- SaaS revenue grows 26% to $39.3
million
- Total revenue grows 17% to $55.1
million
- Adjusted EBITDA(1) margin of 18%
OTTAWA, ON, Nov. 4, 2020 /CNW/ - Kinaxis® (TSX:
KXS) , the authority in driving agility for fast, confident
decision-making in an unpredictable world, today reported results
for its third quarter ended September 30,
2020. All amounts are in U.S. dollars. All figures are
prepared in accordance with International Financial Reporting
Standards (IFRS) unless otherwise indicated.
"We are pleased to report another strong quarter as SaaS revenue
grew by 26% and we achieved an Adjusted EBITDA margin of 18%, even
after making an acquisition and other significant investments in
the business. On the strength of year-to-date results and a growing
backlog, we are able to tighten our annual SaaS revenue growth
guidance to the high end of our initial range, and increase both
our total revenue and adjusted EBITDA margin guidance," said
John Sicard, President and CEO of
Kinaxis.
Added Sicard, "Throughout Q3, and consistent with recent supply
chain industry reports, we continued to see the impact of
COVID-19 through protracted contract approval processes and
deferred projects for some companies. Also, while retention rates
remain very high, the environment has put some customers in a
position where they are not currently able to renew their
subscription agreements. However, the disruption has brought new
levels of awareness to our unique differentiator – concurrent
planning. We saw ongoing growth in our sales pipeline, and an
unprecedented level of attendance by new prospects and customers at
our Kinexions '20 event. The integration of our Rubikloud
acquisition is going as planned. We have closed our first joint
customer, Coty, a marquee consumer products company, and are making
headway with others. Quite simply, Kinaxis has never been more
relevant, as massive disruption focuses attention on global
supply chain resilience and agility, and the power of concurrent
planning to enable it."
Q3 2020 Highlights
$ USD thousands,
except as otherwise indicated
|
Q3
2020
|
Q3
2019
|
Change
|
Total
Revenue
|
55,116
|
47,131
|
17%
|
SaaS
|
39,322
|
31,229
|
26%
|
Subscription term
license
|
1,035
|
3,278
|
-68%
|
Professional
services
|
11,492
|
9,348
|
23%
|
Maintenance and
support
|
3,267
|
3,276
|
0%
|
Gross
profit
|
36,559
(66%)
|
33,328
(71%)
|
10%
|
Profit
|
731 ($0.03/diluted
share)
|
4,533
($0.17/diluted share)
|
-84%
|
Adjusted
EBITDA(1)
|
10,134 (18%)
|
12,100
(26%)
|
-16%
|
Cash from
operating activities
|
4,497
|
1,054
|
327%
|
(1)
|
"Adjusted EBITDA"
is a non-IFRS measure and is not a recognized, defined or a
standardized measure under IFRS. This measure as well as other
non-IFRS financial measures reported by Kinaxis are defined in the
"Non-IFRS Measures" section of this news release.
|
Financial Guidance and Outlook
The nature of the
company's long-term contracts provides visibility into future,
contracted revenue. The following table presents revenue expected
to be recognized in the future related to performance obligations
that are unsatisfied (or partially unsatisfied) at September 30, 2020.
$USD millions
|
2020
|
2021
|
2022 and
later
|
Total
backlog
|
SaaS
|
38.1
|
124.3
|
172.5
|
334.9
|
Subscription term
license
|
1.9
|
0.5
|
-
|
2.4
|
Maintenance and
support
|
3.2
|
11.7
|
12.5
|
27.4
|
Total
|
43.2
|
136.5
|
185.0
|
364.7
|
Based on this backlog and its current outlook, Kinaxis is
updating its fiscal 2020 financial guidance, including increases in
expectations for total revenue and adjusted EBITDA, as follows:
|
FY 2020
Guidance
|
Total
revenue
|
$220-223
million
|
SaaS
|
24-25%
growth
|
Subscription term
license
|
$16-17
million
|
Adjusted EBITDA
margin
|
22-24% of
revenue
|
Guidance in this press release is provided to enhance visibility
into Kinaxis' expectations for financial targets for the periods
indicated. Please refer to the section regarding forward-looking
statements that forms an integral part of this release. This press
release along with the financial statements and MD&A for the
three and nine months ended September 30,
2020 are available on Kinaxis' website and on SEDAR at
www.sedar.com.
