8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

July 2, 2024

(Date of the earliest event reported)

Simulations Plus, Inc.

(Exact name of registrant as specified in its charter)

California	001-32046	95-4595609
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

42505 10th Street West, Lancaster, California 93534-7059

(Address of principal executive offices) (Zip Code)

661-723-7723

Registrant's telephone number, including area code

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14z-12 under Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001 per share	SLP	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Item 2.02    Results of Operations and Financial Condition

On July 2, 2024, Simulations Plus, Inc., a California corporation (the “Company”), issued a press release announcing financial results for its third quarter of fiscal year 2024 ended May 31, 2024. The press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K (this “Report”).

Item 7.01    Regulation FD Disclosure

On July 2, 2024, the Company held an investor conference call reporting its financial results for its third quarter of fiscal year 2024 ended May 31, 2024. The PowerPoint presentation, which was used for this investor conference call, is attached as Exhibit 99.2 to this Report.

In accordance with General Instructions B.2 of Form 8-K, the information in this Report, including Exhibits 99.1 and 99.2 (together, the “Exhibits”), is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, except as expressly set forth by specific reference in such filing to this Report.

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

This Report, including the disclosures set forth herein and in the Exhibits attached hereto, contains certain forward-looking statements that involve substantial risks and uncertainties. When used herein, the terms “anticipates,” “expects,” “estimates,” “believes” and similar expressions, as they relate to us or our management, are intended to identify such forward-looking statements.

Forward-looking statements in this Report or reports hereafter furnished, including in other publicly available documents filed with the Securities and Exchange Commission (the “Commission”), to the Company’s stockholders and other publicly available statements issued or released by us involve known and unknown risks, uncertainties and other factors which could cause our actual results, performance (financial or operating) or achievements to differ from the future results, performance (financial or operating) or achievements expressed or implied by such forward-looking statements. Such future results are based upon management’s best estimates based upon current conditions and the most recent results of operations. These risks include, but are not limited to, the risks set forth herein and in such other documents filed with the Commission, each of which could adversely affect our business and the accuracy of the forward-looking statements contained herein. Our actual results, performance or achievements may differ materially from those expressed or implied by such forward-looking statements.

Item 9.01    Financial Statements and Exhibits

(d)    Exhibits

99.1	Press release issued on July 2, 2024.
99.2	PowerPoint presentation used at the Investor Conference Call on July 2, 2024.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	SIMULATIONS PLUS, INC.
Dated: July 2, 2024	By: /s/ Will Frederick
	Will Frederick
	Chief Financial Officer and Chief Operating Officer

2

EX-99.1

Exhibit 99.1

Simulations Plus Reports Third Quarter Fiscal 2024 Financial Results

Total revenue of $18.5 million and diluted earnings per share (EPS) of $0.15

Maintains full-year revenue guidance of $69 to $72 million and updates EPS guidance

LANCASTER, CA, July 2, 2024 – Simulations Plus, Inc. (NASDAQ: SLP) (“Simulations Plus”), a leading provider of biosimulation, simulation-enabled performance and intelligence solutions, and medical communications for the biopharma industry, today reported financial results for its third quarter fiscal 2024, ended May 31, 2024.

Third Quarter 2024 Financial Highlights (compared to third quarter 2023)

•Total revenue increased 14% to $18.5 million

•Software revenue increased 12% to $11.9 million, representing 64% of total revenue

•Services revenue increased 18% to $6.6 million, representing 36% of total revenue

•Gross profit was constant at $13.3 million; gross margin was 71%

•Adjusted EBITDA of $5.7 million, representing 31% of total revenue

•Net income of $3.1 million and diluted earnings per share (EPS) of $0.15 versus net income of $4.0 million and diluted EPS of $0.20

•Adjusted diluted EPS excluding the impact of acquisition costs of $0.19 versus adjusted diluted EPS of $0.21

Nine Months 2024 Financial Highlights (compared to nine months 2023)

