MONTREAL, July 05, 2018 (GLOBE NEWSWIRE) -- TECSYS Inc. (TSX:TCS), an industry-leading supply chain management software company, today announced its results for the fourth quarter and full year of fiscal year 2018, ended April 30, 2018. All dollar amounts are expressed in Canadian currency and are prepared in accordance with International Financial Reporting Standards (IFRS).
Fourth Quarter Highlights:
- Total revenue was $18.9 million, 2% higher than $18.4 million for Q4 2017.
- Proprietary products revenue increased 16% to $3.1 million compared to Q4 2017.
- Cloud, maintenance and subscription revenue remained flat at $6.9 million in Q4 of fiscal 2018 and 2017.
- Professional services revenue was $6.5 million, 6% higher than $6.1 million in Q4 2017.
- Total gross profit margin was flat at 51% compared to Q4 2017.
- Operating expenses increased to $7.8 million, compared to $3.3 million for Q4 2017. During the fourth quarter of the prior year, the Company recognized $4.6 million of prior year federal non-refundable R&D tax credits which reduced gross R&D expenditures by a corresponding amount. This is a result of the Company’s increased probability that these tax credits will be used in the future to reduce cash taxes. Excluding the tax credit recognition mentioned above, operating expenses would have remained relatively flat at $7.9 million in Q4 2017.
- Profit from operations was $1.7 million, compared to $6.0 million for the same period in fiscal 2017. Excluding the tax credits recognition mentioned above, profit from operations was $1.4 million in Q4 2017.
- EBITDA was $2.3 million, compared to $6.7 million for Q4 2017. Excluding the tax credit recognition mentioned above, EBITDA was $2.1 million in Q4 2017.
- Profit was $1.8 million or $0.13 per share in Q4 2018 compared to $4.8 million or $0.39 per share for the same period in fiscal 2017.
- Total contract value bookings rose by 33% to $14.7 million, compared to $11.1 million for the same period in fiscal 2017.
- Cash and cash equivalents, as well as redeemable long-term investments, totaled $23.5 million at the end of Q4 of fiscal 2018 compared to $13.5 million at the end of fiscal 2017.
“Fiscal 2018 was very much a year in two parts. In the first half of the year, our results were bolstered by strong bookings in our complex distribution business, offsetting slowness in our U.S. healthcare business. In the second half, our healthcare business began to return to its pre-U.S. election activity. Overall for the year, currency headwinds trimmed revenue by $1.3M and EBITDA by $900K compared to the prior year. Adjusted for currency and the tax adjustment of Q4 Fiscal 17, revenue rose by 5%, while EBITDA rose by 28%,” said Peter Brereton, President and CEO of TECSYS Inc. “As the company enters fiscal 2019 with a steady pipeline, we will remain focused on welcoming the return of healthcare clients and executing on opportunities within our existing vertical markets and customer base, including those with an interest in pharmacy solutions.”
Recently, TECSYS won a design competition from the Supply Chain Advancement Network in Health (SCAN Health) whose mission is to address key problems, challenges and opportunities of high strategic importance for health systems in Canada and around the globe. "We are very pleased that SCAN Health selected TECSYS for the Alberta Health Services' perioperative services design competition," said Mr. Peter Brereton, President and CEO of TECSYS Inc. “This represents additional validation of the TECSYS’ solution to improve the performance of perioperative practices. The judges that assessed the competitive solutions were composed of an international panel operating in the healthcare supply chain space. We expect in-hospital solutions will be a growing part of our business in the upcoming years.”
In thousands of dollars except per share amounts:
| Results from Operations | 3 Months Ended Apr. 30, 2018 | 3 Months Ended Apr. 30, 2017 | 12 Months Ended Apr. 30, 2018 | 12 Months Ended Apr. 30, 2017 | ||||||||
| Total Revenue | $ | 18,908 | $ | 18,447 | $ | 70,718 | $ | 68,447 | ||||
| Gross Profit | $ | 9,565 | $ | 9,384 | $ | 34,875 | $ | 34,196 | ||||
| Gross Margin % | 51 | % | 51 | % | 49 | % | 50 | % | ||||
| Operating Expenses | $ | 7,816 | $ | 3,334 | $ | 30,621 | $ | 26,245 | ||||
| Op Ex as % of Revenue | 41 | % | 18 | % | 43 | % | 38 | % | ||||
| Profit from Operations | $ | 1,749 | $ | 6,050 | $ | 4,254 | $ | 7,951 | ||||
| EBITDA | $ | 2,307 | $ | 6,674 | $ | 6,490 | $ | 10,364 | ||||
| EPS | $ | 0.13 | $ | 0.39 | $ | 0.30 | $ | 0.49 | ||||
| Contract Bookings | $ | 14,731 | $ | 11,102 | $ | 48,100 | $ | 42,628 | ||||
Fiscal 2018 Highlights:
- Revenue for fiscal 2018 was $70.7 million, up 3% from $68.4 million in the previous fiscal year.
