Simulations Plus, Inc. · NASDAQ:SLP
Simulations Plus — Q3 FY2017 Earnings Presentation
31 slides from Simulations Plus's earnings presentation, Jul 12, 2017
Slide 1: Investor Conference Call July 10, 2017
(NASDAQ:SLP) Investor Conference Call July 10, 2017
Slide 2: Safe Harbor Statement
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 . Factors that could cause or contribute t
Slide 3: Highlights
3 Highlights Walter S. Woltosz CEO and Chairman
Slide 4: Company and 3QFY17 / 9MoFY17 highlights
4 • Major provider of software and consulting solutions for R&D • Earliest drug discovery – when a chemist first draws a molecule • Preclinical development (lab and animals) through first - in - human trials • Safety research and risk assessment • Phase 2 and 3 clinical trials • Beyond patent life t
Slide 5: Acquisition of DILIsym Services, Inc.
Acquisition of DILIsym Services, Inc. • DILIsym® is a mechanistic, mathematical model that has been constructed to support pharmaceutical risk assessment and decision making – Intersection of compound distribution and metabolism (PBPK), hepatotoxicity mechanisms, and patient variability • DILIsym ha
Slide 6: The DILI-sim Initiative: Partnership between DILIsym Services and pharmaceutical companies
The DILI - sim Initiative : P artnership between DILIsym Services and p harmaceutical c ompanies to m inimize DILI • Overall Goals – Improve patient safety – Reduce the need for animal testing – Reduce the cost and time necessary to develop new drugs • History – Officially started in 2011 – 17 major
Slide 7: Ocular dosing and FDA Office of Generic Drugs funded collaborations
7 • Now in 3 rd and final year of $200,000/year collaboration for improved ocular dosing simulations • Established consortium of leading pharmaceutical companies • The global ophthalmic drugs market was valued at $16 billion in 2012, and was expected to reach an estimated value of $21.6 billion in 2
Slide 8: Two-year stock performance compared to DOW, NASDAQ, & S&P 500
* Yahoo! Data 7/10/2017 Two - year stock performance compared to DOW, NASDAQ, & S&P 500 *
Slide 9: Financial Overview
9 Financial Overview John Kneisel Chief Financial Officer
Slide 10: Income Statement: 3QFY17 Versus 3QFY16
10 Income Statement: 3QFY17 Versus 3QFY16 (in millions) Lancaster Buffalo 3QFY17 3QFY16 Diff % chg Net sales $ 4.95 $ 1.80 $ 6.75 $ 6.01 $ 0.74 12.3% Gross profit 4.26 1.05 5.30 4.82 0.49 10.1% Gross profit margin 86.0% 58.1% 78.6% 80.1% - 1.5% - 1.9% SG&A $ 1.33 $ 0.62 $ 1.95 $ 1.68 $ * 0.27 16.3%
Slide 11: Income Statement: 9MoFY17 Versus 9MoFY16
11 Income Statement: 9MoFY17 Versus 9MoFY16 (in millions) Lancaster Buffalo 9MoFY17 9MoFY16 Diff % chg Net sales $ 12.69 $ 5.19 $ 17.87 $ 16.02 $ 1.86 11.6% Gross profit 10.58 2.95 13.54 12.47 1.06 8.5% Gross profit margin 83.4% 56.9% 75.7% 77.9% - 2.1% - 2.7% SG&A $ 3.92 $ 1.85 $ 5.77 $ 5.08 $ * 0.
Slide 12: Consolidated Revenues: Fiscal Quarter
12 Consolidated Revenues: Fiscal Quarter (pro forma prior to 2012; in millions) 2.29 3.12 3.09 1.58 2.64 3.08 3.74 2.00 4.01 4.57 5.94 3.71 4.84 5.16 6.01 3.96 5.42 5.71 6.75 $0 $1 $2 $3 $4 $5 $6 $7 $8 Q1 Q2 Q3 Q4 2013 2014 2015 2016 2017
Slide 13: Consolidated Net Income: Fiscal Quarter
13 Consolidated Net Income: Fiscal Quarter (pro forma prior to 2012; in millions) $0.59 $1.06 $0.99 $0.24 $0.69 $0.81 $1.31 $0.22 $0.53 $0.97 $1.85 $0.49 $1.11 $1.15 $1.91 $0.79 $1.36 $1.20 $2.08 $ - $0.50 $1.00 $1.50 $2.00 $2.50 Q1 Q2 Q3 Q4 2013 2014 2015 2016 2017
Slide 14: Consolidated Diluted Earnings Per Share
14 Consolidated Diluted Earnings Per Share $0.04 $0.06 $0.06 $0.01 $0.04 $0.05 $0.08 $0.01 $0.03 $0.06 $0.11 $0.03 $0.06 $0.07 $0.11 $0.05 $0.08 $0.07 $0.12 $ - $0.02 $0.04 $0.06 $0.08 $0.10 $0.12 $0.14 Q1 Q2 Q3 Q4 Quarterly EPS FY13 FY14 FY15 FY16 FY17
Slide 15: Consolidated EBITDA: Fiscal Quarter
15 Consolidated EBITDA: Fiscal Quarter (in millions) 1.09 1.76 1.73 0.44 1.20 1.35 2.30 0.67 1.22 1.97 3.33 1.19 2.22 2.18 3.28 1.51 2.48 2.30 3.60 $0 $1 $2 $3 $4 Q1 Q2 Q3 Q4 2013 2014 2015 2016 2017
Slide 16: Returning Cash to Shareholders
16 Returning Cash to Shareholders (in millions) 0.8 0.8 2.2 0 0.5 0.5 0.6 0.81 0.81 0.81 0.84 0.84 0.84 0.85 0.85 0.85 0.85 0.85 0.86 0.86 0.86 12.7 11.4 9.3 9.8 10.0 10.1 10.6 11.0 7.8 8.6 5.8 6.1 6.4 8.6 7.2 7.1 8.8 8.0 8.8 7.4 8.2 6.0 $0 $1 $1 $2 $2 $3 $0 $2 $4 $6 $8 $10 $12 $14 Dividend Paid Cas
