Slide 1: Simulations Plus and Cognigen Investor Call
Copyright (c) 2015 Simulations Plus, Inc. 1 Simulations Plus, Inc . and its wholly owned subsidiary Cognigen Corporation ( NASDAQ:SLP ) Investor Call July 13, 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: Quarterly Highlights
Copyright (c) 2015 Simulations Plus, Inc. 3 Quarterly Highlights Walt Woltosz Chairman and Chief Executive Officer
Slide 4: Simulations Plus, Inc. Overview
Copyright (c) 2015 Simulations Plus, Inc. 4 • Major provider of software and consulting services for pharmaceutical research and development • Expertise and software tools spanning from earliest drug discovery through clinical trials and beyond patent life to supporting generic companies • In additi
Slide 5: Quarterly Highlights
Copyright (c) 2015 Simulations Plus, Inc. 5 • Software renewal rates 99%(fees) • 21 new software client sites added • Product releases • GastroPlus 9.0: biologics, dermal dosing, enhanced oral cavity dosing , enhanced ADMET Predictor integration • ADMET Predictor 7.2: new properties, retrained metab
Slide 6: Growth Opportunities
Copyright (c) 2015 Simulations Plus, Inc. 6 • AEROModeler™ ‒ Application of our artificial neural network ensemble (ANNE) technology to: ‒ Predict aerodynamic force coefficients for missiles at arbitrary Mach number and angle of attack ‒ Classify missiles from radar tracking data ‒ Presented at 3 ae
Slide 7: Financial Overview
Copyright (c) 2015 Simulations Plus, Inc. 7 Financial Overview John Kneisel Chief Financial Officer
Slide 8: Income Statement 3QFY15 Compared to 3QFY14
Copyright (c) 2015 Simulations Plus, Inc. 8 Income Statement 3QFY15 Compared to 3QFY14 (in millions) SLP Cognigen 3QFY15 3QFY14 Diff % chg Net sales $ 4.54 $ 1.40 $ 5.94 $ 3.74 $ 2.20 58.9% Gross profit 3.92 0.90 4.83 3.52 1.31 37.3% Gross profit margin 86.4% 64.6% 81.2% 93.9% - 12.7% - 13.5% SG&A 1
Slide 9: Income Statement 9moFY15 Compared to 9moFY14
Copyright (c) 2015 Simulations Plus, Inc. 9 Income Statement 9moFY15 Compared to 9moFY14 (in millions) SLP Cog 9MoFY15 9moFY14 Diff % chg Net sales $ 10.80 $ 3.81 $ 14.60 $ 9.46 $ 5.14 54.3% Gross profit 9.12 2.24 11.36 8.29 3.07 37.0% Gross profit margin 84.5% 58.9% 75.4% 87.6% - 12.2% - 13.9% SG&A
Slide 10: Consolidated Revenues, by Fiscal Quarter and YTD
Copyright (c) 2015 Simulations Plus, Inc. 10 Consolidated Revenues, by Fiscal Quarter and YTD (pro forma prior to 2012; in millions) 4.01 4.57 5.99 $0 $1 $2 $3 $4 $5 $6 $7 Q1 Q2 Q3 Q4 2009 2010 2011 2012 2013 2014 2015 14.57 $0 $1 $2 $3 $4 $5 $6 $7 $8 $9 $10 $11 $12 $13 $14 $15 $16 YTD 9 Months 2009
Slide 11: Consolidated Gross Profit, by Fiscal Quarter & YTD
Copyright (c) 2015 Simulations Plus, Inc. 11 Consolidated Gross Profit, by Fiscal Quarter & YTD (pro forma prior to 2012; in millions) 3.09 3.45 4.83 $0 $1 $2 $3 $4 $5 $6 Q1 Q2 Q3 Q4 2009 2010 2011 2012 2013 2014 2015 11.37 $0 $1 $2 $3 $4 $5 $6 $7 $8 $9 $10 $11 $12 YTD 9 Months 2009 2010 2011 2012 2
Slide 12: Consolidated Net Income, by Fiscal Quarter and YTD
Copyright (c) 2015 Simulations Plus, Inc. 12 Consolidated Net Income, by Fiscal Quarter and YTD (pro forma prior to 2012; in millions) $0.53 $0.97 $1.85 $- $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 $1.80 $2.00 Q1 Q2 Q3 Q4 2009 2010 2011 2012 2013 2014 2015 $3.35 $- $0.50 $1.00 $1.50 $2.00 $2.5
Slide 13: Consolidated Diluted Earnings per Share
Copyright (c) 2015 Simulations Plus, Inc. 13 Consolidated Diluted Earnings per share by Fiscal Quarter and YTD $0.20 $0.00 $0.05 $0.10 $0.15 $0.20 $0.25 Q3 YTD EPS (9 months) FY09 FY10 FY11 FY12 FY13 FY14 FY15 0 0.02 0.04 0.06 0.08 0.1 0.12 Q1 Q2 Q3 Q4 $0.03 $0.06 $0.11 Quarterly EPS FY09 FY10 FY11
Slide 14: Consolidated EBITDA, by Fiscal Quarter & YTD
Copyright (c) 2015 Simulations Plus, Inc. 14 Consolidated EBITDA, by Fiscal Quarter & YTD (in millions) 6.5 $0 $1 $2 $3 $4 $5 $6 $7 YTD 9 Months 2009 2010 2011 2012 1.45 1.97 3.33 $0 $1 $2 $3 $4 Q1 Q2 Q3 Q4 2009 2010 2011 2012 2013 2014 2015
Slide 15: Selected Balance Sheet Items
