Double-Digit Revenue Growth Driven by
Continued Strong Growth in Subscription Fees
American Software, Inc. (NASDAQ: AMSWA) today reported
preliminary financial results for the third quarter of fiscal year
2022.
Key Third Quarter Financial Highlights:
- Subscription fees were $10.9 million for the quarter ended
January 31, 2022, a 45% increase compared to $7.5 million for the
same period last year and software license revenues were up 87% to
$1.0 million compared to $0.5 million for the same period last
year.
- Cloud Services Annual Contract Value (ACV) increased
approximately 43% to $45.3 million for the quarter ended January
31, 2022 compared to $31.6 million during the same period of the
prior year.
- Total revenues for the quarter ended January 31, 2022 increased
17% to $32.4 million, compared to $27.7 million for the same period
of the prior year.
- Recurring revenue streams for Maintenance and Cloud
Subscriptions were 62% of total revenues in the quarter ended
January 31, 2022 compared to 64% in the same period of the prior
year.
- Maintenance revenues for the quarter ended January 31, 2022
decreased 10% to $9.1 million compared to $10.2 million for the
same period last year.
- Professional services and other revenues for the quarter ended
January 31, 2022 increased 21% to $11.4 million compared to $9.5
million for the same period last year. For the Supply Chain
business, professional services revenues for the quarter ended
January 31, 2022 increased by 13% to $5.4 million when compared to
$4.8 million in the same period prior year.
- Operating earnings for the quarter ended January 31, 2022
increased 246% to $3.2 million compared to $0.9 million for the
same period last year.
- GAAP net earnings for the quarter ended January 31, 2022
increased 27% to $2.9 million or $0.09 per fully diluted share
compared to $2.3 million or $0.07 per fully diluted share for the
same period last year.
- Adjusted net earnings for the quarter ended January 31, 2022,
which excludes non-cash stock-based compensation expense and
amortization of acquisition-related intangibles, increased 28% to
$3.8 million or $0.11 per fully diluted share compared to $3.0
million or $0.09 per fully diluted share for the same period last
year.
- EBITDA increased by 94% to $4.2 million for the quarter ended
January 31, 2022 compared to $2.2 million for the same period last
year.
- Adjusted EBITDA increased by 85% to $5.3 million for the
quarter ended January 31, 2022 compared to $2.9 million for the
same period last year. Adjusted EBITDA represents GAAP net earnings
adjusted for amortization of intangibles, depreciation, interest
income & other, net, income tax expense/(benefit) and non-cash
stock-based compensation expense.
Key Fiscal 2022 Year to Date Financial Highlights:
- Subscription fees were $31.0 million for the nine months ended
January 31, 2022, a 49% increase compared to $20.8 million for the
same period last year, while Software license revenues increased
30% to $2.3 million compared to $1.8 million for the same period
last year.
- Total revenues for the nine months ended January 31, 2022
increased 12% to $92.9 million compared to $82.8 million for the
same period last year.
- Recurring revenue streams for Maintenance and Cloud Services
were 63% of total revenues for the nine-month period ended January
31, 2022 compared to 62% in the same period of the prior year.
- Maintenance revenues for the nine months ended January 31, 2022
were $27.9 million, a 9% decrease compared to $30.7 million for the
same period last year.
- Professional services and other revenues for the nine months
ended January 31, 2022 increased 7% to $31.8 million compared to
$29.6 million for the same period last year.
- For the nine months ended January 31, 2022, the Company
reported operating earnings of approximately $7.7 million compared
to $2.5 million for the same period last year, a 214%
increase.
- GAAP net earnings were approximately $9.2 million or $0.27 per
fully diluted share for the nine months ended January 31, 2022, an
83% increase compared to $5.0 million or $0.15 per fully diluted
share for the same period last year.
- Adjusted net earnings for the nine months ended January 31,
2022, which exclude stock-based compensation expense and
amortization of acquisition-related intangibles, increased 60% to
$11.6 million or $0.34 per fully diluted share, compared to $7.3
million or $0.22 per fully diluted share for the same period last
year.
- EBITDA increased by 58% to $10.9 million for the nine months
ended January 31, 2022 compared to $6.9 million for the same period
last year.
- Adjusted EBITDA increased 57% to $13.8 million for the nine
months ended January 31, 2022 compared to $8.8 million for the nine
months ended January 31, 2021. 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 $114.8 million, an
increase of approximately $14.0 million when compared to January
31, 2021. During the third quarter of fiscal year 2022, the Company
paid shareholder dividends of approximately $3.7 million.
