##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended June 30, 2009
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission file number 0-15946
 Ebix, Inc.
  DELAWARE
    
    77-0021975(State or other jurisdiction of incorporation or 
organization)
    
    (I.R.S. Employer Identification No.)5 CONCOURSE PARKWAY, SUITE 3200ATLANTA, GEORGIA
    
    30328(Address of principal executive offices)
    
    (Zip Code)
 678-281-2020
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 Yes o No þ




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##### 



Ebix, Inc. and Subsidiaries
   INDEX
 PART I  FINANCIAL INFORMATIONItem 1. Consolidated Financial StatementsConsolidated Statements of Income for the Three and Six Months ended June 30, 2009 and 2008
(unaudited)
    
    
    2Consolidated Balance Sheets at June 30, 2009 (unaudited) and December 31, 2008
    
    
    3Consolidated Statement of Stockholders Equity and Comprehensive Income for the Six Months ended
June 30, 2009 (unaudited)
    
    
    4Consolidated Statements of Cash Flows for the Six Months ended June 30, 2009 and 2008 (unaudited)
    
    
    5Notes
to Consolidated Financial Statements (unaudited)
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    20Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    29Item 4. Controls and Procedures
    
    
    30PART II  OTHER INFORMATIONItem 1A. Risk Factors
    
    
    31Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    31Item 5. Other Information
    
    
    31Item 6. Exhibits
    
    
    31SIGNATURES
    
    
    32INDEX to EXHIBITS
    
    
    33Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 ITEM 1  CONSOLIDATED FINANCIAL STATEMENTS
 Ebix, Inc. and Subsidiaries
 
 Consolidated Statements of Income
 
 Three Months Ended June 30,
    
    
    Six Months Ended June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Operating Revenue
    
    $
    22,421
    
    
    $
    17,803
    
    
    $
    43,089
    
    
    $
    34,442Operating expenses:Cost of services provided
    
    
    4,532
    
    
    
    3,225
    
    
    
    8,833
    
    
    
    6,161Product development
    
    
    2,753
    
    
    
    2,162
    
    
    
    5,258
    
    
    
    4,240Sales and marketing
    
    
    1,121
    
    
    
    818
    
    
    
    2,255
    
    
    
    1,665General and administrative
    
    
    3,925
    
    
    
    3,856
    
    
    
    7,553
    
    
    
    7,672Amortization and depreciation
    
    
    830
    
    
    
    837
    
    
    
    1,573
    
    
    
    1,656Total operating expenses
    
    
    13,161
    
    
    
    10,898
    
    
    
    25,472
    
    
    
    21,394Operating income
    
    
    9,260
    
    
    
    6,905
    
    
    
    17,617
    
    
    
    13,048Interest income
    
    
    39
    
    
    
    140
    
    
    
    91
    
    
    
    262Interest expense
    
    
    (273
    )
    
    
    (394
    )
    
    
    (557
    )
    
    
    (736
    )Foreign exchange gain (loss)
    
    
    346
    
    
    
    100
    
    
    
    752
    
    
    
    159Income before income taxes
    
    
    9,372
    
    
    
    6,751
    
    
    
    17,903
    
    
    
    12,733Income tax (expense)/benefit
    
    
    (416
    )
    
    
    (415
    )
    
    
    (612
    )
    
    
    (727
    )Net income
    
    $
    8,956
    
    
    $
    6,336
    
    
    $
    17,291
    
    
    $
    12,006Basic earnings per common share
    
    $
    0.88
    
    
    $
    0.65
    
    
    $
    1.72
    
    
    $
    1.21Diluted earnings per common share
    
    $
    0.73
    
    
    $
    0.54
    
    
    $
    1.42
    
    
    $
    1.00Basic weighted average shares outstanding
    
    
    10,186
    
    
    
    9,688
    
    
    
    10,057
    
    
    
    9,954Diluted weighted average shares outstanding
    
    
    12,487
    
    
    
    11,977
    
    
    
    12,427
    
    
    
    12,220
   2




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 
 Consolidated Balance Sheets
  June 30,
    
    
    December 31,2009
    
    
    2008(Unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    11,876
    
    
    $
    9,475Short-term investments
    
    
    3,154
    
    
    
