##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended June 30, 2010
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
 Commission File Number 000-28430
 SS&C TECHNOLOGIES, INC.
  Delaware
    
    06-1169696(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer Identification No.)
 
 
 o þ
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 Yes o No þ




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##### 



SS&C TECHNOLOGIES, INC.
 INDEX
 PageNumberPART I. FINANCIAL INFORMATIONItem 1. Financial Statements (unaudited)Condensed Consolidated Balance Sheets at June 30, 2010
and December 31, 2009
    
    
    3Condensed Consolidated Statements of Operations for the
three months and six months ended June 30, 2010 and 2009
    
    
    4Condensed Consolidated Statements of Cash Flows for the
six months ended June 30, 2010 and 2009
    
    
    5Notes to Condensed Consolidated Financial Statements
    
    
    6Item 2. Managements Discussion and Analysis of Financial
Condition and Results of Operations
    
    
    16Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    25Item 4T. Controls and Procedures
    
    
    25PART II. OTHER INFORMATIONItem 1A. Risk Factors
    
    
    26Item 6. Exhibits
    
    
    26SIGNATURE
    
    
    27EXHIBIT INDEX
    
    
    28Exhibit 31.1Exhibit 31.2Exhibit 32
    2




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##### Table of Contents



Part I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 
 
    June 30,
    
    
    December 31,2010
    
    
    2009ASSETSCurrent assets:Cash and cash equivalents
    
    $
    88,886
    
    
    $
    19,055Accounts receivable, net of allowance for
doubtful accounts of $1,760 and $1,425,
respectively
    
    
    44,744
    
    
    
    41,600Prepaid expenses and other current assets
    
    
    5,243
    
    
    
    6,164Income taxes receivable
    
    
    7,896
    
    
    
    669Deferred income taxes
    
    
    1,988
    
    
    
    1,780Total current assets
    
    
    148,757
    
    
    
    69,268Property and equipment:Leasehold improvements
    
    
    5,340
    
    
    
    5,358Equipment, furniture, and fixtures
    
    
    27,932
    
    
    
    25,91533,272
    
    
    
    31,273Less accumulated depreciation
    
    
    (19,960
    )
    
    
    (17,237
    )Net property and equipment
    
    
    13,312
    
    
    
    14,036Deferred income taxes
    
    
    559
    
    
    
    499Goodwill (Note 9)
    
    
    886,982
    
    
    
    885,517Intangible and other assets, net of
accumulated amortization of $133,343 and
$116,670, respectively
    
    
    199,002
    
    
    
    216,321Total assets
    
    $
    1,248,612
    
    
    $
    1,185,641LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Current portion of long-term debt (Note 5)
    
    $
    2,011
    
    
    $
    4,270Accounts payable
    
    
    3,921
    
    
    
    4,804Income taxes payable
    
    
    
    
    
    
    703Accrued employee compensation and benefits
    
    
    8,341
    
    
    
    14,693Other accrued expenses
    
    
    12,184
    
    
    
    16,938Interest payable
    
    
    1,305
    
    
    
    2,070Deferred maintenance and other revenue
    
    
    45,827
    
    
    
    40,400Total current liabilities
    
    
    73,589
    
    
    
    83,878Long-term debt, net of current portion (Note 5)
    
    
    313,387
    
    
    
    392,989Other long-term liabilities
    
    
    9,574
    
    
    
    10,764Deferred income taxes
    
    
    47,043
    
    
    
    52,023Total liabilities
    
    
    443,593
    
    
    
    539,654Commitments and contingencies (Note 7)Stockholders equity (Note 3 and 4):Common stock
    
    
    
    
    
    
    Additional paid-in capital
    
    
    730,904
    
    
    
    583,251Accumulated other comprehensive income
    
    
    14,432
    
    
    
    16,436Retained earnings
    
    
    59,683
    
    
    
    46,300Total stockholders equity
    
    
    805,019
    
    
    
    645,987Total liabilities and stockholders equity
    
    $
    1,248,612
    
    
    $
    1,185,641
 See accompanying notes to Condensed Consolidated Financial Statements.
  3




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Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,
    
    
    June 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Revenues:Software licenses
    
    $
    6,074
    
    
    $
    3,983
    
    
    $
    11,663
    
    
    $
    9,803Maintenance
    
    
    17,817
    
    
    
    16,066
    
    
    
    35,836
    
    
    
    31,606Professional services
    
    
    5,099
    
    
    
    5,393
    
    
    
    10,488
    
    
    
    10,589Software-enabled services
    
    
    52,628
    
    
    
    41,809
    
    
    
    101,805
    
    
    
    78,975Total revenues
    
    
    81,618
    
    
    
    67,251
    
    
    
    159,792
    
    
    
    130,973Cost of revenues:Software licenses
    
    
    1,908
    
    
    
    2,123
    
    
    
    3,836
    
    
    
    4,171Maintenance
    
    
    8,084
    
    
    
    6,853
    
    
    
    16,081
    
    
    
    13,327Professional services
    
    
    3,260
    
    
    
    3,512
    
    
    
    6,618
    
    
    
    7,489Software-enabled services
    
    
    27,688
    
    
    
    22,033
    
    
    
    53,567
    
    
    
    42,606Total cost of revenues
    
    
    40,940
    
    
    
    34,521
    
    
    
    80,102
    
    
    
    67,593Gross profit
    
    
    40,678
    
    
    
    32,730
    
    
    
    79,690
    
    
    
    63,380Operating expenses:Selling and marketing
    
    
    6,483
    
    
    
    5,039
    
    
    
    12,635
    
    
    
    10,267Research and development
    
    
    7,860
    
    
    
    6,757
    
    
    
    15,619
    
    
    
