Return to Double-Digit Revenue Growth Driven
by Continued Strong Growth in Subscription Fees
American Software, Inc. (NASDAQ: AMSWA) today reported
preliminary financial results for the second quarter of fiscal year
2022.
Key Second Quarter Financial Highlights:
- Subscription fees were $10.4 million for the quarter ended
October 31, 2021, a 49% increase compared to $7.0 million for the
same period last year and software license revenues were up
slightly to $0.8 million compared to $0.5 million for the same
period last year.
- Cloud Services Annual Contract Value (ACV) increased
approximately 44% to $42.5 million for the quarter ended October
31, 2021 compared to $29.6 million during the same period of the
prior year.
- Total revenues for the quarter ended October 31, 2021 increased
12% to $31.2 million, compared to $27.9 million for the same period
of the prior year.
- Recurring revenue streams for Maintenance and Cloud
Subscriptions were 63% of total revenues in the quarter ended
October 31, 2021 compared to 62% in the same period of the prior
year.
- Maintenance revenues for the quarter ended October 31, 2021
decreased 9% to $9.3 million compared to $10.2 million for the same
period last year.
- Professional services and other revenues for the quarter ended
October 31, 2021 increased 5% to $10.8 million compared to $10.2
million for the same period last year. For the Supply Chain
business, professional services revenues for the quarter ended
October 31, 2021 increased by 6% to $5.3 million when compared to
$5.0 million in the same period prior year.
- Operating earnings for the quarter ended October 31, 2021
increased 326% to $2.7 million compared to $0.6 million for the
same period last year.
- GAAP net earnings for the quarter ended October 31, 2021
increased 379% to $3.3 million or $0.10 per fully diluted share
compared to $0.7 million or $0.02 per fully diluted share for the
same period last year.
- Adjusted net earnings for the quarter ended October 31, 2021,
which excludes non-cash stock-based compensation expense and
amortization of acquisition-related intangibles, increased 173% to
$4.2 million or $0.12 per fully diluted share compared to $1.5
million or $0.05 per fully diluted share for the same period last
year.
- EBITDA increased by 74% to $3.7 million for the quarter ended
October 31, 2021 compared to $2.1 million for the same period last
year.
- Adjusted EBITDA increased by 70% to $4.8 million for the
quarter ended October 31, 2021 compared to $2.8 million for the
same period last year. Adjusted EBITDA represents GAAP net earnings
adjusted for amortization of intangibles, depreciation, interest
income/(expense) & other, net, income tax expense/ (benefit)
and non-cash stock-based compensation expense.
Key Fiscal 2022 Year to Date Financial Highlights:
- Subscription fees were $20.1 million for the six months ended
October 31, 2021, a 51% increase compared to $13.3 million for the
same period last year, while Software license revenues were $1.3
million compared to $1.2 million for the same period last year,
reflecting our conversion to the SaaS engagement model.
- Total revenues for the six months ended October 31, 2021
increased 10% to $60.5 million compared to $55.2 million for the
same period last year.
- Recurring revenue streams for Maintenance and Cloud Services
were 64% of total revenues for the six-month period ended October
31, 2021 compared to 61% in the same period of the prior year.
- Maintenance revenues for the six months ended October 31, 2021
were $18.7 million, a 9% decrease compared to $20.5 million for the
same period last year.
- Professional services and other revenues for the six months
ended October 31, 2021 increased 1% to $20.3 million compared to
$20.1 million for the same period last year.
- For the six months ended October 31, 2021, the Company reported
operating earnings of approximately $4.5 million compared to $1.5
million for the same period last year, a 194% increase.
- GAAP net earnings were approximately $6.3 million or $0.18 per
fully diluted share for the six months ended October 31, 2021, a
130% increase compared to $2.7 million or $0.08 per fully diluted
share for the same period last year.
- Adjusted net earnings for the six months ended October 31,
2021, which exclude stock-based compensation expense and
amortization of acquisition-related intangibles, increased 81% to
$7.8 million or $0.23 per fully diluted share, compared to $4.3
million or $0.13 per fully diluted share for the same period last
year.