    1,536Accounts receivable, less allowance of $548 and $453, respectively
    
    
    16,394
    
    
    
    13,562Other current assets
    
    
    1,558
    
    
    
    951Total current assets
    
    
    32,982
    
    
    
    25,524Property and equipment, net
    
    
    4,668
    
    
    
    3,774Goodwill
    
    
    102,251
    
    
    
    88,488Indefinite-lived intangibles
    
    
    13,637
    
    
    
    11,589Other intangible assets, net
    
    
    11,014
    
    
    
    10,235Other assets
    
    
    636
    
    
    
    1,557Total assets
    
    $
    165,188
    
    
    $
    141,167LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable and accrued expenses
    
    $
    3,766
    
    
    $
    8,245Accrued payroll and related benefits
    
    
    2,353
    
    
    
    2,709Short term debt
    
    
    24,945
    
    
    
    24,945Current portion of convertible debt
    
    
    5,306
    
    
    
    11,518Current portion of long term debt and capital lease obligations
    
    
    212
    
    
    
    912Deferred revenue
    
    
    7,671
    
    
    
    5,383Other current liabilities
    
    
    212
    
    
    
    142Total current liabilities
    
    
    44,465
    
    
    
    53,854Convertible debt
    
    
    15,000
    
    
    
    15,000Long term debt and capital lease obligation, less current portion
    
    
    419
    
    
    
    290Other liabilities
    
    
    2,708
    
    
    
    941Deferred revenue
    
    
    96
    
    
    
    330Deferred rent
    
    
    730
    
    
    
    610Total liabilities
    
    
    63,418
    
    
    
    71,025Commitments and Contingencies, Note 9Stockholders equity:Convertible Series D Preferred stock, $.10 par value, 500,000
shares authorized, no shares issued and outstanding
    
    
    
    
    
    
    Common stock, $.10 par value, 20,000,000 shares authorized,
10,331,872 issued and 10,318,369 outstanding at June 30, 2009 and
10,006,455 issued and 9,946,710 outstanding at December 31, 2008
    
    
    1,032
    
    
    
    981Additional paid-in capital
    
    
    118,282
    
    
    
    111,641Treasury stock (13,503 and 59,745 shares repurchased as of June
30, 2009 and December 31, 2008 respectively)
    
    
    (76
    )
    
    
    (1,178
    )Accumulated deficit
    
    
    (12,908
    )
    
    
    (30,199
    )Accumulated other comprehensive income
    
    
    (4,560
    )
    
    
    (11,103
    )Total stockholders equity
    
    
    101,770
    
    
    
    70,142Total liabilities and stockholders equity
    
    $
    165,188
    
    
    $
    141,167
   3




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 
 Consolidated Statement of Stockholders Equity and Comprehensive Income
 (unaudited)
 AccumulatedCommon Stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    OtherTreasury
    
    
    
    
    
    
    Additional
    
    
    
    
    
    
    
    
    
    
    ComprehensiveStock
    
    
    Treasury
    
    
    Paid-in
    
    
    Deferred
    
    
    Accumulated
    
    
    (Loss)
    
    
    
    
    
    
    ComprehensiveShares
    
    
    Amount
    
    
    Shares
    
    
    Stock
    
    
    Capital
    
    
    Compensation
    
    
    Deficit
    
    
    Income
    
    
    Total
    
    
    Income(In thousands, except share amounts)Balance, December 31, 2008
    
    
    10,006,455
    
    
    $
    981
    
    
    
    (59,745
    )
    
    $
    (1,178
    )
    
    $
    111,641
    
    
    $
    
    
    
    $
    (30,199
    )
    
    $
    (11,103
    )
    
    $
    70,142Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,291
    
    
    
    
    
    
    
    17,291
    
    
    $
    17,291Cumulative translation
adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,543
    
    
    
    6,543
    
    
    $
    6,543Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    23,834Conversion of principal and
interest on convertible
promissory notes
    
    
    294,340
    
    
    
    30
    
    
    
    
    
    
    
    
    
    
    
    6,234
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,264Repurchase of common
stock
    
    
    (16,224
    )
    
    
    (2
    )
    
    
    (10,650
    )
    
    
    (205
    )
    
    
    (298
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (505
    )Exercise of stock options
    
