[August 25, 2016] |
|
American Software Reports Preliminary First Quarter of Fiscal Year 2017 Results
American Software, Inc. (NASDAQ: AMSWA) today reported preliminary
financial results for the first quarter of fiscal 2017.
Key first quarter financial highlights:
-
Total revenues for the quarter ended July 31, 2016 were $27.4 million,
a decrease of 5% over the comparable period last year.
-
Software license revenues for the quarter ended July 31, 2016 were
$4.6 million, a decrease of 5% compared to the same period last year.
-
Services and other revenues for the quarter ended July 31, 2016
decreased 12% to $12.2 million compared to $13.8 million for the same
period last year.
-
Maintenance revenues for the quarter ended July 31, 2016 increased 4%
to $10.6 million compared to $10.1 million for the same period last
year.
-
Operating earnings for the quarter ended July 31, 2016 were $1.6
million compared to $3.8 million the same period last year.
-
GAAP net earnings for the quarter ended July 31, 2016 decreased 34% to
$1.7 million or $0.06 per fully diluted share compared to $2.6 million
or $0.09 per fully diluted share for the same period last year.
-
Adjusted net earnings for the quarter ended July 31, 2016, which
excludes non-cash stock-based compensation expense and amortization of
acquisition-related intangibles were $2.0 million or $0.07 per fully
diluted share compared to $2.9 million or $0.10 per fully diluted
share for the same period last year, which also excluded non-cash
stock-based compensation expense and amortization of
acquisition-related intangibles.
-
EBITDA decreased by 42% to $3.1 million for the quarter ended July 31,
2016 compared to $5.2 million for the quarter ended July 31, 2015.
-
Adjusted EBITDA decreased 39% to $3.4 million for the quarter ended
July 31, 2016 compared to $5.6 million for the quarter ended July 31,
2015. Adjusted EBITDA represents GAAP net earnings adjusted for
amortization of intangibles, depreciation, interest income & other,
net, income tax expense and non-cash stock-based compensation expense.
-
Cloud Services Annual Contract Value (ACV) increased approximately 36%
to $4.0 million for the quarter ended July 31, 2016 compared to $3.0
million for the same period of the prior year. The ACV is comprised of
software-as-a-service (SaaS) ACV of $2.1 million compared to
approximately $1.5 million during the same period last year and other
cloud services ACV of $1.9 million compared to $1.5 million during the
same period last year.
The Company is including ACV, EBITDA, adjusted EBITDA, adjusted net
earnings and adjusted net earnings per share in the summary financial
information provided with this press release as supplemental information
relating to its operating results. This financial information is not in
accordance with, or an alternative for, GAAP-compliant financial
information and may be different from the non-GAAP financial information
used by other companies. The Company believes that this presentation of
ACV, EBITDA, adjusted EBITDA, adjusted net earnings and adjusted net
earnings per share provides useful information to investors regarding
certain additional financial and business trends relating to its
financial condition and results of operations. ACV is a forward-looking
operating measure used by management to better understand cloud services
(SaaS and other related cloud services) revenue trends within the
Company's business as it reflects the Company's current estimate of
revenue to be generated under the existing client contracts in the
forward 12-month period.
The overall financial condition of the Company remains strong, with cash
and investments of approximately $78.0 million and no debt as of July
31, 2016. We increased cash and investments by $1.2 million from the
same period last year. During the first quarter, the Company paid
approximately $2.9 million in dividends.
"Although first quarter results were below our expectations, it should
be noted that the same period prior year results included the completion
of a project with customer acceptance for approximately $1.5 million in
revenue, while the costs for that project were incurred in prior
periods," stated Mike Edenfield, president and CEO of American Software.
"We remain optimistic about fiscal year 2017. And, we continued to see
more customers leveraging our cloud services and SaaS offerings to
accelerate their deployments and enhance their operations. We are
pleased to report a significant 36% increase in Cloud Services ACV when
compared to the same period in the prior year."
