Tecsys Inc., an industry-leading supply chain management SaaS company, announced its results for the third quarter of fiscal year 2022, ended January 31, 2022. All dollar amounts are expressed in Canadian currency and are prepared in accordance with International Financial Reporting Standards (IFRS).
Third Quarter Highlights:
- SaaS revenue increased by 49% to $7.0 million in Q3 2022, up from $4.7 million in Q3 2021.
- Annual Recurring Revenue (ARRi) at January 31, 2022 was up 17% to $59.5 million compared to $50.8 million at January 31, 2021.
- During Q3 2022, SaaS subscription bookingsi(measured on an ARRi basis) were $2.3 million, up 133% compared to $1.0 million in the third quarter of fiscal 2021.
- Professional services revenue was up 5% to $12.9 million in Q3 2022 compared to $12.3 million in Q3 2021.
- Total revenue was a record $35.4 million, 11% higher than $31.9 million reported for Q3 2021.
- Gross margin was 43% compared to 48% in the prior year quarter, negatively impacted by a weaker US dollar, change in revenue mix and investment in key growth initiatives.
- Total gross profit decreased to $15.2 million, down 1% from $15.4 million in Q3 2021.
- Operating expenses increased to $13.9 million, higher by $1.1 million or 9% compared to $12.8 million in Q3 fiscal 2022 with continuing investment in sales and marketing as well as research and development.
- Profit from operations in Q3 2022 was $1.4 million, down from $2.6 million in Q3 2021.
- Net profit was $0.9 million or $0.06 per share on a fully diluted basis in Q3 2022 compared to a net profit of $1.8 million or $0.12 per share on a fully diluted basis for the same period in fiscal 2021.
- Adjusted EBITDAiiwas $2.7 million in Q3 2022, down 31% compared to $4.0 million reported in Q3 2021.
- A weaker USD to CAD exchange rate negatively impacted revenue by $1.7 million and Profit from operations and Adjusted EBITDA by $1.6 million compared to the same quarter last year.
“This quarter happened in the middle of a challenging global environment with the Omicron wave hitting many of our customers very hard in late December and January. We were pleased to see the quarter come in strong as the twelfth consecutive quarter of record revenue. We added another hospital network in the quarter and saw strong bookings from our base, as well. This solid growth trajectory is a strong testament to our greatest asset, the people of Tecsys, and our truly adaptable agile solutions helping our customers succeed in a climate where excellence in supply chain execution is a key driver for success,” said Peter Brereton, president and CEO of Tecsys, Inc. “Our pipeline continues to swell with new customer opportunities and as the pandemic seems to be finally fading away, Q4 is off to a strong start.”
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 third quarter fiscal 2022 revenue grew by about 16% compared to the same period last year, with SaaS revenue once again being a key driver at 56% constant currency growth. We continue to expect a key milestone in the coming quarters with SaaS revenue set to overtake maintenance and support as our leading source of recurring revenue.”
Year-to-date performance for first nine months of fiscal 2022:
- SaaS revenue for the nine-month period increased by 41% to $19.2 million, up from $13.7 million in the same period of fiscal 2021.
- SaaS subscription bookingsi(measured on an ARRi basis) were $7.5 million, up 23% compared to $6.1 million the same period of fiscal 2021.
- Professional services revenue for the nine-month period was up 11% to $39.1 million compared to $35. million in the same period of fiscal 2021.
- Total revenue was a record $102.9 million, 13% higher than $90.7 million reported for the same period of fiscal 2021.
- Gross margin was 44% compared to 49% in the same period of fiscal 2021, negatively impacted by a weaker US dollar, revenue mix and investment in key growth initiatives.
- Total gross profit increased to $45.2 million, up 1% from $44.9 million in the same period fiscal 2021.
- Operating expenses increased to $41.1 million, higher by $4.3 million or 12% compared to $36.9 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 nine months of fiscal 2022 was $4.1 million, down from $8.1 million in the same period of fiscal 2021.
- Net profit was $1.9 million or $0.13 per share on a fully diluted basis in the first nine months of fiscal 2022 compared to a net profit of $5.2 million or $0.35 per share on a fully diluted basis for the same period in fiscal 2021.
- Adjusted EBITDAiiwas $8.4 million in the first nine months of fiscal 2022, down 32% compared to $12.3 million reported in the same period in fiscal 2021.
- A weaker USD to CAD exchange rate negatively impacted revenue by $6.0 million and Profit from operations and Adjusted EBITDA by $4.6 million compared to the same period last year.
On March 2, 2022, the Company’s Board of Directors declared a quarterly dividend of $0.07 per share to be paid on April 14, 2022 to shareholders of record on March 24, 2022.
Pursuant to the Canadian Income Tax Act, dividends paid by the Company to Canadian residents are considered to be “eligible” dividends.
Third Quarter of Fiscal 2022 Results Conference Call
Date: March 3, 2022
Time: 8:30 a.m. EST
Phone number: (877) 200-1292 or (416) 620-9188
The call can be replayed until March 10, 2022 by calling:
(416) 626-4100 or (800) 558-5253 (access code: 22015722)