- Total gross profit margin reached 49% compared to 50% in fiscal 2017.
- Operating expenses increased to $30.6 million, compared to $26.2 million in the previous fiscal year. Excluding the tax credit mentioned above, operating expenses in fiscal 2017 was $30.8 million.
- EBITDA for the year was $6.5 million, compared to $10.4 million in fiscal 2017. Excluding the tax credit recognition mentioned above, EBITDA was $5.8 million in fiscal 2017.
- Profit from operations of $4.3 million in fiscal 2018 in comparison to $8.0 million in fiscal 2017. Excluding the tax credits recognition mentioned above, profit from operations was $3.4 million.
- Net profit for fiscal 2018 was $3.9 million, or $0.30 per share, compared to $6.0 million, or $0.49 per share, for fiscal 2017.
- Total contract bookings for fiscal 2018 totalled $48.1 million, compared to $42.6 million for fiscal 2017, an increase of 13%.
- Recurring revenue at the end of fiscal 2018 was $26.2 million or 37% of total revenue, compared to $26.9 million or 39% in fiscal 2017.
The Company has declared a dividend of $0.05 per share to be paid on August 3, 2018 to shareholders of record at the close of business on July 20, 2018.
Pursuant to the Canadian Income Tax Act, dividends paid by the Company to Canadian residents are considered to be “eligible” dividends.
Fourth Quarter 2018 Results Conference Call
Date: July 6, 2018
Time: 8:30 am EDT
Phone number: (416) 641-6202 or (800) 908-8386
The call can be replayed until July 13, 2018 by calling (416) 626-4100 or (800) 558-5253 (access code: 21891730).
About TECSYS
TECSYS provides transformative supply chain solutions that equip our customers to succeed in a rapidly-changing omni-channel world. TECSYS solutions are built on a true enterprise supply chain platform, and include warehouse management, distribution, transportation management, supply management at point-of-use as well as complete financial management and analytics solutions. Customers running on TECSYS' Supply Chain Platform are confident knowing they can execute, day in and day out, regardless of business fluctuations or changes in technology, they can adapt and scale to any business needs or size, and they can expand and collaborate with customers, suppliers and partners as one borderless enterprise. From demand planning to demand fulfillment, TECSYS puts power into the hands of both front-line workers and back office planners, and unshackles business leaders so they can see and manage their supply chains like never before.
TECSYS is the market leader in supply chain solutions for health systems and hospitals. Over 600 mid-size and Fortune 1000 customers trust their supply chains to TECSYS in the healthcare, service parts, third-party logistics, and general wholesale high-volume distribution industries. TECSYS' shares are listed on the Toronto Stock Exchange under the ticker symbol TCS.
Contact
Solutions and General info: info@tecsys.com
Investor Relations: steve.li@tecsys.com, (514) 866-5800 ext. 4120
Media Relations: media@tecsys.com
By phone: (514) 866-0001 or (800) 922-8649
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 annual information form for the fiscal year ended April 30th, 2017. 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. 2018. All names, trademarks, products, and services mentioned are registered or unregistered trademarks of their respective owners.
| TECSYS Inc. | ||||||
| Consolidated Statements of Financial Position | ||||||
| As at April 30, 2018 and April 30, 2017 | ||||||
| (in thousands of Canadian dollars) | ||||||
| April 30, | April 30, | |||||
| 2018 | 2017 | |||||
| Assets | ||||||
| Current assets | ||||||
| Cash and cash equivalents | $ | 13,496 | $ | 13,476 | ||
| Accounts receivable | 13,939 | 14,218 | ||||
| Work in progress | 617 | 612 | ||||
| Other receivables | 535 | 370 | ||||
| Tax credits | 3,391 | 3,126 | ||||
| Inventory | 1,145 | 914 | ||||
| Prepaid expenses | 1,829 | 1,899 | ||||
| Total current assets | 34,952 | 34,615 | ||||
| Non-current assets | ||||||
| Long-term investments | 10,007 | - | ||||
