TECSYS Inc. (TSX: TCS) an industry-leading supply chain management software company, today announced its results for the second quarter of fiscal year 2019, ended October 31, 2018. The unaudited interim financial statements are prepared in accordance with International Financial Reporting Standards (IFRS). All dollar amounts are expressed in Canadian dollars unless otherwise indicated.
Second Quarter Highlights:
- Total revenue was $18.2 million, in line with $18.1 million for Q2 2018.
- Proprietary products revenue increased 50% to $2.5 million from $1.6 million in Q2 2018.
- Cloud, maintenance and subscription revenue was $6.8 million, a 6% increase from $6.4 million in Q2 2018.
- Professional services revenue was $6.9 million compared with $7.9 million in Q2 2018 which included $1.0 million of deferred professional services revenue due to termination of a contract and its associated future obligations.
- Total gross profit margin was 52%, even with 52% in Q2 2018.
- Operating expenses were $8.7 million, compared to $7.8 million for Q2 2018.
- Profit from operations was $0.8 million compared to $1.6 million for the same period in fiscal 2018.
- EBITDA was $1.4 million, compared to $2.2 million for Q2 2018.
- Total contract value bookings amounted to $16.2 million, up 41% compared to $11.5 million for the same period in fiscal 2018.
- Backlog grew to $51.7 million, compared to $42.4 million at the end of Q2 2018.
- Cash and cash equivalents, as well as redeemable short-term and long-term investments, totaled $21.7 million at the end of Q2 fiscal 2019, compared to $23.5 million at the end of Q4 2018.
“We have achieved record quarterly bookings driven by healthcare base accounts which grew 196% YoY,” said Peter Brereton, President and CEO of TECSYS Inc. “We are off to a good start with our recent acquisition, OrderDynamics. The OrderDynamics platform processed $40M worth of orders during black Friday week, an impressive 144% increase over last year. Our pipeline remains strong and we will focus on capitalizing on our strong market position by growing our sales team and investing in marketing as we look to the second half of the year.”
“The comparison of FY19 Q2 Operating Profit and EBITDA to prior year results is challenging given the impact of (a) $1.0 million of deferred professional services revenue recognized in FY18 Q2 resulting from the contract termination in that prior period and (b) costs related to the acquisition of OrderDynamics and stock-based compensation expenses of $0.2 million recognized in the current period. That said, we are pleased with FY19 Q2 profitability and will continue to invest in sales and marketing and research and development to take advantage of market opportunity” said Mark J. Bentler, Chief Financial Officer.
First Half Fiscal 2019 Highlights:
- Total revenue was $34.5 million, in line with $34.6 million for H2 2018.
- Proprietary products revenue increased 31% to $3.8 million, compared to $2.9 million for H2 2018.
- Cloud, maintenance and subscription revenue was $13.8 million, compared with $13.5 million for Q2 2018.
- Professional services revenue was $13.0 million, compared with $14.0 million in H2 2018.
- Total gross profit margin was even with H2 2018 at 50%.
- Operating expenses were $16.4 million, compared to $15.5 million for Q2 2018.
- Profit from operations was $0.7 million, compared to $1.7 million for the same period in fiscal 2018.
- Profit was $0.6 million or $0.05 per share compared with $1.4 million or $0.11 per share in H2 2018.
- EBITDA was $2.0 million, compared to $2.9 million for H2 2018.
- Total contract value bookings increased 26% to $26.9 million, compared to $21.3 million for H2 2018.
- The Company has increased its dividend to $0.055 per share to be paid on January 11, 2019 to shareholders of record at the close of business on December 21, 2018.
Pursuant to the Canadian Income Tax Act, dividends paid by the Company to Canadian residents are considered to be “eligible” dividends.
Second Quarter 2019 Results Conference Call
Date: November 30, 2018
Time: 8:30 am EST
Phone number: (416) 981-9070 or (888) 224-3715
The call can be replayed until December 7th, 2018 by calling (416) 626-4100 or (800) 558 5253 (access code: 21900462).
View the Q2 FY2019 Financial Statements (PDF, 51K)