Slide 17: Selected Balance Sheet Items
17 Selected Balance Sheet Items (in millions, except where indicated) May 31, 2017 August 31, 2016 Cash and cash equivalents $ 8.248* $ 8.030* Cash per share ( in Dollars ) $ 0.48 $ 0.47 Total current assets 14.935 12.700 Total assets 29.547 27.814 Total current liabilities 1.267 2.126 Total liabili
Slide 18: Marketing and Sales
18 Marketing and Sales Walter S. Woltosz CEO and Chairman
Slide 19: Simulations Plus: Your end-to-end M&S solutions provider
N H O OH O CH 3 CH 3 CH 3 ADMET Predictor™ GastroPlus ™ MedChem Studio™ MedChem Designer™ DDDPlus ™ MembranePlus™ Consulting Services and Collaborations Discovery Preclinical Clinical PKPlus™ KIWI™ Simulations Plus: Your end - to - end M&S solutions provider DILIsym ® NAFLDsym™
Slide 20: Software Product News
20 • Version 9.5 released in April 2017 ‒ Intramuscular dosing model – optional add - on module ‒ New PBPK models for antibody - drug conjugates (ADCs) – optional add - on module • Version 8.5 scheduled for fall 2017 ‒ Rapid compound library screening in virtual humans and rats – optional add - on m
Slide 21: 3QFY17 Sales Review
3QFY17 Sales Review • Consolidated revenue +12.3% vs. 3QFY16 • Highlights: – Software revenue +5% • 89% renewal rate (accounts) • 93% renewal rate (fees) • 20% increase in license units • 10 new commercial companies • 10 new nonprofit groups – Continued expansion of licenses at China FDA – Consultin
Slide 22: 9MoFY17 Sales Review
9MoFY17 Sales Review • Consolidated revenue +11.6% vs. 9MoFY16 • Highlights: – Software revenue +6.7% • 88% renewal rate (accounts) • 95% renewal rate (fees) • 8% increase in license units • 32 new commercial companies • 31 new nonprofit groups – Consulting revenue +23% • +20.6% in Buffalo • +42.6%
Slide 23: 3QFY17 Software Revenue – by Region
3QFY17 Software Revenue – by Region Europe 21% North America 53% Asia 26% South America <1% Japan = 69% China = 22% India = 9% Korea = <1% 23
Slide 24: 9MoFY17 Software Revenue – by Region
9MoFY17 Software Revenue – by Region Europe 24% North America 49% Asia 27% South America <1% Japan = 62% China = 23% India = 17% Korea = <1% 24
Slide 25: 3Q17 Marketing Activities
3Q17 Marketing Activities Website Content • Continued production of video content for promotional/branding purposes • Increased focus on SEO performance Workshops and Conferences • PBPK and/or population PK data analysis workshops held in San Diego, Germany, Shanghai, and Buffalo – Workshops schedul
Slide 26: Buffalo (Cognigen) Division Update
26 Buffalo (Cognigen) Division Update Re - imagining the future of science - based research and development Ted Grasela President July 10, 2017
Slide 27: Status Report - Consulting
27 Status Report - Consulting • In FY2017 working with 26 companies on 39 drugs, 65 projects – 6 new companies in FY2017 – 36 new projects in FY17 – 22 projects expanded scope in FY17 – 3 projects with reduced scope – 32 outstanding proposals with 20 different companies • In FY2017 presented 9 poste
Slide 28: KIWI Update
28 • Continued to work on $4.7 million contract with a major foundation to implement a KIWI platform for global teams engaged in model - based drug development; 5 - year term contingent on satisfactory completion of milestones • KIWI platform development continuing • Deploying data repository in Jul
Slide 29: Cognigen continues to grow: Summary
29 Cognigen continues to grow: • Consulting activities continuing to expand; healthy pipeline of new projects, including collaborations with Lancaster colleagues for PBPK modeling in clinical pharmacology • Excited about collaboration opportunities with our new colleagues at DILIsym • KIWI platform
Slide 30: Final Summary
30 Final Summary Walter S. Woltosz CEO and Chairman
Slide 31: Final Summary: 3QFY17 and 9MoFY17 results
31 • 3QFY17 • Revenues up 12.2% to $6.75 million • Net income up 8.9% to $2.08 million (diluted earnings = 1 2¢ per share) • 9MoFY17 • Revenues up 11.6% to $17.87 million • Net income up 11.4% to $4.64 million* • D iluted earnings up 9.9% to 27¢ per share* • California and Buffalo divisions both per