Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil Hydroworld Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Simulations Plus Reports Second Quarter Fiscal 2023 Financial Results By: Simulations Plus, Inc. via Business Wire April 05, 2023 at 16:06 PM EDT Total revenue of $15.8 million; Diluted Earnings Per Share (EPS) of $0.20; Maintains full-year revenue guidance of $59.3 - $62.0 million (+10-15%) and EPS Guidance of $0.63 - $0.67 Simulations Plus, Inc. (Nasdaq: SLP), a leading provider of modeling and simulation software and services for pharmaceutical safety and efficacy, today reported financial results for its second quarter of fiscal 2023, ended February 28, 2023. Second Quarter Financial Highlights (Fiscal 2023 vs. Fiscal 2022) Total revenue increased 6% to $15.8 million; Software revenue increased 7% to $10.5 million, representing 67% of total revenue; Services revenue increased 4% to $5.3 million, representing 33% of total revenue; Gross profit increased 10% to $13.1 million; gross margin was 83%; Net income of $4.2 million and diluted EPS of $0.20, compared to net income of $4.4 million and diluted EPS of $0.21; Adjusted EBITDA of $6.2 million, representing 40% of total revenue. YTD Financial Highlights (Fiscal 2023 vs. Fiscal 2022) Total revenue increased 2% to $27.7 million; Software revenue decreased 3% to $16.6 million, representing 60% of total revenue; Services revenue increased 11% to $11.2 million, representing 40% of total revenue; Gross profit increased 4% to $22.4 million; gross margin was 81%; Net income of $5.4 million and diluted EPS of $0.26, compared to net income of $7.4 million and diluted EPS of $0.36; Adjusted EBITDA of $9.2 million, representing 33% of total revenue. Management Commentary Shawn O’Connor, chief executive officer of Simulations Plus, said: “We were pleased to see revenue growth return in the second quarter, increasing 6% on a reported basis and 8% on a constant currency basis, as compared to the same period last year, with higher gross margins. The renewal harmonization initiative we implemented to simplify and align software product renewals according to each customer is progressing as planned, and as a result, we are driving improved cross-selling across our organization and readjusting the seasonality impact to a more normal cadence. We also successfully navigated some extensions by certain potential customers in the sales cycle on the software side, while our services business delivered strong growth in the PBPK and PKPD segments. “Simultaneously, we continued to grow our team during the quarter by recruiting and signing strong candidates with expertise in software and biology to help us accelerate our penetration in key markets. Our ability to successfully recruit professionals with unique and valuable skillsets, especially in this challenging labor market, is a validation of our strength and the value we bring to the industry. These expert consultants allow us to meet the robust and growing demand for our services. “As part of our updated capital allocation strategy that we detailed last quarter, we began our $20 million accelerated share repurchase program during the quarter, which we expect to complete during our third quarter. Finally, while the global geopolitical and macroeconomic environments have impacted certain customers, our business remains strong and we remain on target to hit our full-year guidance. We expect to continue to see results from our cross-selling efforts and the streamlining of our renewal process,” concluded O’Connor. Fiscal 2023 Guidance and Commentary Fiscal 2023 Guidance Annual Increase Revenue $59.3M - 62.0M 10-15% Software mix 60-65% — Services mix 35-40% — Diluted earnings per share $0.63-$0.67 5-10% Quarterly Dividend The company’s Board of Directors declared a cash dividend of $0.06 per share of the company’s common stock, payable on May 1, 2023, to shareholders of record as of April 24, 2023. The declaration of any future dividends will be determined by the Board of Directors each quarter and will depend on earnings, financial condition, capital requirements, and other factors. Environmental, Social, and Governance (ESG) We focus our Environmental, Social, and Governance (ESG) efforts where we can have the most positive impact. To learn more about our latest initiatives and priorities, please visit our ESG website. Webcast and Conference Call Details Shawn O’Connor, chief executive officer, and Will Frederick, chief financial officer, will host a conference call and webcast today at 5 p.m. Eastern Daylight Time to discuss details of the company’s performance for the quarter and certain forward-looking information. The call may be accessed by registering here or by calling 1-201-389-0879. The webcast will be available on our website under Conference Calls & Presentations. A replay of the webcast will be available on the website approximately one hour following the call. Non-GAAP Definition Adjusted EBITDA is defined as earnings (loss) before interest, taxes, depreciation and amortization, stock-based compensation, and any acquisition or financial transaction-related expenses. Adjusted EBITDA represents a measure that we believe is customarily used by investors and analysts to evaluate the financial performance of companies in addition to the GAAP measures that we present. Our management also believes that Adjusted EBITDA is useful in evaluating our core operating results. However, Adjusted EBITDA is not a measure of financial performance under accounting principles generally accepted in the United States of America and should not be considered an alternative to net income or operating income as an indicator of our operating performance or to net cash provided by operating activities as a measure of our liquidity. The company’s Adjusted EBITDA measure may not provide information that is directly comparable to that provided by other companies in its industry, as other companies in its industry may calculate non-GAAP financial results differently, particularly related to nonrecurring, unusual items. About Simulations Plus Serving clients worldwide for more than 25 years, Simulations Plus is a leading provider in the biosimulation market providing software and consulting services supporting drug discovery, development, research, and regulatory submissions. We offer solutions that bridge artificial intelligence (AI)/machine learning, physiologically based pharmacokinetics, quantitative systems pharmacology/toxicology, and population PK/PD modeling approaches. Our technology is licensed and applied by major pharmaceutical, biotechnology, and regulatory agencies worldwide. For more information, visit our website at www.simulations-plus.com. Follow us on LinkedIn | Twitter | YouTube. Forward-Looking Statements Except for historical information, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties. Words like “believe,” “expect,” and “anticipate” mean that these are our best estimates as of this writing, but there can be no assurances that expected or anticipated results or events will actually take place, so our actual future results could differ significantly from those statements. Factors that could cause or contribute to such differences include, but are not limited to: our ability to maintain our competitive advantages, acceptance of new software and improved versions of our existing software by our customers, the general economics of the pharmaceutical industry, our ability to finance growth, our ability to continue to attract and retain highly qualified technical staff, our ability to identify and close acquisitions on terms favorable to the company, market conditions, macroeconomic factors, and a sustainable market. Further information on our risk factors is contained in our quarterly and annual reports and filed with the U.S. Securities and Exchange Commission. SIMULATIONS PLUS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME For the three and six months ended February 28, 2023 and 2022 (Unaudited) Three Months Ended Six Months Ended (in thousands, except per common share amounts) 2023 2022 2023 2022 Revenues Software $ 10,487 $ 9,758 $ 16,561 $ 17,120 Services 5,263 5,038 11,153 10,093 Total revenues 15,750 14,796 27,714 27,213 Cost of revenues Software 843 780 1,728 1,515 Services 1,777 2,050 3,563 4,071 Total cost of revenues 2,620 2,830 5,291 5,586 Gross profit 13,130 11,966 22,423 21,627 Operating expenses Research and development 1,317 902 2,483 1,784 Selling, general, and administrative 7,779 5,584 15,028 10,572 Total operating expenses 9,096 6,486 17,511 12,356 Income from operations 4,034 5,480 4,912 9,271 Other income, net 1,034 53 1,774 118 Income before income taxes 5,068 5,533 6,686 9,389 Provision for income taxes (894 ) (1,124 ) (1,267 ) (1,954 ) Net income $ 4,174 $ 4,409 $ 5,419 $ 7,435 Earnings per share Basic $ 0.21 $ 0.22 $ 0.27 $ 0.37 Diluted $ 0.20 $ 0.21 $ 0.26 $ 0.36 Weighted-average common shares outstanding Basic 20,112 20,177 20,200 20,164 Diluted 20,529 20,745 20,657 20,738 Other comprehensive (loss) income, net of tax Foreign currency translation adjustments (23 ) (38 ) 30 (275 ) Comprehensive income $ 4,151 $ 4,371 $ 5,449 $ 7,160 SIMULATIONS PLUS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Audited) (in thousands, except share and per share amounts) February 28, 2023 August 31, 2022 ASSETS Current assets Cash and cash equivalents $ 39,292 $ 51,567 Accounts receivable, net of allowance for doubtful accounts of $12 and $12 11,398 13,787 Prepaid income taxes 397 1,391 Prepaid expenses and other current assets 4,335 3,377 Short-term investments 76,052 76,668 Total current assets 131,474 146,790 Long-term assets Capitalized computer software development costs, net of accumulated amortization of $16,455 and $15,672 10,501 9,563 Property and equipment, net 822 632 Operating lease right-of-use assets 1,190 1,420 Intellectual property, net of accumulated amortization of $8,552 and $7,928 8,358 9,057 Other