    12,624General and administrative
    
    
    6,546
    
    
    
    5,099
    
    
    
    12,226
    
    
    
    10,181Total operating expenses
    
    
    20,889
    
    
    
    16,895
    
    
    
    40,480
    
    
    
    33,072Operating income
    
    
    19,789
    
    
    
    15,835
    
    
    
    39,210
    
    
    
    30,308Interest expense, net
    
    
    (8,058
    )
    
    
    (9,294
    )
    
    
    (17,075
    )
    
    
    (18,644
    )Other income (expense), net
    
    
    115
    
    
    
    (1,479
    )
    
    
    
    
    
    
    (922
    )Loss on extinguishment of debt
    
    
    (5,480
    )
    
    
    
    
    
    
    (5,480
    )
    
    
    Income before income taxes
    
    
    6,366
    
    
    
    5,062
    
    
    
    16,655
    
    
    
    10,742Provision for income taxes
    
    
    2,004
    
    
    
    1,571
    
    
    
    3,272
    
    
    
    3,353Net income
    
    $
    4,362
    
    
    $
    3,491
    
    
    $
    13,383
    
    
    $
    7,389
 See accompanying notes to Condensed Consolidated Financial Statements.
  4




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Six months ended June 30,2010
    
    
    2009Cash flow from operating activities:Net income
    
    $
    13,383
    
    
    $
    7,389Adjustments to reconcile net income to net cash provided by
operating activities:Depreciation and amortization
    
    
    20,297
    
    
    
    17,598Amortization of loan origination costs
    
    
    2,403
    
    
    
    1,145(Gain) loss on sale or disposition of property and equipment
    
    
    (2
    )
    
    
    3Deferred income taxes
    
    
    (6,090
    )
    
    
    (5,628
    )Stock-based compensation expense
    
    
    5,232
    
    
    
    2,794Provision for doubtful accounts
    
    
    454
    
    
    
    327Changes in operating assets and liabilities, excluding effects
from acquisitions:Accounts receivable
    
    
    (2,423
    )
    
    
    1,649Prepaid expenses and other assets
    
    
    818
    
    
    
    1,634Accounts payable
    
    
    (857
    )
    
    
    (145
    )Accrued expenses and other liabilities
    
    
    (10,914
    )
    
    
    (7,136
    )Income taxes receivable and payable
    
    
    (3,838
    )
    
    
    (2,549
    )Deferred maintenance and other revenues
    
    
    4,971
    
    
    
    3,824Net cash provided by operating activities
    
    
    23,434
    
    
    
    20,905Cash flow from investing activities:Additions to property and equipment
    
    
    (2,238
    )
    
    
    (621
    )Proceeds from sale of property and equipment
    
    
    52
    
    
    
    3Cash paid for business acquisitions, net of cash acquired
    
    
    (11,372
    )
    
    
    (10,327
    )Additions to capitalized software and other intangibles
    
    
    (99
    )
    
    
    Net cash used in investing activities
    
    
    (13,657
    )
    
    
    (10,945
    )Cash flow from financing activities:Repayment of debt
    
    
    (81,597
    )
    
    
    (1,153
    )Transactions involving SS&C Holdings common stock
    
    
    
    
    
    
    (184
    )Proceeds from common stock issuance, net of issuance costs
    
    
    134,611
    
    
    
    Proceeds from the exercise of stock options
    
    
    5,396
    
    
    
    Purchase of common stock for treasury
    
    
    (1,169
    )
    
    
    Income tax benefit related to exercise of stock options
    
    
    3,583
    
    
    
    Net cash provided by (used in) financing activities
    
    
    60,824
    
    
    
    (1,337
    )Effect of exchange rate changes on cash and cash equivalents
    
    
    (770
    )
    
    
    1,145Net increase in cash and cash equivalents
    
    
    69,831
    
    
    
    9,768Cash and cash equivalents, beginning of period
    
    
    19,055
    
    
    
    29,299Cash and cash equivalents, end of period
    
    $
    88,886
    
    
    $
    39,067
 See accompanying notes to Condensed Consolidated Financial Statements.
  5




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SS&C TECHNOLOGIES, INC. AND SUBSIDIARIES
 
   SS&C Technologies, Inc., together with its subsidiaries, is referred to herein as the Company,
we, our, and us. SS&C Technologies Holdings, Inc., our ultimate parent company, is referred
to herein as Holdings.
           6




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Three Months Ended June 30,
    
    
    Six Months Ended June 30,Statements of operations classification
    
    2010
    
    
    2009
    
    
    2010
    
    
    2009Cost of maintenance
    
    $
    98
    
    
    $
    31
    
    
    $
    125
    
    
    $
    56Cost of professional services
    
    
    140
    
    
    
    57
    
    
    
    186
    
    
    
    104Cost of software-enabled services
    
    
    823
    
    
    
    307
    
    
    
    1,090
    
    
    
    560Total cost of revenues
    
    
    1,061
    
    
    
    395
    
    
    
    1,401
    
    
    
    720Selling and marketing
    
    
    557
    
    
    
    258
    
    
    
    765
    
    
    
    495Research and development
    
    
    383
    
    
    
    164
    
    
    
    515
    
    
    
    298General and administrative
    
    
    1,881
    
    
    
    708
    
    
    
    2,551
    
    
    
    1,281Total operating expenses
    
    
    2,821
    
    
    
    1,130
    
    
    
    3,831
    
    
    
    2,074Total stock-based compensation expense
    
    $
    3,882
    
    
    $
    1,525
    
    
    $
    5,232
    
    
    $
    2,794
  7




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Shares of HoldingsUnderlyingOptionsOutstanding at January 1, 2010
    