•Total revenue increased 17% to $51.3 million

•Software revenue increased 14% to $31.1 million, representing 61% of total revenue

•Services revenue increased 21% to $20.2 million, representing 39% of total revenue

•Gross profit increased 2% to $36.3 million; gross margin was 71%

•Adjusted EBITDA of $16.2 million, representing 32% of total revenue

•Net income of $9.1 million and diluted EPS of $0.45 versus net income of $9.4 million and diluted EPS of $0.46

•Adjusted diluted EPS excluding the impact of acquisition costs was constant at of $0.49

Management Commentary

“Our third quarter results reflected continued solid performance in both our software and services segments,” said Shawn O’Connor, Chief Executive Officer of Simulations Plus. “Total revenue increased 14%, led by higher software sales in our Cheminformatics and Clinical Pharmacology & Pharmacometrics (CPP) business units, with strong growth in our ADMET Predictor®and MonolixSuite™ platforms, respectively. Our Physiologically Based Pharmacokinetics (PBPK) business unit also performed well, reflecting higher revenues from GastroPlus®. During the quarter, we were excited to launch GastroPlus X, the next generation of physiologically based pharmacokinetics/biopharmaceutics (PBPK/PBBM) modeling and simulation software, and believe it will become a meaningful addition to our suite of leading-edge solutions. The 18% increase in services revenue was driven by strong growth in our Quantitative Systems Pharmacology (QSP) and CPP business units.

“Biotech funding is starting to show signs of recovery, most notably for companies that have drug candidates in the clinic. We continue to be cautiously optimistic about the funding environment for our biotech clients. We see a range of spending patterns among large pharmaceutical companies. Some are increasing expenditures, while others remain conservative, with most falling in between depending on various internal and external market factors. Overall, the market is in a better position today compared to a year ago.

“Our acquisition of Pro-ficiency on June 11th brings together our collective expertise in simulations, AI technologies and focus on science, creating a one-of-a-kind platform that spans across the drug development continuum. The Pro-ficiency integration and collaboration is progressing in-line with our internal plan and schedule with positive responses from our clients.

“Our performance in the first nine months of the year remains aligned with our original fiscal 2024 revenue guidance. The newly formed Clinical Simulations and Medical Communications (CSMC) business unit is expected to contribute approximately $3 million to our fiscal 2024 revenue. We are entering our final fiscal quarter of 2024 with a healthy pipeline and remain confident that Simulations Plus is well positioned to achieve its goals for the fiscal year. Going forward, we remain committed to a disciplined growth strategy that will deliver long-term returns for our shareholders.”

Fiscal 2024 Guidance

	Fiscal 2024 Guidance
Revenue	$69M - $72M
Revenue growth	15 - 20%
Software mix	55 - 60%
Services mix	40 - 45%
Diluted EPS	$0.46 - $0.48
Adjusted diluted EPS	$0.54 - $0.56

Quarterly Dividend

The Simulations Plus Board of Directors has determined to discontinue the Company’s quarterly cash dividend and reallocate these funds to our capital allocation strategy for investing in growth initiatives that are intended to generate long-term shareholder value. The final dividend of $0.06 per share of the Company’s common stock will be paid on August 5, 2024, to shareholders of record as of July 29, 2024.

Environmental, Social, and Governance

We focus our Environmental, Social, and Governance (ESG) efforts where we can have the most positive impact. To learn more about our latest initiatives and priorities, please visit our website to read our 2023 ESG update.

Webcast and Conference Call Details

Shawn O’Connor, Chief Executive Officer, and Will Frederick, Chief Financial and Operating Officer, will host a conference call and webcast today at 5 p.m. Eastern Time to discuss the details of the Company’s performance for the quarter and certain forward-looking information. The call may be accessed by registeringhere or by calling 1-877-451-6152 (domestic) or 1-201-389-0879 (international) or by clicking on this Call me™ link to request a return call. The webcast will be available on our website on the investor relations page of the Simulations Plus website at www.simulations-plus.com/investorscorporate-profile/corporate-profile/. A replay of the webcast will be available on the website approximately one hour following the call.

