Canada NewsWire
Tenth consecutive quarter of record revenue; SaaS revenue up 47% year-over-year
MONTREAL , Sept. 9, 2021 /CNW/ -- Tecsys Inc. (TSX: TCS), an industry-leading supply chain management SaaS company, today announced its results for the first quarter of fiscal year 2022, ended July 31, 2021 . All dollar amounts are expressed in Canadian currency and are prepared in accordance with International Financial Reporting Standards (IFRS).
First Quarter Highlights:
- SaaS revenue increased by 47% to $5.7 million in Q1 2022, up from $3.8 million in Q1 2021.
- Annual Recurring Revenue (ARR i ) at July 31, 2021 was up 9% to $53.7 million compared to $49.3 million at July 31, 2020 .
- During Q1 2022, SaaS subscription bookings i (measured on an ARR i basis) were $1.1 million , down 54% compared to $2.4 million in the first quarter of 2021.
- Professional services revenue was up 17% to $13.1 million in Q1 2022 compared to $11.2 million in Q1 2021.
- Total revenue was a record $33.2 million , 18% higher than $28.1 million reported for Q1 2021.
- Gross margin was 43% compared to 48% in the prior year quarter, negatively impacted by a weaker US dollar, investment in our key growth initiatives and revenue mix. Total gross profit increased to $14.4 million , up 7% from $13.5 million in Q1 2021.
- Operating expenses increased to $13.3 million , higher by $1.8 million or 16% compared to $11.5 million in Q1 fiscal 2021 with continuing investment in sales and marketing as well as research and development.
- Profit from operations in Q1 2022 was $1.1 million , down from $2.0 million in Q1 2021.
- Net profit was $0.2 million or $0.02 per share on a fully diluted basis in Q1 2022 compared to a net profit of $1.2 million or $0.08 per share on a fully diluted basis for the same period in fiscal 2021.
- Adjusted EBITDA ii was $2.5 million in Q1 2022, down 30% compared to $3.5 million reported in Q1 2021.
"Fiscal 2022 is off to a very postitive start. Our tenth consecutive quarter of record revenue demonstrates our sustained growth trajectory and is composed of a healthy blend of new customers and expanded investments from our existing accounts," said Peter Brereton , president and CEO of Tecsys, Inc. "SaaS bookings demonstrated some lumpiness being down after a very strong Q4. We saw legal and procurement bottlenecks as the primary factor here. That said, we added two new hospital networks in Q1 and have already added another in August. Our strong performance is being led by our truly adaptable agile solutions, which are resonating extremely well in a climate more attuned to the importance of supply chain execution excellence. As we continue to set records for the company on a quarterly sequential basis, we expect our very strong pipeline to yield accelerated growth and sustained upside."
Mark Bentler , chief financial officer of Tecsys Inc., added, "In spite of significant foreign currency headwinds, we are pleased to report another solid quarter of revenue growth and profitability. In fact, on a constant currency basis our first quarter fiscal 2022 revenue grew by about 25% compared to the same period last year, with SaaS revenue once again being a key driver."
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Trailing 12 |
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Trailing 12 |
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Results from operations |
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3 months ended |
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3 months ended |
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months ended |
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months ended |
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July 31, 2021 |
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July 31, 2020 |
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July 31, 2021 |
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July 31, 2020 |
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Total Revenue |
$ |
33,232 |
$ |
28,091 |
$ |
128,242 |
$ |
108,696 |
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SaaS Revenue |
|
5,653 |
|
3,844 |
|
20,973 |
|
11,102 |
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Maintenance and Support Revenue |
|
8,326 |
|
8,409 |
|
33,632 |
|
32,427 |
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Gross Profit |
|
14,429 |
|
13,490 |
|
61,569 |
|
52,275 |
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Gross Margin % |
|
43% |
|
48% |
|
48% |
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48% |
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Operating Expenses |
|
13,341 |
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11,522 |
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51,768 |
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46,102 |
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Op. Ex. As % of Revenue |
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40% |
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41% |
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40% |
|
42% |
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Profit from Operations |
|
1,088 |
|
1,968 |
|
9,801 |
|
6,173 |
|
Adjusted EBITDA ii |
|
2,456 |
|
3,509 |
|
15,167 |
|
11,785 |
|
EPS basic |
|
0.02 |
|
0.09 |
|
0.43 |
|
0.29 |
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EPS diluted |
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0.02 |
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0.08 |
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0.43 |
|
0.28 |
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License Bookings |
|
286 |
|
461 |
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4,114 |
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4,786 |
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SAAS ARR Bookings |
|
1,099 |
|
2,370 |
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8,246 |
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10,748 |
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Annual Recurring Revenue |
|
53,656 |
|
49,293 |
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53,656 |
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49,293 |
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Professional Services Backlog |
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35,124 |
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38,060 |
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35,124 |
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38,060 |
On September 9, 2021 , the Company declared a quarterly dividend of $0.065 per share payable on October 8, 2021 to shareholders of record at the close of business on September 24, 2021 .
