Omnicell Inc (OMCL) 2015 Q4 法說會逐字稿

Good afternoon. My name is Sherilynn, and I will be your conference operator today. At this time I would like to welcome everyone to the Omnicell fourth and total-year 2015 quarter earnings call. (Operator Instructions) I would now like to turn the conference over to Peter Kuipers. Please go ahead.

Thank you. Good afternoon, and welcome to the Omnicell fourth-quarter results conference call. At this time, all participants are in a listen-only mode. Later, will we conduct a question-and-answer session, and instructions will follow at that time.

Joining me today is Randall Lipps, Omnicell Founder, Chairman, President and CEO. This call will include forward-looking statements subject to risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied. For a more detailed description of the risks that impact these forward-looking statements, please refer to the information in our press release today, in the Omnicell annual report on Form 10-K filed with the SEC on March 30, 2015, and in other more recent reports filed with the SEC. Please be aware that you should not place undue reliance on any forward-looking statements made today.

The date of this conference call is February 4, 2016, and all forward-looking statements on this call are made based on the beliefs of Omnicell as of this date only. Future events or simply the passage of time may cause these beliefs to change.

Finally, this conference call is the property of Omnicell Inc., and any taping, other duplication or rebroadcast without the express written consent of Omnicell Inc. is prohibited.

Randy will -- Randall will first cover an update on our business today; then I will cover our results for 2015 and our guidance for 2016. Following our prepared remarks, we will take your questions.

Our fourth-quarter and total-year financial results are, as usual, included in our earnings announcement which was released earlier today and is posted in the investor relations section of our website at www.omnicell.com. Let me turn over the call to Randall.

Good afternoon, everyone. We're excited to discuss our fourth-quarter and total-year results as well as our expectations for 2016, including the Aesynt business that we acquired on January 5 this year.

I'm proud of our performance in the fourth quarter and 2015 overall and our consistent track record over the past several years. The full year of 2015 was a Company record for bookings, the annualized new and competitive conversion rate, revenues and earnings.

For the fourth quarter, we exceeded our revenue guidance with record quarterly revenue of $130 million. Together with good cost execution, this revenue strength resulted in record non-GAAP EPS of $0.40 above analyst expectations. Total fiscal-year bookings ended at $392.3 million, slightly below our bookings guidance. We saw very strong momentum in bookings at the end of the quarter continuing into first-quarter 2016. We finished 2015 with the highest-ever annualized new and competitive conversion rate of 41% of bookings. This is a great indicator of the strength of the business. Over three quarters of these were competitive conversions, and the remainder were from greenfield customers who have never automated before.

For 10 consecutive years now, we have received the top honors from KLAS, the prestigious third-party rating organization. For 11 consecutive years, we have increased our market share and gained new thought-leader customers every quarter. Together with our customers, we are consistently delivering state-of-the-art medication management and workflow efficiency from caregivers and better health care for patients.

On January 5 of this year, we closed the acquisition of Aesynt. The Aesynt business, based in Cranberry Township, Pennsylvania, is a leader in enterprise medication management, with specific products in IV compounding, central pharmacy automation, point-of-care solutions and enterprise software products. We had previously prepared a brief summary of the transaction, which has been posted to the investor relations section of our website, omnicell.com, and has since been updated to reflect the closing of the transaction.

As a refresher, let me start by explaining our strategic rationale for this acquisition. The acquisition broadens our product portfolio for the point-of-care and centralized medication management equipment and solutions, and the combination provides our customers with unparalleled flexibility with the addition of new, innovative products that we feel integrate well with our existing portfolio of products. It expands our presence in hospitals by adding world-leading IV solutions and provides Omnicell with an opportunity to enter new growth markets. It accelerates development of enterprise software and real-time analytics. It further strengthens our continued commitment to improve patient and clinical safety and improve outcomes for patients. The acquisitions scale to better serve health care systems. The combination is expected to be accretive to non-GAAP earnings in 2016.

We have started our planned integration activities in all functional areas, led by a dedicated integration management team on-site in Cranberry. We are functionally integrating all teams with the exception of the IV robotics business unit, which is FDA-governed. We have visited a significant number of Aesynt customers, and the customer response to the combination have been very positive, welcoming the broader product portfolio that healthcare systems want to put in place because they are much more scalable and customizable.