"Logility's (News - Alert) acquisition of AdapChain, announced on August 23, 2016,
extends our ability to deploy our portfolio of innovative solutions more
quickly and at a lower total cost of ownership than our industry peers,"
said Edenfield. "This is the natural culmination of years of successful
collaboration between AdapChain and Logility and enables our customers
to enhance their supply chain success by transforming the complexity of
enterprise-wide application integration into a quick, simple and
repeatable process with systems such as SAP, Oracle (News - Alert), Infor, Microsoft
and JDA. The AdapChain acquisition is expected to be accretive to
Logility's earnings and cash flow within the next 12 months."
"Sales engagements continue to underscore that both new and existing
customers are investing to improve their supply chain performance and
achieve tangible business benefits from their planning initiatives in
the form of lower costs, better service and improved visibility across
increasingly complex and global networks," continued Edenfield.
"Likewise, we continue to invest in expanding our global presence to
serve more companies around the world. We signed software agreements
with customers in 11 countries during the first quarter of fiscal year
2017."
Additional highlights for the first quarter of fiscal 2017 include:
Customers & Channels
-
Notable new and existing customers placing orders with the Company in
the first quarter include: AdvancedPierre Foods, Bestseller United,
Brightstar Device Protection, Byer of California, Johnson Controls,
Medifast, Medline Japan G.K., MGA Entertainment, Sandvik, Serqirus,
Shanghai Formica Decorative Material Co. and Smithfield Foods.
-
During the quarter, software license agreements were signed with
customers located in the following 11 countries: Australia, Canada,
China, Denmark, Finland, Ireland, Japan, Mexico, Sweden, the United
Kingdom and the United States.
-
Logility, a wholly-owned subsidiary of the Company, announced Nutrabolt,
a fast-growing nutritional life sciences company, selected Logility
Voyager Solutions™ to help drive a more accurate forecast, align
inventory and improve customer service. With Logility, Nutrabolt will
synchronize its production and inventory with market demand across
multiple sales channels.
-
Logility announced Vista Outdoor, Inc., a designer, manufacturer, and
marketer of outdoor sports and recreation products, implemented
Logility Voyager Solutions to increase visibility across its global
supply chain and provide the technology foundation for its sales and
operations planning (S&OP) process. The company turned to advanced supply
chain solutions from Logility to support its S&OP process, foster
collaboration, increase forecast accuracy, and improve customer
service.
-
Logility announced several customer speakers for its upcoming
conference, Connections Europe 2016: The Voice of Supply Chain
Success. PANDORA, ghd (Good Hair Day), CooperVision, and BESTSELLER
join the packed agenda to share their experiences and journeys towards
supply chain success. The two-day event will be held at the London
Heathrow Marriott Hotel in London, UK, 10 - 11 October 2016.
-
During the quarter Logility congratulated Sandvik Mining and
Construction on being named a recipient of the Manufacturing
Executive 2016 Manufacturing Leadership 100 Award (ML 100).
Sandvik Mining and Construction was recognized for its outstanding
achievements in the Supply Chain Leadership category for their supply
chain transformation journey.
-
Logility announced the editors of Supply & Demand Chain
Executive Magazine named Logility to its annual listing of the
Supply & Demand Chain Executive 100 for supporting Modell's Sporting
Goods and their complex supply chain operations with innovative
technology. The award highlights 100 top supply chain projects of the
past year and marks the 14th year Logility has been honored
for enabling extraordinary supply chain initiatives
-
Demand Management, a wholly-owned subsidiary, announced that Andis
Company selected Demand Solutions DSX as its supply chain planning
solution. The leading provider of hair grooming products will use
Demand Solutions DSX Forecast Management to improve planning accuracy.
-
NGC Software, a wholly-owned subsidiary of the Company, announced that
ELAN International Inc., a designer, manufacturer and distributer of
young contemporary collections, including lounge, resort and
sportswear, has selected NGC's ERP (enterprise resource planning) and
Shop Floor Control System. ELAN will utilize NGC's solutions to ensure
the company continues to deliver on its reputation for customer
service, flexibility and excellent quality at competitive pricing.