Non-GAAP Definitions

Adjusted EBITDA

Adjusted EBITDA is defined as earnings (loss) before interest, taxes, depreciation and amortization, stock-based compensation, (gain) loss on currency exchange, any acquisition- or financial-transaction-related expenses, and any asset impairment charges. Currency exchange excluded represents the exchange rate fluctuations on the foreign currency denominated transactions. The impact of transactions in foreign currency represents the effect of converting revenue and expenses occurring in a currency other than the functional currency. The Company believes that the non-GAAP financial measures presented facilitate an understanding of operating performance and provide a meaningful comparison of its results between periods. The Company’s management uses non-GAAP financial measures to, among other things, evaluate its ongoing operations in relation to historical results, for internal planning and forecasting purposes and in the calculation of performance-based compensation. Adjusted EBITDA represents a measure that we believe is customarily used by investors and analysts to evaluate the financial performance of companies in addition to the GAAP measures that we present. Our management also believes that Adjusted EBITDA is useful in evaluating our core operating results. However, Adjusted EBITDA is not a measure of financial performance under accounting principles generally accepted in the United States of America and should not be considered an alternative to net income or operating income as an indicator of our operating performance or to net cash provided by operating activities as a measure of our liquidity. The Company’s Adjusted EBITDA measure may not provide information that is directly comparable to that provided by other companies in its industry, as other companies in its industry may calculate non-GAAP financial results differently, particularly related to nonrecurring, unusual items.

Adjusted Diluted EPS

Adjusted diluted EPS is calculated based on net income excluding the impact of any acquisition- or financial-transaction-related expenses, any asset impairment charges, and tax provisions / benefits related to the previous items. The Company excludes the above items because they are outside of the Company’s normal operations and/or, in certain cases, are difficult to forecast accurately for future periods.

The Company believes that the use of non-GAAP measures helps investors to gain a better understanding of the Company’s core operating results and future prospects, consistent with how management measures and forecasts the Company’s performance, especially when comparing such results to previous periods or forecasts.

About Simulations Plus

With more than 25 years of experience serving clients globally, Simulations Plus stands as a premier provider in the Biopharma sector, offering advanced software and consulting services that enhance drug discovery, development, research, clinical trial operations, regulatory submissions, and commercialization. Our comprehensive biosimulation solutions integrate artificial intelligence/machine learning (AI/ML), physiologically based pharmacokinetics, quantitative systems pharmacology/toxicology, and population PK/PD modeling approaches. We also deliver simulation-enabled performance and intelligence solutions alongside medical communications support for clinical and commercial drug development. Our cutting-edge technology is licensed and utilized by leading pharmaceutical, biotechnology, and regulatory agencies worldwide. For more information, visit our website at www.simulations-plus.com. Follow us on LinkedIn | X | YouTube.

Forward-Looking Statements

Except for historical information, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties. Words like “believe,” “expect,” and “anticipate” mean that these are our best estimates as of this writing, but there can be no assurances that expected or anticipated results or events will actually take place, so our actual future results could differ significantly from those statements. Factors that could cause or contribute to such differences include, but are not limited to: our ability to successfully integrate the Pro-ficiency business with our own, as well as expenses we may incur in connection therewith, our ability to maintain our competitive advantages, acceptance of new software and improved versions of our existing software by our customers, the general economics of the pharmaceutical industry, our ability to finance growth, our ability to continue to attract and retain highly qualified technical staff, market conditions, macroeconomic factors, and a sustainable market. Further information on our risk factors is contained in our quarterly and annual reports and filed with the U.S. Securities and Exchange Commission.

