CALGARY, AB, March 18, 2021 /CNW/ - Sylogist Ltd.
(TSXV: SYZ) ("Sylogist" or the "Company"), is pleased to announce
the acquisition of Municipal Accounting Systems, Inc. ("MAS"), a
highly regarded, Oklahoma-based
provider of student information management and accounting solutions
to K-12 public school districts. Pursuant to the transaction, which
closed on March 17, 2021, Sylogist,
through its subsidiary Sylogist USA Inc., acquired all of the shares of MAS
for cash consideration of $37.8M
(CDN), subject to working capital adjustments, 50% of which was
paid from cash on hand and the remainder drawn under its existing
credit facility.
MAS was founded in 1985 and has grown to serve nearly 85% of the
Oklahoma K-12 public education market with its integrated Wen-GAGE
platform. The modern SaaS solution includes advanced budgeting and
accounting, comprehensive student information tracking, grading and
scheduling, and lunchroom administration. In its last fiscal year
(ended December 31, 2020), MAS
generated revenues of approximately $7.4
million (CDN) and adjusted EBITDA of approximately
$4.3 million (CDN) while serving
approximately 500 school districts.
Bill Wood, Sylogist's President
and CEO stated: "We are delighted to welcome MAS customers and its
team to Sylogist. MAS is highly complementary to our existing SaaS
K-12 solution and we have identified value-add capabilities within
each platform that can integrate with the other. We are excited to
offer a more feature-rich, scalable and flexible solution to
customers and new school districts throughout North America. Further investments in our
go-to-market strategy will greatly benefit from the leverage this
larger scale and breadth of offering
provides.
As a testament to the strength of its products, great customer
service, and disciplined management, MAS has operated very
profitably and we expect it to be immediately accretive for
Sylogist, growing both our top line revenue and adjusted EBITDA run
rates by approximately 20%.
This strategic acquisition demonstrates our ability to execute
on our commitment to accelerating growth. We identified MAS as a
valuable, strategic target that was under the radar and efficiently
negotiated a win-win transaction," Mr. Wood concluded.
Pam Humphrey, MAS' founder
stated: "I am very happy to see MAS join Sylogist. Although we
weren't looking to sell the company, after we began discussions
with Bill and his team, it quickly became clear that the companies
were a natural fit and the timing was right. I am very comfortable
that the business is in good hands with Sylogist and I'm confident
this provides the right mix of continuity, stability and potential
new product advancements for our customers, which is very important
to me."
Sylogist Expands Credit Facility
Concurrently with the acquisition, Sylogist announces that it
has entered into a binding term sheet with its existing lender to
expand its current credit facility from $40
million (CDN) to $75 million
(CDN), on substantially the same terms as its existing credit
facility.
Bill Wood commented, "Not to be
lost in the exciting news related to acquiring MAS, an expanded
credit facility provides additional resources to readily pursue
other strategic and transformative acquisitions."
Conference Call
Sylogist will be holding a webinar to discuss the MAS
acquisition, expansion of its credit facility, and other recent
developments at 9:30 AM (Mountain Daylight
Time) on Tuesday, March 23rd. Those interested may register
at the following link:
https://us02web.zoom.us/webinar/register/WN_E7cEGAYoSSunu51T1i2ZOA
About Sylogist
Sylogist is a software company that, through strategic
acquisitions, investments and operations management, provides
comprehensive, mission-critical ERP and CRM solutions, including
fund accounting, student information systems case management, grant
management and payroll, to public service
organizations. Sylogist's customers include all levels of
government, nonprofit organizations, non-governmental
organizations, educational institutions as well as public
compliance driven and funded companies. The Company delivers highly
scalable, multi-language, multi-currency software solutions, which
serve the needs of an international clientele.
Full financial statements together with Management's Discussion
and Analysis are available on SEDAR at www.sedar.com
The Company's stock is traded on the TSX Venture Exchange under
the symbol SYZ. Information about Sylogist can be found
at www.sylogist.com.
Forward-looking Statements
Certain statements in this news release may be
forward-looking statements within the meaning of applicable
securities laws and regulations. These statements typically
use words such as expect, believe, estimate, project, anticipate,
plan, may, should, could and would, or the negative of these terms,
variations thereof or similar terminology. Forward-looking
information in this news release includes statements with respect
to integrating technology, benefits to Sylogist's go-to-market
strategy, MAS' expected contribution to Sylogist's financial
performance and growth, and the Company's expanded credit
facility providing the resources for it to execute on strategic
acquisitions. By their very nature, forward-looking statements are
based on assumptions and involve inherent risks and uncertainties,
both general and specific in nature. It is therefore possible that
the beliefs and plans and other forward-looking expectations
expressed herein will not be achieved or will prove inaccurate.
Although Sylogist believes that the expectations reflected in these
forward-looking statements are reasonable, it provides no assurance
that these expectations will prove to have been correct.
Forward-looking information involves risks, uncertainties and other
factors that could cause actual events, results, performance,
prospects and opportunities to differ materially from those
expressed or implied by such forward-looking information, including
headwinds from COVID-19 and economic turmoil, customer delays and
the availability of strategic and transformative acquisitions.
Additional information regarding some of these risks, uncertainties
and other factors may be found under in the management's discussion
and analysis for the three months ended December 31, 2020, and other documents available
on the Company's profile at www.sedar.com. Material assumptions and
factors that could cause actual results to differ materially from
such forward-looking information include Sylogist's ability to
attract and retain customers and to realize on its investments.
Although Sylogist believes that the material assumptions and
factors used in preparing the forward-looking information in this
news release are reasonable, undue reliance should not be placed on
such information, which only applies as of the date of this news
release, and no assurance can be given that such events will occur.
Sylogist disclaims any intention or obligation to update or revise
any forward-looking information, whether as a result of new
information, future events or otherwise, other than as required by
law.
Certain information set out herein may be considered as
"financial outlook" within the meaning of applicable securities
laws. The purpose of this financial outlook is to provide readers
with disclosure regarding Sylogist's reasonable expectations as to
the anticipated results of its proposed business activities for the
periods indicated. Readers are cautioned that the financial outlook
may not be appropriate for other purposes.
Non-GAAP Financial Measures
Adjusted EBITDA is a non-GAAP financial measures: Adjusted
EBITDA is defined as: profit for the period before stock-based
compensation, share-based payments, foreign exchange gains or
losses, interest expense, bargain purchase price on acquisition,
income taxes, acquisition-related costs, depreciation and
amortization.
This news release makes reference to certain non-GAAP
measures. These measures are not recognized measures under Canadian
GAAP, do not have a standardized meaning prescribed by Canadian
GAAP and are therefore may not be comparable to similar measures
presented by other issuers. These measures are provided as
additional information to complement measures under GAAP by
providing further understanding of the Company's expected results
of operations from management's perspective. Accordingly, such
measures should not be considered in isolation nor as a substitute
for analysis of the Company's financial information reported under
Canadian GAAP.
Adjusted EBITDA is provided to investors as alternative
methods for assessing the Company's operating results in a manner
that is focused on the Company's ongoing operations and to provide
a more consistent basis for comparison between periods. These
measures should not be construed as alternatives to net profit
(loss) or cash flow from operating activities determined in
accordance with GAAP as an indicator of the Company's
performance. For further information
regarding non-GAAP measures used by the Company, please refer to
the management's discussion and analysis of the Company, copies of
which are available on Sylogist's SEDAR profile at
www.sedar.com.
- Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release -
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SOURCE Sylogist Ltd.