-
NGC Software announced that Grupo M, the Western Hemisphere's largest
apparel manufacturer, has selected NGC's PLM software. Grupo M chose
NGC's PLM platform to drive innovation and efficiency for its rapidly
growing business. With NGC's solutions, Grupo M aims to improve
productivity throughout its complex organization.
-
NGC Software announced that Destination XL Group, Inc. (DXL) is
implementing NGC's EZ-Ship
Scan/Pack Solution. DXL will use EZ-Ship to reduce chargebacks and
packing errors by validating the contents of each carton and shipment
sent from the retailer's factory.
Company & Technology
-
Logility and Demand Management announced each company was named a SupplyChainBrain
100 Great Supply Chain Partner. This marks the 11th year
Logility has been recognized and the 10th year for Demand
Management. The award is based on a six-month survey in which supply
chain professionals were asked to nominate software solution and
service providers whose solutions have made a significant impact on
their company's efficiency, customer service and overall supply chain
performance.
-
Demand Management announced that its president, Bill Harrison was
named among the 2016 Provider Pros to Know by industry publication Supply
& Demand Chain Executive. The Pros to Know award recognizes an
elite group of professionals, chosen from more than 350 applicants,
who have helped shape the supply chain industry and elevate the role
of supply chain within the enterprise.
-
NGC Software announced that Inbound Logistics selected NGC as
one of the 2016 Top 100 Logistics IT Providers, marking the eighth
consecutive year that NGC has been named to this prestigious annual
list. All companies selected to the Top 100 list are viewed as leaders
in logistics IT, with solutions that are designed for simplicity, ROI
and efficient implementation.
About American Software, Inc.
Atlanta-based American Software, Inc. (NASDAQ: AMSWA) provides
demand-driven supply chain management and enterprise software solutions,
backed by more than 40 years of industry experience, that drive value
for companies regardless of market conditions. Logility, Inc., a
wholly-owned subsidiary of American Software, is a leading provider of
collaborative supply chain optimization and advanced retail planning
solutions that help medium, large, and Fortune 500 companies realize
substantial bottom-line results in record time. Logility Voyager
Solutions™ is a complete supply chain and retail optimization solution
suite that features an advanced analytics architecture and provides
supply chain visibility; demand, inventory and replenishment planning;
Sales and Operations Planning (S&OP); Integrated Business Planning
(IBP), supply and inventory optimization; manufacturing planning and
scheduling; retail merchandise and assortment planning and allocation;
and transportation planning and management. Logility customers include
Abercrombie & Fitch, Big Lots, Parker Hannifin, Verizon Wireless (News - Alert), and VF
Corporation. Demand Management, Inc., a wholly-owned subsidiary
of Logility, delivers affordable, easy-to-use software-as-a-service
(SaaS) supply chain solutions for manufacturers and distributors
designed to increase forecast accuracy, improve customer service levels,
and reduce overall inventory to maximize profits and lower costs. Demand
Solutions DSX offers demand planning, collaborative forecasting,
inventory planning, production planning and scheduling, S&OP and IBP.
Demand Management serves customers such as Siemens (News - Alert) Healthcare,
AutomationDirect.com, and Newfoundland Labrador Liquor Corporation. New
Generation Computing® (NGC®), a wholly-owned subsidiary of American
Software, is a leading provider of PLM, supply chain management, ERP,
and shop floor control software and services for brand owners, retailers
and consumer products companies. NGC customers include A|X Armani
Exchange, Billabong, Carter's, Destination XL, Hugo Boss, Jos. A. Bank,
Marchon Eyewear, Spanx, Swatfame, VF Corporation, and many others. For
more information about American Software, named one of the 100 Most
Trustworthy Companies in America by Forbes Magazine, please visit www.amsoftware.com,
call (800) 726-2946 or email: [email protected].