    
    12,737,559Granted
    
    
    2,139,635Cancelled/forfeited
    
    
    (107,626
    )Exercised
    
    
    (1,716,240
    )Outstanding at June 30, 2010
    
    
    13,053,328
    Three Months Ended June 30,
    
    
    Six Months Ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Net income
    
    $
    4,362
    
    
    $
    3,491
    
    
    $
    13,383
    
    
    $
    7,389Foreign currency translation gains (losses)
    
    
    (11,632
    )
    
    
    18,646
    
    
    
    (3,190
    )
    
    
    11,541Unrealized gains on interest rate swaps,
net of tax
    
    
    692
    
    
    
    432
    
    
    
    1,186
    
    
    
    783Total comprehensive income (loss)
    
    $
    (6,578
    )
    
    $
    22,569
    
    
    $
    11,379
    
    
    $
    19,713
   June 30,
    
    
    December 31,2010
    
    
    2009Senior credit facility, revolving portion
    
    $
    
    
    
    $
    2,000Senior credit facility, term loan portion,
weighted-average interest rate of 2.62% and 2.39%,
respectively
    
    
    182,021
    
    
    
    190,032113/4% senior subordinated notes due 2013
    
    
    133,250
    
    
    
    205,000Capital leases
    
    
    127
    
    
    
    227315,398
    
    
    
    397,259Short-term borrowings and current portion of long-term debt
    
    
    (2,011
    )
    
    
    (4,270
    )Long-term debt
    
    $
    313,387
    
    
    $
    392,989
   3 4
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Three Months Ended June 30,
    
    
    Six Months Ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Interest rate swap
    
    $
    1,135
    
    
    $
    907
    
    
    $
    2,267
    
    
    $
    1,746
  Three Months Ended June 30,
    
    
    Six Months Ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Amount of gain recognized in AOCI, net of tax
    
    $
    692
    
    
    $
    432
    
    
    $
    1,186
    
    
    $
    783
         9




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Accounts receivable
    
    $
    1,680Tangible assets acquired, net of cash received
    
    
    32Acquired customer relationships and contracts
    
    
    2,500Goodwill
    
    
    8,404Deferred revenue
    
    
    (1,126
    )Other liabilities assumed
    
    
    (118
    )Consideration paid, net of cash received
    
    $
    11,372
  Three Months Ended June 30,
    
    
    Six Months Ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Revenues
    
    $
    81,618
    
    
    $
    77,067
    
    
    $
    160,448
    
    
    $
    152,559Net income
    
    $
    4,362
    
    
    $
    4,581
    
    
    $
    13,459
    
    
    $
    9,025
   Balance at December 31, 2009
    
    $
    885,5172010 acquisition
    
    
    8,404Income tax benefit on rollover options exercised
    
    
    (4,049
    )Effect of foreign currency translation
    
    
    (2,890
    )Balance at June 30, 2010
    
    $
    886,982
  10




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Three Months Ended June 30,
    
    
    Six Months Ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009United States
    
    $
    54,596
    
    
    $
    43,205
    
    
    $
    106,711
    
    
    $
    84,135Canada
    
    
    12,674
    
    
    
    9,947
    
    
    
    24,359
    
    
    
    19,663Americas excluding United States and Canada
    
    
    2,277
    
    
    
    972
    
    
    
    3,279
    
    
    
    3,250Europe
    
    
    10,172
    
    
    
    10,353
    
    
    
    21,569
    
    
    
    19,825Asia Pacific and Japan
    
    
    1,899
    
    
    
    2,774
    
    
    
    3,874
    
    
    
    4,100$
    81,618
    
    
    $
    67,251
    
    
    $
    159,792
    
    
    $
    130,973
  Three Months Ended June 30,
    
    
    Six Months Ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Portfolio management/accounting
    
    $
    65,326
    
    
    $
    55,101
    
    
    $
    127,551
    
    
    $
    106,491Trading/treasury operations
    
    
    10,240
    
    
    
    5,958
    
    
    
    20,160
    
    
    
    12,076Financial modeling
    
    
    2,250
    
    
    
    2,197
    
    
    
    4,596
    
    
    
    4,296Loan management/accounting
    
    
    1,082
    
    
    
    1,022
    
    
    
    2,031
    
    
    
    2,290Property management
    
    
    1,028
    
    
    
    1,222
    
    
    
    2,218
    
    
    
    2,491Money market processing
    
    
    1,077
    
    
    
    1,068
    
    
    
    1,983
    
    
    
    1,901Training
    
    
    615
    
    
    
    683
    
    
    
    1,253
    
    
    
    1,428$
    81,618
    
    
    $
    67,251
    
    
    $
    159,792
    
    
    $
    130,973
  3 4
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At June 30, 2010Total
    
    
    Total Non-
    
    
    ConsolidatingSS&C
    
    
    Guarantors
    
    
    Guarantors
    
    
    Adjustments
    
    
    TotalCash and cash equivalents
    
    $
    74,395
    
    
    $
    3,561
    
    
    $
    10,930
    
    
    $
    
    
    
    $
    88,886Accounts receivable, net
    
    
    26,623
    
    
    
    5,971
    
    
    
    12,150
    
    
    
    
    
    
    
    44,744Income taxes receivable
    
    
    7,896
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,896Prepaid expenses and other current assets
    
    
    2,225
    
    
    
    673
    
    
    
    2,345
    
    
    
    
    
    
    
    5,243Deferred income taxes
    
    
    1,496
    
    
    
    220
    
    
    
    272
    
    
    
    
    
    
    
    1,988Property and equipment, net
    
    
    7,764
    
    
    
    1,372
    
    
    
    4,176
    
    
    
    
    
    
    
    13,312Investment in subsidiaries
    
    
    203,443
    
    
    
    
    
    
    
    
    
    
    
    (203,443
    )
    