Conference Call
Kinaxis will host a conference call
tomorrow, November 5, 2020, to
discuss these results. John Sicard,
Chief Executive Officer, and Richard
Monkman, Chief Financial Officer, will host the call
starting at 8:30 a.m. Eastern Time. A
question and answer session will follow management's presentation.
Investors and participants must register for the call in
advance. See registration link below. Please call the
conference telephone number fifteen minutes prior to the start
time.
CONFERENCE CALL DETAILS
DATE:
|
Thursday, November 5,
2020
|
TIME:
|
8:30 a.m. Eastern
Time
|
CALL
REGISTRATION:
|
http://www.directeventreg.com/registration/event/5957056
|
WEBCAST:
|
https://bit.ly/3iWk4zS
|
REPLAY:
|
(416) 849-0833 or
(855) 859-2056
|
|
Available until 11:59
p.m. ET, Thursday, November 12, 2020
|
REFERENCE
NUMBER:
|
5957056
|
About Kinaxis Inc.
Everyday volatility and uncertainty
demand quick action. Kinaxis® delivers the agility to
make fast, confident decisions across integrated business planning
and the digital supply chain. People can plan better, live better
and change the world. Trusted by innovative brands, we combine
human intelligence with AI and concurrent planning to help
companies plan for any future, monitor risks and opportunities and
respond at the pace of change. Powered by an extensible,
cloud-based platform, Kinaxis delivers industry-proven applications
so everyone can know sooner, act faster and remove waste. For more
Kinaxis news, follow us on LinkedIn or Twitter.
Non-IFRS Measures
This news release contains non-IFRS
measures, specifically Adjusted EBITDA and Adjusted EBITDA margin.
We use Adjusted EBITDA to provide investors with a supplemental
measure of our operating performance and thus highlight trends in
our core business that may not otherwise be apparent when relying
solely on IFRS financial measures. We believe that securities
analysts, investors and other interested parties frequently use
non-IFRS measures in the evaluation of issuers. Management
also uses non-IFRS measures in order to facilitate operating
performance comparisons from period to period, prepare annual
operating budgets and assess our ability to meet our capital
expenditure and working capital requirements. Adjusted EBITDA and
Adjusted EBITDA margins are not recognized, defined or standardized
measures under IFRS. Our definition of Adjusted EBITDA and Adjusted
EBITDA margin will likely differ from that used by other companies
(including our peers) and therefore comparability may be
limited. Non-IFRS measures should not be considered a
substitute for or in isolation from measures prepared in accordance
with IFRS. Investors are encouraged to review our financial
statements and disclosures in their entirety and are cautioned not
to put undue reliance on non-IFRS measures and view them in
conjunction with the most comparable IFRS financial measures.
Kinaxis has reconciled Adjusted EBITDA to the most comparable IFRS
financial measure as follows:
|
|
Three months
ended September
30,
|
|
|
Nine months
ended September
30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
(In thousands of
USD)
|
Profit............................................................................
|
$
|
731
|
|
$
|
4,533
|
|
$
|
15,316
|
|
$
|
15,500
|
Share-based
compensation........................................
|
|
4,732
|
|
|
3,537
|
|
|
12,231
|
|
|
10,190
|
Adjusted
profit............................................................
|
$
|
5,463
|
|
$
|
8,070
|
|
$
|
27,547
|
|
$
|
25,690
|
Income tax
expense....................................................
|
|
354
|
|
|
1,725
|
|
|
10,094
|
|
|
7,448
|
Depreciation and
amortization...................................
|
|
4,500
|
|
|
3,045
|
|
|
11,068
|
|
|
8,696
|
Foreign exchange loss
(gain)......................................
|
|
(124)
|
|
|
101
|
|
|
(168)
|
|
|
186
|
Net finance
income.....................................................
|
|
(59)
|
|
|
(841)
|
|
|
(884)
|
|
|
(2,427)
|
|
|
4,671
|
|
|
4,030
|
|
|
20,110
|
|
|
13,903
|
Adjusted
EBITDA.........................................................
|
$
|
10,134
|
|
$
|
12,100
|
|
$
|
47,657
|
|
$
|
39,593
|
Adjusted EBITDA as a
percentage of revenue............
|
|
18%
|
|
|
26%
|
|
|
28%
|
|
|
29%
|
Forward-Looking Statements
Certain statements in
this release constitute forward-looking statements within the
meaning of applicable securities laws. Forward-looking
statements include statements as to our expectations for:
- growth of annual total revenue, annual SaaS and Subscription
term licenses revenue, and our expectations for Adjusted EBITDA
margin achievement, in each case looking forward for our fiscal
year ending December 31, 2020;
and
- contracted revenue in future periods, including 2020, 2021
and 2022 and later.
