SaaS revenue up 42%
MONTREAL, Sept. 8,
2022 /CNW/ -- Tecsys Inc. (TSX: TCS), an
industry-leading supply chain management SaaS company, today
announced its results for the first quarter of fiscal year 2023,
ended July 31, 2022. 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 42% to $8.0
million, up from $5.7 million
in Q1 2022.
- SaaS subscription bookingsi (measured on an
ARRi basis) were $3.9
million, up 256% compared to $1.1
million in the first quarter of 2022.
- SaaS Remaining Performance Obligation (RPOi)
increased by 58% to $102.5 million at
July 31, 2022, up from $65.0 million at the same time last year.
- Annual Recurring Revenue (ARRi) at July 31, 2022 was up 21% to $65.1 million compared to $53.7 million at July 31,
2021.
- Professional services revenue was up 4% to $13.6 million compared to $13.1 million in Q1 2022.
- Total revenue excluding hardware revenue was $30.4 million, 11% higher than $27.5 million reported for Q1 2022.
- Gross margin was 43% compared to 43% in the same period in
fiscal 2022.
- Total gross profit increased to $14.8
million, up 2% from $14.4
million in Q1 2022.
- Operating expenses increased to $14.7
million, higher by $1.3
million or 10% compared to $13.3
million in Q1 2022.
- Profit from operations was $0.1
million, down from $1.1
million in Q1 2022.
- Net profit was $40 thousand or
$0.00 per share on a fully diluted
basis compared to a net profit of $0.2
million or $0.02 per share for
the same period in fiscal 2022.
- Adjusted EBITDAii was $1.5
million, down 40% compared to $2.5
million reported in Q1 2022.
"We are pleased to report a very strong start to Fiscal 2023.
Our solid bookings for the quarter span our vertical markets and
included three new hospital networks. We believe this serves
as a testament that our SaaS solution suite is well-suited to the
demands of a market ripe for transformation," said Peter Brereton, president and CEO of Tecsys,
Inc. "Supply chain organizations around the world have been facing
tough challenges when it comes to consumer expectations, labor
shortages and legacy software unable to manage modern fulfillment
complexity. With supply chain gaining so much mindshare as a
strategic lever in organizations, we are seeing demand signals and
buyer intent for more robust supply chain software. And we are
fully prepared with the right software and the right market
position to deliver customer and shareholder value."
Mark Bentler, chief financial
officer of Tecsys Inc., added, "With another record quarter of SaaS
revenue representing a 42% increase over last year, solid revenue
growth and substantial SaaS ARR bookings, we are pleased with our
topline growth. Our SaaS ARR bookings are up 256% over last year,
which translates into a positive impact on RPO up 58% year over
year. As we continue to see rapid growth in bookings and RPO, we
continue to invest in cloud infrastructure, R&D, and Sales and
marketing to take advantage of this evolving market
opportunity."
Results from
operations
|
|
Three months
ended
|
|
Three months
ended
|
|
Trailing 12
months
ended
|
|
Trailing 12
months ended
|
|
|
July 31,
2022
|
|
July 31,
2021
|
|
July 31,
2022
|
|
July 31,
2021
|
Total
Revenue
|
$
|
34,204
|
$
|
33,232
|
$
|
138,172
|
$
|
128,242
|
Total Revenue
Excluding
Hardware
|
|
30,359
|
|
27,456
|
|
117,376
|
|
108,604
|
SaaS, Maintenance
and
Support Revenue
|
|
16,269
|
|
13,979
|
|
61,917
|
|
54,605
|
Gross Profit
|
|
14,758
|
|
14,429
|
|
60,639
|
|
61,569
|
Gross Margin
%
|
|
43 %
|
|
43 %
|
|
44 %
|
|
48 %
|
Operating
Expenses
|
|
14,668
|
|
13,341
|
|
56,261
|
|
51,768
|
Op. Ex. As % of
Revenue
|
|
43 %
|
|
40 %
|
|
41 %
|
|
40 %
|
Profit from
Operations
|
|
90
|
|
1,088
|
|
4,378
|
|
9,801
|
Adjusted
EBITDA
|
|
1,484
|
|
2,456
|
|
9,158
|
|
15,167
|
EPS basic
|
|
0.00
|
|
0.02
|
|
0.29
|
|
0.43
|
EPS diluted
|
|
0.00
|
|
0.02
|
|
0.28
|
|
0.42
|
License
Bookings
|
|
249
|
|
286
|
|
2,365
|
|
4,114
|
SAAS ARR
Bookings
|
|
3,908
|
|
1,099
|
|
14,730
|
|
8,277
|
SAAS RPO
|
|
|
|
|
|
102,540
|
|
64,997
|
Annual Recurring
Revenue
|
|
|
|
|
|
65,074
|
|
53,656
|
Professional Services
Backlog
|
|
|
|
|
|
30,674
|
|
35,124
|
On September 8, 2022, the Company
declared a quarterly dividend of $0.07 per share payable on October 7, 2022 to shareholders of record at the
close of business on September 23,
2022.
