EX-99.1 2 a991earningsrelease930.htm EXHIBIT 99.1 Exhibit

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Tyler Technologies Reports Earnings for Third Quarter 2019

Revenues grow 16.7% as operating cash flows reach new quarterly high

PLANO, Texas – October 30, 2019 – Tyler Technologies, Inc. (NYSE: TYL) today announced financial results for the third quarter ended September 30, 2019.

Third Quarter 2019 Financial Highlights:

•
Total revenues were $275.4 million, up 16.7% from $236.1 million for the third quarter of 2018. Organic revenue growth was 8.9%. Non-GAAP total revenues were $277.2 million, up 16.7% from $237.6 million for the third quarter of 2018. Non-GAAP organic revenue growth was 8.3%.
•
Recurring revenues from maintenance and subscriptions were $185.1 million, an increase of 19.5% compared to the third quarter of 2018, and comprised 67.2% of third quarter 2019 revenue.
•
Operating income was $40.1 million, up 6.6% from $37.6 million for the third quarter of 2018. Non-GAAP operating income was $71.0 million, up 10.3% from $64.3 million for the third quarter of 2018.
•
Net income was $40.4 million, or $1.00 per diluted share, up 3.8% compared to $38.9 million, or $0.96 per diluted share, for the third quarter of 2018. Non-GAAP net income was $54.3 million, or $1.35 per diluted share, up 9.3% compared to $49.7 million, or $1.23 per diluted share, for the third quarter of 2018.
•
Cash flows from operations were $130.1 million, up 16.0% compared to $112.1 million for the third quarter of 2018.
•
Adjusted EBITDA was $77.1 million, up 9.3% compared to $70.5 million for the third quarter of 2018.
•
Software subscription arrangements comprised approximately 51% of the total new software contract value in the third quarter, compared to approximately 37% in the third quarter of 2018.
•
Subscription bookings in the third quarter added $10.6 million in annual recurring revenue.
•
Total backlog was $1.41 billion, up 13.9% from $1.24 billion at September 30, 2018. Software-related backlog (excluding appraisal services) was $1.38 billion, up 14.9% from $1.20 billion at September 30, 2018.
•
Effective January 1, 2019, Tyler adopted the requirements of ASU No. 2016-02, Leases (Topic 842), utilizing the modified retrospective method of transition.

“Our execution in the third quarter was solid as we continued to build on a strong first half of the year,” said Lynn Moore, Tyler’s president and chief executive officer. “We achieved double-digit growth over last year in all of our software-related revenue lines, and organic revenue growth continued to accelerate sequentially. Subscription revenue once again led our growth, rising 28.2%, and software license and royalty revenue grew 13.1%. In addition, non-GAAP diluted earnings per share and free cash flow both reached new quarterly highs.

"Bookings in the third quarter were solid at approximately $259 million, up 1.6% over the prior year. For the trailing twelve months, bookings were up 18.9%. We signed a record number of new software contracts this



Tyler Technologies Reports Earnings
For Third Quarter 2019
October 30, 2019
Page 2

quarter, and for the first nine months of 2019, the total number of new software contracts signed has already surpassed the total signed for the full year of 2018. Bookings and revenue growth in the quarter were both affected by delays in the timing of several federal contracts at MicroPact, as an increasing amount of that business is coming through its partner channel. Several significant deals were signed by partners at the end of the quarter, but the related contracts with MicroPact were not executed until October and will be recognized in the fourth quarter.

"We're excited about the recently announced strategic collaboration agreement with Amazon Web Services (AWS), which deepens our existing relationship by leveraging the AWS cloud to lay the groundwork for the future of cloud services for the public sector. This agreement provides the framework for development, training and collaboration in order to support next-generation applications that have the scalability, resiliency and security AWS offers. We look forward to working with AWS on accelerating innovation and the development of strategic initiatives.

"We're also pleased to announce today the acquisition of Courthouse Technologies (CHT), a leading provider of jury management systems. CHT's software-as-a-service solution serves courts of all sizes across the United States and Canada and complements and elevates Tyler's existing solutions for courts," added Moore.


