Slide 1: Simulations Plus Investor Call April 14, 2015
Copyright (c) 2015 Simulations Plus, Inc. 1 Simulations Plus, Inc . and its wholly owned subsidiary Cognigen Corporation ( NASDAQ:SLP ) Investor Call April 14, 2015
Slide 2: Safe Harbor Statement
Copyright (c) 2015 Simulations Plus, Inc. 2 With the exception of historical information, the matters discussed in this presentation are forward - looking statements that involve a number of risks and uncertainties . The actual results of the Company could differ significantly from those statements
Slide 3: Simulations Plus, Inc. Overview
Copyright (c) 2015 Simulations Plus, Inc. 3 • Major provider of software and consulting services for pharmaceutical research and development • Expertise and software tools span from earliest drug discovery through clinical trials and beyond patent life to supporting generic companies • New applicati
Slide 4: 2QFY15 Highlights Compared to 2QFY14
Copyright (c) 2015 Simulations Plus, Inc. 4 • Revenues increased by 48.4%, or $1.5 million, to $ 4.6 million from $3.1 million ‒ Cognigen revenues were $ 1.27 million, up by $140,000 over prior quarter ‒ Simulations Plus revenue increased 7.2%, or $221,000, in 2QFY15 versus 2QFY14; analytical study
Slide 5: 2QFY15 Highlights Compared to 2QFY14, cont'd
Copyright (c) 2015 Simulations Plus, Inc. 5 • SG&A increased 46.1%, or $ 509,000, to $1.6 million from $1.1 million the prior year ‒ $539,000 of increase is from Cognigen operating expenses ‒ Simulations Plus SG&A decreased $30,000 ‒ Total SG &A decreased to 32.5% of revenues in 2QFY15 from 35.8% in
Slide 6: 2QFY15 Highlights Compared to 2QFY14, cont'd
Copyright (c) 2015 Simulations Plus, Inc. 6 • Net income increased by 19.8%, or $ 160,000, to $970,000 in 2QFY15 from $810,000 in 2QFY14 ‒ $124,000 of this increase were earnings from Cognigen subsidiary ‒ Simulations Plus profit increase was affected by a $250,000 renewal order that pushed into the
Slide 7: Income Statement 2QFY15 Compared to 2QFY14
Copyright (c) 2015 Simulations Plus, Inc. 7 Income Statement 2QFY15 Compared to 2QFY14 (in millions) 2QFY15 2QFY14 Net sales $ 4.574 $ 3.081 Gross profit 3.448 2.589 Gross profit margin 75.4% 84.0% SG&A 1.612 1.104 R&D 0.361 0.354 Total operating expenses 1.973 1.458 Income from operations 1.475 1.1
Slide 8: Income Statement 2QFY15, by Division
Copyright (c) 2015 Simulations Plus, Inc. 8 Income Statement 2QFY15, by Division (in millions) SLP Cognigen Eliminations FQY15.2 Net sales $ 3.302 $ 1.271 0.00 $ 4.574 Gross profit 2.711 0.737 0.00 3.448 Gross profit margin 82.1% 58.0% 0.00 75.4% SG&A 1.073 0.539 0.00 1.612 R&D 0.350 0.011 0.00 0.36
Slide 9: 6moFY15 Highlights Compared to 6moFY14
Copyright (c) 2015 Simulations Plus, Inc. 9 • Revenues increased by 51.3%, or $2.9 million, to $8.7 million from $5.7 million in 6moFY14 ‒ Cognigen revenues were $2.4 million ‒ Simulations Plus revenue increased 9.3%, or $531,000, to $6.3 million in 6moFY15 versus 6moFY14; analytical study revenues
Slide 10: 6moFY15 Highlights Compared to 6moFY14, cont'd
