- SaaS revenue grows 18% to $42.3
million
- Adjusted EBITDA(1) margin of 12%
OTTAWA, ON, Aug. 5, 2021
/CNW/ - Kinaxis® (TSX: KXS) , the authority in driving agility for
fast, confident decision-making in an unpredictable world, today
reported results for its second quarter. All amounts are in U.S.
dollars. All figures are prepared in accordance with International
Financial Reporting Standards (IFRS) unless otherwise
indicated.
"After three consecutive quarters of strong business momentum,
I'm confident that the market has returned to a very healthy growth
environment. With all the well-known disruptions that supply chains
have endured over the past year, we are seeing a heightened level
of interest in the hyper-agility that only Kinaxis can bring to the
planning process," said John Sicard,
President and CEO of Kinaxis. "Compared to the first half of last
year, we have won over twice the number of new customers, and our
annual recurring revenue2 is 24% higher than a year ago.
We believe that these are excellent indicators of the positive
trends in our business and give us even greater confidence in our
expectation of a return to higher SaaS revenue growth next
year."
Q2 2021 Highlights
$ USD thousands,
except as otherwise indicated
|
Q2
2021
|
Q2
2020
|
Change
|
Total
Revenue
|
60,056
|
61,373
|
-2%
|
SaaS
|
42,301
|
35,741
|
18%
|
Subscription term
license
|
620
|
10,003
|
(94%)
|
Professional
services
|
14,001
|
12,400
|
13%
|
Maintenance and
support
|
3,134
|
3,229
|
(3%)
|
Gross
profit
|
40,273
|
45,739
|
(12)%
|
|
67%
|
75%
|
|
Profit
|
3,088
|
9,004
|
(66%)
|
|
$0.11/diluted
share
|
$0.32/diluted
share
|
|
Adjusted
EBITDA(1)
|
7,149
|
22,471
|
(68%)
|
|
12%
|
37%
|
|
Cash from
operating activities
|
15,002
|
30,813
|
(51%)
|
(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.
|
Key Performance Indicators
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 June 30, 2021.
$USD millions
|
2021
|
2022
|
2023 and
later
|
Total
backlog
|
SaaS
|
86.3
|
132.0
|
140.6
|
358.9
|
Maintenance and
support
|
6.2
|
8.7
|
5.7
|
20.6
|
Subscription term
license
|
1.5
|
-
|
-
|
1.5
|
Total
|
94.0
|
140.7
|
146.3
|
381.0
|
The company's Annual Recurring Revenue2 (ARR), which
includes amounts related to both SaaS and on-premise subscription
contracts, rose 24% to $200 million
at the end of the quarter.
$USD
millions
|
2019
|
2020
|
Q1
2021
|
Q2
2021
|
Annual recurring
revenue2
|
159
|
185
|
191
|
200
|
Year-over-year
growth
|
20.7%
|
15.3%
|
18.2%
|
24.3%
|
(2)
|
Annual Recurring
Revenue (ARR) is the total annualized value of recurring
subscription amounts (ultimately recognized as SaaS, Subscription
Term Licenses and Maintenance & Support revenue) of all
subscription contracts at a point in time. Annualized subscription
amounts are determined solely by reference to the underlying
contracts, normalizing for the varying revenue recognition
treatments under IFRS 15 for cloud-based versus on-premise
subscription amounts. It excludes one-time fees, such as for
non-recurring professional services, and assumes that customers
will renew the contractual commitments on a periodic basis as those
commitments come up for renewal, unless such renewal is known to be
unlikely. We believe that this measure provides a more current
indication of our performance in the growth of our subscription
business than other metrics.
|
Financial Guidance
Based on our current business
outlook, Kinaxis is reiterating its fiscal 2021 financial guidance,
as follows:
|
FY 2021
Guidance
|
Total
revenue
|
$242-247
million
|
SaaS
|
17-20%
growth
|
Subscription term
license
|
$3-5
million
|
Adjusted
EBITDA(1)
margin
|
11-14%
|
Beyond 2021, and assuming an ongoing return to more typical
business and market conditions, the company continues to believe
that annual SaaS revenue growth of 23-25% is achievable in the
mid-term.
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 months ended June 30, 2021 are
available on Kinaxis' website and on SEDAR at www.sedar.com.