“Our revenue growth accelerated to 17% in the third quarter of
fiscal year 2022 and our Cloud Services ACV increased 43% increase
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 61% to $129
million in the third quarter when compared to last year, reflecting
a new record for the company. As we head into our final quarter of
fiscal 2022, we expect to build upon our momentum as we execute
against our growing pipeline and position the company for strong
growth in fiscal 2023 and beyond.”
“This past quarter also heightened the importance of
transparency and the continued adoption of AI and ML to enable
sustainable and socially responsible businesses. It’s becoming ever
more necessary for companies to prove the sustainability of their
practices through increased diligence around corporate
responsibility, traceability and honesty with customers about the
origins of goods and services,” continued Dow. “Because of this, I
believe the adoption of AI and ML is going to continue to
accelerate and enable companies to truly optimize operations and
achieve sustainability long-term. These methods help companies take
massive data sets and turn them into digestible, actionable
insights for their supply chain practices. We believe the future of
supply chain sustainability is rooted in transparency and
automation that is enabled by a committed technology partner.”
Key Third Quarter of Fiscal Year 2022 highlights:
Customers & Channels
- Notable new and existing customers placing orders with the
Company in the third quarter include: Celanese Ltd., CQMS Razer
Pty. Ltd., Empresa Siderurgica del Peru SAA, Intertape Polymer
Corp., Mustad Netherlands B.V., Reynolds Consumer Product LLC, and
Seco Tools AB.
- During the quarter, SaaS subscription and/or software license
agreements were signed with customers located in the following 10
countries: Australia, Canada, Ireland, Mexico, Netherlands, New
Zealand, Peru, Sweden, United Kingdom and United States.
- Logility, Inc. and Demand Management, Inc., wholly owned
subsidiaries of the Company, were recognized among Food Logistics’
2021 Top Software and Technology Providers. This marks Logility’s
seventeenth year and Demand Management’s thirteenth year of
recognition. The annual FL100+ Top Software and Technology
Providers honors leading software and technology providers that
ensure a safe, efficient, and reliable global food and beverage
supply chain.
- During the quarter, Logility was ranked in the 2022 RIS
Software LeaderBoard as a leader in eighteen categories, and in the
top ten of many of the referenced categories. Logility was
recognized for helping retail customers by delivering innovative
technology and offering exceptional support as they faced
unparalleled challenges in the past two years.
- Also, during the quarter, Logility announced its recognition in
Retail Today’s Retail CIO Radar 2022. This is a list of the most
innovative and transformative retail technology solution providers.
Based on Logility’s innovative and transformative capabilities,
track record, competency, leadership in the industry, market share,
competitive landscape, and more, a panel of industry experts,
analysts and Retail Today editorial board selected Logility.
Company and Technology
- During the quarter, Demand Management announced a strategic
partnership with Royal Cyber, a leading IT consultancy and
solutions provider. The partnership enables organizations to gain
value by leveraging the benefits of Demand Management’s digital
supply chain platform, along with Royal Cyber’s efficient and
robust customer service.
- Logility also announced a partnership with Planalytics to
identify, quantify and apply weather-driven demand calculations to
business planning and forecasting. The partnership enables Logility
customers to layer in Planalytics’ predictive demand metrics to
better understand impacts across their customer base and
proactively capitalize on sales opportunities created by favorable
weather while mitigating risks when demand is negatively
impacted.
- Logility announced a commitment to help food and beverage,
consumer packaged goods and durables, process manufacturing and
fashion brands to gain greater visibility, traceability and
compliance within their supply chains. Logility is committed to
doing so through the corporate responsibility solution within the
Logility® Digital Supply Chain Platform that was launched earlier
in the year. The solution helps businesses track the social
compliance and environmental status of suppliers.
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 & 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)
Third Quarter Ended
Nine Months Ended
January 31,
January 31,
2022
2021
Pct Chg.
2022
2021
Pct Chg.