This release also includes forward-looking statements as to
Kinaxis' growth opportunities and the potential benefits of, and
markets and demand for, Kinaxis' products and services. These
statements are subject to certain assumptions, risks and
uncertainties, including our view of the relative position of
Kinaxis' products and services compared to competitive offerings in
the industry.
In particular, our guidance for 2020 annual total revenue,
annual SaaS and Subscription term license revenue and annual
Adjusted EBITDA margin, is subject to certain assumptions and
associated risks including:
- our ability to win business from new customers and expand
business from existing customers;
- the timing of new customer wins and expansion decisions by
our existing customers;
- maintaining our current customer retention levels;
and
- with respect to Adjusted EBITDA, our ability to contain
expense levels while expanding our business.
Our guidance and commentary for achievement of contracted
revenue in future periods, including in 2020, 2021 and 2022 and
later, is based on assumptions and associated risks
including:
- our ability to satisfy material unperformed obligations
under our long-term contracts; and
- the continued financial capacity and creditworthiness of our
customers under long-term contracts.
These and other assumptions, risks and uncertainties may
cause Kinaxis' actual results, performance, achievements and
developments to differ materially from the results, performance,
achievements or developments expressed or implied by
forward-looking statements. Material risks and uncertainties
relating to our business are described under the headings
"Forward-Looking Statements" and "Risks and Uncertainties" in our
annual MD&A dated February 25,
2020, under the heading "Risk Factors" in our Annual
Information Form dated March 23, 2020
and in our other public documents filed with Canadian securities
regulatory authorities, which are available at www.sedar.com.
Forward-looking statements are provided to help readers understand
management's expectations as at the date of this release and may
not be suitable for other purposes. Readers are cautioned not to
place undue reliance on forward-looking statements. Kinaxis assumes
no obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as expressly required by law.
Kinaxis
Inc.
|
Condensed
Consolidated Interim Statements of Financial Position
|
|
As at September 30,
2020 and December 31, 2019
|
(Expressed in
thousands of USD)
|
(Unaudited)
|
|
|
|
September 30,
2020
|
|
December 31,
2019
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
|
179,856
|
$
|
182,284
|
Short-term
investments
|
|
30,177
|
|
30,319
|
Trade and other
receivables
|
|
45,512
|
|
80,623
|
Prepaid
expenses
|
|
8,610
|
|
6,534
|
|
|
264,155
|
|
299,760
|
|
|
|
|
|
Non-current
assets:
|
|
|
|
|
Property and
equipment
|
|
31,163
|
|
25,704
|
Right-of-use
assets
|
|
16,450
|
|
8,671
|
Contract acquisition
costs
|
|
15,087
|
|
15,497
|
Unbilled
receivables
|
|
1,683
|
|
249
|
Other
receivables
|
|
733
|
|
713
|
Deferred tax
assets
|
|
2,033
|
|
149
|
Intangible
assets
|
|
13,585
|
|
-
|
Goodwill
|
|
39,988
|
|
-
|
|
|
|
|
|
|
$
|
384,877
|
$
|
350,743
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Trade payables and
accrued liabilities
|
$
|
25,841
|
$
|
20,770
|
Deferred
revenue
|
|
62,893
|
|
83,673
|
Lease
obligations
|
|
4,369
|
|
2,288
|
|
|
93,103
|
|
106,731
|
Non-current
liabilities:
|
|
|
|
|
Lease
obligations
|
|
12,796
|
|
6,818
|
Deferred tax
liabilities
|
|
3,342
|
|
7,092
|
|
|
16,138
|
|
13,910
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
Share
capital
|
|
164,845
|
|
140,961
|
Contributed
surplus
|
|
36,635
|
|
30,392
|
Accumulated other
comprehensive loss
|
|
(257)
|
|
(348)
|
Retained
earnings
|
|
74,413
|
|
59,097
|
|
|
275,636
|
|
230,102
|
|
|
|
|
|
|
$
|
384,877
|
$
|
350,743
|
Kinaxis
Inc.
