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CPSI Announces First Quarter 2011 Results
Company Declares Regular Quarterly Dividend of $0.36 Per Share

MOBILE, Ala., Apr 20, 2011 (BUSINESS WIRE) -- Computer Programs and Systems, Inc. (NASDAQ: CPSI):

Highlights:

  • Revenues of $40.4 million;
  • 12-month backlog of $129.0 million;
  • Earnings per diluted share of $0.49;
  • Cash provided by operations of $14.3 million; and
  • Quarterly dividend of $0.36 per share.

Computer Programs and Systems, Inc. (NASDAQ: CPSI), a leading provider of healthcare information solutions, today announced results for the first quarter ended March 31, 2011.

The Company also announced that its Board of Directors has declared a regular quarterly cash dividend of $0.36 (thirty-six cents) per share, payable on May 27, 2011, to stockholders of record as of the close of business on May 12, 2011.

Total revenues for the first quarter ended March 31, 2011, increased 28.0% to $40.4 million, compared with total revenues of $31.5 million for the prior-year period. Net income for the quarter ended March 31, 2011, increased 84.0% to $5.4 million, or $0.49 per diluted share, compared with $2.9 million, or $0.27 per diluted share, for the quarter ended March 31, 2010. Cash provided by operations for the first quarter of 2011 was $14.3 million, compared with $5.8 million of cash provided by operations for the prior-year period.

For the second quarter of 2011, the Company anticipates total revenues of $42.0 million to $45.0 million and net income of approximately $5.7 million to $6.1 million, or $0.52 to $0.56 per diluted share. CPSI's 12-month backlog as of March 31, 2011, was $129.0 million, consisting of $32.3 million in non-recurring system purchases and $96.7 million in recurring payments for support, Business Management Services, ASP and ISP contracts.

A listen-only simulcast and replay of CPSI's first quarter 2011 conference call will be available on-line at www.cpsinet.comand www.earnings.comon April 21, 2011, beginning at 9:00 a.m. Eastern Time.

About Computer Programs and Systems, Inc.

CPSI is a leading provider of healthcare information solutions for community hospitals with over 650 client hospitals in 46 states and the District of Columbia. Founded in 1979, the Company is a single-source vendor providing comprehensive software and hardware products, complemented by complete installation services and extensive support. Its fully integrated, enterprise-wide system automates clinical and financial data management in each of the primary functional areas of a hospital. CPSI's staff of over 1,000 technical, healthcare, medical and business professionals provides system implementation and continuing support services as part of a comprehensive program designed to respond to clients' information needs in a constantly changing healthcare environment. For more information, visit www.cpsinet.com.

This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995.These forward-looking statements can be identified generally by the use of forward-looking terminology and words such as "expects," "anticipates," "estimates," "believes," "predicts," "intends," "plans," "potential," "may," "continue," "should," "will" and words of comparable meaning.Without limiting the generality of the preceding statement, all statements in this press release relating to estimated and projected earnings, margins, costs, expenditures, cash flows, growth rates and future financial results are forward-looking statements.We caution investors that any such forward-looking statements are only predictions and are not guarantees of future performance.Certain risks, uncertainties and other factors may cause actual results to differ materially from those projected in the forward-looking statements.Such factors may include: overall business and economic conditions affecting the healthcare industry; saturation of our target market and hospital consolidations; changes in customer purchasing priorities, capital expenditures and demand for information technology systems; competition with companies that have greater financial, technical and marketing resources than we have; failure to develop new technology and products in response to market demands; fluctuations in quarterly financial performance due to, among other factors, timing of customer installations; failure of our products to function properly resulting in claims for medical losses; government regulation of our products and customers, including the effects of the healthcare reform legislation enacted in 2010 and changes in healthcare policy affecting Medicare and Medicaid reimbursement rates; changes in accounting principles generally accepted in the United States; general economic conditions, including changes in the financial markets that may affect the availability and cost of credit to us or our customers; interruptions in our power supply and/or telecommunications capabilities and other risk factors described from time to time in our public releases and reports filed with the Securities and Exchange Commission, including, but not limited to, our most recent Annual Report on Form 10-K.We also caution investors that the forward-looking information described herein represents our outlook only as of this date, and we undertake no obligation to update or revise any forward-looking statements to reflect events or developments after the date of this press release.

COMPUTER PROGRAMS AND SYSTEMS, INC.
Unaudited Condensed Statements of Operations

(in thousands, except per share data)

Three Months Ended

March 31,

2011 2010
Sales revenues:
System sales $ 15,607 $ 9,700
Support and maintenance 16,162 14,206
Business management services 8,611 7,635
Total sales revenues 40,380 31,541
Cost of sales:
System sales 12,121 9,467
Support and maintenance 6,444 5,530
Business management services 4,679 4,435
Total cost of sales 23,244 19,432
Gross profit 17,136 12,109
Operating expenses:
Sales and marketing 2,925 2,199
General and administrative 5,720 5,511
Total operating expenses 8,645 7,710
Operating income 8,491 4,399
Interest income, net 153 172
Income before taxes 8,644 4,571
Provision for income taxes 3,271 1,651
Net income $ 5,373 $ 2,920
Basic earnings per share $ 0.49 $ 0.27
Diluted earnings per share $ 0.49 $ 0.27
Weighted average shares outstanding:
Basic 10,963 10,973
Diluted 10,963 10,973
COMPUTER PROGRAMS AND SYSTEMS, INC.
Condensed Balance Sheets

(in thousands, except per share data)

March 31,

2011

Dec. 31,

2010

(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 9,943 $ 2,940
Investments 16,435 13,402
Accounts receivable, net of allowance for doubtful accounts of $969 and $759, respectively 23,004 25,473
Financing receivables, current portion 2,945 3,114
Inventory 2,349 1,783
Deferred tax assets 1,888 2,244
Prepaid income taxes - 102
Prepaid expenses 244 562
Total current assets 56,808 49,620
Financing receivables, long-term 4,692 4,432
Property and equipment 20,001 19,576
Accumulated depreciation (11,502 ) (10,893 )
Total assets $ 69,999 $ 62,735
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 3,659 $ 2,617
Deferred revenue 5,698 4,469
Accrued vacation 3,051 2,952
Income taxes payable 2,826 -
Other accrued liabilities 5,110 4,447
Total current liabilities 20,344 14,485
Deferred tax liabilities 1,689 1,786
Stockholders' equity:
Common stock, par value $0.001 per share, 30,000 shares authorized, 10,963 and 10,973 shares issued and outstanding 11 11
Additional paid-in capital 30,620 30,549
Accumulated other comprehensive income 63 59
Retained earnings 17,272 15,845
Total stockholders' equity 47,966 46,464
Total liabilities and stockholders' equity $ 69,999 $ 62,735
COMPUTER PROGRAMS AND SYSTEMS, INC.
Unaudited Other Supplemental Information

(In thousands)

The following table summarizes free cash flow for the Company:

Three Months Ended

March 31,

2011 2010
Net cash provided by operating activities $ 14,290 $ 5,788
Purchases of property and equipment (298 ) (1,283 )
Free cash flow $ 13,992 $ 4,505

Free cash flow is a non-GAAP financial measure which CPSI defines as net cash provided by operating activities less purchases of property and equipment. The most directly comparable GAAP financial measure is net cash provided by operating activities. The Company believes free cash flow is a useful measure of performance and uses this measure as an indication of the financial resources of the Company and its ability to generate cash.

SOURCE: Computer Programs and Systems, Inc.

Computer Programs and Systems, Inc.
Boyd Douglas, 251-639-8100
President and Chief Executive Officer