    
    82,846
    
    
    
    8
    
    
    
    
    
    
    
    
    
    
    
    1,414
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,422Vesting of restricted stock
    
    
    21,347
    
    
    
    15
    
    
    
    
    
    
    
    
    
    
    
    (15
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Retirement
of treasury stock
    
    
    (56,892
    )
    
    
    
    
    
    
    56,892
    
    
    
    1,307
    
    
    
    (1,307
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Deferred compensation and
amortization related to
options
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    613
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    613Balance, June 30, 2009
    
    
    10,331,872
    
    
    
    1,032
    
    
    
    (13,503
    )
    
    $
    (76
    )
    
    $
    118,282
    
    
    $
    
    
    
    $
    (12,908
    )
    
    $
    (4,560
    )
    
    $
    101,770
   4




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 
 Consolidated Statements of Cash Flows
   Six Months Ended June 30,2009
    
    
    2008Cash flows from operating activities:Net income
    
    $
    17,291
    
    
    $
    12,006Adjustments to reconcile net income to net cash provided by operating activities:Depreciation and amortization
    
    
    1,573
    
    
    
    1,651Stock-based compensation
    
    
    100
    
    
    
    64Restricted stock compensation
    
    
    513
    
    
    
    254Unrealized foreign exchange gain on forward contracts
    
    
    (144
    )
    
    
    Provision for doubtful accounts
    
    
    90
    
    
    
    179Changes in operating assets and liabilities:Accounts receivable
    
    
    (2,617
    )
    
    
    (2,738
    )Other assets
    
    
    (387
    )
    
    
    44Accounts payable and accrued expenses
    
    
    (483
    )
    
    
    (1,282
    )Accrued payroll and related benefits
    
    
    (532
    )
    
    
    216Deferred revenue
    
    
    1,092
    
    
    
    (368
    )Deferred taxes
    
    
    (1,125
    )
    
    
    653Deferred rent and other liabilities
    
    
    178
    
    
    
    (20
    )Net cash provided by operating activities
    
    
    15,549
    
    
    
    10,659Cash flows from investing activities:Investment in Telstra eBusiness Services, net of cash acquired
    
    
    
    
    
    
    (42,968
    )Investment in Periculum, net of cash acquired
    
    
    (200
    )
    
    
    (1,067
    )Investment in ConfirmNet, net of cash acquired
    
    
    (3,094
    )
    
    
    Investment in IDS, net of cash acquired
    
    
    (1,000
    )
    
    
    Investment in Acclamation, net of cash acquired
    
    
    (85
    )
    
    
    Investment in Facts, net of cash acquired
    
    
    (5,704
    )
    
    
    (Purchase) Maturities of marketable securities, net
    
    
    (1,618
    )
    
    
    (655
    )Capital expenditures
    
    
    (1,200
    )
    
    
    (382
    )Net cash used in investing activities
    
    
    (12,901
    )
    
    
    (45,072
    )Cash flows from financing activities:Proceeds from (payments on) line of credit
    
    
    
    
    
    
    9,295Proceeds from the issuance of common stock, net of issuance costs
    
    
    
    
    
    
    12,518Proceeds from the exercise of the stock options
    
    
    1,422
    
    
    
    514Repurchase of Common Stock
    
    
    (505
    )
    
    
    (24,000
    )Payments on capital lease obligations
    
    
    (78
    )
    
    
    (2
    )Principal payments of debt obligations
    
    
    (742
    )
    
    
    (490
    )Net cash provided/(used) in financing activities
    
    
    97
    
    
    
    (2,165
    )Effect of foreign exchange rates on cash
    
    
    (344
    )
    
    
    (1,469
    )Net change in cash and cash equivalents
    
    
    2,401
    
    
    
    (38,047
    )Cash and cash equivalents at the beginning of the period
    
    
    9,475
    
    
    
    48,437Cash and cash equivalents at the end of the period
    
    $
    11,876
    
    
    $
    10,390Supplemental disclosures of cash flow information:Interest paid
    
    $
    429
    
    
    $
    459Income taxes paid
    
    $
    2,873
    
    
    $
    560
 Supplemental
Disclosure of noncash financing activities
     5




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Ebix, Inc. and Subsidiaries
 
 Notes
to Consolidated Financial Statements (unaudited)
 Note 1: Description of Business and Summary of Significant Accounting Policies
 Description of Business
  For the Three Months Ended
    