Guidance for 2019

As of October 30, 2019, Tyler Technologies is providing the following guidance for the full year 2019:

•
GAAP total revenues are expected to be in the range of $1.082 billion to $1.095 billion. Non-GAAP total revenues are expected to be in the range of $1.090 billion to $1.103 billion.
•
GAAP diluted earnings per share are expected to be in the range of $3.50 to $3.63 and may vary significantly due to the impact of stock incentive awards on the GAAP effective tax rate, as well as final valuation of acquired intangibles.
•
Non-GAAP diluted earnings per share are expected to be in the range of $5.22 to $5.35.
•
Pretax non-cash, share-based compensation expense is expected to be approximately $62 million.
•
Research and development expense is expected to be in the range of $81 million to $83 million.
•
Fully diluted shares for the year are expected to be in the range of $40 million to $40.5 million shares.
•
GAAP earnings per share assumes an estimated annual effective tax rate of approximately 10% after discrete tax items and includes approximately $27 million of discrete tax benefits related to share-based compensation.
•
The non-GAAP annual effective tax rate is expected to be 24%.
•
Capital expenditures are expected to be in the range of $45 million to $47 million, including approximately $20 million related to real estate and approximately $6 million of capitalized software development costs related to MicroPact. Total depreciation and amortization expense is expected to be approximately $76 million, including approximately $52 million from amortization of acquisition intangibles.

GAAP to non-GAAP guidance reconciliation



Tyler Technologies Reports Earnings
For Third Quarter 2019
October 30, 2019
Page 3

Non-GAAP total revenues is derived from adding back the estimated full year impact of write-downs of acquisition-related deferred revenue and amortization of acquired leases of approximately $8 million. Non-GAAP diluted earnings per share excludes the estimated full year impact of non-cash share-based compensation expense and employer portion of payroll tax related to employee stock transactions of approximately $62 million, and amortization of acquired software and intangible assets of approximately $52 million. Additionally, the non-GAAP tax rate of 24% is estimated periodically as described below under "Non-GAAP Financial Measures" and excludes approximately $27 million of estimated discrete tax benefits that are included in the GAAP estimated annual effective tax rate.

Conference Call

Tyler Technologies will hold a conference call on Thursday, October 31, at 10:00 a.m. EDT to discuss the company’s results. The company is offering participants the opportunity to register in advance for the conference through the following link: http://dpregister.com/10134985. Registered participants will receive an email with a calendar reminder and a dial-in number and PIN that will allow them to listen to the call live.

Participants who do not wish to pre-register for the call may dial in using 844-861-5506 (U.S. callers) or 412-317-6587 (international callers) or 866-450-4696 (Canada callers) and ask for the “Tyler Technologies” call. A replay will be available two hours after completion of the call through November 7, 2019. To access the replay, please dial 877-344-7529 (U.S. callers), 412-317-0088 (international callers) and 855-669-9658 (Canada callers) and reference passcode 10134985.

The live webcast and archived replay can also be accessed at https://tylertech.irpass.com/Presentations.

About Tyler Technologies, Inc.

Tyler Technologies (NYSE: TYL) is the largest and most established provider of integrated software and technology services focused on the public sector. Tyler’s end-to-end solutions empower local, state, and federal government entities to operate more efficiently and connect more transparently with their constituents and with each other. By connecting data and processes across disparate systems, Tyler’s solutions are transforming how clients gain actionable insights that solve problems in their communities. Tyler has more than 21,000 successful installations across 10,000 sites, with clients in all 50 states, Canada, the Caribbean, Australia, and other international locations. A financially strong company, Tyler has achieved double-digit revenue growth every quarter since 2012. It was also named to Forbes’ "Best Midsize Employers" list in 2018 and recognized twice on its "Most Innovative Growth Companies" list. More information about Tyler Technologies, headquartered in Plano, Texas, can be found at tylertech.com.