|
Condensed
Consolidated Interim Statements of Comprehensive Income
|
|
For the three and
nine months ended September 30, 2020 and 2019
|
(Expressed in
thousands of USD, except share and per share data)
(Unaudited)
|
|
|
For the three
months
ended September 30,
|
For the nine
months
ended September 30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
Revenue
|
$
|
55,116
|
$
|
47,131
|
$
|
169,244
|
$
|
135,237
|
|
|
|
|
|
|
|
|
|
Cost of
revenue
|
|
18,557
|
|
13,803
|
|
50,027
|
|
38,978
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
36,559
|
|
33,328
|
|
119,217
|
|
96,259
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Selling and
marketing
|
|
12,881
|
|
10,762
|
|
37,109
|
|
30,523
|
Research and
development
|
|
13,664
|
|
8,587
|
|
33,598
|
|
24,682
|
General and
administrative
|
|
9,209
|
|
8,461
|
|
24,249
|
|
20,347
|
|
|
35,754
|
|
27,810
|
|
94,956
|
|
75,552
|
|
|
|
|
|
|
|
|
|
|
|
805
|
|
5,518
|
|
24,261
|
|
20,707
|
Other income
:
|
|
|
|
|
|
|
|
|
Foreign exchange gain
(loss)
|
|
124
|
|
(101)
|
|
168
|
|
(186)
|
Net finance and other
income
|
|
156
|
|
841
|
|
981
|
|
2,427
|
|
|
280
|
|
740
|
|
1,149
|
|
2,241
|
|
|
|
|
|
|
|
|
|
Profit before income
taxes
|
|
1,085
|
|
6,258
|
|
25,410
|
|
22,948
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
354
|
|
1,725
|
|
10,094
|
|
7,448
|
|
|
|
|
|
|
|
|
|
Profit
|
|
731
|
|
4,533
|
|
15,316
|
|
15,500
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss):
|
|
|
|
|
|
|
|
|
Items that are or may
be reclassified subsequently to profit or loss:
|
|
|
|
|
|
|
|
|
Foreign currency
translation differences - foreign operations
|
|
146
|
|
(94)
|
|
91
|
|
(129)
|
|
|
|
|
|
|
|
|
|
Total comprehensive
income
|
$
|
877
|
$
|
4,439
|
$
|
15,407
|
$
|
15,371
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share
|
$
|
0.03
|
$
|
0.17
|
$
|
0.58
|
$
|
0.59
|
|
|
|
|
|
|
|
|
|
Weighted average
number of basic Common Shares
|
|
26,596,412
|
|
26,184,980
|
|
26,622,939
|
|
26,141,410
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
$
|
0.03
|
$
|
0.17
|
$
|
0.55
|
$
|
0.58
|
|
|
|
|
|
|
|
|
|
Weighted average
number of diluted Common Shares
|
|
27,766,505
|
|
26,928,596
|
|
28,000,655
|
|
26,888,187
|
Kinaxis
Inc.
|
Condensed
Consolidated Interim Statements of Changes in Shareholders'
Equity
|
|
For the nine months
ended September 30, 2020 and 2019
|
(Expressed in
thousands of USD)
|
(Unaudited)
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
other
|
|
|
|
|
|
|
Share
|
|
Contributed
|
|
comprehensive
|
|
Retained
|
|
|
|
|
capital
|
|
surplus
|
|
loss
|
|
earnings
|
|
Total
equity
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31,
2018
|
$
|
124,951
|
$
|
24,284
|
$
|
(319)
|
$
|
35,766
|
$
|
184,682
|
|
|
|
|
|
|
|
|
|
|
|
Profit
|
|
-
|
|
-
|
|
-
|
|
15,500
|
|
15,500
|
Other comprehensive
loss
|
|
-
|
|
-
|
|
(129)
|
|
-
|
|
(129)
|
Total comprehensive
income (loss)
|
|
-
|
|
-
|
|
(129)
|
|
15,500
|
|
15,371
|
|
|
|
|
|
|
|
|
|
|
|
Share options
exercised
|
|
6,059
|
|
(1,736)
|
|
-
|
|
-
|
|
4,323
|
Share based
payments
|
|
-
|
|
10,190
|
|
-
|
|
-
|
|
10,190
|
Total shareholder
transactions
|
|
6,059
|
|
8,454
|
|
-
|
|
-
|
|
14,513
|
|
|
|
|
|
|
|
|
|
|
|
Balance, September
30, 2019
|
$
|
131,010
|
$
|
32,738
|
$
|
(448)
|
$
|
51,266
|
$
|
214,566
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31,
2019
|
$
|
140,961
|
$
|
30,392
|
$
|
(348)
|
$
|
59,097
|
$
|
230,102
|
|
|
|
|
|
|
|
|
|
|
|
Profit
|
|
-
|
|
-
|
|
-
|
|
15,316
|
|
15,316
|
Other comprehensive
income
|
|
-
|
|
-
|
|
91
|
|
-
|
|
91
|
Total comprehensive
income
|
|
-
|
|
-
|
|
91
|
|
15,316
|
|
15,407
|
|
|
|
|
|
|
|
|
|
|
|
Share options
exercised
|
|
23,884
|
|
(5,988)
|
|
-
|
|
-
|
|
17,896
|
Share based
payments
|
|
-
|
|
12,231
|
|
-
|
|
-
|
|
12,231
|
Total shareholder
transactions
|
|
23,884
|
|
6,243
|
|
-
|
|
-
|
|
30,127
|
|
|
|
|
|
|
|
|
|
|
|
Balance, September
30, 2020
|
$
|
164,845
|
$
|
36,635
|
$
|
(257)
|
$
|
74,413
|
$
|
275,636
|
Kinaxis
Inc.