Of our three growth strategies, our first strategy of differentiated products continues to attract new customers. We continue to experience great wins and add notable customers to our Omnicell family. In the fourth quarter, we had a strong momentum, and some of our notable first-time customer wins were the University of Kansas Medical Center and the Tripler Army Medical Center. The University of Kansas Medical Center, the region's premier academic medical center, is a 750-bed hospital serving more than 31,000 inpatients annually. Following an extensive internal review by KU involving nursing, pharmacy and informatics, the health system will be replacing their current products with a full range of Omnicell solutions throughout their multi-center health system. KU's decision to convert to Omnicell was based on our Unity platform benefits as well as our interoperability with their epic electronic healthcare record system.

I'm also very pleased with another important fourth-quarter win in the government segment. Omnicell was recently awarded the point-of-use medical system for Tripler Army Medical Center located in Hawaii. Tripler is the largest Army health readiness platform in the Pacific basin. We are proud to be a partner to this medical center, which today supports 264,000 local active-duty and retired military personnel, their families and veteran beneficiaries.

And already early in the quarter, we signed new agreements with Penn Medicine, a competitive conversion, and the University of Wisconsin Health. Penn Medicine, part of the University of Pennsylvania Health System, will initially convert three hospitals -- hospital at the University of Pennsylvania, Penn Presbyterian and Pennsylvania Hospital -- as well as four specialty locations to Omnicell solutions.

The hospitals of the University of Pennsylvania and Penn Presbyterian are ranked among the top hospitals in the United States by US News and World Report 2015, 2016. Penn Medicine will be using our Unity platform throughout the entire health system and will be implementing epic interoperability system-wide.

Also in January, we signed a multi-year agreement with another leading academic institution, the University of Wisconsin. The University of Wisconsin Health has been a historic leader in patient safety initiatives and pharmacy automation. They continue this leadership role by recommitting to their safe, efficient hybrid dispensing model using AcuDose robotic Rx, Enterprise Medication Manager and IV ONCO.

The agreement encompassed replacement of their automated dispensing cabinets with new AcuDose machines, a rebuild of their robot Rx and investment in IV ONCO to improve safety and accuracy in the compounding of hazardous IVs. This is a landmark win, as University of Wisconsin Health is now the first major health system to commit to the full line of Omnicell's recently acquired Aesynt solutions.

Penn Medicine and the University of Wisconsin are generally recognized as a leading hospital pharmacy medication management schools where the future pharmacists are moving into hospital medication management are educated.

Our second strategy of expanding into new markets also fueled growth in 2015 and, we believe, sets us up well for 2016 and beyond. Internationally, Omnicell is installing its first MACH4 robotic dispensing system in the Middle East after winning a contract and expanding our current relationship with Hamad Medical Corporation, Qatar's premier nonprofit health care provider. Hamad Medical Corporation and Omnicell expect the Omnicell robotic dispensing system to be fully operational at the General Hospital, the country's main hospital, next month.

Our third strategy of expanding our presence and relevance through requisition has also delivered great results with the acquisitions of MACH4 robotic dispensing equipment business, the [super] business Avantec in the United Kingdom, and the acquisition of Aesynt business that was announced in 2015 and closed in the first week of January this year.

We believe our hard work over the years and the execution about three-leg strategy laid the foundation for its success in 2015 and sets us up for continued future growth and scale. In today's evolving healthcare environment, we remain focused on our mission to change the practice of healthcare with solutions that improve patient and provider outcomes.

I will now turn the call back over to Peter to discuss our Q4 results and our 2016 guidance.

Thank you, Randall. I will discuss a summary of our 4Q 2015 and total-year 2015 financial results and our guidance for 2016.

Our 4Q 2015 revenues of $130.3 million were up 7.2% from the same quarter last year and up 4% sequentially. Strong demand was driven by both expansion and upgrades at existing customers as well as by new and competitive conversion customers.

Revenue strength in the fourth quarter resulted in record revenue of $485 million for total-year 2015, an increase of 10% year over year. Non-GAAP EPS of $1.33 per share in 2015 was also a record.

Earnings per share in accordance with GAAP were $0.21 in the fourth quarter 2015, which is down from $0.25 in 4Q 2014. GAAP gross margin was at 50% for the quarter.

In addition to GAAP financial results, we report our results on a non-GAAP basis, which excludes stock compensation expense and amortization of intangible assets associated with acquisitions and one-time acquisition-related expenses. We use non-GAAP financial statements in addition to GAAP financial statements because we believe it is useful for investors to understand acquisition, amortization-related costs and non-cash stock compensation expenses that are a component of our reported results, as well as one-time events suggest a gain on the Avantec investments in 2Q 2015 and one-time acquisition-related expenses.