Non-GAAP Financial Measures

Tyler Technologies has provided in this press release financial measures that have not been prepared in accordance with generally accepted accounting principles (GAAP) and are therefore considered non-GAAP financial measures. This information includes non-GAAP revenues, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, non-GAAP earnings per diluted share, EBITDA, and adjusted EBITDA. We use these non-GAAP financial measures internally in analyzing our financial results and believe they are useful to investors, as a supplement to GAAP measures, in evaluating Tyler’s ongoing operational performance because they provide additional insight in comparing results from period to period. Tyler believes the use of these non-GAAP financial measures



Tyler Technologies Reports Earnings
For Third Quarter 2019
October 30, 2019
Page 4

provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial results with other companies in our industry, many of which present similar non-
GAAP financial measures. Non-GAAP financial measures discussed above exclude write-downs of acquisition-related deferred revenue and acquired leases, share-based compensation expense, employer portion of payroll taxes on employee stock transactions, expenses associated with amortization of intangibles arising from business combinations, and acquisition-related expenses.

Tyler currently uses a non-GAAP tax rate of 24%. This rate is based on Tyler's estimated annual GAAP income tax rate forecast, adjusted to account for items excluded from GAAP income in calculating Tyler's non-GAAP income, as well as significant non-recurring tax adjustments. The non-GAAP tax rate used in future periods will be reviewed periodically to determine whether it remains appropriate in consideration of factors including Tyler's periodic effective tax rate calculated in accordance with GAAP, changes resulting from tax legislation, changes in the geographic mix of revenues and expenses, and other factors deemed significant. Due to differences in tax treatment of items excluded from non-GAAP earnings, as well as the methodology applied to Tyler's estimated annual tax rate as described above, the estimated tax rate on non-GAAP income may differ from the GAAP tax rate and from Tyler's actual tax liabilities.

Non-GAAP financial measures should be considered in addition to, and not as a substitute for, or superior to, financial information prepared in accordance with GAAP. The non-GAAP measures used by Tyler Technologies may be different from non-GAAP measures used by other companies. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures, which has been provided in the financial statement tables included below in this press release.
 
Forward-looking Statements

This document contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that are not historical in nature and typically address future or anticipated events, trends, expectations or beliefs with respect to our financial condition, results of operations or business. Forward-looking statements often contain words such as “believes,” “expects,” “anticipates,” “foresees,” “forecasts,” “estimates,” “plans,” “intends,” “continues,” “may,” “will,” “should,” “projects,” “might,” “could” or other similar words or phrases. Similarly, statements that describe our business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. We believe there is a reasonable basis for our forward-looking statements, but they are inherently subject to risks and uncertainties and actual results could differ materially from the expectations and beliefs reflected in the forward-looking statements. We presently consider the following to be among the important factors that could cause actual results to differ materially from our expectations and beliefs: (1) changes in the budgets or regulatory environments of our clients, primarily local and state governments, that could negatively impact information technology spending; (2) our ability to protect client information from security breaches and provide uninterrupted operations of data centers; (3) our ability to achieve growth or operational synergies through the integration of acquired businesses, while avoiding unanticipated costs and disruptions to existing operations; (4) material portions of our business require the Internet infrastructure to be adequately maintained; (5) our ability to achieve our financial forecasts due to various factors, including project delays by our clients, reductions in transaction size, fewer transactions, delays in delivery of new products or releases or a decline in our renewal rates for service agreements; (6) general economic, political and market conditions; (7) technological and market risks associated with the development of new products or services or of new versions of existing or acquired products or services; (8) competition in the industry in which we



Tyler Technologies Reports Earnings
For Third Quarter 2019
October 30, 2019
Page 5

conduct business and the impact of competition on pricing, client retention and pressure for new products or services; (9) the ability to attract and retain qualified personnel and dealing with the loss or retirement of key members of management or other key personnel; and (10) costs of compliance and any failure to comply with government and stock exchange regulations. These factors and other risks that affect our business are described in our filings with the Securities and Exchange Commission, including the detailed “Risk Factors” contained in our most recent annual report on Form 10-K. We expressly disclaim any obligation to publicly update or revise our forward-looking statements.
###
(Comparative results follow)

Contact: Brian K. Miller
Executive Vice President & CFO
Tyler Technologies, Inc.
972-713-3720
brian.miller@tylertech.com

19-75




TYLER TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Amounts in thousands, except per share data)
(Unaudited)


 


 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2019
 
2018
 
2019
 
2018
 
 
 
 
 
 
 
 
 