    
    For the Six Months EndedJune 30,
    
    
    June 30,(dollar amounts in thousands)
    
    2009
    
    
    2008
    
    
    2009
    
    
    2008Carrier Systems
    
    $
    2,701
    
    
    $
    2,843
    
    
    $
    5,527
    
    
    $
    5,133Exchanges
    
    
    13,162
    
    
    
    9,380
    
    
    
    25,195
    
    
    
    18,731BPO
    
    
    3,714
    
    
    
    1,817
    
    
    
    7,075
    
    
    
    3,514Broker Systems
    
    
    2,844
    
    
    
    3,763
    
    
    
    5,292
    
    
    
    7,064Totals
    
    $
    22,421
    
    
    $
    17,803
    
    
    $
    43,089
    
    
    $
    34,442
 Summary of Significant Accounting Policies
 Basis of Presentation
 Reclassification
 Short-term Investments
 Fair Value of Financial Instruments
  6




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (unaudited)
 Revenue Recognition and Deferred Revenue
  Software Revenue Recognition (SOP
97-2) Modification of SOP 97-2, Software Revenue
Recognition, With Respect to Certain Transactions, (SOP 98-9) , Revenue
Arrangements with Multiple Deliverables
     7




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (unaudited)
    Allowance
for Doubtful Accounts Receivable
 Goodwill and Other Indefinite-Lived Intangible Assets
   (In thousands)Beginning Balance at December 31,2008
    
    $
    88,488Additions
    
    
    8,668Foreign currency translation adjustments
    
    
    5,095Ending Balance at June 30, 2009
    
    $
    102,251
  8




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (unaudited)
  Finite-lived Intangible Assets
 LifeCategory
    
    (yrs)Customer relationships
    
    
    4-20Developed technology
    
    
    3-7Trademarks
    
    
    5-10
  9




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (unaudited)
  June 30,
    
    
    December 31,2009
    
    
    2008(In thousands)Intangible assets:Customer relationships
    
    $
    13,032
    
    
    $
    11,373Developed technology
    
    
    5,051
    
    
    
    4,762Trademarks
    
    
    687
    
    
    
    656Backlog
    
    
    140
    
    
    
    140Total intangibles
    
    
    18,910
    
    
    
    16,931Accumulated amortization
    
    
    (7,896
    )
    
    
    (6,696
    )Intangibles, net
    
    $
    11,014
    
    
    $
    10,235Indefinite-lived intangibles:Customer/territorial relationships
    
    $
    13,637
    
    
    $
    11,589
  Income Taxes
  Foreign Currency Translation
 Recent Accounting Pronouncements Business
Combinations
  10




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (unaudited)
 Fair Value Measurement
 Interim Disclosures about Fair Value
of Financial Instruments, Financial Instruments
 Subsequent Events
 Note 2: Earnings per Share
    11




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (unaudited)
 For the Three Months EndedJune 30,2009
    
    
    2008Basic Weighted Average Shares Outstanding
    
    
    10,186,485
    
    
    
    9,688,320Incremental Shares
    
    
    2,300,976
    
    
    
    2,288,994Diluted Shares Outstanding
    
    
    12,487,461
    
    
    
    11,977,314
 For the Six Months EndedJune 30,2009
    
    
    2008Basic Weighted Average Shares Outstanding
    
    
    10,057,457
    
    
    
    9,953,556Incremental Shares
    
    
    2,369,769
    
    
    
    2,266,755Diluted Shares Outstanding
    
    
    12,427,226
    
    
    
    12,220,311
 Note 3: Stock Split
  Note 4: Business Acquisitions
 Business Combinations Business
Combinations
 2009 Acquisition
 Facts Services, Inc.
  12




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (unaudited)
 2008 Acquisitions
 ConfirmNet Corporation
 Acclamation Systems, Inc .
 Periculum Services Group
 Telstra eBusiness Services Recognition of Liabilities in Connection with a Purchase Business
Combination,
  13




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (unaudited)
  June 30,
    
    
    December 31,(In thousands)
    