    
    Intercompany balances
    
    
    99,301
    
    
    
    (1,847
    )
    
    
    (97,454
    )
    
    
    
    
    
    
    Deferred taxes, long-term
    
    
    
    
    
    
    
    
    
    
    559
    
    
    
    
    
    
    
    559Goodwill, intangible and other assets, net
    
    
    747,731
    
    
    
    59,028
    
    
    
    279,225
    
    
    
    
    
    
    
    1,085,984Total assets
    
    $
    1,170,874
    
    
    $
    68,978
    
    
    $
    212,203
    
    
    $
    (203,443
    )
    
    $
    1,248,612Current portion of long-term debt
    
    $
    1,649
    
    
    $
    
    
    
    $
    362
    
    
    $
    
    
    
    $
    2,011Accounts payable
    
    
    2,257
    
    
    
    376
    
    
    
    1,288
    
    
    
    
    
    
    
    3,921Accrued expenses and other liabilities
    
    
    15,021
    
    
    
    2,041
    
    
    
    4,768
    
    
    
    
    
    
    
    21,830Income taxes payable
    
    
    (3,278
    )
    
    
    2,450
    
    
    
    828
    
    
    
    
    
    
    
    Deferred maintenance and other revenue
    
    
    33,191
    
    
    
    4,666
    
    
    
    7,970
    
    
    
    
    
    
    
    45,827Long-term debt, net of current portion
    
    
    279,079
    
    
    
    
    
    
    
    34,308
    
    
    
    
    
    
    
    313,387Other long-term liabilities
    
    
    2,692
    
    
    
    281
    
    
    
    6,601
    
    
    
    
    
    
    
    9,574Deferred income taxes, long-term
    
    
    35,244
    
    
    
    2,938
    
    
    
    8,861
    
    
    
    
    
    
    
    47,043Total liabilities
    
    
    365,855
    
    
    
    12,752
    
    
    
    64,986
    
    
    
    
    
    
    
    443,593Stockholders equity
    
    
    805,019
    
    
    
    56,226
    
    
    
    147,217
    
    
    
    (203,443
    )
    
    
    805,019Total liabilities and stockholders equity
    
    $
    1,170,874
    
    
    $
    68,978
    
    
    $
    212,203
    
    
    $
    (203,443
    )
    
    $
    1,248,612
 At December 31, 2009Total
    
    
    Total Non-
    
    
    ConsolidatingSS&C
    
    
    Guarantors
    
    
    Guarantors
    
    
    Adjustments
    
    
    TotalCash and cash equivalents
    
    $
    6,226
    
    
    $
    1,087
    
    
    $
    11,742
    
    
    $
    
    
    
    $
    19,055Accounts receivable, net
    
    
    24,958
    
    
    
    5,898
    
    
    
    10,744
    
    
    
    
    
    
    
    41,600Prepaid expenses and other current assets
    
    
    3,440
    
    
    
    575
    
    
    
    2,149
    
    
    
    
    
    
    
    6,164Income taxes receivable
    
    
    669
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    669Deferred income taxes
    
    
    1,321
    
    
    
    220
    
    
    
    239
    
    
    
    
    
    
    
    1,780Property and equipment, net
    
    
    7,998
    
    
    
    1,620
    
    
    
    4,418
    
    
    
    
    
    
    
    14,036Investment in subsidiaries
    
    
    193,769
    
    
    
    
    
    
    
    
    
    
    
    (193,769
    )
    
    
    Intercompany balances
    
    
    104,903
    
    
    
    (6,353
    )
    
    
    (98,550
    )
    
    
    
    
    
    
    Deferred income taxes, long-term
    
    
    
    
    
    
    
    
    
    
    499
    
    
    
    
    
    
    
    499Goodwill, intangible and other assets, net
    
    
    754,745
    
    
    
    60,997
    
    
    
    286,096
    
    
    
    
    
    
    
    1,101,838Total assets
    
    $
    1,098,029
    
    
    $
    64,044
    
    
    $
    217,337
    
    
    $
    (193,769
    )
    
    $
    1,185,641Current portion of long-term debt
    
    $
    3,725
    
    
    $
    
    
    
    $
    545
    
    
    $
    
    
    
    $
    4,270Accounts payable
    
    
    1,935
    
    
    
    1,043
    
    
    
    1,826
    
    
    
    
    
    
    
    4,804Accrued expenses
    
    
    23,733
    
    
    
    3,813
    
    
    
    6,155
    
    
    
    
    
    
    
    33,701Income taxes payable
    
    
    739
    
    
    
    (63
    )
    
    
    27
    
    
    
    
    
    
    
    703Deferred maintenance and other revenue
    
    
    29,308
    
    
    
    2,888
    
    
    
    8,204
    
    
    
    
    
    
    
    40,400Long-term debt, net of current portion
    
    
    351,624
    
    
    
    
    
    
    
    41,365
    
    
    
    
    
    
    
    392,989Other long-term liabilities
    
    
    3,482
    
    
    
    384
    
    
    
    6,898
    
    
    
    
    
    
    
    10,764Deferred income taxes, long-term
    
    
    37,496
    
    
    
    3,265
    
    
    
    11,262
    
    
    
    
    
    
    
    52,023Total liabilities
    
    
    452,042
    
    
    
    11,330
    
    
    
    76,282
    
    
    
    
    
    
    
    539,654Stockholders equity
    
    
    645,987
    
    
    
    52,714
    
    
    
    141,055
    
    
    
    (193,769
    )
    
    
    645,987Total liabilities and stockholders equity
    
    $
    1,098,029
    
    
    $
    64,044
    
    
    $
    217,337
    
    
    $
    (193,769
    )
    