|
Condensed
Consolidated Interim Statements of Cash Flows
|
|
For the three and
nine months ended September 30, 2020 and 2019
|
(Expressed in
thousands of USD)
|
(Unaudited)
|
|
|
For the three
months
ended September 30,
|
For the nine
months
ended September 30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
Cash flows from (used
in) operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit
|
$
|
731
|
$
|
4,533
|
$
|
15,316
|
$
|
15,500
|
Items not affecting
cash:
|
|
|
|
|
|
|
|
|
Depreciation of
property and equipment and right-of-use assets
|
|
3,939
|
|
3,045
|
|
10,403
|
|
8,696
|
Amortization of
intangible assets
|
|
561
|
|
-
|
|
665
|
|
-
|
Share-based
payments
|
|
4,732
|
|
3,537
|
|
12,231
|
|
10,190
|
Net finance
income
|
|
(156)
|
|
(841)
|
|
(981)
|
|
(2,427)
|
Income tax
expense
|
|
354
|
|
1,725
|
|
10,094
|
|
7,448
|
Change in operating
assets and liabilities
|
|
(5,219)
|
|
(12,061)
|
|
10,474
|
|
(1,087)
|
Interest
received
|
|
596
|
|
1,120
|
|
1,658
|
|
2,993
|
Interest
paid
|
|
(198)
|
|
(149)
|
|
(487)
|
|
(419)
|
Income taxes received
(paid)
|
|
(843)
|
|
145
|
|
(3,103)
|
|
(12,320)
|
|
|
4,497
|
|
1,054
|
|
56,270
|
|
28,574
|
|
|
|
|
|
|
|
|
|
Cash flows from (used
in) investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of
businesses, net of cash acquired
|
|
(59,166)
|
|
-
|
|
(61,743)
|
|
-
|
Purchase of property
and equipment
|
|
(1,299)
|
|
(1,147)
|
|
(12,337)
|
|
(10,341)
|
Purchase of
short-term investments
|
|
(20,150)
|
|
(20,102)
|
|
(95,452)
|
|
(50,108)
|
Redemption of
short-term investments
|
|
65,302
|
|
25,102
|
|
95,404
|
|
75,108
|
|
|
(15,313)
|
|
3,853
|
|
(74,128)
|
|
14,659
|
|
|
|
|
|
|
|
|
|
Cash flows from (used
in) financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payment of lease
obligations
|
|
(1,154)
|
|
(708)
|
|
(2,639)
|
|
(1,995)
|
Common shares issued
on exercise of stock options
|
|
6,548
|
|
2,225
|
|
17,896
|
|
4,323
|
|
|
5,394
|
|
1,517
|
|
15,257
|
|
2,328
|
|
|
|
|
|
|
|
|
|
(Decrease) increase
in cash and cash equivalents
|
|
(5,422)
|
|
6,424
|
|
(2,601)
|
|
45,561
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents, beginning of period
|
|
184,992
|
|
165,512
|
|
182,284
|
|
126,144
|
|
|
|
|
|
|
|
|
|
Effects of exchange
rates on cash and cash equivalents
|
|
286
|
|
21
|
|
173
|
|
252
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents, end of period
|
$
|
179,856
|
$
|
171,957
|
$
|
179,856
|
$
|
171,957
|
SOURCE Kinaxis Inc.