intangible assets, net of accumulated amortization of $1,812 and $2,662 7,387 7,560 Goodwill 12,921 12,921 Other assets 548 439 Total assets $ 173,201 $ 188,382 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable $ 350 $ 225 Accrued compensation 2,635 3,254 Accrued expenses 535 931 Operating lease liability - current portion 432 461 Deferred revenue 2,050 2,864 Total current liabilities 6,002 7,735 Long-term liabilities Deferred income taxes, net 1,859 1,456 Operating lease liability 747 943 Total liabilities 8,608 10,134 Commitments and contingencies — — Shareholders' equity Preferred stock, $0.001 par value - 10,000,000 shares authorized; no shares issued and outstanding $ — $ — Common stock, $0.001 par value and additional paid-in capital —50,000,000 shares authorized; 19,930,623 and 20,260,070 shares issued and outstanding 137,821 138,512 Retained earnings 27,050 40,044 Accumulated other comprehensive loss (278 ) (308 ) Total shareholders' equity 164,593 178,248 Total liabilities and shareholders' equity $ 173,201 $ 188,382 SIMULATIONS PLUS, INC. Trended Financial Information* (Unaudited) (in millions except earnings per share amounts) FY 2022 FY 2023 2022 2023 Q1 Q2 Q3 Q4 Q1 Q2 FY FY Revenue Software $ 7.4 $ 9.8 $ 9.6 $ 5.9 $ 6.1 $ 10.5 $ 32.7 $ 16.6 Services 5.0 5.0 5.3 5.8 5.9 5.3 21.2 11.2 Total $ 12.4 $ 14.8 $ 15.0 $ 11.7 $ 12.0 $ 15.8 $ 53.9 $ 27.7 Gross Margin Software 90.0 % 92.0 % 92.4 % 86.1 % 85.4 % 92.0 % 90.6 % 89.6 % Services 60.0 % 59.3 % 65.6 % 68.2 % 69.7 % 66.2 % 63.5 % 68.1 % Total 77.8 % 80.9 % 82.9 % 77.2 % 77.7 % 83.4 % 79.9 % 80.9 % Income from operations $ 3.8 $ 5.5 $ 4.9 $ 0.7 $ 0.9 $ 4.0 $ 14.9 $ 4.9 Operating Margin 30.6 % 37.0 % 33.1 % 5.9 % 7.3 % 25.6 % 27.7 % 17.7 % Net Income $ 3.0 $ 4.4 $ 4.1 $ 1.0 $ 1.2 $ 4.2 $ 12.5 $ 5.4 Diluted Earnings Per Share $ 0.15 $ 0.21 $ 0.20 $ 0.05 $ 0.06 $ 0.20 $ 0.60 $ 0.26 Adjusted EBITDA $ 5.3 $ 7.2 $ 6.3 $ 2.3 $ 3.0 $ 6.2 $ 21.0 $ 9.2 Cash Flow from Operations $ 3.6 $ 2.6 $ 3.8 $ 7.9 $ 4.7 $ 5.5 $ 17.9 $ 10.2 Revenue Breakdown by Region Americas $ 8.5 $ 9.7 $ 11.2 $ 8.4 $ 8.5 $ 10.6 $ 37.7 $ 19.1 EMEA 3.0 3.7 1.9 1.7 2.1 3.6 10.4 5.7 Asia Pacific 0.9 1.4 1.9 1.6 1.3 1.5 5.8 2.9 Total $ 12.4 $ 14.8 $ 15.0 $ 11.7 $ 12.0 $ 15.8 $ 53.9 $ 27.7 Software Performance Metrics Average Revenue per Customer (in 000s) Commercial $ 71.0 $ 101.0 $ 95.0 $ 65.0 $ 68.0 $ 110.0 Services Performance Metrics Backlog $ 15.4 $ 17.0 $ 16.7 $ 15.9 $ 15.8 $ 15.4 *Numbers may not add due to rounding SIMULATIONS PLUS, INC. Reconciliation of Adjusted EBITDA to Net Income* (Unaudited) FY 2022 FY 2023 2022 2023 (in millions) Q1 Q2 Q3 Q4 Q1 Q2 FY FY Net Income $ 3.0 $ 4.4 $ 4.1 $ 1.0 $ 1.2 $ 4.2 $ 12.5 $ 5.4 Excluding: Interest income and expense, net (0.1 ) (0.1 ) (0.1 ) (0.4 ) (0.8 ) (1.0 ) (0.7 ) (1.8 ) Provision for income taxes 0.8 1.1 0.7 (0.1 ) 0.4 0.9 2.6 1.3 Depreciation and amortization 0.8 1.0 0.9 0.9 0.9 0.9 3.6 1.9 Stock-based compensation 0.6 0.7 0.7 0.7 0.9 1.2 2.7 2.0 Mergers & Acquisitions expense — — — 0.3 0.3 0.1 0.3 0.4 Adjusted EBITDA $ 5.3 $ 7.2 $ 6.3 $ 2.3 $ 3.0 $ 6.2 $ 21.0 $ 9.2 *Numbers may not add due to rounding View source version on businesswire.com: https://www.businesswire.com/news/home/20230405005408/en/Contacts Investor Relations Contacts: Brian Siegel, IRC, MBA Senior Managing Director Hayden IR 346-396-8696 brian@haydenir.com Renee Bouche Simulations Plus Investor Relations 661-723-7723 renee.bouche@simulations-plus.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
Simulations Plus Reports Second Quarter Fiscal 2023 Financial Results By: Simulations Plus, Inc. via Business Wire April 05, 2023 at 16:06 PM EDT Total revenue of $15.8 million; Diluted Earnings Per Share (EPS) of $0.20; Maintains full-year revenue guidance of $59.3 - $62.0 million (+10-15%) and EPS Guidance of $0.63 - $0.67 Simulations Plus, Inc. (Nasdaq: SLP), a leading provider of modeling and simulation software and services for pharmaceutical safety and efficacy, today reported financial results for its second quarter of fiscal 2023, ended February 28, 2023. Second Quarter Financial Highlights (Fiscal 2023 vs. Fiscal 2022) Total revenue increased 6% to $15.8 million; Software revenue increased 7% to $10.5 million, representing 67% of total revenue; Services revenue increased 4% to $5.3 million, representing 33% of total revenue; Gross profit increased 10% to $13.1 million; gross margin was 83%; Net income of $4.2 million and diluted EPS of $0.20, compared to net income of $4.4 million and diluted EPS of $0.21; Adjusted EBITDA of $6.2 million, representing 40% of total revenue. YTD Financial Highlights (Fiscal 2023 vs. Fiscal 2022) Total revenue increased 2% to $27.7 million; Software revenue decreased 3% to $16.6 million, representing 60% of total revenue; Services revenue increased 11% to $11.2 million, representing 40% of total revenue; Gross profit increased 4% to $22.4 million; gross margin was 81%; Net income of $5.4 million and diluted EPS of $0.26, compared to net income