A full reconciliation of our GAAP to non-GAAP results is included in our fourth-quarter earnings press release and is posted on our corporate website.

On a non-GAAP basis, earnings per share were $0.40 in 4Q 2015, up $0.01 from the same quarter last year. The acquisitions of MACH4 and Avantec contributed approximately $9 million of revenue and were neutral to non-GAAP EPS in the fourth quarter. Among the factors positively affecting both our GAAP and non-GAAP results is the US government permanent extension of the research and development tax credit in December 2015. This credit was not in our guidance and provided a $0.03 benefit to EPS in 4Q 2015. This benefit of the tax rate was partially offset by domestic and international income tax mix.

Adjusted earnings before interest, taxes, depreciation, amortization, which also excludes stock compensation amortization and the amortization of acquisition-related costs -- $25 million for the fourth quarter of 2015, up from $23.2 million a year ago.

Our business is also reported in segments consisting of automation analytics and medication adherence. Automation analytics consists of our Omni Rx automated dispensing cabinets, anesthesia workstations, central pharmacy, Omnicell supply, Pandora Analytics, and MACH4 robotic dispensing systems. Our acquisition of Avantec is also included in this segment.

The medication adherence segment consists of all adherence packaged consumables, which are now branded as SureMed and equipment used by pharmacists to create adherence packages. Our acquisitions of MTS and Surgichem are included in the med adherence segment. As a reminder, we now report certain corporate expenses that cannot be easily applied to either segment separately.

On a segment basis, our automation and analytics segment contributed $105.9 million of revenue in 4Q 2015, up from $98.3 million in 4Q 2014, or an increase of 8%. $29 million of GAAP operating income this quarter was flat versus same quarter last year. $31.3 million of non-GAAP operating income in 4Q 2015 compared to $30.8 million last year.

The medication adherence segments contributed $24.4 million of revenue to the quarter, compared to $23.2 million in 4Q 2014. GAAP operating income for this segment of $1.3 million compared to $1.1 million a year ago. $2.6 million of non-GAAP operating income for this segment compares to $2.4 million of non-GAAP operating income in 4Q a year ago. Non-GAAP common expenses were $13.4 million, compared to $14.3 million in the fourth quarter of 2014.

Turning to cash flow, in 4Q 2015 our cash increased from $57.8 million to $82.2 million, primarily due to strong operating cash flow performance. Accounts receivable days sales outstanding, or DSO, were 76 days, down nine days from last quarter. The decrease in DSO this quarter is a result of stronger collections as we completed implementations and increased revenue.

As expected, the DSOs start to normalize after the unusually high DSO in the first half of 2015. We review the collectability of our receivables regularly, and we do not believe that fluctuations in DSO are indicative of any change in our bad debt rate.

Inventories of $46.6 million, down $3 million from last quarter as a result of good inventory management. Our headcount was 1,451, up 7 from last quarter.

Let me now move to guidance for 2016. We recently completed the acquisition of the Aesynt business on January 5 of this year. And we are providing guidance on a combined basis inclusive of the acquired Aesynt business. Overall, we view 2016 as a transitional and transformative year as we integrate the Aesynt business, including realignment of the field and sales teams. Now, with the combined customer base, we have the opportunity for significant revenue and earnings growth for the coming years.

For 2016, we expect product bookings to be between $540 million and $560 million. We expect revenue to be between $695 million and $715 million in 2016. We expect 2016 non-GAAP EPS to be between $1.50 and $1.60. We expect non-GAAP operating margins for 2016 to be approximately 13%.

When comparing 2016 to 2015, it is important to note a couple of items that are new for 2016. First, for 2016, our non-GAAP expected results include around $10 million of integration expenses that we do not adjust for based on our non-GAAP policy. These integration expenses directly impacting non-GAAP operating margins and non-GAAP EPS mostly consist of retention costs, integration-related IT costs, costs related to the implementation of Sarbanes-Oxley, costs related to tax restructuring, costs related to accelerated product development integration costs, and integration team and project costs.

The second new item for 2016 is cost synergies. In 2016, we are expecting modest first-year cost synergies between $5 million and $10 million. As we have demonstrated in the past, we are confident to achieve our 15% non-GAAP operating margin target over time after integrating the acquired business and getting full benefit of the scale of the combined business.

A third new item for 2016 is interest expense. For 2016, we expect interest expense related to the senior secured credit facility used to finance the Aesynt acquisition to be around $6 million. Compared to 2015 actuals, this is a headwind to non-GAAP EPS of around $0.10.