    $
    1,185,641
  12




---



##### Table of Contents



For the three months ended June 30, 2010Total
    
    
    Total Non-
    
    
    ConsolidatingSS&C
    
    
    Guarantors
    
    
    Guarantors
    
    
    Adjustments
    
    
    TotalRevenue
    
    $
    36,445
    
    
    $
    23,715
    
    
    $
    21,814
    
    
    $
    (356
    )
    
    $
    81,618Cost of revenue
    
    
    20,081
    
    
    
    13,103
    
    
    
    8,112
    
    
    
    (356
    )
    
    
    40,940Gross profit
    
    
    16,364
    
    
    
    10,612
    
    
    
    13,702
    
    
    
    
    
    
    
    40,678Operating expenses:Selling & marketing
    
    
    3,855
    
    
    
    1,004
    
    
    
    1,624
    
    
    
    
    
    
    
    6,483Research & development
    
    
    4,099
    
    
    
    1,794
    
    
    
    1,967
    
    
    
    
    
    
    
    7,860General & administrative
    
    
    4,496
    
    
    
    879
    
    
    
    1,171
    
    
    
    
    
    
    
    6,546Total operating expenses
    
    
    12,450
    
    
    
    3,677
    
    
    
    4,762
    
    
    
    
    
    
    
    20,889Operating income
    
    
    3,914
    
    
    
    6,935
    
    
    
    8,940
    
    
    
    
    
    
    
    19,789Interest expense, net
    
    
    (5,359
    )
    
    
    
    
    
    
    (2,699
    )
    
    
    
    
    
    
    (8,058
    )Other income (expense), net
    
    
    381
    
    
    
    (112
    )
    
    
    (154
    )
    
    
    
    
    
    
    115Loss on extinguishment of debt
    
    
    (5,480
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,480
    )(Loss) income before income taxes
    
    
    (6,544
    )
    
    
    6,823
    
    
    
    6,087
    
    
    
    
    
    
    
    6,366(Benefit) provision for income taxes
    
    
    (1,468
    )
    
    
    1,374
    
    
    
    2,098
    
    
    
    
    
    
    
    2,004Equity in net income of subsidiaries
    
    
    9,438
    
    
    
    
    
    
    
    
    
    
    
    (9,438
    )
    
    
    Net income
    
    $
    4,362
    
    
    $
    5,449
    
    
    $
    3,989
    
    
    $
    (9,438
    )
    
    $
    4,362
 For the three months ended June 30, 2009Total
    
    
    Total Non-
    
    
    ConsolidatingSS&C
    
    
    Guarantors
    
    
    Guarantors
    
    
    Adjustments
    
    
    TotalRevenue
    
    $
    28,512
    
    
    $
    18,340
    
    
    $
    20,806
    
    
    $
    (407
    )
    
    $
    67,251Cost of revenue
    
    
    16,154
    
    
    
    11,569
    
    
    
    7,205
    
    
    
    (407
    )
    
    
    34,521Gross profit
    
    
    12,358
    
    
    
    6,771
    
    
    
    13,601
    
    
    
    
    
    
    
    32,730Operating expenses:Selling & marketing
    
    
    3,078
    
    
    
    590
    
    
    
    1,371
    
    
    
    
    
    
    
    5,039Research & development
    
    
    4,034
    
    
    
    885
    
    
    
    1,838
    
    
    
    
    
    
    
    6,757General & administrative
    
    
    4,051
    
    
    
    260
    
    
    
    788
    
    
    
    
    
    
    
    5,099Total operating expenses
    
    
    11,163
    
    
    
    1,735
    
    
    
    3,997
    
    
    
    
    
    
    
    16,895Operating income
    
    
    1,195
    
    
    
    5,036
    
    
    
    9,604
    
    
    
    
    
    
    
    15,835Interest expense, net
    
    
    (6,394
    )
    
    
    
    
    
    
    (2,900
    )
    
    
    
    
    
    
    (9,294
    )Other (expense) income, net
    
    
    178
    
    
    
    (303
    )
    
    
    (1,354
    )
    
    
    
    
    
    
    (1,479
    )(Loss) income before income taxes
    
    
    (5,021
    )
    
    
    4,733
    
    
    
    5,350
    
    
    
    
    
    
    
    5,062(Benefit) provision for income taxes
    
    
    (1,461
    )
    
    
    928
    
    
    
    2,104
    
    
    
    
    
    
    
    1,571Equity in net income of subsidiaries
    
    
    7,051
    
    
    
    
    
    
    
    
    
    
    
    (7,051
    )
    
    
    Net income
    
    $
    3,491
    
    
    $
    3,805
    
    
    $
    3,246
    
    
    $
    (7,051
    )
    
    $
    3,491
 For the six months ended June 30, 2010Total
    
    
    Total Non-
    
    
    ConsolidatingSS&C
    
    
    Guarantors
    
    
    Guarantors
    
    
    Adjustments
    
    
    TotalRevenue
    
    $
    71,346
    
    
    $
    45,960
    
    
    $
    43,202
    
    
    $
    (716
    )
    
    $
    159,792Cost of revenue
    
    
    38,645
    
    
    
    26,147
    
    
    
    16,026
    
    
    
    (716
    )
    
    
    80,102Gross profit
    
    
    32,701
    
    
    
    19,813
    
    
    
    27,176
    
    
    
    
    
    
    
    79,690Operating expenses:Selling & marketing
    
    
    7,344
    
    
    
    2,121
    
    
    
    3,170
    
    
    
    
    
    
    
    12,635Research & development
    
    
    8,206
    
    
    
    3,400
    
    
    
    4,013
    
    
    
    
    
    
    
    15,619General & administrative
    
    
    8,498
    
    
    
    1,425
    
    
    
    2,303
    
    
    
    
    
