TECSYS Inc.
TSX : TCS

TECSYS Inc.

July 08, 2015 15:26 ET

TECSYS Reports Record Revenue & Contract Bookings in Q4 of FY 2015

MONTREAL, QUEBEC--(Marketwired - July 8, 2015) - TECSYS Inc. (TSX:TCS), an industry-leading supply chain management software company, today announced its results for the fourth quarter and 2015 fiscal year, ended April 30, 2015.

All dollar amounts are expressed in Canadian currency and are prepared in accordance with International Financial Reporting Standards (IFRS).

Fourth Quarter Highlights:

  • Revenue grew 27% to $15.8M in Q4 2015 compared to $12.5M in Q4 2014.
  • EBITDA was $955K for Q4 2015, compared to $1.258K recorded in Q4 2014.
  • Proprietary products revenue grew 41% to $3.9M on strong demand from the Company's Logi-D point-of-use products as well as increased healthcare license revenue.
  • Services revenue improved by 16% to $9.1M, while services profit margin grew to 38% from 35% in Q4 2014.
  • Profit from operations was $311K in Q4 2015, compared to $757K in Q4 2014.
  • Profit from operations was reduced by $270K of one-time costs due to the elimination of redundant management positions as various operating units were integrated into a single operating unit. A large new customer signed on a SAAS revenue model basis, resulting in the deferral of approximately $550K of license fees, while on an accounting basis, the bulk of the expenses impacted the quarter.
  • Recurring revenue on an annualized basis grew to $21.3M, a 21% improvement compared to Q4 2014, representing 37% of fiscal 2015 revenue.
  • Total contract bookings in the fourth quarter totaled $16.0M, compared to $9.0M in the prior year period, a 79% increase.
  • Backlog was $44.9M at the end of Q4 2015 compared to $29.2M at the end of Q4 2014, a 54% increase.
  • Cash and cash equivalents totaled $10.8M at the end of Q4 2015 compared to $8.8M at the end of Q4 2014.
  • Signed one Health System (IDN) in the United States with five hospitals and five specialty centers.
  • Go-lives at 23 customers' sites, most notably: two health systems, one third party logistics provider, two sites for a Fortune 300 imaging manufacturer and five new hospital sites with Logi-D products.

"Our fiscal 2015 results demonstrate the inherent growth potential of our innovative solutions as revenue rose substantially and order bookings doubled over the prior year." said Peter Brereton, President and CEO of TECSYS Inc. "New order bookings in the fourth quarter were up almost 80% from last year's fourth quarter and included a significant SAAS agreement. These record bookings impacted the quarter with significant travel and incentive expense while roughly 70% of the related revenues are future. We continued to invest for growth in areas such as marketing and R&D as well as the launch of an additional sales team, allowing one team to concentrate on Healthcare while the other concentrates on Complex Distribution. We begin 2016 in an excellent financial and competitive position and I look forward to updating you on our progress throughout the year."

Highlights of the 2015 Fiscal Year:

  • Revenue increased 23% in fiscal 2015 to $57.3M, compared to $46.6M last fiscal year.
  • EBITDA was $4.4M in fiscal 2015 compared to $4.1M last year.
  • Profit from operations was $1.9M compared to $2.3M in fiscal 2014. Before acquisition related expenses and amortization, profit from operations was $2.3M in both fiscal 2015 and 2014.
  • Net profit in fiscal 2015 was $1.5M, or $0.13 per share, compared to $1.8M, or $0.16 per share in fiscal year 2014. Before acquisition related expenses and amortization, net profit was $1.9M or $0.16 per share in fiscal 2015 compared to $1.8M or $0.16 per share in fiscal 2014.
  • Total contract bookings in fiscal 2015 totaled $47.0M, which includes the addition of six new IDN's. This represents a 97% increase in contract bookings compared to $23.9M in fiscal 2014.

TECSYS also announced that the Company's Board of Directors approved an increase of the quarterly dividend from $0.0225 per share to $0.025 per share, an increase of 11%. To this effect, the Company declared a dividend of $0.025 per share, to be paid on August 6, 2015 to shareholders of record on July 22, 2015.

Fourth Quarter and Fiscal Year 2015 Results Conference Call

Date: July 8, 2015

Time: 4:30 pm EST

Phone number: 800-734-4208 or 416-620-9188

The call can be replayed by calling 800-558-5253 or 416-626-4100 (access code: 21771491).