Finally, we are assuming an annual average tax rate of 38% on GAAP earnings on a combined basis. This does include the benefit of the R&D tax credit impact, as it has been permanently approved by the government.

For the first quarter of 2016, we expect revenue to be between $165 million and $170 million, and expected non-GAAP EPS is between $0.25 and $0.28 per share.

To round off our update, I will hand the call back to Randall.

Thanks, Peter. We had a great number of great new wins and installs in 2015, and we are off to a terrific start in 2016. We're looking forward to a very strong 2016, with mid-double-digit bookings growth organically for the combined business. The expected reported 2016 non-GAAP EPS growth is strong as well.

Revenue growth is more muted in this transitional and transformative year as we integrate the Aesynt business and expect modest adjustments related to sales force alignment and other integration activities. Revenue growth in this transitional year is impacted modestly as well from an initial pause by Aesynt customers who are waiting to see the acquisition close. Some of these Aesynt customers are retapering their bookings, as they now have a choice of a broader product portfolio, resulting in modest booking-to-revenue conversion timing delays.

We do see a great opportunity over the midterm for the existing customer base to refresh their existing equipment with products from the combined broadened product portfolio. And we are executing our growth strategy well, delivering state-of-the-art medication management and workflow efficiency to our customers, results for investors and better health care for patients. I believe we have all the ingredients for continued long-term success.

With that, operator, I would like to open up the call for questions.

(Operator Instructions) Matt Hewitt, Craig-Hallum Capital.

Congratulations on closing the transaction early and obviously the great performance in Q4.

Thank you.

Thank you.

Thank you, Matt.

A couple questions regarding Aesynt. How should we be modeling for the combined Company? Will you be adding a new bucket for Aesynt, or will that product portfolio be filtered into one of the two existing buckets? And how should we be thinking about that?

Yes, from a -- thanks, Matt. Thanks for the question. The way to look at is on a segment reporting perspective. Essentially, we have determined that the Aesynt products fit into the A&A segment and effectively is an integrated business as of the date of close. As a matter of fact, we have seen some customers already be tapering bookings to actually switch products within that same segment. So we're not providing separate breakouts of the Aesynt business, as it is essentially now a merged business with common customers and customers actually buying products from both legacy entities, if you will.

Jamie Stockton, Wells Fargo.

I guess maybe Peter, could you give us some feel for what the 2015 bookings would've been -- product bookings for the Aesynt business? I know Randy mentioned that you guys are expecting mid -- did you say double-digit or single-digit -- I can't remember -- organic growth?

Strong mid-level digits. So you should take the midrange of our bookings guidance, and then back into the number.

Okay. Is there a number for what Aesynt did in bookings? It sounds like from your commentary that the Aesynt bookings could actually be down some in 2016 just because of the transition. But is there a 2015 number that you have on hand?

What I can tell you is that on a combined basis, we're expecting to be roughly up 15% organically -- 16% versus combined 15%.

Okay. So does that imply that the strong mid-double-digit growth -- if you are actually pro forming -- when you say that you are actually pro forming a 2015 number for the two businesses combined -- or when you say organic, are you just looking at the legacy Omnicell (multiple speakers)?

Both businesses combined off of that number (multiple speakers) up 15%. And actually after we have combined the businesses, it's difficult to track if an Aesynt customer now buys an Omnicell product or it switches over to a Omnicell product or vice versa, you can't -- it's hard to track which products people are buying based on which customers. Because they may just -- they may be originally an Aesynt customer and now they are buying Omnicell products and vice versa. But overall, it's a strong growth profile for next year.

Okay, that's great. And then maybe just one more, Randy. Could you touch on what greenfield opportunity really remains at this point, maybe especially in the US? You obviously had a very good year in 2015 finding either competitive conversion or greenfield yields. Do you think 2016 will shape up in a similar manner, or might we see kind of a shift back toward the existing customer base driving a higher percentage of bookings? And I will leave it there. Thanks.

Well, yes, that's great question. Actually, we see consistently strong competitive conversions and more greenfield -- probably less on the greenfield side because there's just less of it. We also count, on the A&A side, greenfield accounts on the international side, which is contributing to that number mostly. But inside the US, it's mostly competitive conversion.

Now, since we've combined with Aesynt, we used to convert them as a competitor, and now obviously they are inside the family. So the competitive conversion rate naturally, we believe, will drop around 25%. That's not because we were less competitive, it's just that the competitive conversions are now internal, if you will.