Pursuant to the Canadian Income Tax Act, dividends paid by the
Company to Canadian residents are considered to be "eligible"
dividends.
i See Key Performance Indicators in Management's
Discussion and Analysis of the Q1 2023 Financial
Statements.
ii See Non-IFRS Performance Measures in Management's
Discussion and Analysis of the Q1 2023 Financial Statements
First Quarter Fiscal 2023 Results Conference Call
Date: September 9, 2022
Time: 8:30am EDT
Phone number: (800) 768-6727 or (416) 620-9188
The call can be replayed until September 16,
2022 by calling:
(800) 558-5253 or (416) 626-4100 (access code:22020336)
About Tecsys
Tecsys is a global provider of cloud-based supply chain
solutions that equip the borderless enterprise for growth and
competitive advantage. Serving healthcare, distribution and
converging commerce industries, and spanning multiple complex,
regulated and high-volume markets, Tecsys delivers dynamic and
powerful solutions for warehouse management, distribution and
transportation management, supply management at point of use, order
management and fulfillment, as well as 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 the most recently filed annual information form. 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. 2022. 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, gain on remeasurement of lease liability and
recognition of tax credits generated in prior periods. The
exclusion of interest expense, interest income and income taxes
eliminates the impact on earnings derived from non-operational
activities, and the exclusion of depreciation, amortization,
share-based compensation, gain on remeasurement of lease liability
and recognition of tax credits generated in prior periods
eliminates the non-cash impact of these items.
The Company believes that these measures are useful measures of
financial performance without the variation caused by the impacts
of the items described above and that could potentially distort the
analysis of trends in our operating performance. In addition, they
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. Excluding these
items does not imply that they are necessarily non-recurring.
Management believes these non-GAAP financial measures, in addition
to conventional measures prepared in accordance with IFRS, enable
investors to evaluate the Company's operating results, underlying
performance and future prospects in a manner similar to management.
Although EBITDA and Adjusted EBITDA are frequently used by
securities analysts, lenders and others in their evaluation of
companies, they have limitations as an analytical tool, and should
not be considered in isolation, or as a substitute for analysis of
the Company's results as reported under IFRS.
The reconciliation of EBITDA and Adjusted EBITDA to the most
directly comparable IFRS measure is provided below.
