American Software (AMSWA) Tops Q2 EPS by 3c

American Software (NASDAQ: AMSWA) reported Q2 EPS of $0.08, $0.03 better than the analyst estimate of $0.05. Revenue for the quarter came in at $28.21 million versus the consensus estimate of $28.22 million.

Key Second quarter financial highlights:

• Subscription fees were $5.5 million for the quarter ended October 31, 2019, a 64% increase compared to $3.3 million for the same period last year, while Software license revenues were $1.0 million, a 48% decrease compared to $2.0 million for the same period last year, reflecting our continued transition to the SaaS engagement model.
• Cloud Services Annual Contract Value (ACV) increased approximately 55% to $22.4 million as of the quarter ended October 31, 2019 compared to $14.5 million as of the same period of the prior year.
• Total revenues for the quarter ended October 31, 2019 were $28.2 million, an increase of 1% over the comparable period last year.
• Recurring revenue streams for Maintenance and Cloud Services were 58% of total revenues in the quarter ended October 31, 2019 compared to 53% in the same period of the prior year.
• Maintenance revenues for the quarter ended October 31, 2019 decreased 7% to $10.8 million compared to $11.6 million for the same period last year.
• Professional services and other revenues for the quarter ended October 31, 2019 decreased 2% to $10.8 million compared to $11.1 million for the same period last year.
• Operating earnings for the quarter ended October 31, 2019 decreased 45% to $0.8 million compared to $1.5 million for the same period last year.
• GAAP net earnings for the quarter ended October 31, 2019 increased 42% to $1.8 million or $0.05 per fully diluted share compared to $1.2 million or $0.04 per fully diluted share for the same period last year.
• Adjusted net earnings for the quarter ended October 31, 2019, which excludes non-cash stock-based compensation expense and amortization of acquisition-related intangibles, were $2.5 million or $0.08 per fully diluted share compared to $2.2 million or $0.07 per fully diluted share for the same period last year.
• EBITDA decreased by 12% to $3.0 million for the quarter ended October 31, 2019 compared to $3.4 million for the same period last year.
• Adjusted EBITDA decreased by 9% to $3.5 million for the quarter ended October 31, 2019 compared to $3.9 million for the quarter ended October 31, 2018. Adjusted EBITDA represents GAAP net earnings adjusted for amortization of intangibles, depreciation, interest (expense)/income & other, net, income tax (benefit)/expense and non-cash stock-based compensation expense.

“We are pleased with our 64% growth in Subscription Fees and 55% increase in Cloud Services ACV as these key performance indicators continue to underscore our successful transition to a cloud-first company,” said Allan Dow, president of American Software. “Our cloud-based solutions enable customers to gain additional value as they leverage our expertise in managing the solution platform and staying current with the latest innovative planning capabilities available. Additionally, our recurring revenue streams of Maintenance and Subscription Cloud Services represented 58% of second quarter total revenues, giving our business and shareholders increased visibility with respect to future revenue performance.”

“Our cloud-based solutions provide customers with the increased visibility and accuracy necessary to become a connected enterprise, automate critical planning functions and make better decisions across operational, tactical and strategic horizons, all on a single platform,” continued Dow. “We believe customers that take advantage of our advancements in artificial intelligence (AI), machine learning (ML) and advanced supply chain analytics to improve their operating performance from product concept to customer availability, will be better positioned to overcome the growing supply chain talent shortage that may hamper their profitable growth and ability to respond to rapidly changing market conditions.”

For earnings history and earnings-related data on American Software (AMSWA) click here.

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