Conference Call
Kinaxis will host a conference call
tomorrow, August 6, 2021, to discuss
these results. John Sicard, Chief
Executive Officer, and Blaine
Fitzgerald, 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:
Friday, August 6, 2021
TIME:
8:30 a.m. Eastern Time
CALL REGISTRATION:
https://dpregister.com/sreg/10158854/eb660d628c
WEBCAST:
https://bit.ly/3hIIcIZ (available for three months)
REPLAY:
(877)-344-7529
Available through Friday, August 20,
2021
REFERENCE NUMBER: 10158854
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
June 30,
|
|
Six months ended
June 30,
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
|
(In thousands of
USD)
|
Profit
|
$
|
3,088
|
|
$
|
9,004
|
|
$
|
1,554
|
|
$
|
14,585
|
Share-based
compensation
|
|
5,902
|
|
3,723
|
|
11,209
|
|
7,499
|
Non-recurring
item(3)
|
|
(7,906)
|
|
–
|
|
(7,906)
|
|
–
|
Adjusted
profit
|
$
|
1,084
|
|
$
|
12,727
|
|
$
|
4,857
|
|
$
|
22,084
|
Income tax
expense
|
|
916
|
|
6,264
|
|
984
|
|
9,740
|
Depreciation and
amortization
|
|
4,598
|
|
3,627
|
|
9,068
|
|
6,568
|
Foreign exchange loss
(gain)
|
|
443
|
|
5
|
|
911
|
|
(44)
|
Net finance expense
(income)
|
|
108
|
|
(152)
|
|
370
|
|
(825)
|
|
|
6,065
|
|
9,744
|
|
11,333
|
|
15,439
|
Adjusted
EBITDA
|
$
|
7,149
|
|
$
|
22,471
|
|
$
|
16,190
|
|
$
|
37,523
|
Adjusted EBITDA as a
percentage of revenue
|
|
12%
|
|
37%
|
|
14%
|
|
33%
|
|
|
(3)
|
The non-recurring
item this quarter relates to non-refundable government grants
relating to the pandemic that were claimed during the three months
ended June 30th, 2021 and are unlikely to recur in the
future.
|
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, 2021;
and
- contracted revenue in future periods, including 2021, 2022
and 2023 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 2021 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 customer retention levels, and
specifically, that customers will renew contractual commitments on
a periodic basis as those commitments come up for renewal, at rates
consistent with our historic experience; 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 2021, 2022 and 2023 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.
Our guidance and commentary for annual SaaS revenue growth
beyond 2021 is based on assumptions and associated risks including
normalization of macroeconomic factors, including business and
market conditions, relative to recent conditions that have been
affected by the COVID-19 pandemic. 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 March 3, 2021, under the heading "Risk Factors"
in our Annual Information Form dated March
25, 2021 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
(Expressed in thousands of USD)
(Unaudited)
|
|
|
|
|
|
|
June 30,
2021
|
|
December 31,
2020
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
|
202,771
|
$
|
182,958
|
Short-term
investments
|
|
30,172
|
|
30,180
|
Trade and other
receivables
|
|
65,891
|
|
82,883
|
Investment tax
credits recoverable
|
|
–
|
|
1,109
|
Prepaid
expenses
|
|
10,595
|
|
9,264
|
|
|
309,429
|
|
306,394
|
Non-current
assets:
|
|
|
|
|
Property and
equipment
|
|
41,674
|
|
30,746
|
Right-of-use
assets
|
|
13,953
|
|
15,722
|
Contract acquisition
costs
|
|
16,639
|
|
16,484
|
Unbilled
receivables
|
|
196
|
|
2,013
|
Other
receivables
|
|
701
|
|
752
|
Deferred tax
assets
|
|
3,894
|
|
2,308
|
Investment tax
credits recoverable
|
|
1,840
|
|
980
|
Intangible
assets
|
|
11,901
|
|
13,023
|
Goodwill
|
|
39,988
|
|
39,988
|
|
|
|
|
|
|
$
|
440,215
|
$
|
428,410
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Trade payables and
accrued liabilities
|
$
|
28,136
|
$
|
33,030
|
Deferred
revenue
|
|
94,867
|
|
94,275
|
Lease
obligations
|
|
4,857
|
|
4,554
|
|
|
127,860
|
|
131,859
|
Non-current
liabilities:
|
|
|
|
|
Lease
obligations
|
|
10,203
|
|
12,065
|
Deferred tax
liabilities
|
|
3,298
|
|
2,729
|
|
|
13,501
|
|
14,794
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
Share
capital
|
|
179,268
|
|
173,104
|
Contributed
surplus
|
|
45,455
|
|
35,846
|
Accumulated other
comprehensive loss
|
|
(250)
|
|
(20)
|
Retained
earnings
|
|
74,381
|
|
72,827
|
|
|
298,854
|
|
281,757
|
|
|
|
|
|
|
$
|
440,215
|
$
|
428,410
|
Kinaxis Inc.
