[August 28, 2017] |
|
American Software Reports Preliminary First Quarter of Fiscal Year 2018 Results
American Software (News - Alert), Inc. (NASDAQ: AMSWA) today reported preliminary
financial results for the first quarter of fiscal year 2018.
Key First quarter financial highlights:
-
Cloud Services Annual Contract Value (ACV) increased approximately 92%
to $7.7 million as of the quarter ended July 31, 2017 compared to $4.0
million as of the same period of the prior year. ACV consists of
software-as-a-service (SaaS (News - Alert)) of $5.4 million, a 155% increase when
compared to approximately $2.1 million as of the same period last
year, and other cloud services of $2.3 million, a 22% increase when
compared to $1.9 million as of the same period last year.
-
Total revenues for the quarter ended July 31, 2017 were $26.9 million,
a decrease of 2% over the comparable period last year.
-
Software license revenues for the quarter ended July 31, 2017 were
$4.0 million, a decrease of 13% compared to the same period last year.
-
Services and other revenues for the quarter ended July 31, 2017 were
$12.0 million compared to $12.2 million for the same period last year.
-
Maintenance revenues for the quarter ended July 31, 2017 increased 2%
to $10.8 million compared to $10.6 million for the same period last
year.
-
Operating earnings for the quarter ended July 31, 2017 increased 120%
to $3.6 million compared to $1.6 million the same period last year.
-
GAAP net earnings for the quarter ended July 31, 2017 increased 61% to
$2.7 million or $0.09 per fully diluted share compared to $1.7 million
or $0.06 per fully diluted share for the same period last year.
-
Adjusted net earnings for the quarter ended July 31, 2017, which
excludes non-cash stock-based compensation expense and amortization of
acquisition-related intangibles were $3.1 million or $0.10 per fully
diluted share compared to $2.0 million or $0.07 per fully diluted
share for the same period last year, which excluded non-cash
stock-based compensation expense and amortization of
acquisition-related intangibles.
-
EBITDA increased by 64% to $5.0 million for the quarter ended July 31,
2017 compared to $3.1 million for the quarter ended July 31, 2016.
-
Adjusted EBITDA increased 55% to $5.3 million for the quarter ended
July 31, 2017 compared to $3.4 million for the quarter ended July 31,
2016. 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.
The overall financial condition of the Company remains strong, with cash
and investments of approximately $90.6 million and no debt as of July
31, 2017. We increased cash and investments by $12.6 million from the
same period last year. During the first quarter, the Company paid
approximately $3.3 million in dividends.
"We are pleased with our first quarter fiscal year 2018 results which
reflect our continued thoughtful and measured transition from a
perpetual licensing to a software-as-a-service (SaaS) engagement model
for our Logility (News - Alert) Voyager Solutions, Demand Solutions and NGC Andromeda
platforms," said Allan Dow, president of American Software. "Most
notably, the trend towards SaaS subscriptions as a preferred engagement
method for new customers is accelerating. This transition is positively
highlighted by our 92% increase in ACV for Cloud Services and a 155%
growth in SaaS subscription revenue. This transition to SaaS is a
positive trend for our customers as well as our future financial results
driving the improved predictability of revenue and EBITDA performance."
"Further, we believe a SaaS subscription serves our customers well as
they leverage our expertise in managing the applications on their behalf
and leverage the latest and most innovative planning capabilities
available," continued Dow. "Our cloud-based solutions provide customers
the increased visibility and accuracy necessary to become a connected
enterprise. As they take advantage of our advancements in algorithmic
planning, advanced supply chain analytics and artificial intelligence to
improve their operating performance, they will also overcome the supply
chain talent shortage that may be hampering their profitable growth and
speed to market."
Additional highlights for the first quarter of fiscal 2018 include:
Customers & Channels
-
Notable new and existing customers placing orders with the Company in
the first quarter include: ASP Aluminium Holdings Pty, Ashley
Furniture Industries, B&H Foto & Electronics, Brightstar, Brooks
Brothers Group, Dometic Group AB, Ergobaby, FAM Brands, Groupe
Dynamite, Handi-Craft Company, Kolmar Laboratories and Sonoco Products
Company.
-
During the quarter, software license and/or SaaS subscription
agreements were signed with customers located in the following 10
countries: Australia, Canada, Finland, Germany, Ireland, Mexico,
Netherlands, Sweden, United Kingdom, and United States.
-
NGC Software, a wholly-owned subsidiary of the Company, announced
Escalade Sports, a global manufacturer and distributor of sports and
outdoor recreational equipment, implemented NGC's Andromeda Product
Testing and Compliance Software. The solution streamlines Escalade
Sports' compliance with CPSIA, Proposition 65, Conflict Minerals
Reporting, and other regulations.
