Software/ platforms

American Software Reports Third Quarter of Fiscal Year 2022 Results

Double-Digit Revenue Growth Driven by Continued Strong Growth in Subscription Fees

American Software, Inc. (NASDAQ: AMSWA) today reported preliminary financial results for the third quarter of fiscal year 2022.

Key Third Quarter Financial Highlights:

  • Subscription fees were $10.9 million for the quarter ended January 31, 2022, a 45% increase compared to $7.5 million for the same period last year and software license revenues were up 87% to $1.0 million compared to $0.5 million for the same period last year.
  • Cloud Services Annual Contract Value (ACV) increased approximately 43% to $45.3 million for the quarter ended January 31, 2022 compared to $31.6 million during the same period of the prior year.
  • Total revenues for the quarter ended January 31, 2022 increased 17% to $32.4 million, compared to $27.7 million for the same period of the prior year.
  • Recurring revenue streams for Maintenance and Cloud Subscriptions were 62% of total revenues in the quarter ended January 31, 2022 compared to 64% in the same period of the prior year.
  • Maintenance revenues for the quarter ended January 31, 2022 decreased 10% to $9.1 million compared to $10.2 million for the same period last year.
  • Professional services and other revenues for the quarter ended January 31, 2022 increased 21% to $11.4 million compared to $9.5 million for the same period last year. For the Supply Chain business, professional services revenues for the quarter ended January 31, 2022 increased by 13% to $5.4 million when compared to $4.8 million in the same period prior year.
  • Operating earnings for the quarter ended January 31, 2022 increased 246% to $3.2 million compared to $0.9 million for the same period last year.
  • GAAP net earnings for the quarter ended January 31, 2022 increased 27% to $2.9 million or $0.09 per fully diluted share compared to $2.3 million or $0.07 per fully diluted share for the same period last year.
  • Adjusted net earnings for the quarter ended January 31, 2022, which excludes non-cash stock-based compensation expense and amortization of acquisition-related intangibles, increased 28% to $3.8 million or $0.11 per fully diluted share compared to $3.0 million or $0.09 per fully diluted share for the same period last year.
  • EBITDA increased by 94% to $4.2 million for the quarter ended January 31, 2022 compared to $2.2 million for the same period last year.
  • Adjusted EBITDA increased by 85% to $5.3 million for the quarter ended January 31, 2022 compared to $2.9 million for the same period last year. Adjusted EBITDA represents GAAP net earnings adjusted for amortization of intangibles, depreciation, interest income & other, net, income tax expense/(benefit) and non-cash stock-based compensation expense.

Key Fiscal 2022 Year to Date Financial Highlights:

  • Subscription fees were $31.0 million for the nine months ended January 31, 2022, a 49% increase compared to $20.8 million for the same period last year, while Software license revenues increased 30% to $2.3 million compared to $1.8 million for the same period last year.
  • Total revenues for the nine months ended January 31, 2022 increased 12% to $92.9 million compared to $82.8 million for the same period last year.
  • Recurring revenue streams for Maintenance and Cloud Services were 63% of total revenues for the nine-month period ended January 31, 2022 compared to 62% in the same period of the prior year.
  • Maintenance revenues for the nine months ended January 31, 2022 were $27.9 million, a 9% decrease compared to $30.7 million for the same period last year.
  • Professional services and other revenues for the nine months ended January 31, 2022 increased 7% to $31.8 million compared to $29.6 million for the same period last year.
  • For the nine months ended January 31, 2022, the Company reported operating earnings of approximately $7.7 million compared to $2.5 million for the same period last year, a 214% increase.
  • GAAP net earnings were approximately $9.2 million or $0.27 per fully diluted share for the nine months ended January 31, 2022, an 83% increase compared to $5.0 million or $0.15 per fully diluted share for the same period last year.
  • Adjusted net earnings for the nine months ended January 31, 2022, which exclude stock-based compensation expense and amortization of acquisition-related intangibles, increased 60% to $11.6 million or $0.34 per fully diluted share, compared to $7.3 million or $0.22 per fully diluted share for the same period last year.
  • EBITDA increased by 58% to $10.9 million for the nine months ended January 31, 2022 compared to $6.9 million for the same period last year.
  • Adjusted EBITDA increased 57% to $13.8 million for the nine months ended January 31, 2022 compared to $8.8 million for the nine months ended January 31, 2021. Adjusted EBITDA represents GAAP net earnings adjusted for amortization of intangibles, depreciation, interest income & other, net, income tax (benefit)/expense and non-cash stock-based compensation.

