Model N Inc. (MODN) Tops Q1 EPS by 9c, Revenues Beat; Offers 2Q & FY21 Revenue Guidance Above Consensus, 2Q & FY21 EPS Guidance View Below Consensus

Model N Inc. (NYSE: MODN) reported Q1 EPS of $0.16, $0.09 better than the analyst estimate of $0.07. Revenue for the quarter came in at $42.7 million versus the consensus estimate of $40.42 million.

First Quarter 2021 Financial Highlights

• Revenues: Total revenues were $42.7 million, an increase of 11% from the first quarter of fiscal year 2020. Subscription revenues were $31.4 million, an increase of 12% from the first quarter of fiscal year 2020.
• Gross Profit: Gross profit was $25.6 million, an increase of 16% from the first quarter of fiscal year 2020. Gross margin was 60% compared to 57% for the first quarter of fiscal year 2020. Non-GAAP gross profit was $27.1 million, an increase of 15% from the first quarter of fiscal year 2020. Non-GAAP gross margin was 63% compared to 61% for the first quarter of fiscal year 2020. Subscription gross margin was 71% compared to 69% for the first quarter of fiscal year 2020. Non-GAAP subscription gross margin was 74% compared to 72% for the first quarter of fiscal year 2020.
• GAAP Loss and Non-GAAP Income from Operations: GAAP loss from operations was $(1.3) million, an improvement of 46% from the first quarter of fiscal year 2020. Non-GAAP income from operations was $7.3 million, an increase of 59% from the first quarter of fiscal year 2020.
• GAAP Net Loss: GAAP net loss was $(5.2) million compared to a net loss of $(3.0) million for the first quarter of fiscal year 2020. GAAP basic and diluted net loss per share attributable to common stockholders was $(0.15) based upon weighted average shares outstanding of 34.9 million compared to net loss per share of $(0.09) for the first quarter of fiscal year 2020 based upon weighted average shares outstanding of 33.1 million.
• Non-GAAP Net Income: Non-GAAP net income was $5.9 million, an increase of 41% from the first quarter of fiscal year 2020. Non-GAAP net income per diluted share was $0.16 based upon diluted weighted average shares outstanding of 36.0 million compared to non-GAAP net income per diluted share of $0.12 for the first quarter of fiscal year 2020 based upon diluted weighted average shares outstanding of 34.6 million.
• Adjusted EBITDA: Adjusted EBITDA was $7.5 million, an increase of 55% from the first quarter of fiscal year 2020.
• Cash and Cash Flows: Cash and cash equivalents as of December 31, 2020 totaled $143.5 million. During the quarter, the company paid $56.4 million for the acquisition. Net cash used in operating activities was $0.2 million for the first quarter of fiscal year 2021, compared with net cash used in operating activities of $5.0 million in the prior fiscal year period. Free cash flow was $(0.6) million for the first quarter of fiscal year 2021, compared with free cash flow of $(5.0) million in the prior fiscal year period.

“Our first quarter results exceeded expectations across every metric, and we achieved another quarter of record revenue,” said Jason Blessing, president and chief executive officer of Model N. “Looking ahead, I am even more excited about Model N’s future. We believe our recently completed acquisition of Deloitte’s pricing and contracting solutions business will bolster our already strong foundation, significantly expand our addressable market and enable even more opportunities for success in fiscal year 2021 and beyond. With this acquisition, we added significant Life Sciences talent, customers, and a purpose-built technology to our already formidable company, making the new Model N an even more valued partner to the customers we serve.”

GUIDANCE:

Model N Inc. sees Q2 2021 EPS of ($0.06)-($0.05), versus the consensus of $0.06. Model N Inc. sees Q2 2021 revenue of $46-46.5 million, versus the consensus of $41.9 million.

Model N Inc. sees FY2021 EPS of $0.10-$0.15, versus the consensus of $0.31. Model N Inc. sees FY2021 revenue of $184-186 million, versus the consensus of $171.18 million.

• The impact of COVID-19 and its effect on Model N’s business is included in the guidance that is being provided for the second quarter fiscal year 2021 and the full fiscal year ending September 30, 2021 and reflects the company’s outlook as of February 9, 2021.

For earnings history and earnings-related data on Model N Inc. (MODN) click here.

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