[August 28, 2014] |
|
American Software Reports Preliminary First Quarter of Fiscal Year 2015 Results
ATLANTA --(Business Wire)--
American Software, Inc. (NASDAQ: AMSWA) today reported preliminary
financial results for the first quarter of fiscal 2015. The Company has
delivered 54 consecutive quarters of profitability.
Key first quarter financial metrics:
-
Total revenues for the quarter ended July 31, 2014 were $24.9 million,
an increase of 7% over the comparable period last year.
-
Software license fee revenues for the quarter ended July 31, 2014 were
$4.4 million, an increase of 36% compared to the same period last year.
-
Services and other revenues for the quarter ended July 31, 2014
decreased 2% to $11.0 million compared to $11.2 million for the same
period last year.
-
Maintenance revenues for the quarter ended July 31, 2014 were $9.5
million compared to $8.9 million, an increase of 7% over the same
period last year.
-
Operating earnings for the quarter ended July 31, 2014 were $2.2
million, a decrease of 9% compared to the same period last year.
-
GAAP net earnings for the quarter ended July 31, 2014 were $1.5
million or $0.05 per fully diluted share, a decrease of 4% compared to
the same period last year.
-
Adjusted net earnings for the quarter ended July 31, 2014, which
excludes stock-based compensation expense, amortization of
acquisition-related intangibles and the net loss of MIDRetail, were
$2.0 million or $0.07 per fully diluted share compared to $1.9 million
or $0.07 per fully diluted share for the same period last year, which
excluded stock-based compensation expense and amortization of
acquisition-related intangibles.
-
Adjusted EBITDA increased 5% to $4.0 million for the quarter ended
July 31, 2014 compared to $3.8 million for the quarter ended July 31,
2013. Adjusted EBITDA represents GAAP net earnings adjusted for
amortization of intangibles, depreciation, interest income & other,
net, income tax expense, stock-based compensation, and other
significant non-routine operating and non-operating income and expense
items, if applicable.
The Company is including 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 non-GAAP net earnings and non-GAAP per share
measures used by other companies. The Company believes that this
presentation of 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.
The overall financial condition of the Company remains strong, with cash
and investments of approximately $72.4 million as of July 31, 2014.
Since initiating the current cash dividend policy in July, 2004, the
Company has paid approximately $96.9 million in dividends.
"First quarter license fee revenue was up 36% and total revenues
increased by 7%," stated Mike Edenfield, president and CEO of American
Software. "Today, leading businesses are pragmatically preparing for
growth and are looking to increase visibility and lower operating costs
while improving their ability to respond to dynamic market conditions.
Our portfolio of solutions helps our customers optimize inventory
investments and synchronize demand with supply across strategic,
tactical and operational horizons. With the ability to model, optimize
and evaluate multiple business scenarios, our customers have better
information and greater confidence to respond effectively to dynamic
market conditions."
"Logility's acquisition of MIDRetail, announced on May 30, 2014, extends
our reach into retail operations and expands our ability to help
customers improve their Omni-Channel performance. We are now uniquely
positioned to optimize demand-driven integrated business planning (IBP)
from raw materials sourcing and manufacturing through inventory
optimization and distribution to specific store-level requirements and
customer delivery."
The MIDRetail acquisition is expected to be accretive to Logility's
earnings and cash flow within the next 12 months, and is expected to
contribute approximately $4.0 million in annual revenue, with 50% as a
recurring component. First quarter 2015 financial results included two
months of operations of MIDRetail, which reduced the Company's net
income by approximately one cent per share.
Additional highlights for the first quarter of fiscal 2015 include:
Customers & Channels
-
Notable new and existing customers placing orders with the Company in
the first quarter include: Bunzl Australia Holdings, Pioneer Foods
Pty, Reily Foods Company, Reliable Automatic Sprinkler, Sensient
Technologies Corporation, Strategic Partners, Sports Direct
International, and Tillamook Country Creamery Association.
-
During the quarter, software license agreements were signed with
customers located in the following nine countries: Australia, Canada,
Ireland, Italy, Nicaragua, South Africa, Sweden, the United Kingdom,
and the United States.