| Other long-term receivables | 215 | - | ||||
| Tax credits | 4,840 | 5,407 | ||||
| Property and equipment | 3,091 | 2,444 | ||||
| Deferred development costs | 1,850 | 2,751 | ||||
| Other intangible assets | 1,342 | 1,523 | ||||
| Goodwill | 3,596 | 3,596 | ||||
| Deferred tax assets | 3,524 | 2,201 | ||||
| Total non-current assets | 28,465 | 17,922 | ||||
| Total assets | $ | 63,417 | $ | 52,537 | ||
| Liabilities | ||||||
| Current liabilities | ||||||
| Accounts payable and accrued liabilities | $ | 9,087 | $ | 9,265 | ||
| Current portion of long-term debt | 47 | 69 | ||||
| Deferred revenue | 10,774 | 12,094 | ||||
| Total current liabilities | 19,908 | 21,428 | ||||
| Non-current liabilities | ||||||
| Long-term debt | 74 | 121 | ||||
| Other non-current liabilities | 300 | 277 | ||||
| Total non-current liabilities | 374 | 398 | ||||
| Total liabilities | 20,282 | 21,826 | ||||
| Contingencies and commitments | ||||||
| Equity | ||||||
| Share capital | 19,144 | 8,349 | ||||
| Contributed surplus | 9,577 | 9,577 | ||||
| Retained earnings | 14,527 | 13,064 | ||||
| Accumulated other comprehensive income (loss) | (113 | ) | (279 | ) | ||
| Total equity attributable to the owners of the Company | 43,135 | 30,711 | ||||
| Total liabilities and equity | $ | 63,417 | $ | 52,537 | ||
| See accompanying notes to the unaudited condensed interim consolidated financial statements. | ||||||
| TECSYS Inc. | ||||||||||||
| Consolidated Statements of Income and Comprehensive Income | ||||||||||||
| Three month periods and years ended April 30, 2018 and 2017 | ||||||||||||
| (in thousands of Canadian dollars, except per share data) | ||||||||||||
| Three Months | Three Months | Year | Year | |||||||||
| Ended | Ended | Ended | Ended | |||||||||
| April 30, | April 30, | April 30, | April 30, | |||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Revenue: | ||||||||||||
| Proprietary products | $ | 3,072 | $ | 2,638 | $ | 6,895 | $ | 7,187 | ||||
| Third-party products | 1,935 | 2,170 | 6,847 | 6,831 | ||||||||
| Cloud, maintenance and subscription | 6,895 | 6,873 | 27,000 | 26,316 | ||||||||
| Professional services | 6,470 | 6,081 | 27,830 | 25,639 | ||||||||
| Reimbursable expenses | 536 | 685 | 2,146 | 2,474 | ||||||||
| Total revenue | 18,908 | 18,447 | 70,718 | 68,447 | ||||||||
| Cost of revenue: | ||||||||||||
| Products | 1,689 | 1,725 | 6,187 | 5,849 | ||||||||
| Services | 7,118 | 6,653 | 27,510 | 25,928 | ||||||||
| Reimbursable expenses | 536 | 685 | 2,146 | 2,474 | ||||||||
| Total cost of revenue | 9,343 | 9,063 | 35,843 | 34,251 | ||||||||
| Gross profit | 9,565 | 9,384 | 34,875 | 34,196 | ||||||||
| Operating expenses: | ||||||||||||
| Sales and marketing | 3,685 | 4,104 | 14,496 | 15,131 | ||||||||
| General and administration | 1,550 | 1,350 | 6,328 | 5,863 | ||||||||
| Research and development, net of tax credits | 2,581 | (2,120 | ) | 9,797 | 5,251 | |||||||
| Total operating expenses | 7,816 | 3,334 | 30,621 | 26,245 | ||||||||
| Profit from operations | 1,749 | 6,050 | 4,254 | 7,951 | ||||||||
| Net finance (income) costs | (67 | ) | (7 | ) | (151 | ) | 189 | |||||
| Profit before income taxes | 1,816 | 6,057 | 4,405 | 7,762 | ||||||||
| Income tax expense | 14 | 1,281 | 456 | 1,764 | ||||||||
| Profit attributable to the owners of the Company | $ | 1,802 | $ | 4,776 | $ | 3,949 | $ | 5,998 | ||||
| Other comprehensive income (loss): | ||||||||||||
| Effective portion of changes in fair value on designated revenue hedges | (309 | ) | (398 | ) | 166 | (886 | ) | |||||
| Comprehensive income attributable to the owners of the Company | $ | 1,493 | $ | 4,378 | $ | 4,115 | $ | 5,112 | ||||
| Basic and diluted earnings per common share | $ | 0.13 | $ | 0.39 | $ | 0.30 | $ | 0.49 | ||||
| See accompanying notes to the unaudited condensed interim consolidated financial statements. | ||||||||||||
| TECSYS Inc. | ||||||
| Consolidated Statements of Cash Flows | ||||||
| (in thousands of Canadian dollars) | ||||||
| Years ended April 30, | 2018 | 2017 | ||||
| Cash flows from (used in) operating activities: | ||||||
| Profit for the year | $ | 3,949 | $ | 5,998 | ||
