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Share Name | Share Symbol | Market | Type |
---|---|---|---|
American Software Inc | NASDAQ:AMSWA | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 10.21 | 10.00 | 10.21 | 2 | 14:11:47 |
Subscription Fees Increased 57%, Cloud Services Annual Contract Value Increased 58% and License Fees Increased 115% for the Quarter
American Software, Inc. (NASDAQ: AMSWA) today reported preliminary financial results for the third quarter of fiscal year 2020.
Key Third quarter financial highlights:
Key fiscal 2020 year to date financial highlights:
The overall financial condition of the Company remains strong, with cash and investments of approximately $96.3 million, an increase of over $12 million when compared to January 31, 2019, and no debt as of January 31, 2020. During the third quarter of fiscal 2020, the Company paid shareholder dividends of approximately $3.5 million.
“Overall, we had a very good third quarter and are pleased with our performance year to date. During the third quarter, we saw a marked improvement in our close rate driving a 57% growth in Subscription Fees and 58% growth in Cloud Services ACV. These key performance indicators continue to underscore our successful transition to a cloud-first company,” said Allan Dow, president of American Software. “During the quarter, we also closed a few sizable perpetual license fee transactions with customers who had a preference for capital investments over subscription-based operating expenses. In total, we welcomed 11 new customers and completed subscription or license fee transactions in 11 countries.”
“Our recurring revenue streams of Maintenance and Subscription Cloud Services represented 54% and 56% of third quarter and year to date total revenues, respectively. We expect the percentage of recurring revenue to continue trending higher in the future, giving our business and shareholders increased visibility with respect to future revenue performance,” continued Dow.
“Our cloud-based platform provides customers with the increased visibility and accuracy necessary to automate critical planning functions, gain new insights and make better and faster decisions across operational, tactical and strategic horizons,” stated Dow. “We believe customers that take advantage of our advancements in artificial intelligence (AI), machine learning (ML) and advanced supply chain analytics to improve their operating performance from product concept to customer availability will be better positioned to overcome the growing supply chain talent shortage that may impact their profitable growth and ability to respond to rapidly changing market conditions or unanticipated supply chain disruptions.”
Additional highlights for the third quarter of fiscal 2020 include:
Customers & Channels
Company and Technology
About American Software, Inc.
Atlanta-based American Software, Inc. (NASDAQ: AMSWA), delivers innovative AI-powered supply chain management and advanced retail planning platforms. Logility, Inc., a wholly-owned subsidiary of American Software, is accelerating digital supply chain optimization and advanced retail planning from product concept to customer availability and 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, Red Wing Shoe Company and VF Corporation. Demand Management, Inc., a wholly-owned subsidiary of Logility, delivers affordable, easy-to-use Software-as-a-Service (SaaS) 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. New Generation Computing, Inc., a wholly-owned subsidiary of American Software, powers the digital supply chain to enable brand owners and retailers to maximize revenue and profit by accelerating lead times, streamlining product development, and optimizing sourcing and distribution. NGC customers include Brooks Brothers, Carter’s, Destination XL, Fanatics, Foot Locker, Jockey International, Lacoste and Spanx. The comprehensive American Software supply chain and retail planning portfolio 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, and vendor quality and compliance. For more information about American Software, please visit www.amsoftware.com, call (800) 726-2946 or email: ask@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 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.
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) 264-5298.
American Software® is a registered trademark of American Software, Inc.; Logility® is a registered trademark of Logility, Inc.; Demand Solutions® is a registered trademark of Demand Management, Inc.; and New Generation Computing®, is a registered trademark of New Generation Computing, Inc. Other products mentioned in this document are registered marks, trademarks or service marks of 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,
2020
2019
Pct Chg.
2020
2019
Pct Chg.