Copyright (c) 2015 Simulations Plus, Inc. 15 Selected Balance Sheet Items (in millions) May 31, 2015 August 31, 2014 Cash and cash equivalents $6.429* $8.614 Cash per share 0.38 0.52 Total current assets 11.823 11.533 Total assets 27.912 20.981 Total current liabilities 1.717 1.391 Total liabilities
Slide 16: Returning Cash to Shareholders
Copyright (c) 2015 Simulations Plus, Inc. 16 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 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 6.4 7.7 $0 $1 $1 $2 $2 $3 $0 $2 $4 $6 $8 $10 $12 $14 Dividend Paid Cash on Hand Cash paid
Slide 17: Sales and Marketing
Copyright (c) 2015 Simulations Plus, Inc. 17 Sales and Marketing John DiBella VP of Sales and Marketing
Slide 18: Software Product Releases and Updates
Copyright (c) 2015 Simulations Plus, Inc. 18 • Version 9.0 released in May 2015 ‒ I ntegration with ADMET Predictor metabolism models – new add - on licensed by several clients ‒ PBPK models for biologics and dermal delivery – new add - on licensed by several clients • Version 7.2 released in May 20
Slide 19: Consolidated FY15.3 Sales Review
Copyright (c) 2015 Simulations Plus, Inc. 19 Consolidated FY15.3 Sales Review • Consolidated revenue increased 58.8% vs. FY14.3 – SLP revenue increased 21.4% • Highlights: – 94% renewal rate ( accounts) – 99% renewal rate (fees ) – Strong new license revenue • 21 new software clients – Chinese SFDA,
Slide 20: New Software Customers: Fiscal & YTD
Copyright (c) 2015 Simulations Plus, Inc. 20 New Software Customers: Fiscal & YTD 64 0 10 20 30 40 50 60 70 Q3 YTD 9 Months 2011 2012 2013 2014 2015 23 20 21 0 5 10 15 20 25 Q1 Q2 Q3 Q4 Quarterly 2011 2012 2013 2014 2015
Slide 21: FY15.3 Software Sales by Region
Copyright (c) 2015 Simulations Plus, Inc. 21 FY15.3 Software Sales – by Region Europe 30% North America 47% Asia 24% Japan = 63% China = 16% Korea = 8% India = 8% Other = 5 % South America <1%
Slide 22: Marketing Activities FY15.3
Copyright (c) 2015 Simulations Plus, Inc. 22 Marketing Activities – FY15.3 • Marketing group restructuring – Filled new Marketing Coordinator position to manage campaigns – Transitioned scientist into Business Development role • Conferences and scientific meetings – 16 scientific meetings attended;
Slide 23: Cognigen Update
Copyright (c) 2015 Simulations Plus, Inc. 23 Cognigen Update Ted Grasela President
Slide 24: Cognigen Growth Opportunities
Copyright (c) 2015 Simulations Plus, Inc. 24 Simulations Plus, Inc. Cognigen Growth Opportunities • Strategic and synergistic benefits of the Cognigen acquisition are being realized • Strong collaborations between our scientists have identified new and innovative ways of using modeling and simulatio
Slide 25: Cognigen Sales Update
Copyright (c) 2015 Simulations Plus, Inc. 25 • 3QFY15 ‒ Active projects at end of quarter: ~48 ‒ New clients: 2 ‒ New projects and expansions in scope: ~14 ‒ Client assistance in regulatory interactions: ~25% of projects • Beyond 3QFY15 – current ‒ New clients and new clients in pipeline: 6 ‒ New pr
Slide 26: Coping with Complexity and Chaos
Copyright (c) 2015 Simulations Plus, Inc. 26 • Analysis in R&D can be messy with data and inputs coming from many groups • Careful synthesis and communication is essential • The industry has enormous computing power • The industry lacks tools for harnessing that power Behind the scenes in R&D Coping
Slide 27: KIWI Software Platform for Cloud Processing
Copyright (c) 2015 Simulations Plus, Inc. 27 KIWI™ – A Software Platform for Accessing Cognigen’s Validated Cloud Processing Capabilities
Slide 28: Collaboration with FDA Office of Generic Drugs
Copyright (c) 2015 Simulations Plus, Inc. 28 • Company awarded a $200,000 cooperative agreement to develop improved modeling and simulation capabilities for dosage forms designed to be applied to the eye • Completed first 3/4 - year of 3 - year funded collaboration • On target to meet all milestones
Slide 29: Summary
Copyright (c) 2015 Simulations Plus, Inc. 29 • Continued Growth • Seven - year - plus profitable trend • Successful strategic acquisition • Customer base increase: 21 new software customers, 64 year - to - date; with a 90+ percent renewal rate. This means future continuing revenue • Earnings per sha