Condensed Consolidated Interim Statements
of Comprehensive Income
(Expressed in thousands of USD, except share and per share
data)
(Unaudited)
|
|
|
|
For the three
months
ended June 30,
2020
|
For the six
months
ended June 30,
2020
|
|
2021
|
2020
|
2021
|
2020
|
Revenue
|
$
|
60,056
|
$
|
61,373
|
$
|
117,784
|
$
|
114,128
|
Cost of
revenue
|
|
19,783
|
|
15,634
|
|
40,289
|
|
31,470
|
Gross
profit
|
|
40,273
|
|
45,739
|
|
77,495
|
|
82,658
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Selling and
marketing
|
|
14,279
|
|
12,253
|
|
27,117
|
|
24,228
|
|
Research and
development
|
|
11,223
|
|
10,257
|
|
24,905
|
|
19,934
|
|
General and
administrative
|
|
10,323
|
|
8,108
|
|
21,865
|
|
15,040
|
|
|
35,825
|
|
30,618
|
|
73,887
|
|
59,202
|
|
|
4,448
|
|
15,121
|
|
3,608
|
|
23,456
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
Foreign exchange gain
(loss)
|
|
(443)
|
|
(5)
|
|
(911)
|
|
44
|
|
Net finance and other
income (expense)
|
|
(1)
|
|
152
|
|
(159)
|
|
825
|
|
|
(444)
|
|
147
|
|
(1,070)
|
|
869
|
Profit before income
taxes
|
|
4,004
|
|
15,268
|
|
2,538
|
|
24,325
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
916
|
|
6,264
|
|
984
|
|
9,740
|
Profit
|
|
3,088
|
|
9,004
|
|
1,554
|
|
14,585
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss)
|
|
|
|
|
|
|
|
|
Items that are or may
be reclassified
subsequently to profit or loss:
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation
differences - foreign operations
|
|
39
|
|
69
|
|
(230)
|
|
(55)
|
Total comprehensive
income
|
$
|
3,127
|
$
|
9,073
|
$
|
1,324
|
$
|
14,530
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share
|
$
|
0.11
|
$
|
0.34
|
$
|
0.06
|
$
|
0.55
|
Weighted average
number of basic
Common Shares
|
|
27,110,830
|
|
26,546,213
|
|
27,165,088
|
|
26,489,205
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
$
|
0.11
|
$
|
0.32
|
$
|
0.05
|
$
|
0.53
|
Weighted average
number of diluted
Common Shares
|
|
28,132,511
|
|
27,960,482
|
|
28,260,273
|
|
27,776,206
|
Kinaxis Inc.
Condensed Consolidated Interim Statements
of Changes in Shareholders' Equity
(Expressed in thousands of USD)
(Unaudited)
|
|
|
|
|
|
|
Share
capital
|
Contributed
surplus
|
Accumulated
other
comprehensive
loss
|
Retained
earnings
|
Total
equity
|
Balance, December 31,
2019
|
$
|
140,961
|
$
|
30,392
|
$
|
(348)
|
$
|
59,097
|
$
|
230,102
|
|
|
|
|
|
|
|
|
|
|
|
Profit
|
|
–
|
|
–
|
|
–
|
|
14,585
|
|
14,585
|
Other comprehensive
loss
|
|
–
|
|
–
|
|
(55)
|
|
–
|
|
(55)
|
Total comprehensive
income
(loss)
|
|
–
|
|
–
|
|
(55)
|
|
14,585
|
|
14,530
|
|
|
|
|
|
|
|
|
|
|
|
Share options
exercised
|
|
15,273
|
|
(3,925)
|
|
–
|
|
–
|
|
11,348
|
Share based
payments
|
|
–
|
|
7,499
|
|
–
|
|
–
|
|
7,499
|
Total shareholder
transactions
|
|
15,273
|
|
3,574
|
|
–
|
|
–
|
|
18,847
|
|
|
|
|
|
|
|
|
|
|
|
Balance, June 30,
2020
|
$
|
156,234
|
$
|
33,966
|
$
|
(403)
|
$
|
73,682
|
$
|
263,479
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31,
2020
|
$
|
173,104
|
$
|
35,846
|
$
|
(20)
|
$
|
72,827
|
$
|
281,757
|
|
|
|
|
|
|
|
|
|
|
|
Profit
|
|
–
|
|
–
|
|
–
|
|
1,554
|
|
1,554
|
Other comprehensive
loss
|
|
–
|
|
–
|
|
(230)
|
|
–
|
|
(230)
|
Total comprehensive
income (loss)
|
|
–
|
|
–
|
|
(230)
|
|
1,554
|
|
1,324
|
|
|
|
|
|
|
|
|
|
|
|
Share options
exercised
|
|
6,164
|
|
(1,600)
|
|
–
|
|
–
|
|
4,564
|
Share based
payments
|
|
–
|
|
11,209
|
|
–
|
|
–
|
|
11,209
|
Total shareholder
transactions
|
|
6,164
|
|
9,609
|
|
–
|
|
–
|
|
15,773
|
|
|
|
|
|
|
|
|
|
|
|
Balance, June 30,
2021
|
$
|
179,268
|
$
|
45,455
|
$
|
(250)
|
$
|
74,381
|
$
|
298,854
|
Kinaxis Inc.