Copyright (c) 2015 Simulations Plus, Inc. 10 • SG&A increased 69.2%, or $1.5 million, to $3.7 million from $2.2 million the prior year ‒ $1.1 million of the increase is from Cognigen operating expenses ‒ Simulations Plus SG&A increased $440 ,000 for 6moFY15 compared to 6moFY14 ‒ During this 6 - mont
Slide 11: 6moFY15 Highlights Compared to 6moFY14, cont'd
Copyright (c) 2015 Simulations Plus, Inc. 11 • Other income ( expense) decreased by $78,000 in 6moFY15 versus 6moFY14, the result of foreign currency fluctuations ‒ We recently made a ~5% increase to prices in our main Asian market. We do not anticipate this increase will have a significant impact o
Slide 12: Income Statement 6moFY15 Versus 6moFY14
Copyright (c) 2015 Simulations Plus, Inc. 12 6moFY15 6moFY14 Net sales $ 8.660 $ 5.722 Gross profit 6.537 4.782 Gross profit margin 75.5% 83.6% SG&A 3.679 2.175 R&D 0.633 0.516 Total operating expenses 4.312 2.691 Income from continuing operations 2.225 2.091 Other income (0.034) 0.45 Income from op
Slide 13: Income Statement 6moFY15 by Division
Copyright (c) 2015 Simulations Plus, Inc. 13 Income Statement 6moFY15 by division (in millions) SLP Cognigen Eliminations FQY15.1 Net sales 6.254 2.406 0.00 8.660 Gross profit 5.199 1.338 0.00 6.537 Gross profit margin 83.1% 55.6% 0.00 75.5% SG&A 2.614 1.065 0.00 3.679 R&D 0.610 0.024 0.00 0.633 Tot
Slide 14: Selected Balance Sheet Items
Copyright (c) 2015 Simulations Plus, Inc. 14 Selected Balance Sheet Items (in millions) February 28, 2015 August 31, 2014 Cash and cash equivalents $6.103* $8.614 Cash per share 0.36 0.52 Total current assets 10.732 11.533 Total assets 27.062 20.981 Total current liabilities 1.468 1.391 Total liabil
Slide 15: 2QFY15 Consolidated Sales By Region
Copyright (c) 2015 Simulations Plus, Inc. 15 2QFY15 Consolidated Sales By Region Europe 27% North America 5 9% Asia 13% South America <1% Japan = 78% China = 15% Korea = 7 %
Slide 16: New Software Customers, by Fiscal Quarter
Copyright (c) 2015 Simulations Plus, Inc. 16 New Software Customers, by Fiscal Quarter 0 5 10 15 20 25 Q1 Q2 Q3 Q4 23 20 2010 2011 2012 2013 2014 2015
Slide 17: Consolidated Revenues, by Fiscal Quarter
Copyright (c) 2015 Simulations Plus, Inc. 17 Consolidated Revenues, by Fiscal Quarter (pro forma prior to 2012; in millions) Column1 2009 2010 2011 2012 2013 2014 2015 Q1 1.4 1.7 2.1 2.24 2.29 2.64 4.01 Q2 1.8 2.2 2.6 2.79 3.12 3.08 4.57 Q3 2 2.3 2.64 2.77 3.09 3.74 Q4 1.1 1.3 1.43 1.64 1.58 2.00 0
Slide 18: Consolidated Gross Profit, by Fiscal Quarter
Copyright (c) 2015 Simulations Plus, Inc. 18 Consolidated Gross Profit, by Fiscal Quarter (pro forma prior to 2012; in millions) $0 $1 $2 $3 $4 Q1 Q2 Q3 Q4 3.09 3.45 2009 2010 2011 2012 2013 2014 2015
Slide 19: Consolidated EBITDA, by Fiscal Quarter
Copyright (c) 2015 Simulations Plus, Inc. 19 Consolidated EBITDA, by Fiscal Quarter (in millions) $0 $1 $2 $3 Q1 Q2 Q3 Q4 1.45 1.97 2009 2010 2011 2012 2013 2014 2015
Slide 20: Consolidated Net Income, by Fiscal Quarter
Copyright (c) 2015 Simulations Plus, Inc. 20 Consolidated Net Income, by Fiscal Quarter (pro forma prior to 2012; in millions) $ - $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 Q1 Q2 Q3 Q4 $0.53 $0.97 2009 2010 2011 2012 2013 2014 2015