Software licenses and royalties
 
$
25,379

 
$
22,444

 
$
67,847

 
$
67,620

Subscriptions
 
75,272

 
58,699

 
216,022

 
160,736

Software services
 
54,997

 
48,199

 
160,841

 
144,812

Maintenance
 
109,833

 
96,215

 
316,674

 
286,188

Appraisal services
 
6,008

 
5,544

 
17,455

 
16,470

Hardware and other
 
3,911

 
4,966

 
18,751

 
17,475

Total revenues
 
275,400

 
236,067

 
797,590

 
693,301

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Software licenses and royalties
 
971

 
957

 
2,680

 
2,939

Acquired software
 
7,975

 
5,897

 
22,645

 
17,003

Software services, maintenance and subscriptions
 
128,545

 
111,508

 
371,464

 
327,080

Appraisal services
 
4,096

 
3,505

 
11,306

 
10,854

Hardware and other
 
3,096

 
2,574

 
14,870

 
11,718

Total cost of revenues
 
144,683

 
124,441

 
422,965

 
369,594

 
 
 
 
 
 
 
 
 
  Gross profit
 
130,717

 
111,626

 
374,625

 
323,707

 
 
 
 
 
 
 
 
 
Selling, general and administrative expenses
 
63,888

 
52,605

 
187,481

 
152,471

Research and development expense
 
21,130

 
17,050

 
60,172

 
45,929

Amortization of customer and trade name intangibles
 
5,646

 
4,386

 
15,762

 
11,742

  Operating income
 
40,053

 
37,585

 
111,210

 
113,565

Other income, net
 
499

 
1,041

 
838

 
2,198

Income before income taxes
 
40,552

 
38,626

 
112,048

 
115,763

Income tax provision (benefit)
 
162

 
(298
)
 
12,311

 
(147
)
Net income
 
$
40,390

 
$
38,924

 
$
99,737

 
$
115,910

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Earnings per common share:
 
 
 
 
 
 
 
 
   Basic
 
$
1.04

 
$
1.00

 
$
2.58

 
$
3.01

   Diluted
 
$
1.00

 
$
0.96

 
$
2.49

 
$
2.87

 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding:
 
 
 
 
 
 
 
 
   Basic
 
38,765

 
38,761

 
38,614

 
38,533

   Diluted
 
40,280

 
40,528

 
40,015

 
40,345






TYLER TECHNOLOGIES, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(Amounts in thousands, except per share data)
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2019
 
2018
 
2019
 
2018
Reconciliation of non-GAAP total revenues
 
 
 
 
 
 
 
 
GAAP total revenues
 
$
275,400

 
$
236,067

 
$
797,590

 
$
693,301

Non-GAAP adjustments:
 
 
 
 
 
 
 
 
  Add: Write-downs of acquisition-related deferred revenue
 
1,698

 
1,397

 
6,052

 
3,048

  Add: Amortization of acquired leases
 
89

 
104

 
289

 
326

Non-GAAP total revenues
 
$
277,187

 
$
237,568

 
$
803,931

 
$
696,675

 
 
 
 
 
 
 
 
 
Reconciliation of non-GAAP gross profit and margin
 
 
 
 
 
 
 
 
GAAP gross profit
 
$
130,717

 
$
111,626

 
$
374,625

 
$
323,707

Non-GAAP adjustments:
 
 
 
 
 
 
 
 
  Add: Write-downs of acquisition-related deferred revenue
 
1,698

 
1,397

 
6,052

 
3,048

  Add: Amortization of acquired leases
 
89

 
104

 
289

 
326

  Add: Share-based compensation expense included in cost of revenues
3,612

 
3,909

 
11,166

 
9,640

  Add: Amortization of acquired software
 
7,975

 
5,897

 
22,645

 
17,003

Non-GAAP gross profit
 
$
144,091

 
$
122,933

 
$
414,777

 
$
353,724

GAAP gross margin
 
47.5
%
 
47.3
%
 
47.0
%
 
46.7
%
Non-GAAP gross margin
 
52.0
%
 
51.7
%
 
51.6
%
 
50.8
%
 
 
 
 
 
 
 
 
 
Reconciliation of non-GAAP operating income and margin
 
 
 
 
 
 
 
 
GAAP operating income
 
$
40,053

 
$
37,585

 
$
111,210

 
$
113,565

Non-GAAP adjustments:
 