Pursuant to the Canadian Income Tax Act, dividends paid by the Company to Canadian residents are considered to be "eligible" dividends.
First Quarter of Fiscal 2022 Results Conference Call
Date:
September 9, 2021
Time:
1:00pm EST
Phone number: (877) 232-4484 or (416) 981-9028
The call can be replayed until
September 16, 2021
by calling:
(800) 558-5253 or (416) 626-4100 (access code: 21996813).
About Tecsys
Tecsys is a global provider of supply chain solutions that equip the borderless enterprise for growth. Organizations thrive when they have the software, technology and expertise to drive operational greatness and deliver on their brand promise. Spanning healthcare, retail, service parts, third-party logistics, and general wholesale high-volume distribution industries, Tecsys delivers dynamic and powerful solutions for warehouse management, distribution and transportation management, supply management at point of use, retail order management, as well as complete financial management and analytics solutions. Tecsys' shares are listed on the Toronto Stock Exchange under the ticker symbol TCS. For more information on Tecsys, visit www.tecsys.com .
Forward Looking Statements
The statements in this news release relating to matters that are not historical fact are forward looking statements that are based on management's beliefs and assumptions. Such statements are not guarantees of future performance and are subject to a number of uncertainties, including but not limited to future economic conditions, the markets that Tecsys Inc. serves, the actions of competitors, major new technological trends, and other factors beyond the control of Tecsys Inc., which could cause actual results to differ materially from such statements. More information about the risks and uncertainties associated with Tecsys Inc.'s business can be found in the MD&A section of the Company's annual report and annual information form for the fiscal year ended April 30, 2021 . These documents have been filed with the Canadian securities commissions and are available on our website ( www.tecsys.com ) and on SEDAR ( www.sedar.com ).
Copyright © Tecsys Inc. 2021. All names, trademarks, products, and services mentioned are registered or unregistered trademarks of their respective owners.
Non-IFRS Measures
Reconciliation of EBITDA and Adjusted EBITDA
EBITDA is calculated as earnings before interest expense, interest income, income taxes, depreciation and amortization. Adjusted EBITDA is calculated as EBITDA before stock based compensation. The Company believes that these measures are commonly used by investors and analysts to measure a company's performance, its ability to service debt and to meet other payment obligations, or as a common valuation measurement.
The EBITDA and Adjusted EBITDA calculation for the three months ended July 31, 2021 and 2020 derived from IFRS measures in the Company's Consolidated financial statements, is as follows:
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Three months ended July 31, |
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(in thousands of CAD) |
2021 |
2020 |
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Profit for the period |
$ 244 |
$ 1,235 |
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Adjustments for: |
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Depreciation of property and equipment and right-of-use assets |
543 |
533 |
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|
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Amortization of deferred development costs |
54 |
103 |
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|
|
Amortization of other intangible assets |
411 |
408 |
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Interest expense |
161 |
276 |
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|
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Interest income |
(40) |
(50) |
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|
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Income taxes |
729 |
735 |
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EBITDA |
$ 2,102 |
$ 3,240 |
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Adjustment for: |
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Stock based compensation |
354 |
269 |
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Adjusted EBITDA |
$ 2,456 |
$ 3,509 |
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i
See Key Performance Indicators in Management's Discussion and Analysis of the Q1 2022 Financial Statements.
ii
See Non-IFRS Performance Measures in Management's Discussion and Analysis of the Q1 2022 Financial Statements.