-
The editors of Supply & Demand Chain Executive Magazine
named the Company's subsidiaries: Logility, Demand Management Inc., a
wholly-owned subsidiary of Logility, and NGC Software to its annual
listing of the Supply & Demand Chain Executive 100. The award, which
highlights the "100 Great Supply Chain Projects" of the past year,
marks the 12th year Logility and fourth consecutive year NGC Software
have been honored for enabling extraordinary supply chain initiatives.
Logility was recognized for its work with Massimo Zanetti Beverage
USA; Demand Management was selected based on its work with ITW Proline
Australia; and NGC Software was recognized for its fashion PLM and
Supply Chain Management software implementation at New York-based
Fashion Avenue Sweater Knits.
-
Logility Inc. announced that American Hotel Register, Caribou Coffee,
Gear for Sports, Johnstone Supply, and Massimo Zanetti Beverage USA
each received the 2014 Logility Leadership Award. Logility's annual
award program recognizes a select group of companies who significantly
improved their business processes, deployed an innovative solution to
address their supply chain challenges, or demonstrated an on-going
commitment and leadership role in the expansion of supply chain
improvements.
-
Caribou Coffee and Logility led an educational APICS webcast that
explored how Caribou Coffee has balanced its aggressive growth
initiatives across its three channels of business (retail, franchise
and commercial) in the face of challenges such as increasing new
product introductions, compressed planning cycles, and the need to
balance cost and service.
-
NGC Software announced its customers Sport Obermeyer and Fashion
Avenue Sweater Knits were named as 2014 Top Innovators by Apparel
Magazine for their successful implementations of NGC's fashion
software solutions. Apparel Magazine's annual Top Innovator
awards recognize apparel retailers, brands and manufacturers who have
demonstrated exceptional deployments of new technology in unique ways
that have improved their business.
-
During the quarter, NGC Software announced Vald'or Apparel, a
manufacturer of private label and branded apparel for leading brands,
is implementing NGC's PLM, ERP and Shop Floor Control systems to bring
a new level of efficiency and collaboration to its global operations.
Vald'or selected NGC Software's solutions to support the company's
rapid growth.
-
BBC International LLC, a leading full-service footwear company,
selected NGC Software's fashion solution for collaborative workflow
management. BBC International designs, develops and sources
fashionable children's footwear for global customers that include many
of the best-known brands in the industry. BBC selected NGC Software to
help it achieve greater efficiency and productivity, while maintaining
its core commitment to design, and deliver high-quality footwear and
exceptional service to its customers.
Company & Technology
-
Logility announced its acquisition of privately-held MIDRetail, Inc.,
an Indianapolis-based provider of retail allocation and merchandise
planning solutions. MIDRetail's award winning technology helps
retailers synchronize merchandise financial plans with customer demand
at each retail location to boost in-stock performance, profitably grow
their businesses, allocate merchandise, and deliver higher product
availability and customer service. MIDRetail's products will be
integrated into the Logility Voyager Solutions suite and rebranded
under Voyager Retail Optimization.
-
NGC Software announced the release and immediate availability of NGC
ERP Xpress, a cloud-based version of NGC Software's industry-leading
fashion ERP solution. NGC ERP Xpress provides the robust features of
NGC Software's enterprise application in a Software-as-a-Service
(SaaS) model delivered in the cloud. With NGC ERP Xpress, companies
can be up and running in under 30 days on a fully-featured fashion ERP
system that includes EDI, Customer Order Processing, Purchasing,
Production Orders, Inventory Control, Distribution, Accounting, and
Reporting.
-
Demand Management launched a valuable new Supply Chain Planning
Assessment tool that allows Demand Planners and Forecasters to quickly
evaluate the current state of their company's supply chain. The
assessment takes participants through the five stages of the
Integrated Business Planning (IBP) process: Sense, Shape, Collaborate,
Integrate and Orchestrate. A detailed and customized assessment report
identifies the areas of the IBP process in which the company is
excelling as well as the areas that represent opportunities for
improvement in driving tangible business value.
-
Sean Willems, Ph.D., associate professor of Operations Management at
Boston University's School of Management and Chief Scientist at
Logility, led an educational session at the 2014 Gartner Supply Chain
Executive Summit on the importance of inventory optimization within
the sales and operations planning (S&OP) process.