Slide 21: Returning Cash to Shareholders
Copyright (c) 2015 Simulations Plus, Inc. 21 Returning Cash to Shareholders (in millions) 1.6 0.8 0.8 2.2 0 0.5 0.5 0.6 0.81 0.81 0.81 0.84 0.84 13.2 12.9 12.7 11.4 9.3 9.8 10 10.1 10.6 11 7.8 8.6 5.8 6.1 7.3 $0 $1 $1 $2 $2 $3 $0 $2 $4 $6 $8 $10 $12 $14 Dividend Paid Cash on Hand Cash paid $2.5M TSR
Slide 22: Cognigen Growth Opportunities
Copyright (c) 2015 Simulations Plus, Inc. 22 Simulations Plus, Inc. Cognigen Growth Opportunities • Continued penetration of clinical pharmacology departments to provide more detailed mechanistic modeling for clinical data analysis in line with regulatory expectations • Social media and Email blasts
Slide 23: Cognigen Sales Update
Copyright (c) 2015 Simulations Plus, Inc. 23 • 2QFY15 ‒ Active projects at end of quarter: ~40 ‒ New clients: 2 ‒ New projects and expansions in scope: 18 ‒ Client assistance in regulatory interactions: 25% of projects • Beyond 2QFY15 – current ‒ New clients and new clients in pipeline: 8 ‒ New proj
Slide 24: Additional Growth Opportunities
Copyright (c) 2015 Simulations Plus, Inc. 24 • Of 2,500 companies registered with FDA, we have ~10% penetration with Simulations Plus products ‒ http://www.fda.gov/Drugs/NewsEvents/ucm339912.htm • AEROModeler™ ‒ Application of our artificial neural network ensemble (ANNE) technology to predict aerod
Slide 25: Software Release Plans
Copyright (c) 2015 Simulations Plus, Inc. 25 • Version 9.0 slated for April 2015 release ‒ Tighter integration with ADMET Predictor models – now create PBPK models from structure ‒ PBPK modeling for biologics ‒ N ew market opportunity for biopharmaceuticals (large molecules) ‒ PBPK models for dermal
Slide 26: New Software Customers and Consolidated Sales Breakdown – 2QFY15
Copyright (c) 2015 Simulations Plus, Inc. 26 • Added 20 new software customers during 2QFY15: − New companies in US, Europe, Japan , and China − New divisions at the US FDA, US EPA, Japan PMDA, and Chinese FDA • Software renewal rate (accounts ) was 89%; 93% in terms of revenue Simulations Plus, Inc
Slide 27: Marketing Program – 2QFY15
Copyright (c) 2015 Simulations Plus, Inc. 27 • Conferences/scientific meetings continue to be primary source of leads ‒ 9 scientific meetings attended; co - authors on 7 presentations • Trainings and workshops ‒ Conducted training workshops in San Diego – full attendance ‒ 2015 workshops scheduled f
Slide 28: FDA Collaborations
Copyright (c) 2015 Simulations Plus, Inc. 28 • Center for Food Safety and Nutrition ( CFSAN) ‒ Completed third year of 5 - year renewable Research Collaboration Agreement (RCA) with CFSAN to provide model - building capabilities to predict toxicities for large number of substances that can be in foo
Slide 29: Summary
Copyright (c) 2015 Simulations Plus, Inc. 29 • For 2QFY15 and 6moFY15 - Revenues and earnings continued seven - year - plus profitable trend - Cognigen acquisition increases revenues and profit, expands offerings into clinical pharmacology; second quarter Cognigen earnings were $ 124,000 up from $ 4
Slide 30: Q&A
Copyright (c) 2015 Simulations Plus, Inc. 30 Q&A