 30% compared to the prior year,” said Bill Lucia, Chairman and CEO. “We significantly exceeded the expectations we outlined at the beginning of the year, due primarily to stronger than anticipated double-digit growth in both our payment integrity and total population management offerings. Our technology investments contributed meaningfully to margin expansion and improved profitability in 2018, and we believe we are only in the early stages of realizing the full benefits of this operational leverage.”

“We expect to continue our top and bottom line growth in 2019 by advancing our strategic priorities to leverage our expansive customer base, maintaining our focus on customer satisfaction and employee engagement, and taking full advantage of the scalability of our business model to further improve our profit margins and maximize the value of our data assets and technology investments,” Lucia concluded.

“We ended 2018 with a stronger balance sheet and enhanced liquidity to support our business growth and future investments, and expect a continuation of solid revenue growth and margin expansion in the year ahead,” said Jeff Sherman, CFO. “The full year 2019 guidance we are issuing today reflects our expectation of high single digit to low double digit revenue growth, with net income and adjusted EBITDA increasing at a rate exceeding revenue growth. We believe the tremendous progress we made throughout last year positions HMS well to achieve our performance goals in 2019.”

GUIDANCE:

HMS Holdings Corp. sees FY2019 revenue of $640-650 million, versus the consensus of $643.34 million.

For earnings history and earnings-related data on HMS Holdings Corp. (HMSY) click here.

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