- EBITDA increased by 41% to $6.6 million for the six months
ended October 31, 2021 compared to $4.7 million for the same period
last year.
- Adjusted EBITDA increased 43% to $8.4 million for the six
months ended October 31, 2021 compared to $5.9 million for the six
months ended October 31, 2020. Adjusted EBITDA represents GAAP net
earnings adjusted for amortization of intangibles, depreciation,
interest income & other, net, income tax (benefit)/expense and
non-cash stock-based compensation.
The overall financial condition of the Company remains strong,
with cash and investments of approximately $111.3 million, an
increase of approximately $16.7 million when compared to October
31, 2020, and no debt as of October 31, 2021. During the second
quarter of fiscal year 2022, the Company paid shareholder dividends
of approximately $3.7 million.
“Our second quarter of fiscal year 2022 is off to a solid start
with two consecutive quarters of double-digit growth in our Supply
Chain Management segment and a 44% increase in Cloud Services ACV
when compared to the same period last year,” said Allan Dow, CEO
and president of American Software. “Our backlog as measured by our
Remaining Performance Obligations (RPO) increased 58% to $123
million in the second quarter when compared to last year,
reflecting a new record for the company. As we head into our
seasonally stronger second half, we expect to build upon our
momentum as we execute against our growing pipeline and as
enterprises increasingly adopt cloud-based supply chain
transformation solutions.”
“This past quarter also emphasized that sustainability
initiatives are becoming increasingly influential to consumers and,
consequently, businesses. Many companies are evaluating their
social and environmental initiatives and are finding that a
majority of their impact can be traced back to their supply chain
practices,” continued Dow. “This is driving companies of all sizes
to lean on technology to measure their emissions and identify
opportunities for improvement. We believe the future of supply
chain sustainability is rooted in transparency, traceability and
automation.”
Key Second quarter of fiscal year 2022 highlights:
Customers & Channels
- Notable new and existing customers placing orders with the
Company in the second quarter include: Diversey, Inc., Gerdau
Ameristeel US, Inc., Griffith Foods Worldwide, Inc., Lacoste
Operations, Lindsay Corporation, Sauer Brands, Inc, Stichd B.V.,
Whitebridge Pet Brands, LLC.
- During the quarter, SaaS subscription and/or software license
agreements were signed with customers located in the following 6
countries: Belgium, Canada, France, Mexico, New Zealand, and United
States.
- Logility, Inc. and Demand Management, Inc., wholly owned
subsidiaries of the Company, were recognized as SupplyChainBrain’s
2021 100 Great Supply Chain Partners. The recognized companies are
a select group of companies whose customers recognize them for
providing outstanding solutions and services.
- During the quarter, Logility announced its ranking as the
highest in the Digital Planning Use Case in the 2021 Gartner
“Critical Capabilities for Supply Chain Planning Solutions” report.
Logility’s Digital Supply Chain Platform offers support for a broad
range of supply chain planning requirements, from sales and
operations planning (S&OP) through manufacturing.
- Also during the quarter, Logility and Demand Management
congratulated their customers who were recognized as Supply &
Demand Chain Executive’s 2021 Women in Supply Chain. Customers
recognized were Mandy McCain of Berry Global, Katherine Storer of
Berlin Packaging, Stephanie Francis of ChemPoint, Michelle
Wielemaker of Capral Australia and Mariam Belghith of Laboratories
Philadelphia in Sfax, Tunisia (laboratories SIMED).
Company and Technology
- During the quarter, Logility announced its partnership with
PricewaterhouseCoopers (PwC) to bring the latest innovation in
supply chain technology and services to strengthen its local
Brazilian market presence and enable digital transformation.
- Logility announced the partnership with Visus LLC to support
analytics customers and their digital transformation journeys. The
partnership leverages digital solutions using web and mobile
technology to help drive value.
- Logility also announced its latest software release which
supports corporate social responsibility and supply chain
traceability goals. Logility 21.02 powers technology to ensure
sustainable, ethical practices that support brand integrity and
corporate responsibility.