of $7.4 million and diluted EPS of $0.36; Adjusted EBITDA of $9.2 million, representing 33% of total revenue. Management Commentary Shawn O’Connor, chief executive officer of Simulations Plus, said: “We were pleased to see revenue growth return in the second quarter, increasing 6% on a reported basis and 8% on a constant currency basis, as compared to the same period last year, with higher gross margins. The renewal harmonization initiative we implemented to simplify and align software product renewals according to each customer is progressing as planned, and as a result, we are driving improved cross-selling across our organization and readjusting the seasonality impact to a more normal cadence. We also successfully navigated some extensions by certain potential customers in the sales cycle on the software side, while our services business delivered strong growth in the PBPK and PKPD segments. “Simultaneously, we continued to grow our team during the quarter by recruiting and signing strong candidates with expertise in software and biology to help us accelerate our penetration in key markets. Our ability to successfully recruit professionals with unique and valuable skillsets, especially in this challenging labor market, is a validation of our strength and the value we bring to the industry. These expert consultants allow us to meet the robust and growing demand for our services. “As part of our updated capital allocation strategy that we detailed last quarter, we began our $20 million accelerated share repurchase program during the quarter, which we expect to complete during our third quarter. Finally, while the global geopolitical and macroeconomic environments have impacted certain customers, our business remains strong and we remain on target to hit our full-year guidance. We expect to continue to see results from our cross-selling efforts and the streamlining of our renewal process,” concluded O’Connor. Fiscal 2023 Guidance and Commentary Fiscal 2023 Guidance Annual Increase Revenue $59.3M - 62.0M 10-15% Software mix 60-65% — Services mix 35-40% — Diluted earnings per share $0.63-$0.67 5-10% Quarterly Dividend The company’s Board of Directors declared a cash dividend of $0.06 per share of the company’s common stock, payable on May 1, 2023, to shareholders of record as of April 24, 2023. The declaration of any future dividends will be determined by the Board of Directors each quarter and will depend on earnings, financial condition, capital requirements, and other factors. Environmental, Social, and Governance (ESG) We focus our Environmental, Social, and Governance (ESG) efforts where we can have the most positive impact. To learn more about our latest initiatives and priorities, please visit our ESG website. Webcast and Conference Call Details Shawn O’Connor, chief executive officer, and Will Frederick, chief financial officer, will host a conference call and webcast today at 5 p.m. Eastern Daylight Time to discuss details of the company’s performance for the quarter and certain forward-looking information. The call may be accessed by registering here or by calling 1-201-389-0879. The webcast will be available on our website under Conference Calls & Presentations. A replay of the webcast will be available on the website approximately one hour following the call. Non-GAAP Definition Adjusted EBITDA is defined as earnings (loss) before interest, taxes, depreciation and amortization, stock-based compensation, and any acquisition or financial transaction-related expenses. Adjusted EBITDA represents a measure that we believe is customarily used by investors and analysts to evaluate the financial performance of companies in addition to the GAAP measures that we present. Our management also believes that Adjusted EBITDA is useful in evaluating our core operating results. However, Adjusted EBITDA is not a measure of financial performance under accounting principles generally accepted in the United States of America and should not be considered an alternative to net income or operating income as an indicator of our operating performance or to net cash provided by operating activities as a measure of our liquidity. The company’s Adjusted EBITDA measure may not provide information that is directly comparable to that provided by other companies in its industry, as other companies in its industry may calculate non-GAAP financial results differently, particularly related to nonrecurring, unusual items. About Simulations Plus Serving clients worldwide for more than 25 years, Simulations Plus is a leading provider in the biosimulation market providing software and consulting services supporting drug discovery, development, research, and regulatory submissions. We offer solutions that bridge artificial intelligence (AI)/machine learning, physiologically based pharmacokinetics, quantitative systems pharmacology/toxicology, and population PK/PD modeling approaches. Our technology is licensed and applied by major pharmaceutical, biotechnology, and