Intuit Closes Financial Services Transaction; Updates Fourth-quarter and Full-year Guidance
MOUNTAIN VIEW, Calif – Aug. 01, 2013 – Intuit Inc. (Nasdaq: INTU) today announced the close of the divestiture of its Financial Services business as the company shifts to focus on directly serving small businesses, consumers and the accountants who serve them. With the transaction completed, the company updated fourth-quarter and full-year guidance.
Intuit announced on July 1 that a private equity firm, Thoma Bravo, would purchase the Intuit Financial Services division, or IFS. The cash transaction is valued at approximately $1.025 billion. Intuit plans to use existing cash and the proceeds of this transaction to accelerate repurchase of its shares.
“Divesting the Financial Services business provides Intuit with the opportunity to focus more directly on being the operating system behind small business success and doing the nations’ taxes,” said Brad Smith, Intuit president and chief executive officer. “For the newly formed Digital Insight team, this is an exciting new beginning as they set out on their own in the growing digital banking space.”
Adjusting for events and charges subsequent to the guidance provided on May 21, Intuit expects revenue, operating income and earnings per share in line with previous fourth-quarter and fiscal 2013 guidance.
With Intuit Financial Services and Intuit Health Group, which the company also plans to divest, classified as discontinued operations, Intuit has revised its fourth-quarter and full-year guidance. Intuit Financial Services and Intuit Health Group are expected to contribute revenue of approximately $90 million in the fourth quarter of fiscal 2013 and $340 million for the full fiscal year. The following figures include approximately $20 million of restructuring-related severance expense and other nonrecurring costs.
For the fourth quarter of fiscal 2013 which ended July 31, Intuit now expects:
Intuit also revised revenue, operating income, and earnings per share guidance for the total company for fiscal 2013:
Intuit will announce its fourth-quarter results for fiscal year 2013 on Aug. 20 following the close of market.
About Intuit Inc.
Intuit Inc. creates business and financial management solutions that simplify the business of life for small and mid-sized businesses, consumers and accounting professionals.
Its flagship products and services include QuickBooks®, Quicken® and TurboTax®, which make it easier to manage small businesses and payroll processing, personal finance, and tax preparation and filing. Mint.com provides a fresh, easy and intelligent way for people to manage their money, while Demandforce® offers marketing and communication tools for small businesses. ProSeries® and Lacerte® are Intuit's leading tax preparation offerings for professional accountants.
Founded in 1983, Intuit had revenue of $4.15 billion in its fiscal year 2012. The company has approximately 8,200 employees with major offices in the United States, Canada, the United Kingdom, India and other locations. More information can be found at www.intuit.com.
About Non-GAAP Financial Measures
This press release includes non-GAAP financial measures. For a description of these non-GAAP financial measures, including the reasons management uses each measure, and reconciliations of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with Generally Accepted Accounting Principles, please see the section of the accompanying Table 1 titled "About Non-GAAP Financial Measures."
Cautions About Forward-Looking Statements
This press release contains forward-looking statements, including statements about Intuit’s plans to accelerate the repurchase of its shares and the planned divestiture of Intuit Health Group and forecasts of Intuit’s future expected financial results for the fourth fiscal quarter of 2013 and the 2013 fiscal year.
Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause our actual results to differ materially from the expectations expressed in the forward-looking statements. These factors include, without limitation, the following: inherent difficulty in predicting consumer behavior; difficulties in receiving, processing, or filing customer tax submissions; consumers may not respond as we expected to our advertising and promotional activities; product introductions and price competition from our competitors can have unpredictable negative effects on our revenue, profitability and market position; governmental encroachment in our tax businesses or other governmental activities or public policy affecting the preparation and filing of tax returns could negatively affect our operating results and market position; we may not be able to successfully innovate and introduce new offerings and business models to meet our growth and profitability objectives, and current and future offerings may not adequately address customer needs and may not achieve broad market acceptance, which could harm our operating results and financial condition; business interruption or failure of our information technology and communication systems may impair the availability of our products and services, which may damage our reputation and harm our future financial results; as we upgrade and consolidate our customer facing applications and supporting information technology infrastructure, any problems with these implementations could interfere with our ability to deliver our offerings; any failure to properly use and protect personal customer information and data could harm our revenue, earnings and reputation; if we are unable to develop, manage and maintain critical third party business relationships, our business may be adversely affected; increased government regulation of our businesses may harm our operating results; if we fail to process transactions effectively or fail to adequately protect against potential fraudulent activities, our revenue and earnings may be harmed; any significant offering quality problems or delays in our offerings could harm our revenue, earnings and reputation; our participation in the Free File Alliance may result in lost revenue opportunities and cannibalization of our traditional paid franchise; the continuing global economic downturn may continue to impact consumer and small business spending, financial institutions and tax filings, which could negatively affect our revenue and profitability; year-over-year changes in the total number of tax filings that are submitted to government agencies due to economic conditions or otherwise may result in lost revenue opportunities; our revenue and earnings are highly seasonal and the timing of our revenue between quarters is difficult to predict, which may cause significant quarterly fluctuations in our financial results; our financial position may not make repurchasing shares advisable or we may issue additional shares in an acquisition causing our number of outstanding shares to grow; our inability to adequately protect our intellectual property rights may weaken our competitive position and reduce our revenue and earnings; our acquisition and divestiture activities may disrupt our ongoing business, may involve increased expenses and may present risks not contemplated at the time of the transactions; our use of significant amounts of debt to finance acquisitions or other activities could harm our financial condition and results of operation; and litigation involving intellectual property, antitrust, shareholder and other matters may increase our costs. More details about these and other risks that may impact our business are included in our Form 10-K for fiscal 2012 and in our other SEC filings. You can locate these reports through our website at http://investors.intuit.com. Forward-looking statements are based on information as of August 1, 2013, and we do not undertake any duty to update any forward-looking statement or other information in these materials.
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