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, 2014. 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. 2015. 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, 2015 and April 30, 2014
(in thousands of Canadian dollars)
April 30, April 30,
2015 2014
Assets
Current assets
Cash and cash equivalents$10,815$8,839
Accounts receivable 12,570 9,076
Work in progress 704 524
Other accounts receivable 434 66
Tax credits 5,369 2,704
Inventory 1,059 293
Prepaid expenses 1,394 1,037
Total current assets 32,345 22,539
Non-current assets
Restricted cash equivalents - 80
Tax credits 1,538 1,350
Property and equipment 2,526 2,627
Deferred development costs 4,348 4,088
Other intangible assets 2,184 508
Goodwill 3,596 2,239
Deferred tax assets 840 714
Total non-current assets 15,032 11,606
Total assets$47,377$34,145
Liabilities
Current liabilities
Accounts payable and accrued liabilities$8,817$5,426
Current portion of long-term debt 1,456 1,000
Deferred revenue 10,098 8,326
Total current liabilities 20,371 14,752
Non-current liabilities
Long-term debt 3,333 2,500
Other non-current liabilities 311 299
Total non-current liabilities 3,644 2,799
Total liabilities 24,015 17,551
Equity
Share capital 8,349 2,153
Contributed surplus 9,577 9,577
Retained earnings 5,341 4,864
Accumulated other comprehensive income 95 -
Total equity attributable to the owners of the Company 23,362 16,594
Total liabilities and equity$47,377$34,145
TECSYS Inc.
Consolidated Statements of Income and Comprehensive Income
Three month periods and years ended April 30, 2015 and 2014
(in thousands of Canadian dollars, except per share data)
Three Months
Ended
April 30,
2015
(unaudited)
Three Months
Ended
April 30,
2014
(unaudited)
Year
Ended
April 30,
2015
Year
Ended
April 30,
2014
Revenue:
Proprietary products$3,884$2,749$12,525$8,081
Third-party hardware and software products 2,273 1,506 8,576 6,833
Services 9,093 7,807 34,347 30,176
Reimbursable expenses 516 389 1,836 1,468
Total revenue 15,766 12,451 57,284 46,558
Cost of revenue:
Products 1,799 1,351 6,432 5,112
Services 5,652 5,112 21,443 19,685
Reimbursable expenses 516 389 1,836 1,468
Total cost of revenue 7,967 6,852 29,711 26,265
Gross profit 7,799 5,599 27,573 20,293
Operating expenses:
Sales and marketing 3,951 2,406 12,727 8,755
General and administration 1,611 1,080 5,899 4,050
Research and development, net of tax credits 1,926 1,356 7,000 5,223
Total operating expenses 7,488 4,842 25,626 18,028
Profit from operations 311 757 1,947 2,265
Net finance costs 13 41 119 244
Profit before income taxes 298 716 1,828 2,021
Income taxes 3 76 313 226
Profit attributable to the owners of the Company$295$640$1,515$1,795
Other comprehensive income:
Effective portion of changes in fair value on designated revenue hedges 742 - 95 -
Comprehensive income attributable to the owners of the Company$1,037$640$1,610$1,795
Basic and diluted earnings per common share$0.02$0.06$0.13$0.16
TECSYS Inc.
Consolidated Statements of Cash Flows
Years ended April 30, 2015 and 2014
(in thousands of Canadian dollars)
Year
Ended
April 30,
2015
Year
Ended
April 30,
2014
Cash flows from (used in) operating activities:
Profit for the year$1,515 $1,795
Adjustments for:
Depreciation of property and equipment 743 728
Depreciation of deferred development costs 1,291 1,045
Depreciation of other intangible assets 434 170
Net finance costs 119 244
Unrealized foreign exchange losses, realized foreign exchange gains and other 74 122
Federal non-refundable research and development tax credits (500) (300)
Income taxes 184 199
Operating activities excluding changes in non-cash working capital items related to operations
3,860

4,003
Accounts receivable (2,374) (1,117)
Work in progress (84) 767
Other accounts receivable (190) 53
Tax credits (2,443) 1,945
Inventory (298) 252
Prepaid expenses (335) 116
Accounts payable and accrued liabilities 2,023 516
Deferred revenue 1,235 1,165
Changes in non-cash working capital items related to operations (2,466) 3,697
Net cash from operating activities 1,394 7,700
Cash flows from (used in) financing activities:
Repayment of bank loans (140) -
Repayment of loan to related party - (70)
Repayment of long-term debt (1,064) (1,000)
Long-term debt 2,050 -
Issuance of common shares 6,096 130
Normal course issuer bid fees - (11)
Purchase of share options for cancellation (31) (20)
Payment of dividends (1,038) (861)
Interest paid (126) (162)
Net cash from (used) in financing activities 5,747 (1,994)
Cash flows (used in) from investing activities:
Restricted cash equivalents 80 40
Interest received 21 50
Acquisitions of property and equipment (435) (427)
Acquisitions of other intangible assets (374) (134)
Deferred development costs (1,551) (1,816)
Receivables from TECSYS Latin America Inc. 43 72
Business combination, net of cash and cash equivalents acquired (2,949) -
Net cash used in investing activities (5,165) (2,215)
Net increase in cash and cash equivalents during the year 1,976 3,491
Cash and cash equivalents - beginning of year 8,839 5,348
Cash and cash equivalents - end of year$10,815 $8,839
TECSYS Inc.
Consolidated Statements of Changes in Equity
Years ended April 30, 2015 and 2014
(in thousands of Canadian dollars, except number of shares)
Share capital

Number
Amount
Contributed
surplus


Accumulated
other
comprehensive

income

Retained
earnings


Total
Balance, April 30, 201411,524,421$2,153$9,577 $-$4,864 $16,594
Profit for the year- - - - 1,515 1,515
Other comprehensive income for the year:
Effective portion of changes in fair value on designated revenue hedges- - - 95 - 95
Total comprehensive income for the year- - - 95 1,515 1,610
Common shares issued related to purchase of Logi D Holding Inc.15,625 100 - - - 100
Common shares issued under bought deal financing775,280 6,096 - - - 6,096
Dividends to equity owners- - - - (1,038) (1,038)
Total transactions with owners of the Company790,905 6,196 - - (1,038) 5,158
Balance, April 30, 201512,315,326$8,349$9,577 $95$5,341 $23,362
Balance, April 30, 201311,449,421$1,748$9,588 $-$3,930 $15,266
Profit and comprehensive income for the year- - - - 1,795 1,795
Total comprehensive income for the year- - - - 1,795 1,795
Normal course issuer bid fees- - (11) - - (11)
Share options exercised75,000 130 - - - 130
Fair value associated with options exercised- 275 - - - 275
Dividends to equity owners- - - - (861) (861)
Total transactions with owners of the Company75,000 405 (11) - (861) (467)
Balance, April 30, 201411,524,421$2,153$9,577 $-$4,864 $16,594

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