TECSYS Inc.
TSX : TCS

TECSYS Inc.

November 29, 2012 11:58 ET

TECSYS Reports 18% Revenue Growth in Q2, 2013

MONTREAL, QUEBEC--(Marketwire - Nov. 29, 2012) - TECSYS Inc. (TSX:TCS), an industry-leading supply chain management software company, announced today its results for the second quarter of fiscal year 2013, ended October 31st, 2012. All dollar amounts are expressed in Canadian currency and are prepared in accordance with the International Financial Reporting Standards (IFRS) and are unaudited.

Second Quarter Financial Summary:

  • Revenue increased 18% to $10.7M in Q2, 2013 compared to $9.1M in Q2, 2012.
  • Profit from operations for the second quarter, 2013 increased to $428K compared to $170K in Q2, 2012.
  • Due to the rising stock price, option expense surged to $313K in the quarter reflecting the non-dilutive measure taken by the company of cash settling options.
  • EBITDA for Q2, 2013 increased to $613K ($926K prior to revaluation of the fair value of the share options liability) compared to $517K in Q2 of last fiscal year ($555K prior to revaluation of the fair value of the share options liability).
  • Net profit for the second quarter, 2013 was $122K or $0.01 per share ($435K or $0.04 prior to revaluation of the fair value of the share options liability) compared to $133K or $0.01 per share for the second quarter of last fiscal year ($171K or $0.01 prior to revaluation of the fair value of the share options liability).
  • At the end of Q2, 2013 annualized recurring revenue in Canadian currency increased to $15.5M, or 36% of the last twelve months trailing revenue, from $14.4M at the end of Q2 of last fiscal year.
  • Backlog at the end of Q2, 2013 was $25.5M compared to $21.5M at the end of Q2, 2012.
  • Cash flow from operations prior to changes in non-cash working capital amounted to $934K in Q2, 2013 compared to $694K in Q2, 2012.
  • Cash, cash equivalents and other short-term investments amounted to $8.1M at the end of Q2, 2013, compared to $4.9M at the end of Q2, 2012. The substantial increase in cash and cash equivalents is attributable to the financing transaction concluded and announced on November 1st, 2012.

Peter Brereton, President and CEO of TECSYS Inc., commented on the results: "Our top line continued to improve with double-digit growth in Q2, 2013 as we delivered 18% growth in revenue and 21% growth in bookings compared to last year. The quarter marked the beginnings of the resurgence in the hospital supply network market with a win of a mid-size organization in this space and further penetration of the educational market with our unique self-distribution value proposition. We continued to ramp up the resources of our consulting practice to meet the growing demand for our services; the results of this initiative is starting to pay off with a significantly stronger execution infrastructure and improved top line."

During the quarter, the Company won the business of five new clients including:

  • A $1.6 billion Hospital Supply Network in the U.S.
  • An independent school district in the U.S.
  • An innovative, educational resource supplier in the U.K.
  • A leading giftware and collectibles distributor in Canada
  • An industrial distributor in Canada

TECSYS also signed a significant number of new business agreements with existing clients and deployed its supply chain execution solutions at a number of customers from across its business units in Canada and the United States.

First Half Financial Summary:

  • Revenue for the first half, 2013 increased 23% to $22.3M compared to $18.1M for the same period of last fiscal year.
  • Profit from operations for the first half, 2013 increased significantly to $1,476K compared to $342K for the same period in last fiscal year.
  • EBITDA for the first half, 2013 reached $2,246K compared to $1,047K for the first half of 2012.
  • Net profit for the first half of fiscal, 2013 increased to $1,247K or $0.11 per share compared to $279K or $0.02 per share for the same period of the prior fiscal year.
  • Cash flow from operations prior to changes in non-cash working capital amounted to $2.4M for the first half, 2013 compared to $1.4M for the first half of 2012.

TECSYS' Second Quarter 2013 Earnings Conference Call:

Subject: Second Quarter FY2013 Results Conference Call

Date: November 29, 2012

Time: 4:30 pm

Phone number: 800-909-4796 or 416-981-9018

The call can be replayed by calling 800-558-5253 (access code: 21613577) or 416-626-4100 (access code: 21613577).

