Blackbaud officials were happy with the results for the year ended December 31. But the results for the fourth quarter certainly changed at a slower pace than for the year overall.
Net income for the year was off 39.1 percent versus down 74.5 percent for the final quarter. Revenue grew by 7.8 percent for the year; by 1.8 percent for the fourth quarter. CEO Mike Gianoni noted during this week’s earnings webcast the total still left the nonprofit software company exceeding the midpoint of guidance. Net income for the year dropped to $44.8 million, down from $73.6 million. Revenue for 2018 was $848.6 million, up from $788.5 million. Fourth-quarter revenue was $221.2 million, compared to $217.4 million in last year’s corresponding period. Net income in the final period fell to $9.3 million from $36 million. A drop in services revenue hurt the top line for both the year and final period. In the prior two years, “We've seen a 17-percent decline each year in onetime services. We're expecting that to be a 25-percent decline,” he said. The decline is happening because Blackbaud is moving past the top of the bell curve in transitioning customer to the NXT line, the executives said, which has reduced the amount of services sold. A number of factors pushed earnings down. Interest expense of $15.9 million, an increase of 31.4 percent from $12.1 million. Results for 2017 were helped by a tax benefit of $15.3 million. That fell to a benefit of $219,000 for the most recently ended year.
Bob Scott has been informing and entertaining the mid-market financial software community with his email newsletters for 10 years. And he has been covering this market through print publications for 18 years, first as technology editor of Accounting Today and then as the Editor of Accounting Technology from 1997 through 2009. He has covered the traditional tax and accounting profession during the same time and continues to address that as executive editor of the Progressive Accountant.
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