Steve Halper, FBR.

First, when you look at the Aesynt business, obviously on a segment basis it's all go into automation, and not the adherence sector. Is that correct? (multiple speakers). Okay. So then when you look at the Aesynt revenue, what was the mix between your traditional segments on the income statement product versus service?

For 2015 or looking forward to 2016?

Yes, no, no, just for 2015, just to give us some flavor as to what it's going to look like in 2016.

Yes, yes. I think we are actually updating the -- we have updated the investor deck on that as well. So the way to think about it number-wise is that the Omnicell legacy business had about -- or has about 35% pure recurring revenue between maintenance service and the consumables. Add on the Aesynt business, that's a -- that business is 50-50 between product and recurring revenue from services.

Right, so it's got a higher level (multiple speakers) -- right -- it's got a higher level of service attached to it because of the robot staffing? Right?

Exactly.

Okay. So then, what was the -- do you have an estimate yet for what the amortization expense will be relating to the Aesynt acquisition?

Yes, we do. We will disclose them in actuals, but you should -- we are still, of course, doing the purchase price accounting and making sure we got a good estimate there. But initial indications on intangible amortization, about $12 million for the acquisition for the year.

And I guess the only other -- when you look at the last disclosure -- this is my last question. When you indicated that the latest 12 months for Aesynt would be $190 million -- I'm assuming it came in at $190 million from whatever point of time you were measuring it. But -- and understanding that it's hard to measure with any exact form. But based on some of those delays that you talked about, would that number be down, the $190 million? Or is it -- it's too difficult to --

No, fair question. We are finalizing the audit for Aesynt for calendar 2015, if you will. But it's roughly in that ballpark. In the LTM that we disclosed earlier, it should be roughly in line at the $190 million mark for calendar 2015.

But would that number decline because of some of those delays? Or we're not going to be able to see any of that (multiple speakers) breakdown any?

Like we commented on earlier, we really see it as one business now. We have some customers switching bookings, actually, between products, so we're not measuring it separately from that perspective.

We're not disclosing exact numbers, but there is some assumption that most of the delays in the revenue conversion rate are from former Aesynt customers. That's (multiple speakers) right? So we're not losing the business there, just moving the product choices around.

Raymond Myers, Benchmark and Co.

We haven't touched on the M5000. Can we get an update on that product development and when we expect that to launch?

Yes, I think as I said publicly recently, the debated completes this quarter and then is available Q2. And we feel like things are on schedule for that and getting good feedback.

Okay, great. And did you give a number for the percentage of G4 conversions?

We are at the end of the year at 78% -- 77.7%, I believe.

Was it 77% or 78%?

77.7%.

77.7%. Very good.

(multiple speakers). Go ahead.

Just given the overall color and tenor of your comments during this call, it sounds like the signings -- you are very excited about the cadence of signings, particularly in January entering this year. Can you give us a sense -- is that particularly high -- unusually high, or is this within the general positive trends that Omnicell has been experiencing?

Well, I think we are -- definitely, finishing the year at a high of 41% of annualized conversion rate is a record. And we've been very pleased with that kind of result in the marketplace. And I would just say that we continue to see that kind of success in our pipeline is indicating that and gives us confidence about 2016.

Gene Mannheimer, Topeka Capital.

Congrats on a good finish and closing the Aesynt deal. I want to go back to the prior question on the Aesynt contribution. So if we use that $190 million number that you talked about, then your combined guidance implies that the core business would be about $5 million, $10 million this year, up around 6%. So that's below the high-single-digit growth that you are accustomed to seeing. Can you help reconcile that for us, or am I looking at that the right way?

Well, you are, and I think we said it was a transitional year. And what we mean by that, the bookings is still strong continuing on. But we see a delay in some of the customers moving from bookings to revenue, mainly out of the former Aesynt customer base, that does not contribute. We're going to have to get through this year to get through some of these transitions, so it's muting the revenues slightly for the year.

Mitra Ramgopal, Fidelity.

I just was hoping if you could give me a sense as to the $10 million of integration expenses, how we should look for that the flow through 2016. Is most of it going to be in the first quarter, or is it pretty much spread out?

It's fairly equally spread over the quarters.

Okay. And, again, if we had to look back in terms of this past quarter on the gross margin coming in a little, again, it's pretty much the issues you addressed earlier, or is there anything else in the quarter?