regulatory agencies worldwide. For more information, visit our website at www.simulations-plus.com. Follow us on LinkedIn | Twitter | YouTube. Forward-Looking Statements Except for historical information, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties. Words like “believe,” “expect,” and “anticipate” mean that these are our best estimates as of this writing, but there can be no assurances that expected or anticipated results or events will actually take place, so our actual future results could differ significantly from those statements. Factors that could cause or contribute to such differences include, but are not limited to: our ability to maintain our competitive advantages, acceptance of new software and improved versions of our existing software by our customers, the general economics of the pharmaceutical industry, our ability to finance growth, our ability to continue to attract and retain highly qualified technical staff, our ability to identify and close acquisitions on terms favorable to the company, market conditions, macroeconomic factors, and a sustainable market. Further information on our risk factors is contained in our quarterly and annual reports and filed with the U.S. Securities and Exchange Commission. SIMULATIONS PLUS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME For the three and six months ended February 28, 2023 and 2022 (Unaudited) Three Months Ended Six Months Ended (in thousands, except per common share amounts) 2023 2022 2023 2022 Revenues Software $ 10,487 $ 9,758 $ 16,561 $ 17,120 Services 5,263 5,038 11,153 10,093 Total revenues 15,750 14,796 27,714 27,213 Cost of revenues Software 843 780 1,728 1,515 Services 1,777 2,050 3,563 4,071 Total cost of revenues 2,620 2,830 5,291 5,586 Gross profit 13,130 11,966 22,423 21,627 Operating expenses Research and development 1,317 902 2,483 1,784 Selling, general, and administrative 7,779 5,584 15,028 10,572 Total operating expenses 9,096 6,486 17,511 12,356 Income from operations 4,034 5,480 4,912 9,271 Other income, net 1,034 53 1,774 118 Income before income taxes 5,068 5,533 6,686 9,389 Provision for income taxes (894 ) (1,124 ) (1,267 ) (1,954 ) Net income $ 4,174 $ 4,409 $ 5,419 $ 7,435 Earnings per share Basic $ 0.21 $ 0.22 $ 0.27 $ 0.37 Diluted $ 0.20 $ 0.21 $ 0.26 $ 0.36 Weighted-average common shares outstanding Basic 20,112 20,177 20,200 20,164 Diluted 20,529 20,745 20,657 20,738 Other comprehensive (loss) income, net of tax Foreign currency translation adjustments (23 ) (38 ) 30 (275 ) Comprehensive income $ 4,151 $ 4,371 $ 5,449 $ 7,160 SIMULATIONS PLUS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Audited) (in thousands, except share and per share amounts) February 28, 2023 August 31, 2022 ASSETS Current assets Cash and cash equivalents $ 39,292 $ 51,567 Accounts receivable, net of allowance for doubtful accounts of $12 and $12 11,398 13,787 Prepaid income taxes 397 1,391 Prepaid expenses and other current assets 4,335 3,377 Short-term investments 76,052 76,668 Total current assets 131,474 146,790 Long-term assets Capitalized computer software development costs, net of accumulated amortization of $16,455 and $15,672 10,501 9,563 Property and equipment, net 822 632 Operating lease right-of-use assets 1,190 1,420 Intellectual property, net of accumulated amortization of $8,552 and $7,928 8,358 9,057 Other intangible assets, net of accumulated amortization of $1,812 and $2,662 7,387 7,560 Goodwill 12,921 12,921 Other assets 548 439 Total assets $ 173,201 $ 188,382 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable $ 350 $ 225 Accrued compensation 2,635 3,254 Accrued expenses 535 931 Operating lease liability - current portion 432 461 Deferred revenue 2,050 2,864 Total current liabilities 6,002 7,735 Long-term liabilities Deferred income taxes, net 1,859 1,456 Operating lease liability 747 943 Total liabilities 8,608 10,134 Commitments and contingencies — — Shareholders' equity Preferred stock, $0.001 par value - 10,000,000 shares authorized; no shares issued and outstanding $ — $ — Common stock, $0.001 par value and additional paid-in capital —50,000,000 shares authorized; 19,930,623 and 20,260,070 shares issued and outstanding 137,821 138,512 Retained earnings 27,050 40,044 Accumulated other comprehensive loss (278 ) (308 ) Total shareholders' equity 164,593 178,248 Total liabilities and shareholders' equity $ 173,201 $ 188,382 SIMULATIONS PLUS, INC. Trended Financial Information* (Unaudited) (in millions except earnings per share amounts) FY 2022 FY 2023 2022 2023 Q1 Q2 Q3 Q4 Q1 Q2 FY FY Revenue Software $ 7.4 $ 9.8 $ 9.6 $ 5.9 $ 6.1 $ 10.5 $ 32.7 $ 16.6 Services 5.0 5.0 5.3 5.8 5.9 5.3 21.2 11.2 Total $ 12.4 $ 14.8 $ 15.0 $ 11.7 $ 12.0 $ 15.8 $ 53.9 $ 27.7 Gross Margin Software 90.0 % 92.0 % 92.4 % 86.1 % 85.4 % 92.0 % 90.6 % 89.6 % Services 60.0 % 59.3 % 65.6 % 68.2 % 69.7 % 66.2 % 63.5 % 68.1 % Total 77.8 % 80.9 % 82.9 % 77.2 % 77.7 % 83.4 % 79.9 % 80.9 % Income from operations $ 3.8 $ 5.5 $ 