    2009
    
    
    2008Current assets
    
    $
    9,146
    
    
    $
    7,638Property and equipment
    
    
    817
    
    
    
    817Intangible assets
    
    
    7,183
    
    
    
    5,809Indefinite-lived intangibles
    
    
    14,862
    
    
    
    14,748Goodwill
    
    
    66,988
    
    
    
    58,322Total assets acquired
    
    
    98,996
    
    
    
    87,334Less: liabilities assumed
    
    
    (17,438
    )
    
    
    (12,558
    )Net assets acquired
    
    $
    81,558
    
    
    $
    74,776
  WeightedAverageIntangible asset category
    
    Fair Value
    
    
    Useful Life(in thousands)
    
    
    (in years)Customer relationships
    
    $
    6,102
    
    
    
    14.5Developed technology
    
    
    1,081
    
    
    
    4.0Total acquired intangible assets
    
    $
    7,183
    
    
    $
    12.9
 Note 5: Pro Forma Financial Information
  Six Months Ended June 30, 2009
    
    
    Six Months Ended June 30, 2008As Reported
    
    
    Pro Forma
    
    
    As Reported
    
    
    Pro FormaRevenue
    
    $
    43,089
    
    
    $
    44,708
    
    
    $
    34,442
    
    
    $
    36,769Net income
    
    $
    17,291
    
    
    $
    17,443
    
    
    $
    12,006
    
    
    $
    11,923Basic earnings per share
    
    $
    1.72
    
    
    $
    1.73
    
    
    $
    1.21
    
    
    $
    1.20Diluted earnings per share
    
    $
    1.42
    
    
    $
    1.43
    
    
    $
    1.00
    
    
    $
    1.00
 Note 6: Short-term Debt
   14




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (unaudited)
   Note 7: Long-term Debt:
  Note 8: Convertible Debt
 Accounting
for Convertible Debt and Debt Issued with Stock Purchase Warrants
    15




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (unaudited)
 Note 9: Commitments and Contingencies
 Lease Commitments
 Contingencies
 Self Insurance
 Note 10: Income Taxes
 Effective Tax Rate
    16




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (unaudited)
 FIN 48 Accounting for Uncertainty in Income Taxes Accounting for Uncertainty in Income Taxes,
 (in thousands)Balance at January 1, 2009
    
    $
    914Additions for tax positions related to current year
    
    
    98Additions for tax positions of prior years
    
    
    Reductions for tax position of prior years
    
    
    (249
    )Balance at June 30, 2009
    
    $
    763
  Note 11 Financial Instruments
 Fair Value Measurements Effective Date of FASB Statement No. 157,
 
    
    Level 1 
    Quoted prices in active markets for identical assets or liabilities.
 
    
    Level 2 
    Observable inputs other than quoted prices included in Level 1, such as
quoted prices for similar assets and liabilities in active markets; or quoted prices
for identical or similar assets and liabilities in markets that are not active.
 
    
    Level 3 
    Unobservable inputs that are supported by little or no market activity and
that are significant to the fair value of the assets or liabilities. This includes
certain pricing models, discounted cash flow methodologies and similar techniques that
use significant unobservable inputs.
  As at June 30, 2009Fair Value Measurement at reporting date usingQuoted price in
    
    
    
    
    
    
    Significantactive markets for
    
    
    Significant other
    
    
    unobservableidentical assets
    
    
    observable inputs
    
    
    inputsTotal
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)AssetsCurrency forward contract
    
    $
    142
    
    
    $
    
    
    
    $
    142
    
    
    $
    LiabilitiesCurrency forward contract
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
  17




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (unaudited)
 Note 12: Derivative Instruments
   As at June 30, 2009Balance SheetNotional principal
    
    
    exposure assetamount (Note a)
    
    
    (liability) (Note b)Foreign exchange forward contracts
denominated in:United States Dollars (sell) Indian
Rupee (buy)
    
    $
    8,000
    
    
    $
    142$
    142
 (a)
    
    Notional amounts are key elements of derivative financial instrument agreements, but
do not represent the amount exchanged by counterparties and do not measure the Companys exposure
to credit or market risks, or derivative financial instruments agreements.(b)
    
