TECSYS Inc.
TSX : TCS

TECSYS Inc.

July 06, 2012 13:13 ET

TECSYS Reports 27% Revenue Growth in Q4, 2012

MONTREAL, QUEBEC--(Marketwire - July 6, 2012) - TECSYS Inc. (TSX:TCS), an industry-leading supply chain management software company, announced today its results for the fourth quarter and 2012 fiscal year ended April 30th, 2012. The results of the 2012 fiscal year are audited. All dollar amounts are expressed in Canadian currency and reported in accordance with the International Financial Reporting Standards (IFRS).

Highlights of the Fourth Quarter include:

  • Revenue increased by 27% to $10.8M in Q4 of fiscal 2012 compared to $8.5M in Q4 of 2011. Product revenue increased by 79% to $4.5M compared to $2.5M in Q4, 2011 with proprietary License revenue increasing by 130% to $3.0M compared to $1.3M in the same period of 2011. Services revenue increased by 6% to $6.1M compared to $5.7M in the same period of fiscal 2011.
  • Profit from operations in Q4, 2012 was $735K compared to $674K in the same quarter of last year.
  • EBITDA was $1,273K in Q4, 2012 compared to $1,061K in Q4 of last year.
  • Net profit for Q4, 2012 was $473K or $0.04 per share compared to $491K or $0.04 per share in Q4, 2011.
  • At the end of Q4, 2012, annualized recurring revenue reached $14.8M, or 37% of 2012 revenue compared to $14.0M, or 39% of 2011 revenue. Recurring revenue is principally made-up of annual software maintenance contracts.
  • Backlog increased to $26.3M at the end of Q4, 2012, compared to $24.6M at the end of Q3, 2012 and $21M at the end of Q4, 2011.
  • During the quarter, the Company invested approximately $1.0M to increase its services capacity to assist in the delivery of the backlog.
  • During the quarter, the Company generated $1.0M cash from operations compared to $1.4M for the corresponding quarter of fiscal 2011.
  • Cash and cash equivalents, as well as short-term and other investments at the end of Q4, 2012 amounted to $5.2M compared to $7.3M at the end of Q4, 2011.

Peter Brereton, President and CEO of TECSYS Inc., commented on the results: "The combination of our new supply chain software products and the resurgence of the supply chain management market has been evident, we have felt the impact during this quarter more than any other period in the last two to three years. We won the business of nine new customers, several of these being complex distribution accounts, including one of the largest electronic components distributors in the world and three heavy equipment service parts distributors. Our customer base also invested heavily in our solutions, particularly in the healthcare industry, which contributed the lion's share of base account bookings in Q4 of 2012. As our backlog continued its consistent growth; a 25% increase in the past year, we invested in our infrastructure, hiring over 50 people by the end of the fiscal year to continue to be able to deliver on our services' bookings and respond to the needs of our growing customer base."

New customers won during the quarter included:

  • Two Heavy Equipment Dealers; one in the U.S. and one in South America
  • The Canadian operations of a global heavy equipment manufacturer and distributor
  • Canada's largest distributor of value priced greeting cards
  • One of the largest distributors of electronic components
  • Four industrial distributors; two in Canada and two in the U.S.

Furthermore, the Company signed a significant number of new agreements with existing customers across its business units with healthcare representing 50% of total bookings during the quarter. The Company also completed the deployment of its solutions for the go-lives of twenty three customer sites across all of the Company's vertical markets during the quarter.

Highlights of the 2012 Fiscal Year include:

  • Revenue for fiscal 2012 increased by 11% to $39.5M compared to $35.7M for last fiscal year. Product revenue increased by 17% to $14.6M in 2012 compared to $12.5M in 2011, with the Company's proprietary License revenue increasing by 25% to $7.3M in 2012 compared to $5.8M in last fiscal year. Services revenue increased by 8% to $24.1M in 2012 compared to $22.3M in last year.
  • Profit from operations for the year was $1.5M which was the same as the last fiscal year.
  • EBITDA was $3.1M in 2012 compared to $3.2M in fiscal 2011.
  • Net profit for the year was $1.1M or $0.09 per share compared to $1.6M or $0.13 for 2011.
TECSYS' Q4 FY2012 Earnings Conference Call:
Date: July 6, 2012
Time: 4:30 pm EDT
Phone number: 800-745-9476 or 416-981-9006

The call can be replayed by calling 800-558-5253 (access code: 21598658) or 416-626-4100 (access code: 21598658.