    
    
    12,226Total operating expenses
    
    
    24,048
    
    
    
    6,946
    
    
    
    9,486
    
    
    
    
    
    
    
    40,480Operating income
    
    
    8,653
    
    
    
    12,867
    
    
    
    17,690
    
    
    
    
    
    
    
    39,210Interest expense, net
    
    
    (11,730
    )
    
    
    
    
    
    
    (5,345
    )
    
    
    
    
    
    
    (17,075
    )Other income (expense), net
    
    
    710
    
    
    
    (150
    )
    
    
    (560
    )
    
    
    
    
    
    
    Loss from extinguishment of debt
    
    
    (5,480
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,480
    )(Loss) income before income taxes
    
    
    (7,847
    )
    
    
    12,717
    
    
    
    11,785
    
    
    
    
    
    
    
    16,655(Benefit) provision for income taxes
    
    
    (2,038
    )
    
    
    2,502
    
    
    
    2,808
    
    
    
    
    
    
    
    3,272Equity in net income of subsidiaries
    
    
    19,192
    
    
    
    
    
    
    
    
    
    
    
    (19,192
    )
    
    
    Net income
    
    $
    13,383
    
    
    $
    10,215
    
    
    $
    8,977
    
    
    $
    (19,192
    )
    
    $
    13,383
  13




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##### Table of Contents



For the six months ended June 30, 2009Total
    
    
    Total Non-
    
    
    ConsolidatingSS&C
    
    
    Guarantors
    
    
    Guarantors
    
    
    Adjustments
    
    
    TotalRevenue
    
    $
    55,023
    
    
    $
    36,984
    
    
    $
    39,839
    
    
    $
    (873
    )
    
    $
    130,973Cost of revenue
    
    
    30,635
    
    
    
    22,858
    
    
    
    14,973
    
    
    
    (873
    )
    
    
    67,593Gross profit
    
    
    24,388
    
    
    
    14,126
    
    
    
    24,866
    
    
    
    
    
    
    
    63,380Operating expenses:Selling & marketing
    
    
    6,017
    
    
    
    1,580
    
    
    
    2,670
    
    
    
    
    
    
    
    10,267Research & development
    
    
    7,297
    
    
    
    1,687
    
    
    
    3,640
    
    
    
    
    
    
    
    12,624General & administrative
    
    
    7,712
    
    
    
    481
    
    
    
    1,988
    
    
    
    
    
    
    
    10,181Total operating expenses
    
    
    21,026
    
    
    
    3,748
    
    
    
    8,298
    
    
    
    
    
    
    
    33,072Operating income
    
    
    3,362
    
    
    
    10,378
    
    
    
    16,568
    
    
    
    
    
    
    
    30,308Interest expense, net
    
    
    (12,814
    )
    
    
    
    
    
    
    (5,830
    )
    
    
    
    
    
    
    (18,644
    )Other (expense) income, net
    
    
    629
    
    
    
    (333
    )
    
    
    (1,218
    )
    
    
    
    
    
    
    (922
    )Income (loss) before income taxes
    
    
    (8,823
    )
    
    
    10,045
    
    
    
    9,520
    
    
    
    
    
    
    
    10,742(Benefit) provision for income taxes
    
    
    (2,155
    )
    
    
    1,890
    
    
    
    3,618
    
    
    
    
    
    
    
    3,353Equity in net income of subsidiaries
    
    
    14,057
    
    
    
    
    
    
    
    
    
    
    
    (14,057
    )
    
    
    Net income
    
    $
    7,389
    
    
    $
    8,155
    
    
    $
    5,902
    
    
    $
    (14,057
    )
    
    $
    7,389
 For the six months ended June 30, 2010Total
    
    
    Total Non-
    
    
    ConsolidatingSS&C
    
    
    Guarantors
    
    
    Guarantors
    
    
    Adjustments
    
    
    TotalCash Flow from Operating Activities:Net income
    
    $
    13,383
    
    
    $
    10,215
    
    
    $
    8,977
    
    
    $
    (19,192
    )
    
    $
    13,383Non-cash adjustments
    
    
    (2,195
    )
    
    
    2,590
    
    
    
    2,707
    
    
    
    19,192
    
    
    
    22,294Changes in operating assets and liabilities
    
    
    (10,970
    )
    
    
    1,444
    
    
    
    (2,717
    )
    
    
    
    
    
    
    (12,243
    )Net cash provided by operating activities
    
    
    218
    
    
    
    14,249
    
    
    
    8,967
    
    
    
    
    
    
    
    23,434Cash Flow from Investment Activities:Intercompany transactions
    
    
    12,929
    
    
    
    (11,512
    )
    
    
    (1,417
    )
    
    
    
    
    
    
    Cash paid for business acquisitions, net
    
    
    (11,372
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (11,372
    )Proceeds from sale of property and equipment
    
    
    52
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    52Additions to capitalized software and other
intangibles
    
    
    (99
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (99
    )Additions to property and equipment
    
    
    (1,358
    )
    
    
    (263
    )
    
    
    (617
    )
    
    
    
    
    
    
    (2,238
    )Net cash provided by (used in) investing
activities
    
    
    152
    
    
    
    (11,775
    )
    
    
    (2,034
    )
    
    
    
    
    
    
    (13,657
    )Cash Flow from Financing Activities:Net repayments of debt
    
    
    (74,621
    )
    
    
    
    
    
    
    (6,976
    )
    
    
    
    
    
    
    (81,597
    )Proceeds from common stock issuance, net of
issuance costs
    
    
    134,611
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    134,611Proceeds from the exercise of stock options
    
    
    5,396
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,396Purchase of common stock for treasury
    
    
    (1,169
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,169
    )Income tax benefit related to exercise of
stock options
    