    Balance sheet exposure is denominated in U.S. Dollars and denotes the mark-to-market
impact of the derivative financial instruments on the reporting date.  Non-designatedAs at June 30,2009AssetsOther current assets
    
    $
    142Other assets
    
    $
    LiabilitiesOther current liabilities
    
    $
    Other liabilities
    
    $
    
 Note 13: Sales of Unregistered Common Stock
   18




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##### Table of Contents



Ebix, Inc. and Subsidiaries
 Notes
to Consolidated Financial Statements (Unaudited)
 Note 14: Repurchase of Common Stock from Brit:
  Note 15: Geographic Information
  Six Months ended June 30, 2009
 NorthAmerica
    
    
    Australia
    
    
    New Zealand
    
    
    India
    
    
    Singapore
    
    
    TotalRevenue
    
    $
    32,160
    
    
    $
    9,525
    
    
    $
    573
    
    
    $
    
    
    
    $
    831
    
    
    $
    43,089Fixed assets
    
    $
    2,588
    
    
    $
    439
    
    
    $
    34
    
    
    $
    1,566
    
    
    $
    41
    
    
    $
    4,668Goodwill
    
    $
    66,311
    
    
    $
    35,940
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    102,251Other intangible assets
    
    $
    8,550
    
    
    $
    16,101
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    24,651Headcount
    
    
    312
    
    
    
    66
    
    
    
    8
    
    
    
    290
    
    
    
    6
    
    
    
    682
 Six Months ended June 30, 2008
 NorthAmerica
    
    
    Australia
    
    
    New Zealand
    
    
    India
    
    
    Singapore
    
    
    TotalRevenue
    
    $
    20,247
    
    
    $
    12,699
    
    
    $
    505
    
    
    $
    36
    
    
    $
    955
    
    
    $
    34,442Fixed assets
    
    $
    2,111
    
    
    $
    429
    
    
    $
    33
    
    
    $
    816
    
    
    $
    38
    
    
    $
    3,427Goodwill
    
    $
    29,983
    
    
    $
    54,748
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    84,731Other intangible assets
    
    $
    6,362
    
    
    $
    3,626
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    9,988Headcount
    
    
    235
    
    
    
    67
    
    
    
    9
    
    
    
    162
    
    
    
    6
    
    
    
    479
  Note 16: Subsequent Events thru August 6, 2009
 Conversion
of a Portion of Outstanding Debt
  19




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##### Table of Contents



Item 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Safe Harbor for Forward-Looking Statements under the Securities Litigation Reform Act of
1995
  
    
    Regarding Notes 6, and 8 of the Notes to Consolidated Financial Statements, and
our future liquidity needs discussed under Liquidity and Financial Condition, our
ability to generate cash from operating activities and any declines in our credit
ratings or financial condition which could restrict our access to the capital markets or
materially increase our financing costs;
 
    
    With respect to Note 9 of the Condensed Notes to Consolidated Financial
Statements, Commitments and Contingencies, and Contractual Obligations and Commercial
Commitments in MD&A, changes in the market value of our assets or the actual cost of
our commitments or contingencies;
 
    
    Regarding Note 4 of the Condensed Notes to Consolidated Financial Statements
related to acquired intangible assets and our ability to accurately estimate the fair
value of such assets; and,
 
    
    With respect this Management Discussion & Analysis of Financial Condition and
Results of Operation and in particular the analysis of the six month revenue trend, and
the actual level of demand for our services during the immediately foreseeable future.
  Company Overview
    20




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##### Table of Contents



Recently, we have continued to expand both organically and through a series of acquisitions
including:
 Facts Services, Inc.
 ConfirmNet Corporation
 Acclamation Systems, Inc .
 Periculum Services Group
 Telstra eBusiness Services
  21




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##### Table of Contents



Offices and Geographic Information
  Key Performance Indicators
   For the Three Months Ended
    
    
    For the Six Months EndedJune 30,
    
    
    June 30,(dollar amounts in thousands)
    
    2009
    
    
    2008
    
    
    2009
    
    
    2008Revenue
    
    $
    22,421
    
    
    $
    17,803
    
    
    $
    43,089
    
    
    $
    34,442Revenue growth (yr over yr)
    