(in thousands of
CAD)
|
Three months
ended
July
31
|
|
Trailing 12 months
ended
July
31
|
|
|
|
2022
|
|
2021
|
|
|
2022
|
|
2021
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the
period
|
$
|
40
|
$
|
244
|
|
|
4,274
|
|
6,197
|
Adjustments
for:
|
|
|
|
|
|
|
|
|
|
|
Depreciation of
property and equipment
and right-of-use assets
|
|
430
|
|
543
|
|
|
2,049
|
|
2,190
|
|
Amortization of
deferred development costs
|
|
102
|
|
54
|
|
|
338
|
|
220
|
|
Amortization of other
intangible assets
|
|
396
|
|
411
|
|
|
1,597
|
|
1,666
|
|
Interest
expense
|
|
119
|
|
161
|
|
|
580
|
|
672
|
|
Interest
income
|
|
(104)
|
|
(40)
|
|
|
(538)
|
|
(164)
|
|
Income taxes
|
|
25
|
|
729
|
|
|
242
|
|
3,163
|
EBITDA
|
$
|
1,008
|
$
|
2,102
|
|
|
8,542
|
|
13,944
|
Adjustments
for:
|
|
|
|
|
|
|
|
|
|
|
Stock based
compensation
|
|
476
|
|
354
|
|
|
1,806
|
|
1,223
|
|
Gain on remeasurement
of lease liability
|
|
-
|
|
-
|
|
|
(573)
|
|
-
|
|
Recognition of tax
credits generated in prior
periods
|
|
-
|
|
-
|
|
|
(617)
|
|
-
|
Adjusted
EBITDA
|
$
|
1,484
|
$
|
2,456
|
|
|
9,158
|
|
15,167
|
Consolidated Statements
of Financial Position
As at July 31, 2022 and April 30, 2022
(Unaudited)
(In thousands of Canadian dollars)
|
|
|
July 31,
2022
|
April 30,
2022
|
Assets
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
17,215
|
$
|
23,004
|
Short-term
investments
|
|
|
20,331
|
|
20,239
|
Accounts
receivable
|
|
|
17,447
|
|
16,962
|
Work in
progress
|
|
|
2,526
|
|
1,579
|
Other
receivables
|
|
|
622
|
|
234
|
Tax
credits
|
|
|
6,542
|
|
5,224
|
Inventory
|
|
|
1,059
|
|
806
|
Prepaid
expenses
|
|
|
6,949
|
|
6,392
|
Total current
assets
|
|
|
72,691
|
|
74,440
|
Non-current
assets
|
|
|
|
|
|
Other long-term
receivables
|
|
|
165
|
|
192
|
Tax
credits
|
|
|
3,933
|
|
3,782
|
Property
and equipment
|
|
|
1,864
|
|
2,064
|
Right-of-use
assets
|
|
|
4,568
|
|
4,547
|
Contract acquisition
costs
|
|
|
3,430
|
|
3,177
|
Deferred development costs
|
|
|
1,977
|
|
1,870
|
Other intangible assets
|
|
|
9,710
|
|
10,301
|
Goodwill
|
|
|
16,651
|
|
16,863
|
Deferred tax
assets
|
|
|
8,605
|
|
8,608
|
Total non-current
assets
|
|
|
50,903
|
|
51,404
|
Total
assets
|
|
$
|
123,594
|
$
|
125,844
|
Liabilities
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Accounts payable and
accrued liabilities
|
|
$
|
14,490
|
$
|
16,971
|
Deferred
revenue
|
|
|
25,909
|
|
24,689
|
Current portion of
long-term debt
|
|
|
1,200
|
|
1,200
|
Lease
obligations
|
|
|
675
|
|
662
|
Total current
liabilities
|
|
|
42,274
|
|
43,522
|
Non-current
liabilities
|
|
|
|
|
|
Long-term debt
|
|
|
6,900
|
|
7,200
|
Deferred tax
liabilities
|
|
|
1,215
|
|
1,258
|
Lease
obligations
|
|
|
5,114
|
|
5,181
|
Total non-current
liabilities
|
|
|
13,229
|
|
13,639
|
Total
liabilities
|
|
$
|
55,503
|
$
|
57,161
|
Equity
|
|
|
|
|
|
Share capital
|
|
$
|
44,049
|
$
|
43,973
|
Contributed
surplus
|
|
|
13,638
|
|
13,176
|
Retained
earnings
|
|
|
11,988
|
|
12,968
|
Accumulated other
comprehensive income
|
|
|
(1,584)
|
|
(1,434)
|
Total equity
