Ebix, Inc. (NASDAQ: EBIX), a leading international supplier of
On-Demand software and E-commerce services to the insurance,
financial, healthcare and e-learning industries, provided a
business update today and announced plans to grow in international
markets in the converged areas of insurance and finance, in 2019
and beyond.
The Company laid out its expansion plans in the
Middle East, ASEAN and Pacific markets in the near term, while
focusing on the deployment of its converged insurance and finance
offerings.
- US Insurance Businesses - Recent executive
appointments and realignments in Ebix’s core insurance businesses
in the US have resulted in new exchange clients in multiple areas
ranging from Annuities, Life and Health to the strategic RCS areas
of the business. This business segment finished 2018 on a strong
note with the signing of four new Annuities carriers in the fourth
quarter.
- International Insurance Businesses – Ebix’s
Australia business achieved record results in the fourth quarter,
in local currency terms. Ebix also announced that its other
international insurance operations have continued to build on their
recurring business streams in 2018 and entered the new year with
strong new business pipelines and a very solid business
outlook.
- International Expansion – Ebix announced its
near-term intentions to expand internationally into newer
geographies like Muscat, Abu Dhabi, Bahrain, Thailand, Malaysia,
etc. in addition to plans underway for meaningful growth in Dubai.
These growth initiatives will be principally organic, though
supplemented as possible via strategic acquisitions.
- Foreign Exchange Growth – In the past few
months Ebix has substantially expanded its foreign exchange
operations with the acquisitions of Weizmann Forex and Essel Forex
in addition to securing Forex contracts at new airports in India
and UAE. The acquisitions established Ebix as a dominant foreign
exchange provider in India, while enhancing Ebix’s position in
international markets. Ebix has fully implemented the new domestic
forex airport deal, and is presently in the midst of implementing
the UAE international airport forex counters, having already
deposited its financial commitment amounts worth a few million in
local currency terms, as laid out by the Airport authority. Ebix
anticipates a joint announcement of its UAE Forex counters when
they go live in accordance with the Authority’s publicity
strategy.
- Regulatory Compliance Update – Ebix conveyed
its strong and continued commitment to regulatory compliance,
confirming that at present it does not have any open issues with
any regulatory authorities in any country.
- Tax Compliance Update – Ebix also confirmed
that it does not have any open tax audits or reviews in its top two
business geographies of India and the US, nor does it have any open
statutory tax audits in any other geography at present except for
Australia. Ebix also announced that the recent sales tax (GST)
issue in India, related to its ITZCash acquisition has amicably
been settled for a non-material amount, to the satisfaction of both
the parties. The GST issue was related to an industry wide issue
that preceded 4 years of time before Ebix bought ITZCash and a
nine-month period after its acquisition by Ebix, related to the
recent GST act enacted by the Government and the complexity around
its implementation. With Ebix having been indemnified by the
previous owners of ITZCash for any tax issues preceding the
acquisition date, the issue was immaterial for Ebix.
- Transition Tax –
Ebix also announced that as a part of the Trump Tax and Jobs act,
all US multinational companies are supposed to agree to a one-time
transition tax on their foreign earnings by the end of 2018, with
the amount payable over a period of 8 years on an interest free
basis to the IRS. Ebix announced that in compliance with the Act,
it has agreed to pay the IRS a sum of $21.9 million over 8 years,
on an interest free basis. Ebix is encouraged by the overall impact
of the Trump Tax reform, as it reduces the Corporate tax rate going
forward to 21% while opening up tremendous possibilities for
American companies to do business globally and keeping the US at
the center of their growth activities.
- Share Repurchases
- Since October 1, 2018, Ebix has repurchased 1.06 million shares
of its common stock for an aggregate amount of $49.6 million,
including 200,000 shares repurchased from the Rennes Foundation in
an arms-length transaction at a 2% discount to the market price on
that date. Based on all repurchase to date, Ebix expects its
diluted share count for Q1 2019 to be approximately 30.63
million.
- CEO Salary - The
Company Compensation Committee accepted the Ebix CEO Robin Raina’s
request to forego his cash salary and instead accept Ebix stock for
equivalent value every month, at the stock price prevailing at that
time in the market. Ebix CEO will receive stock instead of cash for
a period of time, until the stock price is $150 per share or the
economic equivalent as adjusted for future corporate actions such
as stock splits that may occur from time to time.Ebix CEO also
recently filed a Form 4 reporting some new stock purchases from the
market. All officer and Director stock trades are pre-cleared by
Ebix, while being governed by Ebix’s insider trading policy.
- SOX Update – Ebix
announced that it has engaged a reputed, US based accounting and
forensic firm to look at whether Ebix has successfully remediated
the material weaknesses identified in its 2017 year-end audit, in
the areas of tax documentation and business combinations related to
certain acquisitions. While management believes that it has
successfully remediated these weaknesses, Ebix expects the report
from this accounting firm soon.
- Appointment of
International Audit firm for 2019 – Ebix has appointed RSM
US LLP to serve as the Company's independent consolidated auditor
for 2019. RSM US LLP is the fifth largest accounting firm in the
United States, with over 9,600 employees across 90 cities
nationwide providing audit, tax, and consulting services.
- IPO plans in India
– Ebix continues to pursue plans for a prospective IPO for its
EbixCash operations in India and abroad. In support of this goal,
the Company is actively involved at present in discussions with
many leading Private Equity and investment banking firms, with a
view to maximize shareholder value.