| Adjustments for: | ||||||
| Depreciation of property and equipment | 760 | 819 | ||||
| Depreciation of deferred development costs | 1,118 | 1,319 | ||||
| Depreciation of other intangible assets | 462 | 486 | ||||
| Net finance costs | (151 | ) | 189 | |||
| Unrealized foreign exchange and other | (465 | ) | 649 | |||
| Non-refundable tax credits | (925 | ) | (5,551 | ) | ||
| Income taxes | 361 | 1,332 | ||||
| Operating activities excluding changes in non-cash working capital items related to operations | 5,109 | 5,241 | ||||
| Accounts receivable | 279 | 4,021 | ||||
| Work in progress | (5 | ) | (99 | ) | ||
| Other accounts receivable | (346 | ) | (35 | ) | ||
| Tax credits | (156 | ) | 2,091 | |||
| Inventory | (231 | ) | (170 | ) | ||
| Prepaid expenses | 70 | (277 | ) | |||
| Accounts payable and accrued liabilities | 294 | (1,852 | ) | |||
| Deferred revenue | (1,320 | ) | 889 | |||
| Changes in non-cash working capital items related to operations | (1,415 | ) | 4,568 | |||
| Net cash from operating activities | 3,694 | 9,809 | ||||
| Cash flows used in financing activities: | ||||||
| Repayment of long-term debt | (69 | ) | (3,154 | ) | ||
| Issuance of common shares | 10,489 | - | ||||
| Payment of dividends | (2,486 | ) | (1,847 | ) | ||
| Interest paid | (4 | ) | (81 | ) | ||
| Net cash used in financing activities | 7,930 | (5,082 | ) | |||
| Cash flows from (used in) investing activities: | ||||||
| Decrease (increase) in short-term & other investments | (10,007 | ) | - | |||
| Interest received | 259 | 103 | ||||
| Acquisitions of property and equipment | (1,358 | ) | (630 | ) | ||
| Proceeds on disposal of property and equipment | - | 3 | ||||
| Acquisitions of other intangible assets | (281 | ) | (178 | ) | ||
| Deferred development costs | (217 | ) | (253 | ) | ||
| Net cash used in investing activities | (11,604 | ) | (955 | ) | ||
| Net increase (decrease) in cash and cash equivalents during the year | 20 | 3,772 | ||||
| Cash and cash equivalents - beginning of year | 13,476 | 9,704 | ||||
| Cash and cash equivalents - end of year | $ | 13,496 | $ | 13,476 | ||
| See accompanying notes to the consolidated financial statements. | ||||||
| TECSYS Inc. | ||||||||||||||
| Consolidated Statements of Changes in Equity | ||||||||||||||
| (in thousands of Canadian dollars, except number of shares) | ||||||||||||||
| Share capital | Contributed surplus | Accumulated other comprehensive income (loss) | Retained earnings | Total | ||||||||||
| Number | Amount | |||||||||||||
| Balance, April 30, 2016 | 12,315,326 | $ | 8,349 | $ | 9,577 | $ | 607 | $ | 8,913 | $ | 27,446 | |||
| Profit for the year | - | - | - | - | 5,998 | 5,998 | ||||||||
| Other comprehensive income for the year: | ||||||||||||||
| Effective portion of changes in fair value on designated revenue hedges | - | - | - | (886 | ) | - | (886 | ) | ||||||
| Total comprehensive income for the year | - | - | - | (886 | ) | 5,998 | 5,112 | |||||||
| Dividends to equity owners | - | - | - | - | (1,847 | ) | (1,847 | ) | ||||||
| Total transactions with owners of the Company | - | - | - | - | (1,847 | ) | (1,847 | ) | ||||||
| Balance, April 30, 2017 | 12,315,326 | $ | 8,349 | $ | 9,577 | $ | (279 | ) | $ | 13,064 | $ | 30,711 | ||
| Profit for the year | - | - | - | - | 3,949 | 3,949 | ||||||||
| Other comprehensive loss for the year: | ||||||||||||||
| Effective portion of changes in fair value on designated revenue hedges | - | - | - | 166 | - | 166 | ||||||||
| Total comprehensive income (loss) for the year | - | - | - | 166 | 3,949 | 4,115 | ||||||||
| Common shares issued under bought deal financing, net of taxes of $306 | 767,050 | 10,795 | - | - | - | 10,795 | ||||||||
| Dividends to equity owners | - | - | - | - | (2,486 | ) | (2,486 | ) | ||||||
| Total transactions with owners of the Company | 767,050 | 10,795 | - | - | (2,486 | ) | 8,309 | |||||||
| Balance, April 30, 2018 | 13,082,376 | $ | 19,144 | $ | 9,577 | $ | (113 | ) | $ | 14,527 | $ | 43,135 | ||
| See accompanying notes to the consolidated financial statements. | ||||||||||||||