Revenues:
Subscription fees
$
5,802
$
3,687
57
%
$
15,752
$
10,196
54
%
License fees
3,695
1,718
115
%
6,519
5,432
20
%
Professional services & other
10,308
10,176
1
%
31,271
32,240
(3
%)
Maintenance
10,795
11,422
(5
%)
32,651
34,567
(6
%)
Total Revenues
30,600
27,003
13
%
86,193
82,435
5
%
Cost of Revenues:
Subscription services
1,976
1,389
42
%
6,711
3,746
79
%
License fees
1,582
1,831
(14
%)
3,969
5,305
(25
%)
Professional services & other
7,764
7,714
1
%
22,712
24,484
(7
%)
Maintenance
1,836
2,030
(10
%)
5,551
6,442
(14
%)
Total Cost of Revenues
13,158
12,964
1
%
38,943
39,977
(3
%)
Gross Margin
17,442
14,039
24
%
47,250
42,458
11
%
Operating expenses:
Research and development
4,659
4,884
(5
%)
14,087
13,980
1
%
Less: capitalized development
(806
)
(2,073
)
(61
%)
(2,697
)
(4,162
)
(35
%)
Sales and marketing
5,519
4,699
17
%
16,246
15,183
7
%
General and administrative
5,194
4,302
21
%
14,890
12,903
15
%
Provision for doubtful accounts
-
-
-
33
-
nm
Amortization of acquisition-related intangibles
57
97
(41
%)
232
291
(20
%)
Total Operating Expenses
14,623
11,909
23
%
42,791
38,195
12
%
Operating Earnings
2,819
2,130
32
%
4,459
4,263
5
%
Interest Income & Other, Net
978
527
86
%
2,215
1,090
103
%
Earnings Before Income Taxes
3,797
2,657
43
%
6,674
5,353
25
%
Income Tax Expense
511
356
44
%
477
424
13
%
Net Earnings
$
3,286
$
2,301
43
%
$
6,197
$
4,929
26
%
Earnings per common share: (1)
Basic
$
0.10
$
0.07
43
%
$
0.20
$
0.16
25
%
Diluted
$
0.10
$
0.07
43
%
$
0.19
$
0.16
19
%
Weighted average number of common shares outstanding:
Basic
31,955
31,010
31,611
30,887
Diluted
32,668
31,183
32,260
31,351
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,
2020
2019
Pct Chg.
2020
2019
Pct Chg.
NON-GAAP Operating Earnings:
Operating Income (GAAP Basis)
$
2,819
$
2,130
32
%
$
4,459
$
4,263
5
%
Amortization of acquisition-related intangibles
315
597
(47
%)
1,289
1,791
(28
%)
Stock-based compensation
564
466
21
%
1,509
1,308
15
%
NON-GAAP Operating Earnings:
3,698
3,193
16
%
7,257
7,362
(1
%)
Non-GAAP Operating Earnings, as a % of revenue
12
%
12
%
8
%
9
%
Third Quarter Ended
Nine Months Ended
January 31,
January 31,
2020
2019
Pct Chg.
2020
2019
Pct Chg.
NON-GAAP EBITDA:
Net Earnings (GAAP Basis)
$
3,286
$
2,301
43
%
$
6,197
$
4,929
26
%
Income Tax Expense
511
356
44
%
477
424
13
%
Interest Income & Other, Net
(978
)
(527
)
86
%
(2,215
)
(1,090
)
103
%
Amortization of intangibles
1,723
1,792
(4
%)
5,834
5,184
13
%
Depreciation
159
168
(5
%)
476
487
(2
%)
EBITDA (earnings before interest, taxes, depreciation and amortization)
4,701
4,090
15
%
10,769
9,934
8
%
Stock-based compensation
564
466
21
%
1,509
1,308
15
%
Adjusted EBITDA
$
5,265
$
4,556
16
%
$
12,278
$
11,242
9
%
EBITDA, as a percentage of revenues
15
%
15
%
12
%
12
%
Adjusted EBITDA, as a percentage of revenues
17
%
17
%
14
%
14
%
Third Quarter Ended
Nine Months Ended
January 31,
January 31,
2020
2019
Pct Chg.
2020
2019
Pct Chg.
NON-GAAP EARNINGS PER SHARE:
Net Earnings (GAAP Basis)
$
3,286
$
2,301
43
%
$
6,197
$
4,929
26
%
Amortization of acquisition-related intangibles (2)
273
519
(47
%)
1,119
1,649
(32
%)
Stock-based compensation (2)
488
405
20
%
1,309
1,204
9
%
Adjusted Net Earnings
$
4,047
$
3,225
25
%
$
8,625
$
7,782
11
%
Adjusted non-GAAP diluted earnings per share
$
0.12
$
0.10
20
%
$
0.27
$
0.25
8
%
Third Quarter Ended
Nine Months Ended
January 31,
January 31,
2020
2019
Pct Chg.