-
Logility, a wholly-owned subsidiary of the Company, hosted supply
chain professionals for a webcast, The Business Case for Inventory
Optimization, which featured the Ashley Furniture Industries
success to better synchronize inventory across its global network. The
event, hosted by APICS, took place Tuesday, May 16, 2017 at 11:00 a.m.
ET and is available on demand at https://www.logility.com/library/webcasts.
-
Logility invited attendees of the 2017 Gartner (News - Alert) Supply Chain Executive
Conference to attend the session, Columbia Sportswear: Reaching New
Heights in Global Supply Chain Transformation. The conference, located
at the JW Marriott Phoenix Desert Ridge Resort & Spa in Phoenix, AZ
was held May 23 - 25, 2017.
-
Logility invited attendees of the second annual Integrated Business
Planning Summit to attend the session, Belkin's Global Supply Chain
Transformation: Vision, Trust, and Flexibility. The
conference, located at the Sydney Cricket Ground-Allianz Stadium in
Sydney, was held May 31 - June 2, 2017.
Company & Technology
-
NGC Software announced the latest release and general availability of
its next-generation Andromeda Quality Control solution for fashion
retailers and brand owners. This SaaS solution helps companies
identify product quality issues quickly reducing chargebacks and
returned inventory.
-
NGC Software announced that Jesta I.S., a global leader in integrated
ERP solutions for apparel, footwear and hard goods enterprises,
partnered with the company. Through the relationship, Jesta will
enrich its Vision Suite product line with NGC Software's best-in-class
Andromeda cloud PLM solution.
-
Logility announced Logility Voyager Solutions™, the company's
collaborative supply optimization and advanced retail planning
solution suite, was positioned as a Leader in the Gartner 2017 Magic
Quadrant for Sales and Operations Planning Systems of Differentiation.
This Magic Quadrant research report analyzed software solutions that
support a mature stage 4 or higher sales and operations planning
(S&OP) process.
-
Sean Willems, Ph.D., Logility chief scientist and Haslam Chair in
Supply Chain Analytics at the University of Tennessee led a standing
room only roundtable discussion on Driving Supply Chain Transformation
and Optimizing Inventory Investments at the 2017 Gartner Supply Chain
Executive conference held in Phoenix, AZ on May 23, 2017.
-
Logility announced the company was selected by Inbound
Logistics as a Top 100 Logistics IT Provider for 2017. This is the
20th consecutive year Logility was recognized by Inbound
Logistics for helping companies solve their complex supply chain
challenges.
-
Logility and Demand Solutions, a wholly-owned subsidiary of Logility,
were each selected by the Manufacturing Leadership Council as 2017
Manufacturing Leadership Partner Award recipients. The Partnership
Award recognizes technology providers that play a critical role in
helping manufacturers achieve peak performance through the application
of advanced technology solutions.
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 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 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].
Operating and Non-GAAP Financial Measures
The Company includes operating measures (ACV) and other non-GAAP
financial measures (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 operating or 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. EBITDA represents GAAP net earnings adjusted
for amortization of intangibles, depreciation, interest income & other,
net, and income tax expense. 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. A reconciliation of these non-GAAP
financial measures to their nearest U.S. GAAP measure appears in the
accompanying financial tables.
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 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,
|
|
|
|
2017
|
|
|
2016
|
|
|
Pct Chg.
