Tecsys Inc., an industry-leading supply chain management SaaS company, announced its results for the second quarter of fiscal year 2022, ended October 31, 2021. All dollar amounts are expressed in Canadian currency and are prepared in accordance with International Financial Reporting Standards (IFRS).
Second Quarter Highlights:
- SaaS revenue increased by 28% to $6.6 million in Q2 2022, up from $5.1 million in Q2 2021.
- Annual Recurring Revenue (ARRi) at October 31, 2021 was up 12% to $56.9 million compared to $50.9 million at October 31, 2020.
- During Q2 2022, SaaS subscription bookingsi(measured on an ARRi basis) were $4.0 million, up 50% compared to $2.7 million in the second quarter of fiscal 2021.
- Professional services revenue was up 11% to $13.1 million in Q2 2022 compared to $11.8 million in Q2 2021.
- Total revenue was a record $34.3 million, 12% higher than $30.7 million reported for Q2 2021.
- Gross margin was 45% compared to 52% in the prior year quarter, negatively impacted by a weaker US dollar, investment in our key growth initiatives and revenue mix. Total gross profit decreased to $15.5 million, down 3% from $16.0 million in Q2 2021.
- Operating expenses increased to $13.9 million, higher by $1.3 million or 11% compared to $12.6 million in Q2 fiscal 2021 with continuing investment in sales and marketing as well as research and development.
- Profit from operations in Q2 2022 was $1.6 million, down from $3.5 million in Q2 2021.
- Net profit was $0.7 million or $0.05 per share on a fully diluted basis in Q2 2022 compared to a net profit of $2.1 million or $0.14 per share on a fully diluted basis for the same period in fiscal 2021.
- Adjusted EBITDAiiwas $3.2 million in Q2 2022, down 34% compared to $4.8 million reported in Q2 2021.
“We continue our momentum into yet another quarter of record revenue and solid sequential and year-over-year growth. We are supporting that performance with excellent strides in building out our sales team, strengthening our delivery capacity, investing in our platform, and developing our pipeline,” said Peter Brereton, president and CEO of Tecsys, Inc. “Our three target verticals are all performing or outperforming expectations, with notable wins in healthcare with three new major hospital networks, and an expanding customer base in global retail and our distribution market. We are confident that we are favorably positioned as the heightened focus on supply chains turns into greater investment in supply chain agility and the specialized technologies that underpin it.”
Mark Bentler, chief financial officer of Tecsys Inc., added, “We are pleased with another quarter of solid revenue growth in spite of significant foreign currency headwinds. On a constant currency basis, our second quarter fiscal 2022 revenue grew by about 18% compared to the same period last year, with SaaS revenue once again being a key driver. Currency fluctuations knocked about $2 million off of revenue and $1.5 million off of adjusted EBITDA compared to the same quarter last year. Considering the general trajectory of our SaaS revenue, within a few quarters we are likely to see SaaS revenue overtaking maintenance and support as our leading source of recurring revenue.”
Year-to-date performance for first half of fiscal 2022:
- SaaS revenue increased by 36% to $12.2 million in the first half of fiscal 2022, up from $9.0 million the same period of fiscal 2021.
- SaaS subscription bookingsi(measured on an ARRi basis) were $5.1 million for both the first half of fiscal 2022 and 2021.
- Professional services revenue was up 14% to $26.2 million in the first half of fiscal 2022 compared to $23.0 million in the same period of fiscal 2021.
- Total revenue was a record $67.5 million, 15% higher than $58.8 million reported for the same period of fiscal 2021.
- Gross margin was 44% compared to 50% in the same period of fiscal 2021, negatively impacted by a weaker US dollar, investment in our key growth initiatives and revenue mix.
- Total gross profit increased to $29.9 million, up 2% from $29.5 million in the same period fiscal 2021.
- Operating expenses increased to $27.2 million, higher by $3.2 million or 13% compared to $24.0 million in the same period of fiscal 2021 with continuing investment in sales and marketing as well as research and development.
- Profit from operations in the first half of fiscal 2022 was $2.7 million, down from $5.4 million in the same period of fiscal 2021.
- Net profit was $1.0 million or $0.06 per share on a fully diluted basis in the first half of fiscal 2022 compared to a net profit of $3.3 million or $0.23 per share on a fully diluted basis for the same period in fiscal 2021.
- Adjusted EBITDAiiwas $5.7 million in the first half of fiscal 2022, down 32% compared to $8.3 million reported in the same period in fiscal 2021.
On December 1, 2021, the Company’s Board of Directors declared a quarterly dividend of $0.07 per share to be paid on January 7, 2022 to shareholders of record on December 16, 2021.