    
    3,582
    
    
    
    
    
    
    
    1
    
    
    
    
    
    
    
    3,583Net cash provided by (used in) financing
activities
    
    
    67,799
    
    
    
    
    
    
    
    (6,975
    )
    
    
    
    
    
    
    60,824Effect of exchange rate changes on cash
    
    
    
    
    
    
    
    
    
    
    (770
    )
    
    
    
    
    
    
    (770
    )Net increase (decrease) in cash and cash
equivalents
    
    
    68,169
    
    
    
    2,474
    
    
    
    (812
    )
    
    
    
    
    
    
    69,831Cash and cash equivalents, beginning of period
    
    
    6,226
    
    
    
    1,087
    
    
    
    11,742
    
    
    
    
    
    
    
    19,055Cash and cash equivalents, end of period
    
    $
    74,395
    
    
    $
    3,561
    
    
    $
    10,930
    
    
    $
    
    
    
    $
    88,886
  14




---



##### Table of Contents



For the six months ended June 30, 2009Total
    
    
    Total Non-
    
    
    ConsolidatingSS&C
    
    
    Guarantors
    
    
    Guarantors
    
    
    Adjustments
    
    
    TotalCash Flow from Operating Activities:Net income
    
    $
    7,389
    
    
    $
    8,155
    
    
    $
    5,902
    
    
    $
    (14,057
    )
    
    $
    7,389Non-cash adjustments
    
    
    (2,881
    )
    
    
    1,689
    
    
    
    3,374
    
    
    
    14,057
    
    
    
    16,239Changes in operating assets and liabilities
    
    
    (4,446
    )
    
    
    3,647
    
    
    
    (1,924
    )
    
    
    
    
    
    
    (2,723
    )Net cash provided by operating activities
    
    
    62
    
    
    
    13,491
    
    
    
    7,352
    
    
    
    
    
    
    
    20,905Cash Flow from Investment Activities:Intercompany transactions
    
    
    14,364
    
    
    
    (14,793
    )
    
    
    429
    
    
    
    
    
    
    
    Additions to property and equipment
    
    
    (388
    )
    
    
    (29
    )
    
    
    (204
    )
    
    
    
    
    
    
    (621
    )Cash paid for business acquisitions, net of
cash acquired
    
    
    (10,456
    )
    
    
    129
    
    
    
    
    
    
    
    
    
    
    
    (10,327
    )Proceeds from sale of property and equipment
    
    
    
    
    
    
    
    
    
    
    3
    
    
    
    
    
    
    
    3Net cash provided by (used in) investing
activities
    
    
    3,520
    
    
    
    (14,693
    )
    
    
    228
    
    
    
    
    
    
    
    (10,945
    )Cash Flow from Financing Activities:Net repayments of debt
    
    
    (961
    )
    
    
    
    
    
    
    (192
    )
    
    
    
    
    
    
    (1,153
    )Transactions involving SS&C Technologies
Holdings, Inc. common stock
    
    
    (184
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (184
    )Net cash used in financing activities
    
    
    (1,145
    )
    
    
    
    
    
    
    (192
    )
    
    
    
    
    
    
    (1,337
    )Effect of exchange rate changes on cash
    
    
    
    
    
    
    
    
    
    
    1,145
    
    
    
    
    
    
    
    1,145Net increase (decrease) in cash and cash
equivalents
    
    
    2,437
    
    
    
    (1,202
    )
    
    
    8,533
    
    
    
    
    
    
    
    9,768Cash and cash equivalents, beginning of period
    
    
    10,329
    
    
    
    5,180
    
    
    
    13,790
    
    
    
    
    
    
    
    29,299Cash and cash equivalents, end of period
    
    $
    12,766
    
    
    $
    3,978
    
    
    $
    22,323
    
    
    $
    
    
    
    $
    39,067
      15




---



##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 CRITICAL ACCOUNTING POLICIES
  
    
    Revenue Recognition
    
    Allowance for Doubtful Accounts
    
    Long-Lived Assets, Intangible Assets and Goodwill
    
    Acquisition Accounting
    
    Income Taxes
    
    Stock-Based Compensation
 Results of Operations for the Three Months and Six Months Ended June 30, 2010 and 2009
  Three months ended June 30,
    
    
    %
    
    
    Six months ended June 30,
    
    
    %2010
    
    
    2009
    
    
    Change
    
    
    2010
    
    
    2009
    
    
    ChangeRevenues:Software licenses
    
    $
    6,074
    
    
    $
    3,983
    
    
    
    52
    %
    
    $
    11,663
    
    
    $
    9,803
    
    
    
    19
    %Maintenance
    
    
    17,817
    
    
    
    16,066
    
    
    
    11
    %
    
    
    35,836
    
    
    
    31,606
    
    
    
    13
    %Professional services
    
    
    5,099
    
    
    
    5,393
    
    
    
    -5
    %
    
    
    10,488
    
    
    
    10,589
    
    
    
    -1
    %Software-enabled services
    
    
    52,628
    
    
    
    41,809
    
    
    
    26
    %
    
    
    101,805
    
    
    
    78,975
    
    
    
    29
    %Total revenues
    
    $
    81,618
    
    
    $
    67,251
    
    
    
    21
    %
    
    $
    159,792
    
    
    $
    130,973
    
    
    
    22
    %
  Three months ended June 30,
    
    
    Six months ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Revenues:Software licenses
    
    
    7
    %
    
    
    6
    %
    
    
    7
    %
    
    
    8
    %Maintenance
    
    
    22
    %
    
    
    24
    %
    
    
    22
    %
    
    
    24
    %Professional services
    
    
    6
    %
    
    
    8
    %
    
    
    7
    %
    
    
    8
    %Software-enabled services
    
    
    65
    %
    
    
    62
    %
    
    
    64
    %
    
    
    60
    %Total revenues
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
  16