The overall financial condition of the Company remains strong, with cash and investments of approximately $114.8 million, an increase of approximately $14.0 million when compared to January 31, 2021. During the third quarter of fiscal year 2022, the Company paid shareholder dividends of approximately $3.7 million.

“Our revenue growth accelerated to 17% in the third quarter of fiscal year 2022 and our Cloud Services ACV increased 43% increase when compared to the same period last year,” said Allan Dow, CEO and president of American Software. “Our backlog as measured by our Remaining Performance Obligations (RPO) increased 61% to $129 million in the third quarter when compared to last year, reflecting a new record for the company. As we head into our final quarter of fiscal 2022, we expect to build upon our momentum as we execute against our growing pipeline and position the company for strong growth in fiscal 2023 and beyond.”

“This past quarter also heightened the importance of transparency and the continued adoption of AI and ML to enable sustainable and socially responsible businesses. It’s becoming ever more necessary for companies to prove the sustainability of their practices through increased diligence around corporate responsibility, traceability and honesty with customers about the origins of goods and services,” continued Dow. “Because of this, I believe the adoption of AI and ML is going to continue to accelerate and enable companies to truly optimize operations and achieve sustainability long-term. These methods help companies take massive data sets and turn them into digestible, actionable insights for their supply chain practices. We believe the future of supply chain sustainability is rooted in transparency and automation that is enabled by a committed technology partner.”

Key Third Quarter of Fiscal Year 2022 highlights:

Customers & Channels

  • Notable new and existing customers placing orders with the Company in the third quarter include: Celanese Ltd., CQMS Razer Pty. Ltd., Empresa Siderurgica del Peru SAA, Intertape Polymer Corp., Mustad Netherlands B.V., Reynolds Consumer Product LLC, and Seco Tools AB.
  • During the quarter, SaaS subscription and/or software license agreements were signed with customers located in the following 10 countries: Australia, Canada, Ireland, Mexico, Netherlands, New Zealand, Peru, Sweden, United Kingdom and United States.
  • Logility, Inc. and Demand Management, Inc., wholly owned subsidiaries of the Company, were recognized among Food Logistics’ 2021 Top Software and Technology Providers. This marks Logility’s seventeenth year and Demand Management’s thirteenth year of recognition. The annual FL100+ Top Software and Technology Providers honors leading software and technology providers that ensure a safe, efficient, and reliable global food and beverage supply chain.
  • During the quarter, Logility was ranked in the 2022 RIS Software LeaderBoard as a leader in eighteen categories, and in the top ten of many of the referenced categories. Logility was recognized for helping retail customers by delivering innovative technology and offering exceptional support as they faced unparalleled challenges in the past two years.
  • Also, during the quarter, Logility announced its recognition in Retail Today’s Retail CIO Radar 2022. This is a list of the most innovative and transformative retail technology solution providers. Based on Logility’s innovative and transformative capabilities, track record, competency, leadership in the industry, market share, competitive landscape, and more, a panel of industry experts, analysts and Retail Today editorial board selected Logility.

Company and Technology

  • During the quarter, Demand Management announced a strategic partnership with Royal Cyber, a leading IT consultancy and solutions provider. The partnership enables organizations to gain value by leveraging the benefits of Demand Management’s digital supply chain platform, along with Royal Cyber’s efficient and robust customer service.
  • Logility also announced a partnership with Planalytics to identify, quantify and apply weather-driven demand calculations to business planning and forecasting. The partnership enables Logility customers to layer in Planalytics’ predictive demand metrics to better understand impacts across their customer base and proactively capitalize on sales opportunities created by favorable weather while mitigating risks when demand is negatively impacted.
  • Logility announced a commitment to help food and beverage, consumer packaged goods and durables, process manufacturing and fashion brands to gain greater visibility, traceability and compliance within their supply chains. Logility is committed to doing so through the corporate responsibility solution within the Logility® Digital Supply Chain Platform that was launched earlier in the year. The solution helps businesses track the social compliance and environmental status of suppliers.

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