Condensed Consolidated Interim Statements
of Cash Flows
(Expressed in thousands of USD)
(Unaudited)
|
|
|
|
For the three
months
ended June 30,
|
For the six
months
ended June 30,
|
|
2021
|
2020
|
2021
|
2020
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
|
Profit
|
$
|
3,088
|
$
|
9,004
|
$
|
1,554
|
$
|
14,585
|
|
Items not affecting
cash:
|
|
|
|
|
|
|
|
|
|
|
Depreciation of
property and equipment
and right-of-use assets
|
|
4,037
|
|
3,565
|
|
7,946
|
|
6,464
|
|
|
Amortization of
intangible assets
|
|
561
|
|
62
|
|
1,122
|
|
104
|
|
|
Share-based
payments
|
|
5,902
|
|
3,723
|
|
11,209
|
|
7,499
|
|
|
Net finance and other
income (expense)
|
|
1
|
|
(152)
|
|
159
|
|
(825)
|
|
|
Income tax
expense
|
|
916
|
|
6,264
|
|
984
|
|
9,740
|
|
|
Income tax credits
recoverable
|
|
674
|
|
–
|
|
249
|
|
–
|
|
Change in operating
assets and liabilities
|
|
70
|
|
8,837
|
|
13,010
|
|
15,693
|
|
Interest
received
|
|
183
|
|
200
|
|
206
|
|
1,062
|
|
Interest
paid
|
|
(173)
|
|
(169)
|
|
(357)
|
|
(289)
|
|
Income taxes
paid
|
|
(257)
|
|
(521)
|
|
(431)
|
|
(2,260)
|
|
|
15,002
|
|
30,813
|
|
35,651
|
|
51,773
|
|
|
|
|
|
|
|
|
|
Cash flows used in
investing activities:
|
|
|
|
|
|
|
|
|
|
Acquisition of
business, net of cash acquired
|
|
–
|
|
(167)
|
|
(800)
|
|
(2,577)
|
|
Purchase of property
and equipment
|
|
(12,489)
|
|
(9,329)
|
|
(16,930)
|
|
(11,038)
|
|
Purchase of
short-term investments
|
|
(15,154)
|
|
(10,000)
|
|
(30,160)
|
|
(75,302)
|
|
Redemption of
short-term investments
|
|
15,154
|
|
10,000
|
|
30,160
|
|
30,102
|
|
|
(12,489)
|
|
(9,496)
|
|
(17,730)
|
|
(58,815)
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
|
Payment of lease
obligations
|
|
(1,185)
|
|
(894)
|
|
(2,357)
|
|
(1,485)
|
|
Common shares issued
on exercise of stock options
|
|
2,304
|
|
6,338
|
|
4,564
|
|
11,348
|
|
|
1,119
|
|
5,444
|
|
2,207
|
|
9,863
|
|
|
|
|
|
|
|
|
|
Increase in cash and
cash equivalents
|
|
3,632
|
|
26,761
|
|
20,128
|
|
2,821
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents, beginning of period
|
|
199,143
|
|
158,148
|
|
182,958
|
|
182,284
|
|
|
|
|
|
|
|
|
|
Effects of exchange
rates on cash and cash equivalents
|
|
(4)
|
|
83
|
|
(315)
|
|
(113)
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents, end of period
|
$
|
202,771
|
$
|
184,992
|
$
|
202,771
|
$
|
184,992
|
SOURCE Kinaxis Inc.