Revenues:
Subscription fees
$
10,856
$
7,486
45
%
$
31,005
$
20,815
49
%
License fees
992
530
87
%
2,289
1,767
30
%
Professional services & other
11,443
9,495
21
%
31,751
29,551
7
%
Maintenance
9,131
10,172
(10
%)
27,859
30,709
(9
%)
Total Revenues
32,422
27,683
17
%
92,904
82,842
12
%
Cost of Revenues:
Subscription services
3,431
3,062
12
%
10,059
8,767
15
%
License fees
240
288
(17
%)
597
1,516
(61
%)
Professional services & other
8,012
7,178
12
%
22,499
22,632
(1
%)
Maintenance
1,789
1,894
(6
%)
5,509
5,608
(2
%)
Total Cost of Revenues
13,472
12,422
8
%
38,664
38,523
0
%
Gross Margin
18,950
15,261
24
%
54,240
44,319
22
%
Operating expenses:
Research and development
4,602
4,475
3
%
13,304
13,278
0
%
Less: capitalized development
-
(233
)
(100
%)
-
(604
)
(100
%)
Sales and marketing
5,222
5,029
4
%
17,234
15,202
13
%
General and administrative
5,834
5,002
17
%
15,844
13,833
15
%
Amortization of acquisition-related
intangibles
53
53
0
%
159
159
0
%
Total Operating Expenses
15,711
14,326
10
%
46,541
41,868
11
%
Operating Earnings
3,239
935
246
%
7,699
2,451
214
%
Interest Income & Other, Net
92
1,432
(94
%)
1,459
2,722
(46
%)
Earnings Before Income Taxes
3,331
2,367
41
%
9,158
5,173
77
%
Income Tax Expense/(Benefit)
391
56
598
%
(43
)
136
nm
Net Earnings
$
2,940
$
2,311
27
%
$
9,201
$
5,037
83
%
Earnings per common share: (1)
Basic
$
0.09
$
0.07
29
%
$
0.28
$
0.16
75
%
Diluted
$
0.09
$
0.07
29
%
$
0.27
$
0.15
80
%
Weighted average number of common
shares outstanding:
Basic
33,490
32,628
33,293
32,485
Diluted
34,578
33,293
34,325
33,107
nm- not meaningful
AMERICAN SOFTWARE,
INC.
NON-GAAP MEASURES OF
PERFORMANCE
(In thousands, except per
share data, unaudited)
Third Quarter Ended
Nine Months Ended
January 31,
January 31,
2022
2021
Pct Chg.
2022
2021
Pct Chg.
NON-GAAP Operating Earnings:
Operating Earnings (GAAP Basis)
$
3,239
$
935
246
%
$
7,699
$
2,451
214
%
Amortization of acquisition-related
intangibles
53
96
(45
%)
159
718
(78
%)
Stock-based compensation
1,093
703
55
%
2,910
1,901
53
%
NON-GAAP Operating Earnings:
4,385
1,734
153
%
10,768
5,070
112
%
Non-GAAP Operating Earnings, as a % of
revenue
14
%
6
%
12
%
6
%
Third Quarter Ended
Nine Months Ended
January 31,
January 31,
2022
2021
Pct Chg.
2022
2021
Pct Chg.
NON-GAAP EBITDA:
Net Earnings (GAAP Basis)
$
2,940
$
2,311
27
%
$
9,201
$
5,037
83
%
Income Tax Expense/(Benefit)
391
56
598
%
(43
)
136
(132
%)
Interest Income & Other, Net
(92
)
(1,432
)
(94
%)
(1,459
)
(2,722
)
(46
%)
Amortization of intangibles
810
1,093
(26
%)
2,626
3,976
(34
%)
Depreciation
191
154
24
%
544
465
17
%
EBITDA (earnings before interest,
taxes, depreciation and amortization)
4,240
2,182
94
%
10,869
6,892
58
%
Stock-based compensation
1,093
703
55
%
2,910
1,901
53
%
Adjusted EBITDA
$
5,333
$
2,885
85
%
$
13,779
$
8,793
57
%
EBITDA, as a percentage of
revenues
13
%
8
%
12
%
8
%
Adjusted EBITDA, as a percentage of
revenues
16
%
10
%
15
%
11
%
Third Quarter Ended
Nine Months Ended
January 31,
January 31,
2022
2021
Pct Chg.
2022
2021
Pct Chg.
NON-GAAP EARNINGS PER SHARE:
Net Earnings (GAAP Basis)
$
2,940
$
2,311
27
%
$
9,201
$
5,037
83
%
Amortization of acquisition-related
intangibles (2)
41
80
(49
%)
126
617
(80
%)
Stock-based compensation (2)
848
589
44
%
2,304
1,631
41
%
Adjusted Net Earnings
$
3,829
$
2,980
28
%
$
11,631
$
7,285
60
%
Adjusted non-GAAP diluted earnings per
share
$
0.11
$
0.09
22
%
$
0.34
$
0.22
55
%
Third Quarter Ended
Nine Months Ended
January 31,
January 31,
2022
2021
Pct Chg.
