Jack Henry & Associates Inc. (NASDAQ:JKHY) Q3 2018 Earnings Conference Call - Preliminary Transcript

May 02, 2018 • 08:45 am ET

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Jack Henry & Associates Inc. (NASDAQ:JKHY) Q3 2018 Earnings Conference Call - Preliminary Transcript

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Presentation
Executive
David B. Foss

of quota. As I mentioned in the press release, it also appears that the team is on track to exceed quota for the year. This was a well-balanced sales quarter with the sales teams posting solid numbers for several of our new solutions, including Banno, Debit Processing, the new Credit Processing Solution and Treasury Management. We also had a record number of Symitar into out signings at 13.

Regarding our new first data PSU debit card offering, we now have 34 customers converted and live on the new platform. As with any conversion, we've encountered a few minor bumps, but I'm very happy to say that all of these customers are referenceable at this point. And as planned, we will begin to slowly ramp our conversion volume later in May.

With regard to the recently enacted Tax Cuts and Jobs Act, we provided a very high level review of our plans in the last call, including plans to return a portion of the savings to our shareholders. Shortly after that call, we announced an increase to our quarterly dividend of 19%. We also discussed our intent to use a portion of the TCJA savings to offer a voluntary incentive plan which would provide a large subset of our longer tenured employees the option to leave the company with a significant financial reward. We projected a Q4 expense of around $8 million as a result of this program.

As we have discussed with many of you in the past, our voluntary turnover rate runs well below the industry average. This tends to provide great stability in our workforce because once people join our company, they are generally inclined to stay. We saw this same behavior reflected in the results of this special incentive program in that even though we felt we had forecasted conservatively, many fewer people took advantage of the program than we had expected. Our Q4 charge therefore will be much closer to $5.5 million than the originally projected $8 million.

We don't intend to offer another program like this, but as we move through FY 2019, we'll be announcing several other programs intended to benefit our employees, including an improved 401(k) offering and improved bonus structure and other changes designed to help us continue to attract and retain strong talent.

Sticking with the topic of attracting and retaining the best talent in the industry, most of you are well aware of the fact that we regularly win Best Place to Work Awards around the country and in various publications. Yesterday afternoon, we were notified that this year we have again won as a Best Large Employer in the Forbes Magazine annual review. Last year, we were recognized as number 92 on the list of Top 500 Large Employers and number seven among the 26 technology companies. This year, we have moved up to number 12 overall and number two on the list of technology companies with Google as the only company scoring higher than Jack Henry. Obviously, we're