- Also during the quarter, Logility announced the partnership
with ArcherGrey to strengthen consulting and technology solutions
for its customers. The partnership will support the evolving needs
of customers in a rapidly changing supply chain environment.
About American Software, Inc.
Atlanta-based American Software, Inc. (NASDAQ: AMSWA),
through its operating entities, delivers an innovative technical
platform with AI-powered capabilities for supply chain management
and advanced retail planning that is accelerating digital supply
chain optimization from product concept to customer availability.
Logility, Inc. is helping large enterprise companies transform
their supply chain operations to gain a competitive advantage.
Recognized for its high-touch approach to customer service, rapid
implementations and industry-leading return on investment (ROI),
Logility customers include Big Lots, Husqvarna Group, Parker
Hannifin, Sonoco Products and Red Wing Shoe Company. Demand
Management, Inc. delivers affordable, easy-to-use supply chain
planning solutions designed to increase forecast accuracy, improve
customer service and reduce inventory to maximize profits and lower
costs. Demand Management serves customers such as Siemens
Healthcare, AutomationDirect.com and Newfoundland Labrador Liquor
Corporation. Customers of New Generation Computing, Inc. which are
now serviced by Logility and Demand Management, include Brooks
Brothers, Carter’s, Destination XL, Foot Locker, Jockey
International, Lacoste and Spanx. The comprehensive American
Software supply chain and retail planning portfolio delivered in
the cloud includes advanced analytics, 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, product
lifecycle management (PLM), sourcing management, vendor quality and
compliance, and product traceability. For more information about
American Software, please visit www.amsoftware.com, call (626)
657-0013 or email kliu@amsoftware.com.
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
existing customer contracts in the forward 12-month period. EBITDA
represents GAAP net earnings adjusted for amortization of
intangibles, depreciation, interest income/(expense) & other,
net, and income tax (benefit)/expense. Adjusted EBITDA represents
GAAP net earnings adjusted for amortization of intangibles,
depreciation, interest income & other, net, income tax
(benefit)/expense and non-cash stock-based compensation
expense.
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 or performance to differ
materially from what is anticipated by statements made herein.
These factors include, but are not limited to, continuing U.S. and
global economic uncertainty and the timing and degree of business
recovery; the irregular pattern of the Company’s revenues;
dependence on particular market segments or customers; competitive
pressures; market acceptance of the Company’s products and
services; technological complexity; undetected software errors;
potential product liability or warranty claims; risks associated
with new product development; the challenges and risks associated
with integration of acquired product lines, companies and services;
uncertainty about the viability and effectiveness of strategic
alliances; the Company’s ability to satisfy in a timely manner all
Securities and Exchange Commission (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; as well as a
number of other risk factors that could affect the Company’s future
performance. 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 SEC. For more information, contact:
Kevin Liu, American Software, Inc., (626) 657-0013 or email
kliu@amsoftware.com.
Logility® is a registered trademark of Logility, 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)
Second Quarter Ended
Six Months Ended
October 31,
October 31,
2021
2020
Pct Chg.
2021
2020
Pct Chg.
