FactSet Research Systems Reports Results for the First Quarter of Fiscal 2010

Norwalk, Connecticut – December 15, 2009 – FactSet Research Systems Inc. (NYSE: FDS) (NASDAQ: FDS), a leading provider of integrated financial information and analytical applications to the global investment community, today announced its results for the first quarter of fiscal 2010.

For the quarter ended November 30, 2009, revenues were $155.2 million, down 0.2% compared to the prior year. Operating income for the first quarter advanced to $54.0 million, up 5% from $51.3 million in the same period of fiscal 2009. Net income rose to $36.1 million as compared to $35.6 million a year ago. Diluted earnings per share increased to $0.74, up from $0.73 in the same period of fiscal 2009. Included in the prior year first quarter were income tax benefits of $1.4 million or $0.03 per diluted share related to the reenactment of the U.S. Federal R&D credit in October 2008, retroactive to January 1, 2008.

“While our business stabilizes, FactSet continues to invest for the future as we focus on increasing earnings per share. We are pleased with the adoption rate of both our proprietary content and new platform,” said Phil Hadley, Chairman and CE0. “We successfully released a new platform this quarter and early client acceptance metrics are very strong.”

Annual Subscription Value (“ASV”)
ASV increased $2 million during the first quarter. Excluding the first time inclusion of non-subscription revenues, ASV decreased $2 million organically during the quarter. ASV was $621 million at November 30, 2009. Of this total, 82% is derived from buy-side clients and the remainder is from the sell-side firms who perform M&A advisory work and equity research. ASV at any given point in time represents the forward-looking revenues for the next 12 months from all annual subscription services currently being supplied to clients in addition to the trailing 12 months of non-subscription revenues derived from workstations sold to summer interns, introducing brokerage services, M&A related publications and the Partner software product.

Financial Highlights

• ASV from FactSet’s U.S. operations was $420 million and $201 million related to international operations.
• U.S. revenues were $105 million, down 1% from the year ago quarter.
• Non-U.S. revenues increased 1% to $50 million.
• Operating margins expanded 180 basis points to 34.8%.
• Free cash flow was $18.5 million.
• The effective tax rate for the quarter was 33.4%.
• Cash and investments in marketable securities were $218 million at November 30, 2009.
• Accounts receivable decreased $3 million or 4% over the last three months.

Operational Highlights

• Professionals using FactSet increased to 37,400, up 100 users.
• Client count was 2,044 at November 30, a net decrease of 1 client during the quarter.
• Annual client retention rate was greater than 95% of ASV and 87% of clients.
• Portfolio Analytics (“PA”) 2.0 was deployed by 647 clients representing 5,670 users. PA users increased by 30 during the quarter, while the number of PA clients remained the same as the previous quarter.
• Employee count at November 30, 2009 was 3,269, up 300 employees during the quarter. Over 90% of the increase in headcount during the quarter was driven by the expansion of FactSet’s proprietary content operation.
• Capital expenditures were $6.5 million, net of landlord contributions for construction of $0.2 million. Approximately 80% of capital expenditures were for computer equipment and the remainder covered office space expansion.
• On September 14, 2009, FactSet announced the release of the Company’s newest financial software platform. The new FactSet consolidates data and analytics, previously spread across multiple applications, onto one comprehensive, intuitive interface.

View the complete release and related financial tables >>