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##### Table of Contents



Revenues
   Software Licenses
 Maintenance
 Professional Services
  17




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##### Table of Contents



Software-Enabled Services
 Cost of Revenues
  Cost of Software Licenses
 Cost of Maintenance
 Cost of Professional Services
  18




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##### Table of Contents



Cost of Software-Enabled Services
 Operating Expenses
  Selling and Marketing
 Research and Development
  19




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##### Table of Contents



General and Administrative
 Interest Expense, Net. 3 4 3 4 Liquidity and Capital Resources
 Other Income (Expense), Net
 Loss on Extinguishment of Debt Liquidity and Capital Resources
 Provision for Income Taxes.
 Liquidity and Capital Resources
    20




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##### Table of Contents



3 4
 Off-Balance Sheet Arrangements
  Senior Credit Facilities
     21




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##### Table of Contents



113/4% Senior Subordinated Notes due 2013
 3 4 pari passu
 3 4
  Covenant Compliance
       22




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##### Table of Contents




    
    Consolidated EBITDA does not reflect the provision of income tax expense in our various
jurisdictions;
 
    
    Consolidated EBITDA does not reflect the significant interest expense we incur as a
result of our debt leverage;
 
    
    Consolidated EBITDA does not reflect any attribution of costs to our operations related
to our investments and capital expenditures through depreciation and amortization charges;
 
    
    Consolidated EBITDA does not reflect the cost of compensation we provide to our
employees in the form of stock option awards; and
 
    
    Consolidated EBITDA excludes expenses that we believe are unusual or non-recurring, but
which others may believe are normal expenses for the operation of a business.
  Three Months Ended
    
    
    Six Months Ended
    
    
    Twelve Months EndedJune 30,
    
    
    June 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009
    
    
    2010Net income
    
    $
    4,362
    
    
    $
    3,491
    
    
    $
    13,383
    
    
    $
    7,389
    
    
    $
    25,012Interest expense (1)
    
    
    13,538
    
    
    
    9,294
    
    
    
    22,555
    
    
    
    18,644
    
    
    
    40,774Income taxes
    
    
    2,004
    
    
    
    1,571
    
    
    
    3,272
    
    
    
    3,353
    
    
    
    9,723Depreciation and amortization
    
    
    10,184
    
    
    
    9,025
    
    
    
    20,297
    
    
    
    17,598
    
    
    
    38,727EBITDA
    
    
    30,088
    
    
    
    23,381
    
    
    
    59,507
    
    
    
    46,984
    
    
    
    114,236Purchase accounting adjustments (2)
    
    
    (60
    )
    
    
    (54
    )
    
    
    (37
    )
    
    
    (105
    )
    
    
    (25
    )Unusual or non-recurring charges (3)
    
    
    (267
    )
    
    
    1,755
    
    
    
    84
    
    
    
    1,283
    
    
    
    791Acquired EBITDA and cost savings (4)
    
    
    
    
    
    
    857
    
    
    
    192
    
    
    
    2,025
    
    
    
    4,041Stock-based compensation
    
    
    3,882
    
    
    
    1,525
    
    
    
    5,232
    
    
    
    2,794
    
    
    
    8,045Capital-based taxes
    
    
    228
    
    
    
    342
    
    
    
    454
    
    
    
    676
    
    
    
    573Other (5)
    
    
    (45
    )
    
    
    295
    
    
    
    161
    
    
    
    640
    
    
    
    722Consolidated EBITDA
    
    $
    33,826
    
    
    $
    28,101
    
    
    $
    65,593
    
    
    $
    54,297
    
    
    $
    128,383
 (1)
    
    Interest expense includes loss from extinguishment of debt shown as a separate line item on our
Statement of Operations for the three months and six months ended June 30, 2010 and 2009.(2)
    
    Purchase accounting adjustments include an adjustment to increase rent expense by the amount
that would have been recognized if lease obligations were not adjusted to fair value at the date of the Transaction.(3)
    
    Unusual or non-recurring charges include foreign currency gains and losses, proceeds from legal
and other settlements and other one-time expenses.(4)
    
    Acquired EBITDA and cost savings reflects the EBITDA impact of significant businesses that were
acquired during the period as if the acquisition occurred at the beginning of the period and cost
savings to be realized from such acquisitions.(5)
    
    Other includes management fees and related expenses paid to The Carlyle Group and the non-cash
portion of straight-line rent expense.  23




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##### Table of Contents



t
 Covenant
    
    
    ActualRequirements
    
    
    RatiosMaximum consolidated total leverage to Consolidated EBITDA ratio
    
    
    5.50
    x
    
    
    2.22
    xMinimum Consolidated EBITDA to consolidated net interest
coverage ratio
    
    
    2.25
    x
    
    
    3.89
    x
 Recent Accounting Pronouncements
     24




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##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk
      
 Item 4T. Controls and Procedures
    25




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##### Table of Contents



PART II  OTHER INFORMATION
 
 Item 1A. Risk Factors
  
 Item 6. Exhibits
   26




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##### Table of Contents



SIGNATURE
  SS&C TECHNOLOGIES, INC.Date: August 9, 2010
    By:
    /s/ Patrick J. PedontiPatrick J. PedontiSenior Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)  27




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##### Table of Contents



Exhibit Index
 ExhibitNumber
    
    Description31.1
    
    
    Certification of the Registrants Chief Executive Officer pursuant
to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    
    Certification of the Registrants Chief Financial Officer pursuant
to Section 302 of the Sarbanes-Oxley Act of 200232
    
    
    Certification of the Registrants Chief Executive Officer and
Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
  28