    
    25.9
    %
    
    
    81.4
    %
    
    
    25.1
    %
    
    
    82.9
    %Operating income
    
    $
    9,260
    
    
    $
    6,905
    
    
    $
    17,617
    
    
    $
    13,048Operating margin
    
    
    41.3
    %
    
    
    38.8
    %
    
    
    40.9
    %
    
    
    37.9
    %Net income
    
    $
    8,956
    
    
    $
    6,336
    
    
    $
    17,291
    
    
    $
    12,006Diluted earnings per share
    
    $
    0.73
    
    
    $
    0.54
    
    
    $
    1.42
    
    
    $
    1.00Cash provided by operating activities
    
    $
    7,733
    
    
    $
    7,043
    
    
    $
    15,549
    
    
    $
    10,659
 Results of Operations Three Month Periods Ended June 30, 2009 and 2008
 Operating Revenue
   For the Three Months Ended
    
    
    For the Six Months EndedJune 30,
    
    
    June 30,(dollar amounts in thousands)
    
    2009
    
    
    2008
    
    
    2009
    
    
    2008Carrier Systems
    
    $
    2,701
    
    
    $
    2,843
    
    
    $
    5,527
    
    
    $
    5,133Exchanges
    
    
    13,162
    
    
    
    9,380
    
    
    
    25,195
    
    
    
    18,731BPO
    
    
    3,714
    
    
    
    1,817
    
    
    
    7,075
    
    
    
    3,514Broker Systems
    
    
    2,844
    
    
    
    3,763
    
    
    
    5,292
    
    
    
    7,064Totals
    
    $
    22,421
    
    
    $
    17,803
    
    
    $
    43,089
    
    
    $
    34,442
  22




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##### Table of Contents



Cost of Services Provided
  Product Development Expenses
  Sales and Marketing Expenses
  General and Administrative Expenses
  Amortization and Depreciation Expenses
  Income Taxes
   23




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##### Table of Contents



Results of Operations Six-Month Periods Ended June 30, 2009 and 2008
 Operating Revenue
  Cost of Services Provided
  Product Development Expenses
  Sales and Marketing Expenses
  General and Administrative Expenses
  Amortization and Depreciation Expenses
   24




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##### Table of Contents



Income Taxes
  Liquidity and Capital Resources
     25




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##### Table of Contents



Operating Activities
   Investing Activities
   Financing Activities
   Revolving Credit Facility
  Off-Balance Sheet Arrangements
   26




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##### Table of Contents



Contractual Obligations and Commercial Commitments
  Payment Due by PeriodLess Than
    
    
    
    
    
    
    
    
    
    
    More thanTotal
    
    
    1 Year
    
    
    1 - 3 Years
    
    
    3 - 5 Years
    
    
    5 years(in thousands)Short-term debt
    
    $
    24,945
    
    
    $
    24,945
    
    
    $
    
    
    
    $
    
    
    
    $
    Convertible debt
    
    
    20,306
    
    
    
    5,306
    
    
    
    15,000
    
    
    
    
    
    
    
    Operating leases
    
    
    6,221
    
    
    
    1,897
    
    
    
    2,611
    
    
    
    1,566
    
    
    
    147Capital leases
    
    
    631
    
    
    
    212
    
    
    
    276
    
    
    
    143
    
    
    
    Total
    
    $
    52,103
    
    
    $
    32,360
    
    
    $
    17,887
    
    
    $
    1,709
    
    
    $
    147
 Recent Accounting Pronouncements
  Application of Critical Accounting Policies
  Revenue Recognition
    27




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Allowance for Doubtful Accounts Receivable
  Valuation of Goodwill
    28




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Income Taxes
    Foreign Currency Translation
  
 Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
   29




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##### Table of Contents



Item 4. CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
 Internal Control over Financial Reporting
  30




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Part II  OTHER INFORMATION
 
 Item 1A. RISK FACTORS
  
 Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
  Item 3. DEFAULTS UPON SENIOR SECURITIES
  Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  
 Item 5. OTHER INFORMATION
  Maximum Number (orTotal Number of Shares
    
    
    
    
    
    
    Approximate Dollar Value) ofPurchased as Part of
    
    
    
    
    
    
    Shares that May Yet BePublicly-Announced
    
    
    Average Price Paid
    
    
    Purchased Under the Plans orPeriod
    
    Plans or Programs
    
    
    Per Share (1)
    