-
During the quarter, Logility announced that the editors of Inbound
Logistics named the company to its annual Top 100 Logistics IT
Provider list. This marks the 17th consecutive year Logility has been
recognized for enabling logistics excellence through its innovative
supply chain management solutions. Each year Inbound Logistics
selects the Top 100 Logistics IT Providers who are leading the way in
the coming year.
About American Software, Inc.
Atlanta-based American Software (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 solutions to optimize the supply chain. Logility Voyager
Solutions™ is a complete supply chain management solution suite that
features a performance monitoring architecture and provides supply chain
visibility; demand, inventory and replenishment planning; Sales and
Operations Planning (S&OP); supply and inventory optimization;
manufacturing planning and scheduling; retail merchandise planning and
allocation; and transportation planning and management. Logility
customers include Abercrombie & Fitch, Big Lots, Fender Musical
Instruments, Parker Hannifin, Verizon Wireless, and VF Corporation. Demand
Management, Inc., a wholly-owned subsidiary of Logility, delivers
supply chain solutions to small and midsized manufacturers, distributors
and retailers. Demand Management's Demand Solutions® suite is
widely deployed and globally recognized for forecasting, demand planning
and point-of-sale analysis. Demand Management serves customers such as
AutomationDirect.com, Campbell Hausfeld and Lonely Planet. New
Generation Computing® (NGC®),
a wholly-owned subsidiary of American Software, is a leading provider of
PLM, supply chain management, ERP and product testing software and
services for brand owners, retailers and consumer products companies.
NGC customers include A|X Armani Exchange, Aeropostale, Billabong,
Carter's, Casual Male, Hugo Boss, Jos. A. Bank, FGL Group, Athletica,
Marchon Eyewear, and Swatfame. For more information about American
Software, 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, continuing U.S. and global economic uncertainty, the
timing and degree of business recovery, unpredictability and the
irregular pattern of future revenues, dependence on particular market
segments or customers, competitive pressures, delays, product liability
and warranty claims and other risks associated with new product
development, undetected software errors, market acceptance of the
Company's products, technological complexity, the challenges and risks
associated with integration of acquired product lines, companies and
services, 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 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,
|
|
|
|
|
|
2014
|
|
2013
|
|
Pct Chg.
|
Revenues:
|
|
|
|
|
|
|
|
|
|
License
|
|
|
$
|
4,368
|
|
|
$
|
3,218
|
|
|
36
|
%
|
|
Services & other
|
|
|
|
10,992
|
|
|
|
11,228
|
|
|
(2
|
%)
|
|
Maintenance
|
|
|
|
9,497
|
|
|
|
8,872
|
|
|
7
|
%
|
|
|
Total Revenues
|
|
|
|
24,857
|
|
|
|
23,318
|
|
|
7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Revenues:
|
|
|
|
|
|
|
|
|
|
License
|
|
|
|
1,736
|
|
|
|
1,161
|
|
|
50
|
%
|
|
Services & other
|
|
|
|
7,795
|
|
|
|
8,040
|
|
|
(3
|
%)
|
|
Maintenance
|
|
|
|
1,981
|
|
|
|
1,962
|
|
|
1
|
%
|
|
|
Total Cost of Revenues
|
|
|
|
11,512
|
|
|
|
11,163
|
|
|
3
|
%
|
Gross Margin
|
|
|
|
13,345
|
|
|
|
12,155
|
|
|
10
|
%
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
|
3,374
|
|
|
|
2,817
|
|
|
20
|
%
|
|
Less: capitalized development
|
|
|
|
(178
|
)
|
|
|
(717
|
)
|
|
(75
|
%)
|
|
Sales and marketing
|
|
|
|
4,644
|
|
|
|
4,394
|
|
|
6
|
%
|
|
General and administrative
|
|
|
|
3,215
|
|
|
|
3,153
|
|
|
2
|
%
|
|
Provision for doubtful accounts
|
|
|
|
42
|
|
|
|
-
|
|
|
nm
|
|
Amortization of acquisition-related intangibles
|
|
|
|
85
|
|
|
|
125
|
|
|
(32
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating Expenses
|
|
|
|
11,182
|
|
|
|
9,772
|
|
|
14
|
%
|
Operating Earnings
|
|
|
|
2,163
|
|
|
|
2,383
|
|
|
(9
|
%)
|
|
Interest Income & Other, Net
|
|
|
|
306
|
|
|
|
44
|
|
|
595
|
%
|
Earnings Before Income Taxes
|
|
|
|
2,469
|
|
|
|
2,427
|
|
|
2
|
%
|
Income Tax Expense
|
|
|
|
935
|
|
|
|
834
|
|
|
12
|
%
|
Net Earnings
|
|
|
$
|
1,534
|
|
|
$
|
1,593
|
|
|
(4
|
%)
|
Earnings per common share: (1)
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
|
0.05
|
|
|
$
|
0.06
|
|
|
(17
|
%)
|
|
Diluted
|
|
|
$
|
0.05
|
|
|
$
|
0.06
|
|
|
(17
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
28,233
|
|
|
|
27,363
|
|
|
|
|
|
|
Diluted
|
|
|
|
28,606
|
|
|
|
27,815
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
nm- not meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMERICAN SOFTWARE, INC.