Revenues:
Subscription fees
$
10,361
$
6,966
49
%
$
20,149
$
13,329
51
%
License fees
805
450
79
%
1,297
1,237
5
%
Professional services & other
10,779
10,242
5
%
20,308
20,056
1
%
Maintenance
9,266
10,223
(9
%)
18,728
20,537
(9
%)
Total Revenues
31,211
27,881
12
%
60,482
55,159
10
%
Cost of Revenues:
Subscription services
3,404
2,946
16
%
6,628
5,705
16
%
License fees
198
553
(64
%)
357
1,228
(71
%)
Professional services & other
7,477
7,624
(2
%)
14,487
15,454
(6
%)
Maintenance
1,746
1,941
(10
%)
3,720
3,714
0
%
Total Cost of Revenues
12,825
13,064
(2
%)
25,192
26,101
(3
%)
Gross Margin
18,386
14,817
24
%
35,290
29,058
21
%
Operating expenses:
Research and development
4,278
4,463
(4
%)
8,702
8,803
(1
%)
Less: capitalized development
-
(126
)
(100
%)
-
(371
)
(100
%)
Sales and marketing
5,892
5,429
9
%
12,012
10,173
18
%
General and administrative
5,476
4,367
25
%
10,010
8,831
13
%
Amortization of acquisition-related
intangibles
53
53
0
%
106
106
0
%
Total Operating Expenses
15,699
14,186
11
%
30,830
27,542
12
%
Operating Earnings
2,687
631
326
%
4,460
1,516
194
%
Interest Income/(Expense) & Other,
Net
930
(42
)
nm
1,367
1,290
6
%
Earnings Before Income Taxes
3,617
589
514
%
5,827
2,806
108
%
Income Tax Expense/(Benefit)
303
(103
)
nm
(434
)
80
nm
Net Earnings
$
3,314
$
692
379
%
$
6,261
$
2,726
130
%
Earnings per common share: (1)
Basic
$
0.10
$
0.02
400
%
$
0.19
$
0.08
138
%
Diluted
$
0.10
$
0.02
400
%
$
0.18
$
0.08
125
%
Weighted average number of common
shares outstanding:
Basic
33,336
32,489
33,195
32,414
Diluted
34,684
32,896
34,448
32,919
nm- not meaningful
AMERICAN SOFTWARE,
INC.
NON-GAAP MEASURES OF
PERFORMANCE
(In thousands, except per
share data, unaudited)
Second Quarter Ended
Six Months Ended
October 31,
October 31,
2021
2020
Pct Chg.
2021
2020
Pct Chg.
NON-GAAP Operating Earnings:
Operating Earnings (GAAP Basis)
$
2,687
$
631
326
%
$
4,460
$
1,516
194
%
Amortization of acquisition-related
intangibles
53
311
(83
%)
106
622
(83
%)
Stock-based compensation
1,042
652
60
%
1,817
1,198
52
%
NON-GAAP Operating Earnings:
3,782
1,594
137
%
6,383
3,336
91
%
Non-GAAP Operating Earnings, as a % of
revenue
12
%
6
%
11
%
6
%
Second Quarter Ended
Six Months Ended
October 31,
October 31,
2021
2020
Pct Chg.
2021
2020
Pct Chg.
NON-GAAP EBITDA:
Net Earnings (GAAP Basis)
$
3,314
$
692
379
%
$
6,261
$
2,726
130
%
Income Tax Expense/(Benefit)
303
(103
)
nm
(434
)
80
nm
Interest Income/(Expense) & Other,
Net
(930
)
42
nm
(1,367
)
(1,290
)
6
%
Amortization of intangibles
860
1,353
(36
%)
1,816
2,883
(37
%)
Depreciation
179
161
11
%
353
311
14
%
EBITDA (earnings before interest,
taxes, depreciation and amortization)
3,726
2,145
74
%
6,629
4,710
41
%
Stock-based compensation
1,042
652
60
%
1,817
1,198
52
%
Adjusted EBITDA
$
4,768
$
2,797
70
%
$
8,446
$
5,908
43
%
EBITDA, as a percentage of
revenues
12
%
8
%
11
%
9
%
Adjusted EBITDA, as a percentage of
revenues
15
%
10
%
14
%
11
%
Second Quarter Ended
Six Months Ended
October 31,
October 31,
2021
2020
Pct Chg.
2021
2020
Pct Chg.
NON-GAAP EARNINGS PER SHARE:
Net Earnings (GAAP Basis)
$
3,314
$
692
379
%
$
6,261
$
2,726
130
%
Amortization of acquisition-related
intangibles (2)
43
272
(84
%)
85
545
(84
%)
Stock-based compensation (2)
836
570
47
%
1,456
1,048
39
%
Adjusted Net Earnings
$
4,193
$
1,534
173
%
$
7,802
$
4,319
81
%
Adjusted non-GAAP diluted earnings per
share
$
0.12
$
0.05
140
%
$
0.23
$
0.13
77
%
Second Quarter Ended
Six Months Ended
October 31,
October 31,
2021
2020
Pct Chg.
2021
2020
Pct Chg.