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
License
|
|
|
$
|
4,015
|
|
|
|
$
|
4,627
|
|
|
|
(13
|
%)
|
Services & other
|
|
|
|
12,043
|
|
|
|
|
12,221
|
|
|
|
(1
|
%)
|
Maintenance
|
|
|
|
10,828
|
|
|
|
|
10,585
|
|
|
|
2
|
%
|
Total Revenues
|
|
|
|
26,886
|
|
|
|
|
27,433
|
|
|
|
(2
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Revenues:
|
|
|
|
|
|
|
|
|
|
|
License
|
|
|
|
1,507
|
|
|
|
|
1,823
|
|
|
|
(17
|
%)
|
Services & other
|
|
|
|
7,927
|
|
|
|
|
9,053
|
|
|
|
(12
|
%)
|
Maintenance
|
|
|
|
2,227
|
|
|
|
|
2,761
|
|
|
|
(19
|
%)
|
Total Cost of Revenues
|
|
|
|
11,661
|
|
|
|
|
13,637
|
|
|
|
(14
|
%)
|
Gross Margin
|
|
|
|
15,225
|
|
|
|
|
13,796
|
|
|
|
10
|
%
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
|
3,794
|
|
|
|
|
3,736
|
|
|
|
2
|
%
|
Less: capitalized development
|
|
|
|
(1,287
|
)
|
|
|
|
(636
|
)
|
|
|
102
|
%
|
Sales and marketing
|
|
|
|
5,233
|
|
|
|
|
5,471
|
|
|
|
(4
|
%)
|
General and administrative
|
|
|
|
3,515
|
|
|
|
|
3,511
|
|
|
|
0
|
%
|
Provision for doubtful accounts
|
|
|
|
24
|
|
|
|
|
-
|
|
|
|
nm
|
|
Amortization of acquisition-related intangibles
|
|
|
|
324
|
|
|
|
|
68
|
|
|
|
376
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating Expenses
|
|
|
|
11,603
|
|
|
|
|
12,150
|
|
|
|
(5
|
%)
|
Operating Earnings
|
|
|
|
3,622
|
|
|
|
|
1,646
|
|
|
|
120
|
%
|
Interest Income & Other, Net
|
|
|
|
599
|
|
|
|
|
660
|
|
|
|
(9
|
%)
|
Earnings Before Income Taxes
|
|
|
|
4,221
|
|
|
|
|
2,306
|
|
|
|
83
|
%
|
Income Tax Expense
|
|
|
|
1,496
|
|
|
|
|
618
|
|
|
|
142
|
%
|
Net Earnings
|
|
|
$
|
2,725
|
|
|
|
$
|
1,688
|
|
|
|
61
|
%
|
Earnings per common share: (1)
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
|
0.09
|
|
|
|
$
|
0.06
|
|
|
|
50
|
%
|
Diluted
|
|
|
$
|
0.09
|
|
|
|
$
|
0.06
|
|
|
|
50
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
29,671
|
|
|
|
|
28,938
|
|
|
|
|
|
Diluted
|
|
|
|
29,989
|
|
|
|
|
29,254
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
nm- not meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
AMERICAN SOFTWARE, INC.
|
NON-GAAP MEASURES OF PERFORMANCE
|
(In thousands, except per share data, unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter Ended
|
|
|
|
July 31,
|
|
|
|
2017
|
|
|
2016
|
|
|
Pct Chg.
|
NON-GAAP EBITDA:
|
|
|
|
|
|
|
|
|
|
Net Earnings (GAAP Basis)
|
|
|
$
|
2,725
|
|
|
|
$
|
1,688
|
|
|
|
61
|
%
|
Income Tax Expense
|
|
|
|
1,496
|
|
|
|
|
618
|
|
|
|
142
|
%
|
Interest (Income) Expense & Other, Net
|
|
|
|
(599
|
)
|
|
|
|
(660
|
)
|
|
|
(9
|
%)
|
Amortization of intangibles
|
|
|
|
1,265
|
|
|
|
|
1,212
|
|
|
|
4
|
%
|
Depreciation
|
|
|
|
120
|
|
|
|
|
195
|
|
|
|
(38
|
%)
|
EBITDA (earnings before interest, taxes, depreciation and
amortization)
|
|
|
|
5,007
|
|
|
|
|
3,053
|
|
|
|
64
|
%
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation
|
|
|
|
316
|
|
|
|
|
388
|
|
|
|
(19
|
%)
|
Adjusted EBITDA
|
|
|
$
|
5,323
|
|
|
|
$
|
3,441
|
|
|
|
55
|
%
|
|
|
|
|
|
|
|
|
|
|
EBITDA , as a percentage of revenues
|
|
|
|
19
|
%
|
|
|
|
11
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA , as a percentage of revenues
|
|
|
|
20
|
%
|
|
|
|
13
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter Ended
|
|
|
|
July 31,
|
|
|
|
2017
|
|
|
2016
|
|
|
Pct Chg.
|
NON-GAAP EARNINGS PER SHARE:
|
|
|
|
|
|
|
|
|
|
Net Earnings (GAAP Basis)
|
|
|
$
|
2,725
|
|
|
|
$
|
1,688
|
|
|
|
61
|
%
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquisition-related intangibles (2)
|
|
|
|
209
|
|
|
|
|
50
|
|
|
|
318
|
%
|
Stock-based compensation (2)
|
|
|
|
204
|
|
|
|
|
284
|
|
|
|
(28
|
%)
|
Adjusted Net Earnings
|
|
|
$
|
3,138
|
|
|
|
$
|
2,022
|
|
|
|
55
|
%
|
|
|
|
|
|
|
|
|
|
|
Adjusted non-GAAP diluted earnings per share
|
|
|
$
|
0.10
|
|
|
|
$
|
0.07
|
|
|
|
43
|
%
|
|
|
|
|
|
|
|
|
|
|
(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 $0.09 and $0.06 for the three months ended July 31, 2017
and 2016, respectively.