- Use of Prospective Cash
from EbixCash IPO – As most of Ebix’s investments in India
are in the form of loans granted to its Indian subsidiaries, the
goal of the IPO would be to recoup that cash with interest from the
EbixCash operations once and if the EbixCash IPO is successfully
implemented. Ebix intends to use that prospective cash to grow its
businesses organically and inorganically in the US and abroad, to
repay bank borrowings and to continue share repurchases.
About Ebix, Inc.
With 50+ offices across 5 continents, Ebix,
Inc., (NASDAQ: EBIX) endeavors to provide On-Demand software and
E-commerce services to the insurance, financial, healthcare and
e-learning industries. In the Insurance sector, the Company’s main
focus is to develop and deploy a wide variety of insurance and
reinsurance exchanges on an on-demand basis, while also, providing
Software-as-a-Service ("SaaS") enterprise solutions in the area of
CRM, front-end & back-end systems, outsourced administrative
and risk compliance, across the world.
With a "Phygital” strategy that combines 320,000
physical distribution outlets in many Southeast Asian Nations
(“ASEAN”) countries, to an Omni-channel online digital platform,
the Company’s EbixCash Financial exchange portfolio encompasses
leadership in areas of domestic & international money
remittance, Forex, travel, pre-paid & gift cards, utility
payments, lending etc., in an emerging country like India. The
Company’s Forex Exchange has a dominant market share of India’s
airport Foreign Exchange business encompassing 32 international
airports like Delhi, Mumbai, Bangalore, Chennai, Hyderabad, Goa and
Kolkata International airports, while conducting over $3 Billion in
GMV. EbixCash, through its travel portal Via.com, is also one of
Southeast Asia’s leading travel exchanges with over 110,000
distribution outlets and 8,000 corporate clients processing over
24.5 million transactions every year. For further details, visit
www.ebixcash.com
Through its various SaaS-based software
platforms, Ebix employs thousands of domain-specific technology
professionals to provide products, support and consultancy to
thousands of customers on six continents. For more information,
visit the Company’s website at www.ebix.com
SAFE HARBOR REGARDING FORWARD-LOOKING
STATEMENTS
As used herein, the terms “Ebix,” “the Company,”
“we,” “our” and “us” refer to Ebix, Inc., a Delaware corporation,
and its consolidated subsidiaries as a combined entity, except
where it is clear that the terms mean only Ebix, Inc.
The information contained in this Press Release
contains forward-looking statements and information within the
"safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995, Section 27A of the Securities Act of 1933, and
Section 21E of the Securities Exchange Act of 1934. This
information includes assumptions made by, and information currently
available to management, including statements regarding future
economic performance and financial condition, liquidity and capital
resources, acceptance of the Company's products by the market, and
management's plans and objectives. In addition, certain statements
included in this and our future filings with the Securities and
Exchange Commission ("SEC"), in press releases, and in oral and
written statements made by us or with our approval, which are not
statements of historical fact, are forward-looking statements.
Words such as "may," "could," "should," "would," "believe,"
"expect," "anticipate," "estimate," "intend," "seeks," "plan,"
"project," "continue," "predict," "will," "should," and other words
or expressions of similar meaning are intended by the Company to
identify forward-looking statements, although not all
forward-looking statements contain these identifying words. These
forward-looking statements are found at various places throughout
this report and in the documents incorporated herein by reference.
These statements are based on our current expectations about future
events or results and information that is currently available to
us, involve assumptions, risks, and uncertainties, and speak only
as of the date on which such statements are made.
Our actual results may differ materially from
those expressed or implied in these forward-looking statements.
Factors that may cause such a difference, include, but are not
limited to those discussed in our Annual Report on Form 10-K and
subsequent reports filed with the SEC, as well as: the risk of an
unfavorable outcome of the pending governmental investigations or
shareholder class action lawsuits, reputational harm caused by such
investigations and lawsuits, the willingness of independent
insurance agencies to outsource their computer and other processing
needs to third parties; pricing and other competitive pressures and
the Company's ability to gain or maintain share of sales as a
result of actions by competitors and others; changes in estimates
in critical accounting judgments; changes in or failure to comply
with laws and regulations, including accounting standards, taxation
requirements (including tax rate changes, new tax laws and revised
tax interpretations) in domestic or foreign jurisdictions; exchange
rate fluctuations and other risks associated with investments and
operations in foreign countries (particularly in Australia, UK and
India wherein we have significant operations); equity markets,
including market disruptions and significant interest rate
fluctuations, which may impede our access to, or increase the cost
of, external financing; and international conflict, including
terrorist acts.
Except as expressly required by the federal
securities laws, the Company undertakes no obligation to update any
such factors, or to publicly announce the results of, or changes to
any of the forward-looking statements contained herein to reflect
future events, developments, changed circumstances, or for any
other reason.
Readers should carefully review the disclosures
and the risk factors described in the documents we file from time
to time with the SEC, including future reports on Forms 10-Q and
8-K, and any amendments thereto. You may obtain our SEC filings at
our website, www.ebix.com under the "Investor Information" section,
or over the Internet at the SEC's web site, www.sec.gov.
CONTACT:
Darren Joseph or Gautam Sharma
678 -281-2027 or IR@ebix.com
David Collins or Chris Eddy
Catalyst Global - 212-924-9800 or ebix@catalyst-ir.com
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