Forward-Looking Statements
This press release contains forward-looking statements that are subject
to substantial risks and uncertainties. There are a number of factors
that could cause actual results to differ materially from those
anticipated by statements made herein. These factors include, but are
not limited to, changes in general economic conditions, technology and
the market for the Company's products and services, including economic
conditions within the e-commerce markets; the timely availability and
market acceptance of these products and services; the Company's ability
to satisfy in a timely manner all SEC (News - Alert) required filings and the
requirements of Section 404 of the Sarbanes-Oxley Act of 2002 and the
rules and regulations adopted under that Section; the challenges and
risks associated with integration of acquired product lines and
companies; the effect of competitive products and pricing; the
uncertainty of the viability and effectiveness of strategic alliances;
and the irregular pattern of the Company's revenues. For further
information about risks the Company could experience as well as other
information, please refer to the Company's current Form 10-K and other
reports and documents subsequently filed with the Securities and
Exchange Commission. For more information, contact: Vincent C. Klinges,
Chief Financial Officer, American Software, Inc., (404) 264-5477 or fax:
(404) 237-8868.
Logility is a registered trademark and Logility Voyager Solutions is
a trademark of Logility, Inc.; Demand Solutions is a registered
trademark of Demand Management, Inc.; and NGC and New Generation
Computing are registered trademarks of New Generation Computing, Inc.
Other products mentioned in this document are registered, trademarked or
service marked by their respective owners.
AMERICAN SOFTWARE, INC.
|
Consolidated Statements of Operations Information
|
(In thousands, except per share data, unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter Ended
|
|
|
|
|
July 31,
|
|
|
|
|
2016
|
|
|
2015
|
|
|
Pct Chg.
|
Revenues:
|
|
|
|
|
|
|
|
|
|
License
|
|
$
|
4,627
|
|
|
|
$
|
4,876
|
|
|
|
(5
|
%)
|
|
Services & other
|
|
|
12,221
|
|
|
|
|
13,845
|
|
|
|
(12
|
%)
|
|
Maintenance
|
|
|
10,585
|
|
|
|
|
10,137
|
|
|
|
4
|
%
|
|
|
Total Revenues
|
|
|
27,433
|
|
|
|
|
28,858
|
|
|
|
(5
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Revenues:
|
|
|
|
|
|
|
|
|
|
License
|
|
|
1,823
|
|
|
|
|
1,927
|
|
|
|
(5
|
%)
|
|
Services & other
|
|
|
9,053
|
|
|
|
|
9,451
|
|
|
|
(4
|
%)
|
|
Maintenance
|
|
|
2,761
|
|
|
|
|
2,163
|
|
|
|
28
|
%
|
|
|
Total Cost of Revenues
|
|
|
13,637
|
|
|
|
|
13,541
|
|
|
|
1
|
%
|
Gross Margin
|
|
|
13,796
|
|
|
|
|
15,317
|
|
|
|
(10
|
%)
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
3,736
|
|
|
|
|
3,566
|
|
|
|
5
|
%
|
|
Less: capitalized development
|
|
|
(636
|
)
|
|
|
|
(817
|
)
|
|
|
(22
|
%)
|
|
Sales and marketing
|
|
|
5,471
|
|
|
|
|
5,233
|
|
|
|
5
|
%
|
|
General and administrative
|
|
|
3,511
|
|
|
|
|
3,447
|
|
|
|
2
|
%
|
|
Amortization of acquisition-related intangibles
|
|
|
68
|
|
|
|
|
68
|
|
|
|
0
|
%
|
|
|
Total Operating Expenses
|
|
|
12,150
|
|
|
|
|
11,497
|
|
|
|
6
|
%
|
Operating Earnings
|
|
|
1,646
|
|
|
|
|
3,820
|
|
|
|
(57
|
%)
|
|
Interest Income & Other, Net
|
|
|
660
|
|
|
|
|
303
|
|
|
|
118
|
%
|
Earnings Before Income Taxes
|
|
|
2,306
|
|
|
|
|
4,123
|
|
|
|
(44
|
%)
|
Income Tax Expense
|
|
|
618
|
|
|
|
|
1,552
|
|
|
|
(60
|
%)
|
Net Earnings
|
|
$
|
1,688
|
|
|
|
$
|
2,571
|
|
|
|
(34
|
%)
|
Earnings per common share: (1)
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.06
|
|
|
|
$
|
0.09
|
|
|
|
(33
|
%)
|
|
Diluted
|
|
$
|
0.06
|
|
|
|
$
|
0.09
|
|
|
|
(33
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
28,938
|
|
|
|
|
28,614
|
|
|
|
|
|
|
Diluted
|
|
|
29,254
|
|
|
|
|
28,882
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
nm- not meaningful
|
|
AMERICAN SOFTWARE, INC.