|
NON-GAAP MEASURES OF PERFORMANCE
|
(In thousands, except per share data, unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter Ended
|
|
|
|
|
|
July 31,
|
|
|
|
|
|
|
2014
|
|
2013
|
|
Pct Chg.
|
NON-GAAP EBITDA:
|
|
|
|
|
|
|
|
|
Net Earnings (GAAP Basis)
|
|
|
$
|
1,534
|
|
|
$
|
1,593
|
|
|
(4
|
%)
|
|
Income tax expense
|
|
|
|
935
|
|
|
|
834
|
|
|
12
|
%
|
|
Interest Income & Other, Net
|
|
|
|
(306
|
)
|
|
|
(44
|
)
|
|
595
|
%
|
|
Amortization of intangibles
|
|
|
|
1,099
|
|
|
|
768
|
|
|
43
|
%
|
|
Depreciation
|
|
|
|
284
|
|
|
|
261
|
|
|
9
|
%
|
EBITDA (earnings before interest, taxes, depreciation and
amortization)
|
|
|
|
3,546
|
|
|
|
3,412
|
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation
|
|
|
|
404
|
|
|
|
338
|
|
|
20
|
%
|
Adjusted EBITDA
|
|
|
$
|
3,950
|
|
|
$
|
3,750
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA , as a percentage of revenues
|
|
|
|
14
|
%
|
|
|
15
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA , as a percentage of revenues
|
|
|
|
16
|
%
|
|
|
16
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter Ended
|
|
|
|
|
|
July 31,
|
|
|
|
|
|
|
2014
|
|
2013
|
|
Pct Chg.
|
NON-GAAP EARNINGS PER SHARE:
|
|
|
|
|
|
|
|
|
Net Earnings (GAAP Basis)
|
|
|
$
|
1,534
|
|
|
$
|
1,593
|
|
|
(4
|
%)
|
|
Mid Retail Loss (2)
|
|
|
|
187
|
|
|
|
-
|
|
|
nm
|
|
Amortization of TMS and Optiant acquisition-related intangibles (2)
|
|
|
|
25
|
|
|
|
82
|
|
|
(70
|
%)
|
|
Stock-based compensation (2)
|
|
|
|
251
|
|
|
|
222
|
|
|
13
|
%
|
Adjusted Net Earnings
|
|
|
$
|
1,997
|
|
|
$
|
1,897
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted non-GAAP diluted earnings per share
|
|
|
$
|
0.07
|
|
|
$
|
0.07
|
|
|
0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
(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
$0.05 and $0.06 for the three months ended July 31, 2014 and 2013.
(2) - Tax affected using the effective tax rate for the three months
period ended July 31, 2014 and 2013.
|
|
|
|
|
|
|
|
|
|
AMERICAN SOFTWARE, INC.