|
|
(2) - Tax affected using the effective tax rate for the three months
period ended July 31, 2017 and 2016.
|
|
|
AMERICAN SOFTWARE, INC.
|
Consolidated Balance Sheet Information
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
July 31,
|
|
|
April 30,
|
|
|
|
2017
|
|
|
2017
|
|
|
|
|
|
|
|
Cash and Cash Equivalents
|
|
|
$
|
66,227
|
|
|
$
|
66,001
|
Short-term Investments
|
|
|
|
17,979
|
|
|
|
19,332
|
Accounts Receivable:
|
|
|
|
|
|
|
Billed
|
|
|
|
13,990
|
|
|
|
17,060
|
Unbilled
|
|
|
|
2,377
|
|
|
|
2,811
|
Total Accounts Receivable, net
|
|
|
|
16,367
|
|
|
|
19,871
|
Prepaids & Other
|
|
|
|
3,900
|
|
|
|
4,322
|
Current Assets
|
|
|
|
104,473
|
|
|
|
109,526
|
|
|
|
|
|
|
|
Investments - Non-current
|
|
|
|
6,352
|
|
|
|
4,455
|
|
|
|
|
|
|
|
PP&E, net
|
|
|
|
2,069
|
|
|
|
2,055
|
Capitalized Software, net
|
|
|
|
9,052
|
|
|
|
8,614
|
Goodwill
|
|
|
|
19,549
|
|
|
|
19,549
|
Other Intangibles, net
|
|
|
|
3,004
|
|
|
|
3,399
|
Other Non-current Assets
|
|
|
|
1,343
|
|
|
|
1,176
|
Total Assets
|
|
|
$
|
145,842
|
|
|
$
|
148,774
|
|
|
|
|
|
|
|
Accounts Payable
|
|
|
$
|
1,829
|
|
|
$
|
1,541
|
Accrued Compensation and Related Costs
|
|
|
|
3,095
|
|
|
|
3,329
|
Dividend Payable
|
|
|
|
3,270
|
|
|
|
3,259
|
Other Current Liabilities
|
|
|
|
2,471
|
|
|
|
5,171
|
Deferred Revenues - Current
|
|
|
|
28,332
|
|
|
|
29,437
|
Current Liabilities
|
|
|
|
38,997
|
|
|
|
42,737
|
|
|
|
|
|
|
|
Deferred Revenues - Non-current
|
|
|
|
240
|
|
|
|
214
|
Deferred Tax Liability - Non-current
|
|
|
|
2,114
|
|
|
|
1,994
|
Other Long-term Liabilities
|
|
|
|
77
|
|
|
|
79
|
Long-term Liabilities
|
|
|
|
2,431
|
|
|
|
2,287
|
|
|
|
|
|
|
|
Total Liabilities
|
|
|
|
41,428
|
|
|
|
45,024
|
|
|
|
|
|
|
|
Shareholders' Equity
|
|
|
|
104,414
|
|
|
|
103,750
|
|
|
|
|
|
|
|
Total Liabilities & Shareholders' Equity
|
|
|
$
|
145,842
|
|
|
$
|
148,774
|
|
|
|
|
|
|
|
|
|
|
AMERICAN SOFTWARE, INC.
|
Condensed Consolidated Cashflow Information
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
July 31,
|
|
|
|
2017
|
|
|
2016
|
|
|
|
|
|
|
|
Net cash provided by operating activities
|
|
|
$
|
4,015
|
|
|
|
$
|
5,030
|
|
|
|
|
|
|
|
|
Capitalized computer software development costs
|
|
|
|
(1,287
|
)
|
|
|
|
(636
|
)
|
Purchases of property and equipment, net of disposals
|
|
|
|
(133
|
)
|
|
|
|
(144
|
)
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
|
|
(1,420
|
)
|
|
|
|
(780
|
)
|
|
|
|
|
|
|
|
Dividends paid
|
|
|
|
(3,259
|
)
|
|
|
|
(2,896
|
)
|
Proceeds from exercise of stock options
|
|
|
|
890
|
|
|
|
|
1,479
|
|
|
|
|
|
|
|
|
Net cash used in financing activities
|
|
|
|
(2,369
|
)
|
|
|
|
(1,417
|
)
|
|
|
|
|
|
|
|
Net change in cash and cash equivalents
|
|
|
|
226
|
|
|
|
|
2,833
|
|
Cash and cash equivalents at beginning of period
|
|
|
|
66,001
|
|
|
|
|
49,004
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period
|
|
|
$
|
66,227
|
|
|
|
$
|
51,837
|
|
|
|
|
|
|
|
|
|
|
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20170828005757/en/
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