|
NON-GAAP MEASURES OF PERFORMANCE
|
(In thousands, except per share data, unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter Ended
|
|
|
|
|
July 31,
|
|
|
|
|
2016
|
|
2015
|
|
Pct Chg.
|
NON-GAAP EBITDA:
|
|
|
|
|
|
|
Net Earnings (GAAP Basis)
|
|
$
|
1,688
|
|
|
$
|
2,571
|
|
|
(34
|
%)
|
|
Income Tax Expense
|
|
|
618
|
|
|
|
1,552
|
|
|
(60
|
%)
|
|
Interest Income & Other, Net
|
|
|
(660
|
)
|
|
|
(303
|
)
|
|
118
|
%
|
|
Amortization of intangibles
|
|
|
1,212
|
|
|
|
1,195
|
|
|
1
|
%
|
|
Depreciation
|
|
|
195
|
|
|
|
216
|
|
|
(10
|
%)
|
EBITDA (earnings before interest, taxes, depreciation and
amortization)
|
|
|
3,053
|
|
|
|
5,231
|
|
|
(42
|
%)
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation
|
|
|
388
|
|
|
|
398
|
|
|
(3
|
%)
|
Adjusted EBITDA
|
|
$
|
3,441
|
|
|
$
|
5,629
|
|
|
(39
|
%)
|
|
|
|
|
|
|
|
|
|
EBITDA , as a percentage of revenues
|
|
|
11
|
%
|
|
|
18
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA , as a percentage of revenues
|
|
|
13
|
%
|
|
|
20
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter Ended
|
|
|
|
|
July 31,
|
|
|
|
|
2016
|
|
2015
|
|
Pct Chg.
|
NON-GAAP EARNINGS PER SHARE:
|
|
|
|
|
|
|
Net Earnings (GAAP Basis)
|
|
$
|
1,688
|
|
|
$
|
2,571
|
|
|
(34
|
%)
|
|
Amortization of acquisition-related intangibles (2)
|
|
|
50
|
|
|
|
42
|
|
|
19
|
%
|
|
Stock-based compensation (2)
|
|
|
284
|
|
|
|
248
|
|
|
15
|
%
|
Adjusted Net Earnings
|
|
$
|
2,022
|
|
|
$
|
2,861
|
|
|
(29
|
%)
|
|
|
|
|
|
|
|
|
|
Adjusted non-GAAP diluted earnings per share
|
|
$
|
0.07
|
|
|
$
|
0.10
|
|
|
(30
|
%)
|
|
|
|
|
|
|
|
|
|
(1) - Basic per share amounts are the same for Class A and Class B
shares. Diluted per share amounts for Class A shares are shown
above. Diluted per share for Class B shares under the two-class
method are $0.06 and $0.09 for the three months ended July 31, 2016
and 2015, respectively.
|
|
(2) - Tax affected using the effective tax rate for the three months
period ended July 31, 2016.
|
|
nm- not meaningful
|
AMERICAN SOFTWARE, INC.