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Condensed Interim Consolidated Statements of Financial Position
As at July 31, 2021 and April 30, 2021
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July 31, 2021 |
April 30, 2021 |
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Assets |
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Current assets |
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Cash and cash equivalents |
$ 19,342 |
$ 25,752 |
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Short-term investments |
20,121 |
20,100 |
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Accounts receivable |
19,335 |
16,840 |
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Work in progress |
731 |
182 |
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Other receivables |
589 |
2,034 |
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Tax credits |
6,501 |
5,359 |
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Inventory |
640 |
628 |
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Prepaid expenses |
5,362 |
4,897 |
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Total current assets |
72,621 |
75,792 |
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Non-current assets |
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|
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Other long-term receivables |
240 |
303 |
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Tax credits |
4,037 |
3,904 |
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Property and equipment |
2,597 |
2,682 |
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Right-of-use assets |
7,018 |
7,245 |
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Contract acquisition costs |
2,550 |
2,678 |
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Deferred development costs |
1,520 |
1,088 |
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Other intangible assets |
11,811 |
12,194 |
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Goodwill |
17,431 |
17,417 |
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Deferred tax assets |
6,007 |
6,006 |
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Total non-current assets |
53,211 |
53,517 |
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Total assets |
$ 125,832 |
$ 129,309 |
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Liabilities |
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Current liabilities |
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Accounts payable and accrued liabilities |
$ 17,272 |
$ 19,417 |
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Deferred revenue |
21,987 |
22,044 |
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Current portion of long-term debt |
1,204 |
1,216 |
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Other current liabilities |
500 |
500 |
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Lease obligations |
827 |
848 |
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Total current liabilities |
41,790 |
44,025 |
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Long-term debt |
8,100 |
8,400 |
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Deferred tax liabilities |
1,502 |
1,499 |
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Lease obligations |
8,086 |
8,295 |
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Total non-current liabilities |
17,688 |
18,194 |
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Total liabilities |
59,478 |
62,219 |
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Equity |
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Share capital |
42,700 |
42,700 |
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Contributed surplus |
12,099 |
11,745 |
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Retained earnings |
11,720 |
12,419 |
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Accumulated other comprehensive (loss) income |
(165) |
226 |
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Total equity attributable to the owners of the Company |
66,354 |
67,090 |
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Total liabilities and equity |
$ 125,832 |
$ 129,309 |
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Condensed Interim Consolidated Statements of Income and Comprehensive (loss) Income Three-month periods ended July 31, 2021 and 2020 (Unaudited) (in thousands of Canadian dollars, except per share data) |
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July 31, 2021 |
July 31, 2020 |
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SaaS |
$ 5,653 |
$ 3,844 |
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Maintenance and support |
8,326 |
8,409 |
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Professional services |
13,126 |
11,212 |
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License |
351 |
717 |
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Hardware |
5,776 |
3,909 |
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Total revenue |
33,232 |
28,091 |
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|
18,803 |
14,601 |
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Gross profit |
14,429 |
13,490 |
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Operating expenses:
|
5,682 |
4,997 |
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General and administration |
2,859 |
2,426 |
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Research and development, net of tax credits |
4,800 |
4,099 |
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Total operating expenses |
13,341 |
11,522 |
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Profit from operations |
1,088 |
1,968 |
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Net finance costs (income) |
115 |
(2) |
|
Profit before income taxes |
973 |
1,970 |
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Income tax expense |
729 |
735 |
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Net profit, attributable to the owners of the Company |
$ 244 |
$ 1,235 |
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Other comprehensive (loss) income:
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(358) |
1,109 |
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Exchange differences on translation of foreign operations |
(33) |
553 |
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Comprehensive (loss) income, attributable to the owners of the Company |
$ (147) |
$ 2,897 |
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Basic earnings per common share |
$ 0.02 |
$ 0.09 |
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Diluted earnings per common share |
$ 0.02 |
$ 0.08 |
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Condensed Interim Consolidated Statements of Cash Flows Three-month periods ended July 31, 2021 and 2020 (Unaudited) (in thousands of Canadian dollars) |
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July 31, 2021 |
July 31, 2020 |
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Cash flows from operating activities: |
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Net profit |
$ 244 |
$ 1,235 |
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Adjustments for: |
|
|
|
Depreciation of property and equipment and right-of-use-assets |
543 |
533 |
|
Amortization of deferred development costs |
54 |
103 |
|
Amortization of other intangible assets |
411 |
408 |
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Net finance costs (income) |
115 |
(2) |
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Unrealized foreign exchange and other |
1,261 |
(239) |
|
Non-refundable tax credits |
(366) |
(309) |
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Stock-based compensation |
354 |
269 |
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Income taxes |
693 |
724 |
|
Net cash from operating activities excluding changes in non-cash working capital items related
|
3,309 |
2,722 |
|
Accounts receivable |
(2,492) |
1,075 |
|
Work in progress |
(547) |
(307) |
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Other receivables |
(34) |
(216) |
|
Tax credits |
(910) |
(755) |
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Inventory |
(12) |
41 |
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Prepaid expenses |
(465) |
(789) |
|
Contract acquisition costs |
128 |
(195) |
|
Accounts payable and accrued liabilities |
(3,933) |
(3,810) |
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Deferred revenue |
(59) |
1,969 |
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Changes in non-cash working capital items related to operations |
(8,324) |
(2,987) |
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Net cash used in operating activities |
(5,015) |
(265) |
|
|
(312) |
(300) |
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Payment of lease obligations |
(231) |
(253) |
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Interest paid |
(161) |
(168) |
|
Net cash used in financing activities |
(704) |
(721) |
|
|
- |
(10,000) |
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Interest received |
40 |
50 |
|
Acquisitions of property and equipment |
(230) |
(49) |
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Acquisitions of other intangible assets |
(15) |
(505) |
|
Deferred development costs |
(486) |
(106) |
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Net cash used in investing activities |
(691) |
(10,610) |
|
|
(6,410) |
(11,596) |
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Cash and cash equivalents - beginning of period |
25,752 |
27,528 |
|
Cash and cash equivalents - end of period |
$ 19,342 |
$ 15,932 |
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Condensed Interim Consolidated Statements of Changes in Equity Three-month periods ended July 31, 2021 and 2020 (Unaudited) (in thousands of Canadian dollars, except number of shares) |
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Share capital |
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Number |
Amount |
Contributed
|
Accumulated
|
Retained
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Total |
|
|
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|
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|
|
|
|
|
14,505,095 |
42,700 |
11,745 |
226 |
12,419 |
67,090 |
|
Net profit |
- |
- |
- |
- |
244 |
244 |
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|
|
|
|
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Other comprehensive
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effective portion
|
|
|
|
|
|
|
|
|
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|
value on designated |
|
|
|
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|
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|
|
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|
|
|
revenue hedges |
- |
- |
- |
(358) |
- |
(358) |
|
Exchange difference
|
- |
- |
- |
(33) |
- |
(33) |
|
Total comprehensive (loss)
|
- |
- |
- |
(391) |
244 |
(147) |
|
Stock-based
|
- |
- |
354 |
- |
- |
354 |
|
Dividends to equity
|
- |
- |
- |
- |
(943) |
(943) |
|
Total transactions with
|
- |
- |
354 |
- |
(943) |
(589) |
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Balance, July 31, 2021 |
14,505,095 |
$ 42,700 |
$ 12,099 |
$ (165) |
$ 11,720 |
$ 66,354 |
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|
Balance, April 30, 2020 |
14,416,543 |
$ 40,901 |
$ 10,964 |
$ 416 |
$ 8,838 |
$ 61,119 |
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|
|
|
|
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|
Net profit |
- |
- |
- |
|
1,235 |
1,235 |
|
Other comprehensive
|
|
|
|
|
|
|
|
Effective portion
|
|
|
|
|
|
|
|
revenue hedges |
- |
- |
- |
1,109 |
- |
1,109 |
|
Exchange difference
|
- |
- |
- |
553 |
- |
553 |
|
Total
comprehensive
|
- |
- |
- |
1,662 |
1,235 |
2,897 |
|
Stock-based
|
- |
- |
269 |
- |
- |
269 |
|
Dividends to equity
|
- |
- |
- |
- |
(865) |
(865) |
|
Total transactions with
|
- |
- |
269 |
- |
(865) |
(596) |
|
|
|
|
|
|
|
|
|
Balance, July 31, 2020 |
14,416,543 |
$ 40,901 |
$ 11,233 |
$ 2,078 |
$ 9,208 |
$ 63,420 |
SOURCE Tecsys Inc.
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