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 about 500 mid-size and Fortune 1000 corporations in healthcare, 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, 2011. 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.
Consolidated Statements of Financial Position
As at April 30, 2012, April 30, 2011 and May 1, 2010
(in thousands of Canadian dollars)
April 30, April 30, May 1,
2012 2011 2010
Assets
Current assets
Cash and cash equivalents $ 5,217 $ 6,404 $ 7,256
Short-term and other investments - 850 850
Asset-backed commercial paper - 3,584 -
Accounts receivable 8,207 6,860 7,346
Work in progress 645 45 66
Other accounts receivable and derivatives 190 303 425
Tax credits 2,070 1,737 1,914
Inventory 696 180 171
Prepaid expenses 1,177 850 879
Total current assets 18,202 20,813 18,907
Non-current assets
Restricted cash equivalents and other investments 160 200 200
Asset-backed commercial paper - - 3,514
Non-current receivables 99 23 48
Tax credits 1,076 1,123 930
Investment in equity-accounted associate - 220 211
Property and equipment 2,911 2,268 2,395
Deferred development costs 2,514 2,448 1,991
Other intangible assets 362 288 364
Goodwill 2,239 2,239 2,239
Deferred tax assets 587 609 595
Total non-current assets 9,948 9,418 12,487
Total assets $ 28,150 $ 30,231 $ 31,394
Liabilities
Current liabilities
Bank advances $ - $ 3,720 $ 3,951
Accounts payable and accrued liabilities 5,844 4,114 4,890
Loans payable 85 107 249
Provisions - - 415
Deferred revenue 6,665 6,344 5,827
Total current liabilities 12,594 14,285 15,332
Equity
Share capital 1,688 1,467 1,386
Contributed surplus 10,023 10,993 12,103
Retained earnings 3,845 3,486 2,573
Total equity attributable to the owners of the Company 15,556 15,946 16,062
Total liabilities and equity $ 28,150 $ 30,231 $ 31,394
TECSYS Inc.
Consolidated Statements of Comprehensive Income
Three-month periods and years ended April 30, 2012 and 2011
(in thousands of Canadian dollars, except per share data)
Three Months
Ended
April 30,
2012
Three Months
Ended
April 30,
2011
Year
Ended
April 30,
2012
Year
Ended
April 30,
2011
Revenue:
Products $ 4,501 $ 2,516 $ 14,551 $ 12,459
Services 6,057 5,732 24,078 22,287
Reimbursable expenses 247 242 873 908
Total revenue 10,805 8,490 39,502 35,654
Cost of revenue:
Products 1,084 717 4,944 4,792
Services 4,565 3,568 16,234 14,278
Reimbursable expenses 247 242 873 908
Total cost of revenue 5,896 4,527 22,051 19,978
Gross profit 4,909 3,963 17,451 15,676
Operating expenses:
Sales and marketing 2,110 1,543 7,004 6,180
General and administration 972 891 4,015 3,619
Research and development, net of tax credits 1,068 868 4,956 4,346
Other 24 (13 ) 21 (13 )
Total operating expenses 4,174 3,289 15,996 14,132
Profit from operations 735 674 1,455 1,544
Finance income 15 3 37 328
Finance costs (14 ) (37 ) (157 ) (69 )
Net finance income (costs) 1 (34 ) (120 ) 259
Share of net profit (loss) of equity-accounted associate - 70 (15 ) 9
Gain on sale of the investment in equity-accounted associate 67 - 67 -
Profit before income taxes 803 710 1,387 1,812
Income taxes 330 219 330 242
Profit attributable to the owners of the Company and comprehensive income for the period $ 473 $ 491 $ 1,057 $ 1,570
Basic and diluted earnings per common share $ 0.04 $ 0.04 $ 0.09 $ 0.13
TECSYS Inc.
Consolidated Statements of Cash Flows
Three-month periods and years ended April 30, 2012 and 2011
(in thousands of Canadian dollars)
Three Months
Ended
April 30,
2012
Three Months
Ended
April 30,
2011
Years
Ended
April 30,
2012
Years
Ended
April 30,
2011
Cash flows from operating activities:
Profit for the period $ 473 $ 491 $ 1,057 $ 1,570
Adjustments for:
Depreciation of property and equipment 232 146 789 621
Depreciation of deferred development costs 218 166 789 590
Depreciation of other intangible assets 33 32 119 139
Share-based compensation - 11 40 54
Net finance (income) costs (1 ) 34 120 (259 )