 
 
 
 
 
 
 
  Add: Write-downs of acquisition-related deferred revenue
 
1,698

 
1,397

 
6,052

 
3,048

  Add: Amortization of acquired leases
 
89

 
104

 
289

 
326

  Add: Share-based compensation expense
 
14,887

 
14,476

 
44,369

 
37,966

  Add: Employer portion of payroll tax related to employee stock transactions
621

 
484

 
1,052

 
1,408

  Add: Acquisition related costs
 
5

 
—

 
945

 
—

  Add: Amortization of acquired software
 
7,975

 
5,897

 
22,645

 
17,003

  Add: Amortization of customer and trade name intangibles
 
5,646

 
4,386

 
15,762

 
11,742

Non-GAAP adjustments subtotal
 
30,921

 
26,744

 
$
91,114

 
$
71,493

Non-GAAP operating income
 
$
70,974

 
$
64,329

 
$
202,324

 
$
185,058

GAAP operating margin
 
14.5
%
 
15.9
%
 
13.9
%
 
16.4
%
Non-GAAP operating margin
 
25.6
%
 
27.1
%
 
25.2
%
 
26.6
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 



TYLER TECHNOLOGIES, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(Amounts in thousands, except per share data)
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


 
 
 
 
 
 
 
 
 
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2019
 
2018
 
2019
 
2018
Reconciliation of non-GAAP net income and earnings per share
 
 
 
 
 
 
 
 
GAAP net income
 
$
40,390

 
$
38,924

 
$
99,737

 
$
115,910

Non-GAAP adjustments:
 
 
 
 
 
 
 
 
  Add: Total non-GAAP adjustments to operating income
 
30,921

 
26,744

 
91,114

 
71,493

  Less: Tax impact related to non-GAAP adjustments
 
(16,992
)
 
(15,987
)
 
(36,448
)
 
(45,088
)
Non-GAAP net income
 
$
54,319

 
$
49,681

 
$
154,403

 
$
142,315

GAAP earnings per diluted share
 
$
1.00

 
$
0.96

 
$
2.49

 
$
2.87

Non-GAAP earnings per diluted share
 
$
1.35

 
$
1.23

 
$
3.86

 
$
3.53

 
 
 
 
 
 
 
 
 
Detail of share-based compensation expense
 
 
 
 
 
 
 
 
Cost of software services, maintenance and subscriptions
 
$
3,612

 
$
3,909

 
$
11,166

 
$
9,640

Selling, general and administrative expenses
 
11,275

 
10,567

 
33,203

 
28,326

Total share-based compensation expense
 
$
14,887

 
$
14,476

 
$
44,369

 
$
37,966

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Reconciliation of EBITDA and adjusted EBITDA
 
 
 
 
 
 
 
 
GAAP net income
 
$
40,390

 
$
38,924

 
$
99,737

 
$
115,910

Amortization of customer and trade name intangibles
 
5,646

 
4,386

 
15,762

 
11,742

Depreciation and amortization included in
 
 
 
 
 
 
 
 
    cost of revenues, SG&A and other expenses
 
14,076

 
11,466

 
40,639

 
33,472

Interest expense included in other income, net
 
236

 
192

 
1,409

 
570

Income tax provision
 
162

 
(298
)
 
12,311

 
(147
)
EBITDA
 
$
60,510

 
$
54,670

 
$
169,858

 
$
161,547

Write-downs of acquisition-related deferred revenue
 
1,698

 
1,397

 
6,052

 
3,048

Share-based compensation expense
 
14,887

 
14,476

 
44,369

 
37,966

Acquisition related costs
 
5

 
—

 
$
945

 
$
—

Adjusted EBITDA
 
$
77,100

 
$
70,543

 
$
221,224

 
$
202,561






TYLER TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
 (Unaudited)


 
 
September 30, 2019
 
December 31, 2018
ASSETS
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
     Cash and cash equivalents
 
$
161,438

 
$
134,279

     Accounts receivable, net
 
347,982

 
298,912

     Current investments and other assets
 
60,382

 
80,970

     Income tax receivable
 
4

 
4,697

           Total current assets
 
569,806

 
518,858

 
 
 
 