4.9 $ 0.7 $ 0.9 $ 4.0 $ 14.9 $ 4.9 Operating Margin 30.6 % 37.0 % 33.1 % 5.9 % 7.3 % 25.6 % 27.7 % 17.7 % Net Income $ 3.0 $ 4.4 $ 4.1 $ 1.0 $ 1.2 $ 4.2 $ 12.5 $ 5.4 Diluted Earnings Per Share $ 0.15 $ 0.21 $ 0.20 $ 0.05 $ 0.06 $ 0.20 $ 0.60 $ 0.26 Adjusted EBITDA $ 5.3 $ 7.2 $ 6.3 $ 2.3 $ 3.0 $ 6.2 $ 21.0 $ 9.2 Cash Flow from Operations $ 3.6 $ 2.6 $ 3.8 $ 7.9 $ 4.7 $ 5.5 $ 17.9 $ 10.2 Revenue Breakdown by Region Americas $ 8.5 $ 9.7 $ 11.2 $ 8.4 $ 8.5 $ 10.6 $ 37.7 $ 19.1 EMEA 3.0 3.7 1.9 1.7 2.1 3.6 10.4 5.7 Asia Pacific 0.9 1.4 1.9 1.6 1.3 1.5 5.8 2.9 Total $ 12.4 $ 14.8 $ 15.0 $ 11.7 $ 12.0 $ 15.8 $ 53.9 $ 27.7 Software Performance Metrics Average Revenue per Customer (in 000s) Commercial $ 71.0 $ 101.0 $ 95.0 $ 65.0 $ 68.0 $ 110.0 Services Performance Metrics Backlog $ 15.4 $ 17.0 $ 16.7 $ 15.9 $ 15.8 $ 15.4 *Numbers may not add due to rounding SIMULATIONS PLUS, INC. Reconciliation of Adjusted EBITDA to Net Income* (Unaudited) FY 2022 FY 2023 2022 2023 (in millions) Q1 Q2 Q3 Q4 Q1 Q2 FY FY Net Income $ 3.0 $ 4.4 $ 4.1 $ 1.0 $ 1.2 $ 4.2 $ 12.5 $ 5.4 Excluding: Interest income and expense, net (0.1 ) (0.1 ) (0.1 ) (0.4 ) (0.8 ) (1.0 ) (0.7 ) (1.8 ) Provision for income taxes 0.8 1.1 0.7 (0.1 ) 0.4 0.9 2.6 1.3 Depreciation and amortization 0.8 1.0 0.9 0.9 0.9 0.9 3.6 1.9 Stock-based compensation 0.6 0.7 0.7 0.7 0.9 1.2 2.7 2.0 Mergers & Acquisitions expense — — — 0.3 0.3 0.1 0.3 0.4 Adjusted EBITDA $ 5.3 $ 7.2 $ 6.3 $ 2.3 $ 3.0 $ 6.2 $ 21.0 $ 9.2 *Numbers may not add due to rounding View source version on businesswire.com: https://www.businesswire.com/news/home/20230405005408/en/Contacts Investor Relations Contacts: Brian Siegel, IRC, MBA Senior Managing Director Hayden IR 346-396-8696 brian@haydenir.com Renee Bouche Simulations Plus Investor Relations 661-723-7723 renee.bouche@simulations-plus.com
Total revenue of $15.8 million; Diluted Earnings Per Share (EPS) of $0.20; Maintains full-year revenue guidance of $59.3 - $62.0 million (+10-15%) and EPS Guidance of $0.63 - $0.67
Simulations Plus, Inc. (Nasdaq: SLP), a leading provider of modeling and simulation software and services for pharmaceutical safety and efficacy, today reported financial results for its second quarter of fiscal 2023, ended February 28, 2023. Second Quarter Financial Highlights (Fiscal 2023 vs. Fiscal 2022) Total revenue increased 6% to $15.8 million; Software revenue increased 7% to $10.5 million, representing 67% of total revenue; Services revenue increased 4% to $5.3 million, representing 33% of total revenue; Gross profit increased 10% to $13.1 million; gross margin was 83%; Net income of $4.2 million and diluted EPS of $0.20, compared to net income of $4.4 million and diluted EPS of $0.21; Adjusted EBITDA of $6.2 million, representing 40% of total revenue. YTD Financial Highlights (Fiscal 2023 vs. Fiscal 2022) Total revenue increased 2% to $27.7 million; Software revenue decreased 3% to $16.6 million, representing 60% of total revenue; Services revenue increased 11% to $11.2 million, representing 40% of total revenue; Gross profit increased 4% to $22.4 million; gross margin was 81%; Net income of $5.4 million and diluted EPS of $0.26, compared to net income of $7.4 million and diluted EPS of $0.36; Adjusted EBITDA of $9.2 million, representing 33% of total revenue. Management Commentary Shawn O’Connor, chief executive officer of Simulations Plus, said: “We were pleased to see revenue growth return in the second quarter, increasing 6% on a reported basis and 8% on a constant currency basis, as compared to the same period last year, with higher gross margins. The renewal harmonization initiative we implemented to simplify and align software product renewals according to each customer is progressing as planned, and as a result, we are driving improved cross-selling across our organization and readjusting the seasonality impact to a more normal cadence. We also successfully navigated some extensions by certain potential customers in the sales cycle on the software side, while our services business delivered strong growth in the PBPK and PKPD segments. “Simultaneously, we continued to grow our team during the quarter by recruiting and signing strong candidates with expertise in software and biology to help us accelerate our penetration in key markets. Our ability to successfully recruit professionals with unique and valuable skillsets, especially in this challenging labor market, is a validation of our strength and the value we bring to the industry. These expert consultants allow us to meet the robust and growing demand for our services. “As part of our updated capital allocation strategy that we detailed last quarter, we began our $20 million accelerated share repurchase program during the quarter, which we expect to complete during our third quarter. Finally, while the global geopolitical and macroeconomic environments have impacted certain customers, our business remains strong and we remain on target to hit our full-year guidance. We expect to