Blackbaud, Inc. (BLKB - Free Report) delivered fourth-quarter 2019 non-GAAP earnings of 51 cents per share, outpacing the Zacks Consensus Estimate by 2%. However, the figure declined 21.5% from the year-ago quarter.
Total non-GAAP revenues increased 7.3% year over year to $238.1 million, beating the consensus mark by 2.9%
Quarter in Detail
Blackbaud reports maintenance and subscriptions under recurring revenues as it is shifting toward a cloud-based subscription model from the traditional revenue-based model.
Total non-GAAP recurring revenues for the reported quarter were $220.1 million, accounting for 92.4% of total non-GAAP revenues. The figure was also up 9.8% year over year.
One-time services and other revenues were $18 million, down 15.4% year over year.
Non-GAAP organic revenues improved 4.6% year over year to $231.9 million. Meanwhile, non-GAAP organic recurring revenues advanced 6.7% to $214 million.
Non-GAAP gross margin contracted 280 basis points (bps) on a year-over-year basis to 56%.
Research & development expenses, as a percentage of revenues, expanded 40 bps from the year-ago quarter to 10.9%. Moreover, sales, marketing & customer success, and general & administrative expenses expanded 200 bps and 20 bps, respectively.
Non-GAAP operating margin contracted 420 bps from the year-ago figure to 14.9%.
Balance Sheet & Cash Flow
As on Dec 31, 2019, Blackbaud had cash and cash equivalents of $31.8 million compared with $29.1 million as of Sep 30, 2019.
Total debt (including current portion) as of Dec 31, amounted to $467.1 million compared with $503.1 million as of Sep 30, 2019.
Cash flow from operating activities as of Dec 31, 2019 was $182.5 million. Non-GAAP free cash flow during the quarter was $46.1 million.
The company recently approved a quarterly dividend payment of 12 cents per share to be paid out on Mar 13 to shareholders of record as of Feb 28, 2020.
For full-year 2020, the company anticipates revenues of $930-$955 million. The Zacks Consensus Estimate is currently pegged at $939 million, indicating year-over-year growth of 4.8%
Blackbaud anticipates non-GAAP earnings of $2.20-$2.35 per share for 2020. The Zacks Consensus Estimate is pegged at $2.23 per share, indicating year-over-year decline of 0.15%
Non-GAAP operating margin is projected to be 16%-16.5%.
Non-GAAP free cash flow is expected to be in the range of $100-$115 million for 2020.
Zacks Rank & Stocks to Consider
Blackbaud currently carries a Zacks Rank #3 (Hold).
Applied Materials, Inc. (AMAT - Free Report) , Alteryx, Inc. (AYX - Free Report) and Five9, Inc. (FIVN - Free Report) are some better-ranked stocks in the broader computer and technology sector. Applied Materials and Alteryx sport a Zacks Rank #1 (Strong Buy), while Five9 carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Applied Materials, Alteryx and Five9 are set to report quarterly results on Feb 12, 13 and 19, respectively.
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