2020
2019
Pct Chg.
NON-GAAP Earnings Per Share
Net Earnings (GAAP Basis)
$
0.10
$
0.07
43
%
$
0.19
$
0.16
19
%
Amortization of acquisition-related intangibles (2)
0.01
0.02
(50
%)
0.04
0.05
(20
%)
Stock-based compensation (2)
0.01
0.01
0
%
0.04
0.04
0
%
Adjusted Net Earnings
0.12
$
0.10
20
%
0.27
$
0.25
8
%
Third Quarter Ended
Nine Months Ended
January 31,
January 31,
2020
2019
Pct Chg.
2020
2019
Pct Chg.
Amortization of acquisition-related intangibles
Cost of license
$
258
$
500
(48
%)
$
1,057
$
1,500
(30
%)
Operating expenses
57
97
(41
%)
232
291
(20
%)
Total amortization of acquisition-related intangibles
$
315
$
597
(47
%)
$
1,289
$
1,791
(28
%)
Stock-based compensation
Cost of revenues
$
43
$
35
23
%
$
94
$
96
(2
%)
Research and development
44
35
26
%
117
98
19
%
Sales and marketing
102
71
44
%
260
189
38
%
General and administrative
375
325
15
%
1,038
925
12
%
Total stock-based compensation
$
564
$
466
21
%
$
1,509
$
1,308
15
%
(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 $0.20 for the three and nine months ended January 31, 2020, 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 Janaury 31, 2019, 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, 2020 and 2019.
nm- not meaningful
AMERICAN SOFTWARE, INC.
Consolidated Balance Sheet Information
(In thousands)
(Unaudited)
January 31,
April 30,
2020
2019
Cash and Cash Equivalents
$68,809
$
61,288
Short-term Investments
27,478
24,710
Accounts Receivable:
Billed
21,202
18,819
Unbilled
2,436
1,475
Total Accounts Receivable, net
23,638
20,294
Prepaids & Other
6,576
6,210
Current Assets
126,501
112,502
Investments - Non-current
-
2,484
PP&E, net
3,447
3,585
Capitalized Software, net
9,215
11,063
Goodwill
25,888
25,888
Other Intangibles, net
1,444
2,732
Deferred Sales Commissions - Non-current
2,231
1,546
Lease Right of Use Assets
2,228
-
Other Non-current Assets
1,738
1,510
Total Assets
$172,692
$
161,310
Accounts Payable
$1,772
$
2,448
Accrued Compensation and Related costs
6,006
2,561
Dividend Payable
3,522
3,434
Operating Lease Obligation - Current
770
-
Other Current Liabilities
1,520
1,375
Deferred Revenues - Current
34,419
33,283
Current Liabilities
48,009
43,101
Operating Lease Obligation - Non-current
1,596
-
Deferred Tax Liability - Non-current
3,322
3,514
Other Long-term Liabilities
93
88
Long-term Liabilities
5,011
3,602
Total Liabilities
53,020
46,703
Shareholders' Equity
119,672
114,607
Total Liabilities & Shareholders' Equity
$172,692
$
161,310
AMERICAN SOFTWARE, INC.
Condensed Consolidated Cashflow Information
(In thousands)
(Unaudited)
Nine Months Ended
January 31,
2020
2019
Net cash provided by operating activities
$
13,112
$
13,608
Capitalized computer software development costs
(2,697
)
(4,162
)
Purchases of property and equipment, net of disposals
(339
)
(1,014
)
Net cash used in investing activities
(3,036
)
(5,176
)
Dividends paid
(10,392
)
(10,172
)
Proceeds from exercise of stock options
7,837
4,004
Net cash used in financing activities
(2,555
)
(6,168
)
Net change in cash and cash equivalents
7,521
2,264
Cash and cash equivalents at beginning of period
61,288
52,794
Cash and cash equivalents at end of period
$
68,809
$
55,058
View source version on businesswire.com: https://www.businesswire.com/news/home/20200220005826/en/
Financial Information Press Contact: Vincent C. Klinges Chief Financial Officer American Software, Inc. (404) 264-5477
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