|
Consolidated Balance Sheet Information
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
July 31,
|
|
April 30,
|
|
|
|
2016
|
|
2016
|
|
|
|
|
|
|
Cash and Cash Equivalents
|
$
|
51,837
|
|
$
|
49,004
|
Short-term Investments
|
|
20,037
|
|
|
20,957
|
Accounts Receivable:
|
|
|
|
|
Billed
|
|
13,437
|
|
|
17,104
|
|
Unbilled
|
|
4,583
|
|
|
3,444
|
Total Accounts Receivable, net
|
|
18,020
|
|
|
20,548
|
Prepaids & Other
|
|
3,719
|
|
|
3,586
|
Current Assets
|
|
93,613
|
|
|
94,095
|
|
|
|
|
|
|
Investments - Non-current
|
|
6,088
|
|
|
7,924
|
|
|
|
|
|
|
PP&E, net
|
|
3,345
|
|
|
3,396
|
Capitalized Software, net
|
|
8,787
|
|
|
9,140
|
Goodwill
|
|
18,749
|
|
|
18,749
|
Other Intangibles, net
|
|
1,636
|
|
|
1,858
|
Other Non-current Assets
|
|
1,147
|
|
|
1,562
|
Total Assets
|
$
|
133,365
|
|
$
|
136,724
|
|
|
|
|
|
|
Accounts Payable
|
$
|
1,436
|
|
$
|
1,280
|
Accrued Compensation and Related costs
|
|
2,301
|
|
|
4,349
|
Dividend Payable
|
|
3,191
|
|
|
2,887
|
Other Current Liabilities
|
|
2,891
|
|
|
2,779
|
Deferred Revenues - Current
|
|
26,401
|
|
|
27,999
|
Current Liabilities
|
|
36,220
|
|
|
39,294
|
|
|
|
|
|
|
Deferred Revenues - Non-current
|
|
512
|
|
|
612
|
Deferred Tax Liability - Non-current
|
|
1,327
|
|
|
1,319
|
Other Long-term Liabilities
|
|
57
|
|
|
605
|
Long-term Liabilities
|
|
1,896
|
|
|
2,536
|
|
|
|
|
|
|
|
|
Total Liabilities
|
|
38,116
|
|
|
41,830
|
|
|
|
|
|
|
Shareholders' Equity
|
|
95,249
|
|
|
94,894
|
|
|
|
|
|
|
Total Liabilities & Shareholders' Equity
|
$
|
133,365
|
|
$
|
136,724
|
|
|
|
|
|
|
AMERICAN SOFTWARE, INC.
|
Condensed Consolidated Cashflow Information
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
July 31,
|
|
|
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities
|
|
$
|
5,030
|
|
|
$
|
5,265
|
|
|
|
|
|
|
|
|
|
|
Capitalized computer software development costs
|
|
|
(636
|
)
|
|
|
(817
|
)
|
|
|
Purchases of property and equipment, net of disposals
|
|
|
(144
|
)
|
|
|
(65
|
)
|
|
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
|
(780
|
)
|
|
|
(882
|
)
|
|
|
|
|
|
|
|
|
|
Dividends paid
|
|
|
(2,896
|
)
|
|
|
(2,861
|
)
|
|
|
Excess tax benefits from stock-based compensation
|
|
|
-
|
|
|
|
13
|
|
|
|
Proceeds from exercise of stock options
|
|
|
1,479
|
|
|
|
256
|
|
|
|
|
|
|
|
|
|
|
Net cash used in financing activities
|
|
|
(1,417
|
)
|
|
|
(2,592
|
)
|
|
|
|
|
|
|
|
|
|
Net change in cash and cash equivalents
|
|
|
2,833
|
|
|
|
1,791
|
|
|
|
Cash and cash equivalents at beginning of period
|
|
|
49,004
|
|
|
|
44,655
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period
|
|
$
|
51,837
|
|
|
$
|
46,446
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20160825006223/en/
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