Realized foreign exchange (losses) gains and others (78 ) (199 ) 32 (170 )
Share of net (profit) loss of equity-accounted associate - (70 ) 15 (9 )
Gain on sale of the investment in equity-accounted associate (67 ) - (67 ) -
Federal non-refundable research and development tax credits (330 ) (300 ) (330 ) (300 )
Income taxes 330 211 330 211
Operating activities excluding changes in non-cash working capital items related to operations 810 522 2,894 2,447
Accounts receivable (133 ) 1,629 (1,347 ) 486
Work in progress (209 ) 107 (600 ) 21
Other accounts receivable 337 (51 ) 65 204
Tax credits 1,080 (342 ) (270 ) 59
Inventory 101 18 (516 ) (9 )
Prepaid expenses 71 71 (327 ) 29
Accounts payable and accrued liabilities (1,119 ) (1,353 ) 1,421 (375 )
Provisions - - - (415 )
Deferred revenue 57 773 321 517
Changes in non-cash working capital items related to operations 185 852 (1,253 ) 517
Net cash from operating activities 995 1,374 1,641 2,964
Cash flows used in financing activities:
Repayment of bank advances - (223 ) (3,720 ) (231 )
Repayment of loans (3 ) - (22 ) (142 )
Issuance of common shares 5 - 195 104
Purchase of common shares for cancellation (39 ) (311 ) (437 ) (1,187 )
Purchase of share options for cancellation (8 ) - (347 ) -
Payment of dividends (349 ) (352 ) (698 ) (657 )
Interest paid (2 ) (6 ) (16 ) (31 )
Net cash used in financing activities (396 ) (892 ) (5,045 ) (2,144 )
Cash flows from (used in) investing activities:
Short-term and other investments and restricted cash equivalents and other investments 565 - 890 -
Interest received 15 3 37 26
Proceeds from asset-backed commercial paper - 213 3,584 232
Acquisitions of property and equipment (213 ) (95 ) (1,413 ) (895 )
Proceeds on disposal of property and equipment 1 13 4 13
Acquisitions of other intangible assets (39 ) (39 ) (189 ) (63 )
Deferred development costs (310 ) (304 ) (855 ) (1,047 )
Non-current receivables including the current portion from a related party 3 9 23 62
Proceeds from disposition of the investment in equity-accounted associate 136 - 136 -
Net cash from (used in) investing activities 158 (200 ) 2,217 (1,672 )
Net increase (decrease) in cash and cash equivalents during the period 757 282 (1,187 ) (852 )
Cash and cash equivalents - beginning of period 4,460 6,122 6,404 7,256
Cash and cash equivalents - end of period $ 5,217 $ 6,404 $ 5,217 $ 6,404
TECSYS Inc.
Consolidated Statements of Changes in Equity
Years ended April 30, 2012 and 2011
(in thousands of Canadian dollars, except number of shares)
Share capital Contributed Retained Total
Number Amount surplus earnings
Balance, April 30, 2011 11,678,671 $ 1,467 $ 10,993 $ 3,486 $ 15,946
Profit and comprehensive income for the year - - - 1,057 1,057
Total comprehensive income for the year - - - 1,057 1,057
Repurchase of common shares (192,800 ) (25 ) (412 ) - (437 )
Repurchase of share options - - (279 ) - (279 )
Share options exercised 117,400 195 - - 195
Fair value associated with share options exercised - 51 - - 51
Fair value of share options transferred to liabilities - - (319 ) - (319 )
Share-based compensation - - 40 - 40
Dividends to equity owners - - - (698 ) (698 )
Total transactions with owners of the Company (75,400 ) 221 (970 ) (698 ) (1,447 )
Balance, April 30, 2012 11,603,271 $ 1,688 $ 10,023 $ 3,845 $ 15,556
Balance, May 1, 2010 12,225,306 $ 1,386 $ 12,103 $ 2,573 $ 16,062
Profit and comprehensive income for the year - - - 1,570 1,570
Total comprehensive income for the year - - - 1,570 1,570
Repurchase of common shares (620,353 ) (70 ) (1,117 ) - (1,187 )
Share options exercised 73,718 104 - - 104
Fair value associated with share options exercised - 47 (47 ) - -
Share-based compensation - - 54 - 54
Dividends to equity owners - - - (657 ) (657 )
Total transactions with owners of the Company (546,635 ) 81 (1,110 ) (657 ) (1,686 )
Balance, April 30, 2011 11,678,671 $ 1,467 $ 10,993 $ 3,486 $ 15,946

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