attributable to the owners of the Company
|
|
|
68,091
|
|
68,683
|
Total liabilities
and equity
|
|
$
|
123,594
|
$
|
125,844
|
|
|
|
|
|
|
Consolidated Statements
of Income and Comprehensive Income
Three-month periods ended July 31, 2022 and 2021
(Unaudited)
(In thousands of Canadian dollars, except per share
data)
|
|
|
July 31,
2022
|
July 31,
2021
|
Revenue:
|
|
|
|
|
|
SaaS
|
|
$
|
8,001
|
$
|
5,653
|
Maintenance and
Support
|
|
|
8,268
|
|
8,326
|
Professional
Services
|
|
|
13,631
|
|
13,126
|
License
|
|
|
459
|
|
351
|
Hardware
|
|
|
3,845
|
|
5,776
|
Total
revenue
|
|
|
34,204
|
|
33,232
|
Cost of
revenue
|
|
|
19,446
|
|
18,803
|
Gross
profit
|
|
|
14,758
|
|
14,429
|
Operating
expenses:
|
|
|
|
|
|
Sales and
marketing
|
|
|
6,250
|
|
5,682
|
General and
administration
|
|
|
2,734
|
|
2,859
|
Research and
development, net of tax credits
|
|
|
5,684
|
|
4,800
|
Total operating
expenses
|
|
|
14,668
|
|
13,341
|
Profit from
operations
|
|
|
90
|
|
1,088
|
Financing
Costs
|
|
|
25
|
|
115
|
Profit before income
taxes
|
|
|
65
|
|
973
|
Income tax
expense
|
|
|
25
|
|
729
|
Net profit,
attributable to the owners of the Company
|
|
$
|
40
|
$
|
244
|
Other comprehensive
income (loss):
|
|
|
|
|
|
Effective portion of
changes in fair value on designated revenue
hedges
|
|
|
154
|
|
(358)
|
Exchange differences
on translation of foreign operations
|
|
|
(304)
|
|
(33)
|
Comprehensive loss,
attributable to the owners of the Company
|
|
$
|
(110)
|
$
|
(147)
|
Basic and Diluted
earnings per common share
|
|
$
|
0.00
|
$
|
0.02
|
|
|
|
|
|
|
Consolidated Statements
of Cash Flows
Three-month periods ended July 31, 2022 and 2021
(Unaudited)
(In thousands of Canadian dollars)
|
|
|
July 31,
2022
|
July 31,
2021
|
Cash flows from
operating activities:
|
|
|
|
|
|
Net profit
|
|
$
|
40
|
$
|
244
|
Adjustments
for:
|
|
|
|
|
|
Depreciation of
property and equipment and right-of-use-assets
|
|
|
430
|
|
543
|
Amortization of
deferred development costs
|
|
|
102
|
|
54
|
Amortization of
other intangible assets
|
|
|
396
|
|
411
|
Interest expense
(income) and foreign exchange (gain) loss
|
|
|
25
|
|
115
|
Unrealized foreign
exchange and other
|
|
|
(372)
|
|
1,261
|
Non-refundable tax
credits
|
|
|
(421)
|
|
(366)
|
Stock-based
compensation
|
|
|
476
|
|
354
|
Income
taxes
|
|
|
25
|
|
693
|
Net cash from operating
activities excluding changes in non-cash
working capital items related to operations
|
|
|
701
|
|
3,309
|
Accounts
receivable
|
|
|
(543)
|
|
(2,492)
|
Work in
progress
|
|
|
(954)
|
|
(547)
|
Other
receivables
|
|
|
(335)
|
|
(34)
|
Tax credits
|
|
|
(1,048)
|
|
(910)
|
Inventory
|
|
|
(255)
|
|
(12)
|
Prepaid
expenses
|
|
|
(562)
|
|
(465)
|
Contract acquisition
costs
|
|
|
(253)
|
|
128
|
Accounts payable and
accrued liabilities
|
|
|
(3,012)
|
|
(3,933)
|
Deferred
revenue
|
|
|
1,238
|
|
(59)
|
Changes in non-cash
working capital items related to operations
|
|
|
(5,724)
|
|
(8,324)
|
Net cash used in
operating activities
|
|
|
(5,023)
|
|
(5,015)
|
Cash flows from
financing activities:
|
|
|
|
|
|