No, not specifically. We had a little bit less overhead cost absorption. We do have an upward trend in gross margin and med adherence if I look at the different months. So October, November, December to the quarter, so we feel good about margins going forward.

(Operator Instructions) Sean Wieland, Piper Jaffray.

You mentioned a sales force realignment that you are going to be going through. Can you just expand on what you are doing there?

Yes, I think we -- definitely today we -- for the first 90 days we kept the sales force structure in place so that the former Aesynt employees could focus on closing their deals for the quarter; Omnicell can close -- focus on closing their stuff for Q1. And the beginning of April, we're going to rationalize the sales force into a single face to the customer, and that's more territory realignment so we don't have overlaps like we have today.

And so can you give me a sense of what percentage of territories will be impacted from that?

I think it's going to allow us to actually expand -- I don't think we're going to disrupt the geographic territories of the corporate levels, but we are going to expand our named account executives, which allows us to give dedicated accounts to key accounts that we haven't had in the past.

So I don't think the disruption is going to be as big. But we will still make sure that people team up on former accounts to work together to -- you have some overlapping commissions to pay up from both groups until the end of the year to make sure we don't lose focus or lose contact with key accounts.

Okay. And then just one more quick one on the M5000. You said, I think, the beta completes this quarter and ships in Q2. Have you achieved customer acceptance on the product yet?

No, but we've got several demarcation points and we are on the last. So we've done two and we've got one left, and we feel confident about getting that before the end of the quarter.

Okay. All right. Thank you very much.

Matt Hewitt, Craig-Hallum Capital.

I guess just a question about the general health. There was questions in Q3, I think there was some early in January, regarding the health of the customer hospitals' purchasing patterns. Maybe an update on what you are seeing, what you are hearing from the customers as far as spending expectations for 2016. Thank you.

I think IT budgets are strong. I think we see a lot of continued consolidation and the execution of rationalization of groups and hospital and ID and providers and inpatient and outpatient coming together. And all of that activity, which is really a macro trend, is driving people to standardize on medication management, of strategies to reduce costs and put in best practices, which is -- historically has just been hospital by hospital. But now they are trying to put in corporate best practices, and they're more and more engaging us to do that for them, not just figure out the workflow but how to institute those best practices. And so we feel like there hasn't been a slowdown in either engagement or funds allocated to our specific area of growth in hospital spending.

Great. Thank you.

Mohan Naidu, Oppenheimer.

I apologize if this has been asked already; I'm just joining late. With the new guidance Randy, you had a long-term target of 15% growth and 15% margin. How should we look at coming back to those levels? Like, how are you thinking about with this new acquisition?

Well, obviously, this year with the additional burden of the integration costs and some overlaps in some people as we work through the synergies, we're around 13% this year, and obviously next year we're going to do better than that. We're not committing to what those are, but you should expect improvement as we -- we're committed to those targets. They are very important to us. And as we look to get closer to 2017, we will have a better understanding of that. But especially -- we know for sure it's going to be an improvement over our (multiple speakers) (inaudible) forecast.

Yes, maybe one question around the bookings commentary you made, Randy. You said you had some weakness in the beginning of the quarter but it picked up towards the end. Is that the same weakness -- should we think about this as you saw continued weakness from Q3 into Q4, but at the end of the Q4 it picked back up? And is it back to levels that it was in the beginning of 2015?

Yes, I think that -- yes, we've had a really strong closeout to Q4, which has just continued right on into Q1. Obviously, with the two announcements that we made on University of Wisconsin and Penn University closed almost the first week or two in the quarter there. It's just a good sign up momentum that we have. And we have strong pipelines. And we feel good about putting our guidance in place and executing to the plan that we have now got before us.

Got it. Peter, maybe one quick question around backlog. Do you give out a year-end backlog number?

No, we don't.

Okay. And I'm presuming somebody asked about the bookings split into 2016 guidance between your core on Aesynt, and I will check the transcript back.

We're not providing that. It's -- the AA business is one combined business.

All right. Thank you very much for taking my questions.

At this time, there are no further questions. I will turn the call back over to Randy Lipps for any closing remarks.

Thanks, everybody, joining the call. We're really excited about the Aesynt acquisition. It's only been 30 days and we've already seen some just great results. Spending time with customers and employees and all the things that we had before us, it's just an exciting time to be at Omnicell. And being able to drive growth and really deliver on solutions for what customers need in order to get through the next phase of healthcare. Thanks for joining us today, and see you next time.

Thank you for your participation. This concludes today's conference call. You may now disconnect.