    
    Programs (2)As of December 31, 2008
    
    
    70,245
    
    
    $
    20.43
    
    
    $
    3,565,000January 1, 2009 to
March 31, 2009
    
    
    26,874
    
    
    $
    18.82
    
    
    $
    3,059,000April 1, 2009 to June
30, 2009
    
    
    
    
    
    $
    
    
    
    $
    3,059,000Total
    
    
    97,119
    
    
    $
    19.98
 (1)
    
    Average price paid per share for shares purchased as part of our publicly-announced plan
(includes brokerage commissions).(2)
    
    On March 21, 2008, the Companys board of directors ratified, and we publicly announced, an
increase in the Companys ability to repurchase shares of our outstanding common stock from an
amount of $1.0 million to $5.0 million in shares. The opening balance stated here reflects the
previous repurchase of 70,245 shares. 
 Item 6. EXHIBITS
   31




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Ebix, Inc.Date: August 7, 2009
    By:
    /s/ Robin RainaRobin RainaChief Executive Officer(Principal Executive Officer)Date: August 7, 2009
    By:
    /s/ Robert F. KerrisRobert F. KerrisSenior Vice President and Chief Financial Officer(Principal Financial and Accounting Officer)  32




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EXHIBIT INDEX
 EXHIBITNO.
    
    DESCRIPTION2.1
    
    
    Share Sale Agreement by and among Ebix, Inc., Ebix Australia
(vic) Pty Ltd, and Telstra Services Solutions Holdings Limited
dated December 22, 2007 (incorporated by reference to Exhibit
2.1 to the Companys Current Report on Form 8-K filed on March
18, 2008 and incorporated herein by reference).2.2
    
    
    Stock Purchase Agreement by and amongst Ebix, Acclamation
Systems, Inc., and Joseph Ott, as Seller dated July 31, 2008
(incorporated by reference to Exhibit 2.1 to the Companys
Current Report on Form 8-K filed August 5, 2008 and
incorporated herein by reference).2.3
    
    
    Agreement and Plan of Merger by and among Ebix, Inc.,
ConfirmNet Corporation, Ebix Software India Private Limited,
ConfirmNet Acquisition Sub, Inc and Craig A. Irving, as
shareholders Representation dated November 1, 2008
(incorporated by reference to Exhibit 2.1 to the Companys
Current Report on Form 8-K filed November 11, 2008 and
incorporated herein by reference).3.1
    
    
    Certificates of Incorporation of the Company, as amended
(including Certificates of Designations) (incorporated by
reference to Exhibit 3.1 to the Companys Quarterly Report on
Form 10-Q for the period ended March 31, 2005 and incorporated
herein by reference).3.2
    
    
    Bylaws of the Company (filed as Exhibit 3.2 to the Companys
Annual Report on Form 10-K for the fiscal year ended December
31, 2000 and incorporated herein by reference).10.29
    
    
    Share Purchase Agreement made and entered into as of April 2,
2008 by and among Ebix, Inc and Rennes Foundation
(incorporated by reference to Exhibit 10.29 to the Companys
Current Report on Form 8-K filed on April 14, 2008 and
incorporated herein by reference).10.30
    
    
    Share Purchase Agreement made and entered into as of April 7,
2008 by and among Ebix, Inc and Ashford Capital Management,
Inc. (incorporated by reference to Exhibit 10.30 to the
Companys Current Report on Form 8-K filed on April 14, 2008
and incorporated herein by reference).10.31
    
    
    Stock Re-Purchase Agreement made and entered into as of April
16, 2008 by and among Ebix, Inc and Brit Insurance, Holdings,
Inc. (incorporated by reference to Exhibit 10.31 to the
Companys Current Report on Form 8-K filed April 17, 2008 and
incorporated herein by reference).31.1
    
    
    Certification of Chief Executive Officer Pursuant to 13a-14(a)
(Section 302 of the Sarbanes-Oxley Act of 2002).31.2
    
    
    Certification of Chief Financial Officer Pursuant to 13a-14(a)
(Section 302 of the Sarbanes-Oxley Act of 2002).32.1
    
    
    Certification of Chief Executive Officer Pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification of Chief Financial Officer Pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.
  33