 
Accounts receivable, long-term portion
 
20,437

 
16,020

Operating lease right-of-use assets
 
20,172

 
—

Property and equipment, net
 
169,950

 
155,177

 
 
 
 
 
Other assets:
 
 
 
 
     Goodwill
 
826,040

 
753,718

     Other intangibles, net
 
377,580

 
276,852

     Non-current investments and other assets
 
71,104

 
70,338

 
 
 
 
 
Total assets
 
$
2,055,089

 
$
1,790,963

 
 
 
 
 
 
 
 
 
 
LIABILITIES AND SHAREHOLDERS' EQUITY
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
     Accounts payable and accrued liabilities
 
$
78,841

 
$
73,390

Current income tax payable
 
—

 
—

Operating lease liabilities
 
6,413

 
—

     Deferred revenue
 
391,560

 
350,512

           Total current liabilities
 
476,814

 
423,902

 
 
 
 
 
Revolving line of credit
 
—

 
—

Deferred revenue, long-term
 
241

 
424

Deferred income taxes
 
40,303

 
41,791

Operating lease liabilities, long-term
 
18,134

 
—

Shareholders' equity
 
1,519,597

 
1,324,846

 
 
 
 
 
Total liabilities and shareholders' equity
 
$
2,055,089

 
$
1,790,963

 
 
 
 
 




 
TYLER TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(Unaudited)

 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2019
 
2018
 
2019
 
2018
Cash flows from operating activities:
 
 
 
 
 
 
 
 
    Net income
 
$
40,390

 
$
38,924

 
$
99,737

 
$
115,910

    Adjustments to reconcile net income to cash
 
 
 
 
 
 
 
 
      provided by operations:
 
 
 
 
 
 
 
 
      Depreciation and amortization
 
19,803

 
15,978

 
56,547

 
45,627

      Share-based compensation expense
 
14,887

 
14,476

 
44,369

 
37,966

      Operating lease right-of-use assets - non cash
 
3,979

 
—

 
3,979

 
—

      Deferred income tax (benefit) expense
 
(2,889
)
 
162

 
(10,329
)
 
(5,034
)
      Changes in operating assets and liabilities,
 
 
 
 
 
 
 
 
      exclusive of effects of acquired companies
 
53,903

 
42,583

 
(15,776
)
 
(15,116
)
Net cash provided by operating activities
 
130,073

 
112,123

 
178,527

 
179,353

 
 
 
 
 
 
 
 
 
Cash flows from investing activities:
 
 
 
 
 
 
 
 
Additions to property and equipment
 
(4,781
)
 
(8,508
)
 
(28,833
)
 
(23,460
)
Purchase of marketable security investments
 
(17,205
)
 
(17,788
)
 
(27,322
)
 
(92,638
)
Proceeds from marketable security investments
 
17,166

 
21,054

 
56,854

 
60,208

Investment in software
 
(1,308
)
 
—

 
(3,540
)
 
—

Cost of acquisitions, net of cash acquired
 
(650
)
 
(10,156
)
 
(199,870
)
 
(167,308
)
(Increase) decrease in other
 
(925
)
 
1,043

 
(493
)
 
857

Net cash used by investing activities
 
(7,703
)
 
(14,355
)
 
(203,204
)
 
(222,341
)
 
 
 
 
 
 
 
 
 
Cash flows from financing activities:
 
 
 
 
 
 
 
 
Decrease in net borrowings on revolving line of credit
 
(15,000
)
 
—

 
—

 
—

Purchase of treasury shares
 
—

 
—

 
(17,786
)
 
—

Proceeds from exercise of stock options
 
40,163

 
26,219

 
62,295

 
70,536

Contributions from employee stock purchase plan
 
2,718

 
2,218

 
7,327

 
5,978

Net cash provided by financing activities
 
27,881

 
28,437

 
51,836

 
76,514

 
 
 
 
 
 
 
 
 
Net increase in cash and cash equivalents
 
150,251

 
126,205

 
27,159

 
33,526

Cash and cash equivalents at beginning of period
 
11,187

 
93,247

 
134,279

 
185,926

 
 
 
 
 
 
 
 
 
Cash and cash equivalents at end of period
 
$
161,438

 
$
219,452

 
$
161,438

 
$
219,452