About TECSYS

TECSYS is a leading supply chain management software provider that delivers powerful enterprise distribution, warehouse and transportation logistics software solutions. The company's customers include over 600 mid-size and Fortune 1000 corporations in healthcare, heavy equipment, third-party logistics, and general wholesale high-volume distribution industries. TECSYS' shares are listed on the Toronto Stock Exchange under the ticker symbol TCS.

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, 2012. 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. 2012. All names, trademarks, products, and services mentioned are registered or unregistered trademarks of their respective owners.

TECSYS Inc.
Condensed Interim Consolidated Statements of Financial Position
(Unaudited)
As at October 31, 2012 and April 30, 2012
(in thousands of Canadian dollars)
October 31, April 30,
2012 2012
Assets
Current assets
Cash and cash equivalents$7,987$5,217
Accounts receivable 7,441 8,207
Work in progress 1,893 645
Other accounts receivable and derivatives 162 190
Tax credits 3,214 2,070
Inventory 685 696
Prepaid expenses 1,048 1,177
Total current assets 22,430 18,202
Non-current assets
Restricted cash equivalents and other investments 120 160
Non-current receivables 69 99
Tax credits 1,063 1,076
Property and equipment 3,225 2,911
Deferred development costs 2,813 2,514
Other intangible assets 389 362
Goodwill 2,239 2,239
Deferred tax assets 850 587
Total non-current assets 10,768 9,948
Total assets$33,198$28,150
Liabilities
Current liabilities
Accounts payable and accrued liabilities$5,547$5,844
Loans payable 79 85
Term loan 1,000 -
Deferred revenue 6,569 6,665
Total current liabilities 13,195 12,594
Term loan 4,000 -
Total non-current liabilities 4,000 -
Total liabilities 17,195 12,594
Equity
Share capital 1,723 1,688
Contributed surplus 9,588 10,023
Retained earnings 4,692 3,845
Total equity attributable to the owners of the Company 16,003 15,556
Total liabilities and equity$33,198$28,150
TECSYS Inc.
Condensed Interim Consolidated Statements of Comprehensive Income
(Unaudited)
Three and six-month periods ended October 31, 2012 and 2011
(in thousands of Canadian dollars, except per share data)