continue to see results from our cross-selling efforts and the streamlining of our renewal process,” concluded O’Connor. Fiscal 2023 Guidance and Commentary Fiscal 2023 Guidance Annual Increase Revenue $59.3M - 62.0M 10-15% Software mix 60-65% — Services mix 35-40% — Diluted earnings per share $0.63-$0.67 5-10% Quarterly Dividend The company’s Board of Directors declared a cash dividend of $0.06 per share of the company’s common stock, payable on May 1, 2023, to shareholders of record as of April 24, 2023. The declaration of any future dividends will be determined by the Board of Directors each quarter and will depend on earnings, financial condition, capital requirements, and other factors. Environmental, Social, and Governance (ESG) We focus our Environmental, Social, and Governance (ESG) efforts where we can have the most positive impact. To learn more about our latest initiatives and priorities, please visit our ESG website. Webcast and Conference Call Details Shawn O’Connor, chief executive officer, and Will Frederick, chief financial officer, will host a conference call and webcast today at 5 p.m. Eastern Daylight Time to discuss details of the company’s performance for the quarter and certain forward-looking information. The call may be accessed by registering here or by calling 1-201-389-0879. The webcast will be available on our website under Conference Calls & Presentations. A replay of the webcast will be available on the website approximately one hour following the call. Non-GAAP Definition Adjusted EBITDA is defined as earnings (loss) before interest, taxes, depreciation and amortization, stock-based compensation, and any acquisition or financial transaction-related expenses. Adjusted EBITDA represents a measure that we believe is customarily used by investors and analysts to evaluate the financial performance of companies in addition to the GAAP measures that we present. Our management also believes that Adjusted EBITDA is useful in evaluating our core operating results. However, Adjusted EBITDA is not a measure of financial performance under accounting principles generally accepted in the United States of America and should not be considered an alternative to net income or operating income as an indicator of our operating performance or to net cash provided by operating activities as a measure of our liquidity. The company’s Adjusted EBITDA measure may not provide information that is directly comparable to that provided by other companies in its industry, as other companies in its industry may calculate non-GAAP financial results differently, particularly related to nonrecurring, unusual items. About Simulations Plus Serving clients worldwide for more than 25 years, Simulations Plus is a leading provider in the biosimulation market providing software and consulting services supporting drug discovery, development, research, and regulatory submissions. We offer solutions that bridge artificial intelligence (AI)/machine learning, physiologically based pharmacokinetics, quantitative systems pharmacology/toxicology, and population PK/PD modeling approaches. Our technology is licensed and applied by major pharmaceutical, biotechnology, and regulatory agencies worldwide. For more information, visit our website at www.simulations-plus.com. Follow us on LinkedIn | Twitter | YouTube. Forward-Looking Statements Except for historical information, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties. Words like “believe,” “expect,” and “anticipate” mean that these are our best estimates as of this writing, but there can be no assurances that expected or anticipated results or events will actually take place, so our actual future results could differ significantly from those statements. Factors that could cause or contribute to such differences include, but are not limited to: our ability to maintain our competitive advantages, acceptance of new software and improved versions of our existing software by our customers, the general economics of the pharmaceutical industry, our ability to finance growth, our ability to continue to attract and retain highly qualified technical staff, our ability to identify and close acquisitions on terms favorable to the company, market conditions, macroeconomic factors, and a sustainable market. Further information on our risk factors is contained in our quarterly and annual reports and filed with the U.S. Securities and Exchange Commission. SIMULATIONS PLUS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME For the three and six months ended February 28, 2023 and 2022 (Unaudited) Three Months Ended Six Months Ended (in thousands, except per common share amounts) 2023 2022 2023 2022 Revenues Software $ 10,487 $ 9,758 $ 16,561 $ 17,120 Services 5,263 5,038 11,153 10,093 Total revenues 15,750 14,796 27,714 27,213 Cost of revenues Software 843 780 1,728 1,515 Services 1,777 2,050 3,563 4,071 Total cost of revenues 2,620 2,830 5,291 5,586 Gross profit 13,130 11,966 22,423 21,627 Operating