Repayment of long-term
debt
|
|
|
(300)
|
|
(312)
|
Payment of lease
obligations
|
|
|
(244)
|
|
(231)
|
Interest paid
|
|
|
(119)
|
|
(161)
|
Issuance of common
shares on exercise of stock options
|
|
|
62
|
|
-
|
Net cash used in
financing activities
|
|
|
(601)
|
|
(704)
|
Cash flows from
investing activities:
|
|
|
|
|
|
Interest received
|
|
|
104
|
|
40
|
Acquisitions of
property and equipment
|
|
|
(60)
|
|
(230)
|
Acquisitions of
other intangible assets
|
|
|
-
|
|
(15)
|
Deferred development costs
|
|
|
(209)
|
|
(486)
|
Net cash used in
investing activities
|
|
|
(165)
|
|
(691)
|
Net decrease in cash
and cash equivalents during the period
|
|
|
(5,789)
|
|
(6,410)
|
Cash and cash
equivalents - beginning of period
|
|
|
23,004
|
|
25,752
|
Cash and cash
equivalents - end of period
|
|
$
|
17,215
|
$
|
19,342
|
Consolidated Statements
of Changes in Equity
Three-month periods
ended July 31, 2022 and 2021
(Unaudited)
(In thousands of Canadian dollars, except number of
shares)
|
|
|
|
Share
capital
|
Contributed
surplus
|
Accumulated
other
comprehensive
income (loss)
|
Retained
earnings
|
Total
|
|
|
Number
|
|
Amount
|
Balance, May 1,
2022
|
|
14,562,895
|
$
|
43,973
|
$
|
13,176
|
$
|
(1,434)
|
$
|
12,968
|
$
|
68,683
|
Net profit
|
|
-
|
|
-
|
|
-
|
|
-
|
|
40
|
|
40
|
Other comprehensive
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
Effective portion of
changes in fair
value on designated revenue
hedges
|
|
-
|
|
-
|
|
-
|
|
154
|
|
-
|
|
154
|
Exchange difference on
translation
of foreign operations
|
|
-
|
|
-
|
|
-
|
|
(304)
|
|
-
|
|
(304)
|
Total comprehensive
income
|
|
|
|
|
|
|
|
(150)
|
|
40
|
|
(110)
|
Stock-based
Compensation
|
|
-
|
|
-
|
|
476
|
|
-
|
|
-
|
|
476
|
Dividends to equity
owners
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(1,020)
|
|
(1,020)
|
Share options
exercised
|
|
3,994
|
|
76
|
|
(14)
|
|
-
|
|
-
|
|
62
|
Total transactions
with owners of
the Company
|
|
3,994
|
|
76
|
|
462
|
|
-
|
|
(1,020)
|
|
(482)
|
Balance, July 31,
2022
|
|
14,566,889
|
$
|
44,049
|
$
|
13,638
|
$
|
(1,584)
|
$
|
11,988
|
$
|
68,091
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, May 1,
2021
|
|
14,505,095
|
$
|
42,700
|
$
|
11,745
|
$
|
226
|
$
|
12,419
|
$
|
67,090
|
Net profit
|
|
-
|
|
-
|
|
-
|
|
-
|
|
244
|
|
244
|
Other comprehensive
income:
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Effective portion of
changes in fair
value on designated revenue
hedges
|
|
-
|
|
-
|
|
-
|
|
(358)
|
|
-
|
|
(358)
|
Exchange difference on
translation
of foreign operations
|
|
-
|
|
-
|
|
-
|
|
(33)
|
|
-
|
|
(33)
|
Total comprehensive
income
|
|
-
|
|
-
|
|
-
|
|
(391)
|
|
244
|
|
(147)
|
Stock-based
Compensation
|
|
|
|
-
|
|
354
|
|
-
|
|
-
|
|
354
|
Dividends to equity
owners
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(943)
|
|
(943)
|
Total transactions
with owners of
the Company
|
|
-
|
|
-
|
|
354
|
|
-
|
|
(943)
|
|
(589)
|
Balance, July 31,
2021
|
|
14,505,095
|
$
|
42,700
|
$
|
12,099
|
$
|
(165)
|
$
|
11,720
|
$
|
66,354
|
SOURCE Tecsys Inc.