The ADAM acquisition moved Ebix into the employee benefits area. ADAM's medical database offerings rank at the pinnacle of the industry. But that operation always had trouble capitalizing on its potential due to below average technology management. Software offerings usually were a generation behind. Ebix already is improving those systems. An initial upgrade is slated for introduction in the fall, when most companies open their benefit enrollment season. Further enhancements promise to reinforce the trend in subsequent years. Ebix plans to ultimately extend its reach beyond medical insurance into claims processing, to help carriers and hospitals automate the reimbursement process. Most hospitals and insurance companies currently bolt on a variety of software packages, which can lead to incompatibility and wrong calculations.
We are raising our earnings estimate a nickel to $1.45 a share. Our revenue estimate is unchanged at $175 million. Growth could be sustained at superior levels as the employee benefit line gains momentum, more brokers and insurance companies adopt online exchange systems, and the overall insurance industry recovers. Internal growth of 10%-20% appears sustainable well into the decade. (Please see "Accounting Notes" for an explanation of our adjustments to reported earnings. Addbacks include $556,000 for stock options, $1.2 million for acquired intangible amortization, and $1.79 million in one time deal costs. Our tax rate is 17.0% compared to 9.4% as reported under GAAP rules. It excludes tax loss carryforward benefits.)
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