expenses Research and development 1,317 902 2,483 1,784 Selling, general, and administrative 7,779 5,584 15,028 10,572 Total operating expenses 9,096 6,486 17,511 12,356 Income from operations 4,034 5,480 4,912 9,271 Other income, net 1,034 53 1,774 118 Income before income taxes 5,068 5,533 6,686 9,389 Provision for income taxes (894 ) (1,124 ) (1,267 ) (1,954 ) Net income $ 4,174 $ 4,409 $ 5,419 $ 7,435 Earnings per share Basic $ 0.21 $ 0.22 $ 0.27 $ 0.37 Diluted $ 0.20 $ 0.21 $ 0.26 $ 0.36 Weighted-average common shares outstanding Basic 20,112 20,177 20,200 20,164 Diluted 20,529 20,745 20,657 20,738 Other comprehensive (loss) income, net of tax Foreign currency translation adjustments (23 ) (38 ) 30 (275 ) Comprehensive income $ 4,151 $ 4,371 $ 5,449 $ 7,160 SIMULATIONS PLUS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Audited) (in thousands, except share and per share amounts) February 28, 2023 August 31, 2022 ASSETS Current assets Cash and cash equivalents $ 39,292 $ 51,567 Accounts receivable, net of allowance for doubtful accounts of $12 and $12 11,398 13,787 Prepaid income taxes 397 1,391 Prepaid expenses and other current assets 4,335 3,377 Short-term investments 76,052 76,668 Total current assets 131,474 146,790 Long-term assets Capitalized computer software development costs, net of accumulated amortization of $16,455 and $15,672 10,501 9,563 Property and equipment, net 822 632 Operating lease right-of-use assets 1,190 1,420 Intellectual property, net of accumulated amortization of $8,552 and $7,928 8,358 9,057 Other intangible assets, net of accumulated amortization of $1,812 and $2,662 7,387 7,560 Goodwill 12,921 12,921 Other assets 548 439 Total assets $ 173,201 $ 188,382 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable $ 350 $ 225 Accrued compensation 2,635 3,254 Accrued expenses 535 931 Operating lease liability - current portion 432 461 Deferred revenue 2,050 2,864 Total current liabilities 6,002 7,735 Long-term liabilities Deferred income taxes, net 1,859 1,456 Operating lease liability 747 943 Total liabilities 8,608 10,134 Commitments and contingencies — — Shareholders' equity Preferred stock, $0.001 par value - 10,000,000 shares authorized; no shares issued and outstanding $ — $ — Common stock, $0.001 par value and additional paid-in capital —50,000,000 shares authorized; 19,930,623 and 20,260,070 shares issued and outstanding 137,821 138,512 Retained earnings 27,050 40,044 Accumulated other comprehensive loss (278 ) (308 ) Total shareholders' equity 164,593 178,248 Total liabilities and shareholders' equity $ 173,201 $ 188,382 SIMULATIONS PLUS, INC. Trended Financial Information* (Unaudited) (in millions except earnings per share amounts) FY 2022 FY 2023 2022 2023 Q1 Q2 Q3 Q4 Q1 Q2 FY FY Revenue Software $ 7.4 $ 9.8 $ 9.6 $ 5.9 $ 6.1 $ 10.5 $ 32.7 $ 16.6 Services 5.0 5.0 5.3 5.8 5.9 5.3 21.2 11.2 Total $ 12.4 $ 14.8 $ 15.0 $ 11.7 $ 12.0 $ 15.8 $ 53.9 $ 27.7 Gross Margin Software 90.0 % 92.0 % 92.4 % 86.1 % 85.4 % 92.0 % 90.6 % 89.6 % Services 60.0 % 59.3 % 65.6 % 68.2 % 69.7 % 66.2 % 63.5 % 68.1 % Total 77.8 % 80.9 % 82.9 % 77.2 % 77.7 % 83.4 % 79.9 % 80.9 % Income from operations $ 3.8 $ 5.5 $ 4.9 $ 0.7 $ 0.9 $ 4.0 $ 14.9 $ 4.9 Operating Margin 30.6 % 37.0 % 33.1 % 5.9 % 7.3 % 25.6 % 27.7 % 17.7 % Net Income $ 3.0 $ 4.4 $ 4.1 $ 1.0 $ 1.2 $ 4.2 $ 12.5 $ 5.4 Diluted Earnings Per Share $ 0.15 $ 0.21 $ 0.20 $ 0.05 $ 0.06 $ 0.20 $ 0.60 $ 0.26 Adjusted EBITDA $ 5.3 $ 7.2 $ 6.3 $ 2.3 $ 3.0 $ 6.2 $ 21.0 $ 9.2 Cash Flow from Operations $ 3.6 $ 2.6 $ 3.8 $ 7.9 $ 4.7 $ 5.5 $ 17.9 $ 10.2 Revenue Breakdown by Region Americas $ 8.5 $ 9.7 $ 11.2 $ 8.4 $ 8.5 $ 10.6 $ 37.7 $ 19.1 EMEA 3.0 3.7 1.9 1.7 2.1 3.6 10.4 5.7 Asia Pacific 0.9 1.4 1.9 1.6 1.3 1.5 5.8 2.9 Total $ 12.4 $ 14.8 $ 15.0 $ 11.7 $ 12.0 $ 15.8 $ 53.9 $ 27.7 Software Performance Metrics Average Revenue per Customer (in 000s) Commercial $ 71.0 $ 101.0 $ 95.0 $ 65.0 $ 68.0 $ 110.0 Services Performance Metrics Backlog $ 15.4 $ 17.0 $ 16.7 $ 15.9 $ 15.8 $ 15.4 *Numbers may not add due to rounding SIMULATIONS PLUS, INC. Reconciliation of Adjusted EBITDA to Net Income* (Unaudited) FY 2022 FY 2023 2022 2023 (in millions) Q1 Q2 Q3 Q4 Q1 Q2 FY FY Net Income $ 3.0 $ 4.4 $ 4.1 $ 1.0 $ 1.2 $ 4.2 $ 12.5 $ 5.4 Excluding: Interest income and expense, net (0.1 ) (0.1 ) (0.1 ) (0.4 ) (0.8 ) (1.0 ) (0.7 ) (1.8 ) Provision for income taxes 0.8 1.1 0.7 (0.1 ) 0.4 0.9 2.6 1.3 Depreciation and amortization 0.8 1.0 0.9 0.9 0.9 0.9 3.6 1.9 Stock-based compensation 0.6 0.7 0.7 0.7 0.9 1.2 2.7 2.0 Mergers & Acquisitions expense — — — 0.3 0.3 0.1 0.3 0.4 Adjusted EBITDA $ 5.3 $ 7.2 $ 6.3 $ 2.3 $ 3.0 $ 6.2 $ 21.0 $ 9.2 *Numbers may not add due to rounding View source version on businesswire.com: https://www.businesswire.com/news/home/20230405005408/en/
Investor Relations Contacts: Brian Siegel, IRC, MBA Senior Managing Director Hayden IR 346-396-8696 brian@haydenir.com Renee Bouche Simulations Plus Investor Relations 661-723-7723 renee.bouche@simulations-plus.com