2022
2021
Pct Chg.
NON-GAAP Earnings Per Share
Net Earnings (GAAP Basis)
$
0.09
$
0.07
29
%
$
0.27
$
0.15
80
%
Amortization of acquisition-related
intangibles (2)
-
-
-
-
0.02
(100
%)
Stock-based compensation (2)
0.02
0.02
0
%
0.07
0.05
40
%
Adjusted Net Earnings
0.11
$
0.09
22
%
0.34
$
0.22
55
%
Third Quarter Ended
Nine Months Ended
January 31,
January 31,
2022
2021
Pct Chg.
2022
2021
Pct Chg.
Amortization of acquisition-related
intangibles
Cost of license
$
-
$
43
(100
%)
$
-
$
559
(100
%)
Operating expenses
53
53
0
%
159
159
0
%
Total amortization of
acquisition-related intangibles
$
53
$
96
(45
%)
$
159
$
718
(78
%)
Stock-based compensation
Cost of revenues
$
59
$
37
59
%
$
188
$
103
83
%
Research and development
106
56
89
%
273
130
110
%
Sales and marketing
145
104
39
%
462
257
80
%
General and administrative
783
506
55
%
1,987
1,411
41
%
Total stock-based compensation
$
1,093
$
703
55
%
$
2,910
$
1,901
53
%
(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 $0.28 for the three and
nine months ended January 31, 2022, respectively. Diluted per share
for Class B shares under the two-class method are $0.07 and $0.16
for the three and nine months ended January 31, 2021,
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 nine month periods ended January
31, 2022 of 22.4% and 20.8% and for the three and nine month
periods ended January 31, 2021, 16.2% and 14.2%, respectively.
nm- not meaningful
AMERICAN SOFTWARE,
INC.
Consolidated Balance Sheet
Information
(In thousands)
(Unaudited)
January 31,
April 30,
2022
2021
Cash and Cash Equivalents
$
98,355
$
88,658
Short-term Investments
16,463
16,006
Accounts Receivable:
Billed
24,164
24,438
Unbilled
3,255
2,201
Total Accounts Receivable, net
27,419
26,639
Prepaids & Other
6,474
5,320
Current Assets
148,711
136,623
PP&E, net
3,720
3,428
Capitalized Software, net
2,301
4,767
Goodwill
25,888
25,888
Other Intangibles, net
201
360
Deferred Sales Commissions -
Non-current
2,122
2,474
Lease Right of Use Assets
1,093
1,454
Other Non-current Assets
2,014
2,163
Total Assets
$
186,050
$
177,157
Accounts Payable
$
3,158
$
1,732
Accrued Compensation and Related costs
5,242
6,129
Dividend Payable
3,689
3,615
Operating Lease Obligation - Current
604
739
Other Current Liabilities
1,123
1,307
Deferred Revenues - Current
38,095
37,142
Current Liabilities
51,911
50,664
Operating Lease Obligation -
Non-current
566
821
Deferred Tax Liability - Non-current
2,460
2,627
Other Long-term Liabilities
234
654
Long-term Liabilities
3,260
4,102
Total Liabilities
55,171
54,766
Shareholders' Equity
130,879
122,391
Total Liabilities & Shareholders'
Equity
$
186,050
$
177,157
AMERICAN SOFTWARE,
INC.
Condensed Consolidated
Cashflow Information
(In thousands)
(Unaudited)
Nine Months Ended
January 31,
2022
2021
Net cash provided by operating
activities
$
14,000
$
13,933
Capitalized computer software development
costs
-
(604
)
Purchases of property and equipment, net
of disposals
(751
)
(461
)
Net cash used in investing
activities
(751
)
(1,065
)
Dividends paid
(10,957
)
(10,696
)
Proceeds from exercise of stock
options
7,405
4,735
Net cash used in financing
activities
(3,552
)
(5,961
)
Net change in cash and cash
equivalents
9,697
6,907
Cash and cash equivalents at beginning of
period
88,658
79,814
Cash and cash equivalents at end of
period
$
98,355
$
86,721
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220223006172/en/
Vincent C. Klinges Chief Financial Officer American Software,
Inc. (404) 264-5477
American Software (NASDAQ:AMSWA)
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