NON-GAAP Earnings Per Share
Net Earnings (GAAP Basis)
$
0.10
$
0.02
400
%
$
0.18
$
0.08
125
%
Amortization of acquisition-related
intangibles (2)
-
0.01
(100
%)
-
0.02
(100
%)
Stock-based compensation (2)
0.02
0.02
0
%
0.05
0.03
67
%
Adjusted Net Earnings
0.12
$
0.05
140
%
0.23
$
0.13
77
%
Second Quarter Ended
Six Months Ended
October 31,
October 31,
2021
2020
Pct Chg.
2021
2020
Pct Chg.
Amortization of acquisition-related
intangibles
Cost of license
$
-
$
258
(100
%)
$
-
$
516
(100
%)
Operating expenses
53
53
0
%
106
106
0
%
Total amortization of
acquisition-related intangibles
$
53
$
311
(83
%)
$
106
$
622
(83
%)
Stock-based compensation
Cost of revenues
$
68
$
23
196
%
$
129
$
66
95
%
Research and development
99
49
102
%
167
74
126
%
Sales and marketing
174
87
100
%
317
153
107
%
General and administrative
701
493
42
%
1,204
905
33
%
Total stock-based compensation
$
1,042
$
652
60
%
$
1,817
$
1,198
52
%
(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 $0.10 and $0.19 for the three and
six months ended October 31, 2021, respectively. Diluted per share
for Class B shares under the two-class method are $0.02 and $0.09
for the three and six months ended October 31, 2020,
respectively.
(2) - Tax affected using the effective tax
rate excluding a discrete item related to excess tax benefit for
stock options for the three and six month periods ended October 31,
2021 of 19.8% and 12.5% for the three and six month periods ended
October 31, 2020, respectively.
nm- not meaningful
AMERICAN SOFTWARE,
INC.
Consolidated Balance Sheet
Information
(In thousands)
(Unaudited)
October 31,
April 30,
2021
2021
Cash and Cash Equivalents
$
94,201
$
88,658
Short-term Investments
17,163
16,006
Accounts Receivable:
Billed
19,662
24,438
Unbilled
2,475
2,201
Total Accounts Receivable, net
22,137
26,639
Prepaids & Other
7,375
5,320
Current Assets
140,876
136,623
PP&E, net
3,689
3,428
Capitalized Software, net
3,057
4,767
Goodwill
25,888
25,888
Other Intangibles, net
254
360
Deferred Sales Commissions -
Non-current
2,256
2,474
Lease Right of Use Assets
1,249
1,454
Other Non-current Assets
2,339
2,163
Total Assets
$
179,608
$
177,157
Accounts Payable
$
1,994
$
1,732
Accrued Compensation and Related costs
4,281
6,129
Dividend Payable
3,676
3,615
Operating Lease Obligation - Current
665
739
Other Current Liabilities
611
1,307
Deferred Revenues - Current
35,968
37,142
Current Liabilities
47,195
50,664
Operating Lease Obligation -
Non-current
669
821
Deferred Tax Liability - Non-current
2,527
2,627
Other Long-term Liabilities
370
654
Long-term Liabilities
3,566
4,102
Total Liabilities
50,761
54,766
Shareholders' Equity
128,847
122,391
Total Liabilities & Shareholders'
Equity
$
179,608
$
177,157
AMERICAN SOFTWARE,
INC.
Condensed Consolidated
Cashflow Information
(In thousands)
(Unaudited)
Second Quarter Ended
October 31,
2021
2020
Net cash provided by operating
activities
$
7,712
$
6,771
Capitalized computer software development
costs
-
(371
)
Purchases of property and equipment, net
of disposals
(615
)
(163
)
Net cash used in investing
activities
(615
)
(534
)
Dividends paid
(7,268
)
(7,118
)
Proceeds from exercise of stock
options
5,714
2,853
Net cash used in financing
activities
(1,554
)
(4,265
)
Net change in cash and cash
equivalents
5,543
1,972
Cash and cash equivalents at beginning of
period
88,658
79,814
Cash and cash equivalents at end of
period
$
94,201
$
81,786
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211118006228/en/
Vincent C. Klinges Chief Financial Officer American Software,
Inc. (404) 264-5477
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