Three Months
Ended
October 31,
2012






Three Months
Ended
October 31,
2011






Six Months
Ended
October 31,
2012






Six Months
Ended
October 31,
2011



Revenue:
Products$3,551 $2,995 $8,038 $5,848
Services 6,989 5,889 13,669 11,844
Reimbursable expenses 208 215 551 410
Total revenue 10,748 9,099 22,258 18,102
Cost of revenue:
Products 1,099 1,146 2,027 2,187
Services 4,900 3,710 9,719 7,542
Reimbursable expenses 208 215 551 410
Total cost of revenue 6,207 5,071 12,297 10,139
Gross profit 4,541 4,028 9,961 7,963
Operating expenses:
Sales and marketing 1,718 1,596 3,636 3,074
General and administration 988 1,058 2,102 1,992
Research and development, net of tax credits 1,407 1,204 2,747 2,555
Total operating expenses 4,113 3,858 8,485 7,621
Profit from operations 428 170 1,476 342
Finance income (63) 10 29 16
Finance costs (237) (68) (240) (86)
Net finance costs (300) (58) (211) (70)
Share of net profit of equity-accounted associate - 21 - 7
Profit before income taxes 128 133 1,265 279
Income taxes 6 - 18 -
Profit attributable to the owners of the Company and comprehensive income for the period$122 $133 $1,247 $279
Basic and diluted earnings per common share$0.01 $0.01 $0.11 $0.02
TECSYS Inc.
Condensed Interim Consolidated Statements of Cash Flows
(Unaudited)
Three and six-month periods ended October 31, 2012 and 2011
(in thousands of Canadian dollars)
Three Months Three Months Six Months Six Months
Ended Ended Ended Ended
October 31, October 31, October 31, October 31,
2012 2011 2012 2011
Cash flows from (used in) operating activities:
Profit for the period$122 $133 $1,247 $279
Adjustments for:
Depreciation of property and equipment 254 186 502 355
Depreciation of other intangible assets 39 26 76 55
Depreciation of deferred development costs 195 174 410 355
Share-based compensation - 32 - 40
Net finance costs 300 58 211 70
Realized foreign exchange gains and others 80 106 129 212
Share of net profit of equity-accounted associate - (21) - (7)
Federal non-refundable research and development tax credits (75) - (150) -
Income taxes 19 - (19) -
Operating activities excluding changes in non-cash working capital items related to operations 934 694 2,406 1,359
Accounts receivable (331) (395) 766 (591)
Work in progress (826) (77) (1,248) (175)
Other accounts receivable 45 (68) (85) (1)
Tax credits (664) (445) (1,223) (877)
Inventory 6 (20) 11 15
Prepaid expenses 173 69 129 (149)
Accounts payable and accrued liabilities 144 (43) (675) 14
Deferred revenue (399) (667) (96) (645)
Changes in non-cash working capital items related to operations (1,852) (1,646) (2,421) (2,409)
Net cash used in operating activities (918) (952) (15) (1,050)
Cash flows from (used in) financing activities:
Repayment of bank advances - - - (3,720)
Repayment of loans (3) (17) (6) (17)
Term loan 5,000 - 5,000 -
Issuance of common shares 17 190 48 190
Purchase of common shares for cancellation (231) (48) (462) (57)
Purchase of share options for cancellation (81) (58) (81) (337)
Payment of dividends (400) (349) (400) (349)
Interest paid (4) (4) (7) (11)
Net cash from (used in) financing activities 4,298 (286) 4,092 (4,301)
Cash flows (used in) from investing activities:
Short-term and other investments and restricted cash equivalents and other investments - - 40 325
Interest received 7 10 14 16
Proceeds from asset-backed commercial paper - - - 3,584
Acquisitions of property and equipment (198) (190) (576) (336)
Acquisitions of other intangible assets (18) (41) (107) (105)
Deferred development costs (305) (244) (709) (384)
Non-current receivables including the current portion from a related party 17 8 31 19
Net cash (used in) from investing activities (497) (457) (1,307) 3,119
Net increase (decrease) in cash and cash equivalents during the period 2,883 (1,695) 2,770 (2,232)
Cash and cash equivalents - beginning of period 5,104 5,867 5,217 6,404
Cash and cash equivalents - end of period$7,987 $4,172 $7,987 $4,172
TECSYS Inc.
Condensed Interim Consolidated Statements of Changes in Equity
(Unaudited)
Six-month periods ended October 31, 2012 and 2011
(in thousands of Canadian dollars, except number of shares)
Share capital Contributed Retained Total
Number Amount surplus earnings
Balance, April 30, 201211,603,271 $1,688 $10,023 $3,845 $15,556
Profit and comprehensive income for the period- - - 1,247 1,247
Total comprehensive income for the period- - - 1,247 1,247
Repurchase of common shares(187,300) (27) (435) - (462)
Share options exercised25,950 48 - - 48
Fair value associated with options exercised- 14 - - 14
Dividends to equity owners- - - (400) (400)
Total transactions with owners of the Company(161,350) 35 (435) (400) (800)
Balance, October 31, 201211,441,921 $1,723 $9,588 $4,692 $16,003
Balance, April 30, 201111,678,671 $1,467 $10,993 $3,486 $15,946
Profit and comprehensive income for the period- - - 279 279
Total comprehensive income for the period- - - 279 279
Repurchase of common shares(26,500) (3) (54) - (57)
Repurchase of share options- - (279) - (279)
Stock options exercised114,400 190 - - 190
Fair value associated with options exercised- 48 - - 48
Fair value of share options transferred to liabilities- - (319) - (319)
Share-based compensation- - 40 - 40
Dividends to equity owners- - - (349) (349)
Total transactions with owners of the Company87,900 235 (612) (349) (726)
Balance, October 31, 201111,766,571 $1,702 $10,381 $3,416 $15,499

Contact Information