|
Consolidated Balance Sheet Information
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
July 31,
|
|
|
|
April 30,
|
|
|
|
|
|
2014
|
|
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
Cash and Short-term Investments
|
|
|
$
|
60,608
|
|
|
|
$
|
70,599
|
Accounts Receivable:
|
|
|
|
|
|
|
|
|
Billed
|
|
|
|
12,914
|
|
|
|
|
15,422
|
|
Unbilled
|
|
|
|
3,826
|
|
|
|
|
3,234
|
Total Accounts Receivable, net
|
|
|
|
16,740
|
|
|
|
|
18,656
|
Prepaids & Other
|
|
|
|
3,027
|
|
|
|
|
2,953
|
Income Tax Receivable
|
|
|
|
141
|
|
|
|
|
1,139
|
Current Assets
|
|
|
|
80,516
|
|
|
|
|
93,347
|
|
|
|
|
|
|
|
|
|
|
Investments - Non-current
|
|
|
|
11,831
|
|
|
|
|
8,975
|
|
|
|
|
|
|
|
|
|
|
PP&E, net
|
|
|
|
3,488
|
|
|
|
|
3,681
|
Capitalized Software, net
|
|
|
|
10,013
|
|
|
|
|
10,732
|
Goodwill
|
|
|
|
18,749
|
|
|
|
|
13,819
|
Other Intangibles, net
|
|
|
|
3,522
|
|
|
|
|
534
|
Other Non-current Assets
|
|
|
|
630
|
|
|
|
|
132
|
Total Assets
|
|
|
$
|
128,749
|
|
|
|
$
|
131,220
|
|
|
|
|
|
|
|
|
|
|
Accounts Payable
|
|
|
$
|
745
|
|
|
|
$
|
1,382
|
Accrued Compensation and Related costs
|
|
|
|
2,248
|
|
|
|
|
3,532
|
Dividend Payable
|
|
|
|
2,825
|
|
|
|
|
2,822
|
Other Current Liabilities
|
|
|
|
2,743
|
|
|
|
|
2,735
|
Deferred Tax Liability - Current
|
|
|
|
402
|
|
|
|
|
418
|
Deferred Revenues - Current
|
|
|
|
23,614
|
|
|
|
|
23,638
|
Current Liabilities
|
|
|
|
32,577
|
|
|
|
|
34,527
|
|
|
|
|
|
|
|
|
|
|
Deferred Revenues - Non-current
|
|
|
|
575
|
|
|
|
|
670
|
Deferred Tax Liability - Non-current
|
|
|
|
1,671
|
|
|
|
|
1,936
|
Other Long-term Liabilities
|
|
|
|
2,035
|
|
|
|
|
1,527
|
Long-term Liabilities
|
|
|
|
4,281
|
|
|
|
|
4,133
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
|
|
|
|
36,858
|
|
|
|
|
38,660
|
|
|
|
|
|
|
|
|
|
|
Shareholders' Equity
|
|
|
|
91,891
|
|
|
|
|
92,560
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities & Shareholders' Equity
|
|
|
$
|
128,749
|
|
|
|
$
|
131,220
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMERICAN SOFTWARE, INC.
|
Condensed Consolidated Cashflow Information
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended,
|
|
|
|
|
|
July 31,
|
|
|
|
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities
|
|
|
$
|
1,125
|
|
|
$
|
9,251
|
|
|
|
|
|
|
|
|
|
|
|
Capitalized computer software development costs
|
|
|
|
(178
|
)
|
|
|
(717
|
)
|
|
|
Purchases of property and equipment, net of disposals
|
|
|
|
(58
|
)
|
|
|
(34
|
)
|
|
|
Proceeds from maturities of investments
|
|
|
|
-
|
|
|
|
200
|
|
|
|
Purchase of business, net of cash acquired
|
|
|
|
(7,881
|
)
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
|
|
(8,117
|
)
|
|
|
(551
|
)
|
|
|
|
|
|
|
|
|
|
|
Excess tax benefits from stock based compensation
|
|
|
|
41
|
|
|
|
27
|
|
|
|
Proceeds from exercise of stock options
|
|
|
|
183
|
|
|
|
487
|
|
|
|
Dividends paid
|
|
|
|
(2,826
|
)
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities
|
|
|
|
(2,602
|
)
|
|
|
514
|
|
|
|
|
|
|
|
|
|
|
|
Net change in cash and cash equivalents
|
|
|
|
(9,594
|
)
|
|
|
9,214
|
|
|
|
Cash and cash equivalents at beginning of period
|
|
|
|
55,803
|
|
|
|
41,164
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period
|
|
|
$
|
46,209
|
|
|
$
|
50,378
|
|
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