Investor Relations Contacts:

Lisa Fortuna

Financial Profiles

310-622-8251

slp@finprofiles.com

Renee Bouche

Simulations Plus Investor Relations

661-723-7723

renee.bouche@simulations-plus.com

1

SIMULATIONS PLUS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(Unaudited)

	Three Months Ended				Nine Months Ended
(in thousands, except per common share amounts)	May 31, 2024		May 31, 2023		May 31, 2024		May 31, 2023
Revenues
Software	$	11,908	$	10,632	$	31,111	$	27,193
Services	6,636		5,602		20,238		16,755
Total revenues	18,544		16,234		51,349		43,948
Cost of revenues
Software	1,400		908		3,739		2,636
Services	3,887		2,053		11,284		5,616
Total cost of revenues	5,287		2,961		15,023		8,252
Gross profit	13,257		13,273		36,326		35,696
Operating expenses
Research and development	1,300		945		3,829		3,428
Sales and marketing	2,399		1,683		6,337		4,898
General and administrative	7,678		6,548		18,878		18,361
Total operating expenses	11,377		9,176		29,044		26,687
Income from operations	1,880		4,097		7,282		9,009
Other income	2,010		843		4,266		2,617
Income before income taxes	3,890		4,940		11,548		11,626
Provision for income taxes	(753)		(932)		(2,437)		(2,199)
Net income	$	3,137	$	4,008	$	9,111	$	9,427
Earnings per share
Basic	$	0.16	$	0.20	$	0.46	$	0.47
Diluted	$	0.15	$	0.20	$	0.45	$	0.46
Weighted-average common shares outstanding
Basic	19,995		19,972		19,972		20,123
Diluted	20,433		20,355		20,324		20,512
Other comprehensive (loss) income, net of tax
Foreign currency translation adjustments	(56)		144		(125)		174
Unrealized losses on available-for-sale securities	$	(39)	$	—	$	(39)	$	—
Comprehensive income	$	3,042	$	4,152	$	8,947	$	9,601

2

SIMULATIONS PLUS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	(Unaudited)		(Audited)
(in thousands, except share and per share amounts)	May 31, 2024		August 31, 2023
ASSETS
Current assets
Cash and cash equivalents	$	109,092	$	57,523
Accounts receivable, net of allowance for credit losses of $149 and $46	10,144		10,201
Prepaid income taxes	1,202		804
Prepaid expenses and other current assets	5,303		3,904
Short-term investments	9,875		57,940
Total current assets	135,616		130,372
Long-term assets
Capitalized computer software development costs, net of accumulated amortization of $18,502 and $17,199	12,614		11,335
Property and equipment, net	882		671
Operating lease right-of-use assets	948		1,247
Intellectual property, net of accumulated amortization of $10,498 and $9,301	7,492		8,689
Other intangible assets, net of accumulated amortization of $2,862 and $2,107	12,712		12,825
Goodwill	19,099		19,099
Deferred tax assets	2,804		1,438
Other assets	524		425
Total assets	$	192,691	$	186,101
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable	$	658	$	144
Accrued compensation	4,111		4,392
Accrued expenses	894		659
Contracts payable	3,810		3,250
Operating lease liability - current portion	410		442
Deferred revenue	1,437		3,100
Total current liabilities	11,320		11,987
Long-term liabilities
Operating lease liability	512		755
Contracts payable – net of current portion	—		3,330
Total liabilities	11,832		16,072
Commitments and contingencies	—		—
Shareholders' equity
Preferred stock, $0.001 par value - 10,000,000 shares authorized; no shares issued and outstanding	$	—	$	—
Common stock, $0.001 par value and additional paid-in capital —50,000,000 shares authorized; 20,007,488 and 19,937,961 shares issued and outstanding	150,451		144,974
Retained earnings	30,713		25,196
Accumulated other comprehensive loss	(305)		(141)
Total shareholders' equity	180,859		170,029
Total liabilities and shareholders' equity	$	192,691	$	186,101

3

SIMULATIONS PLUS, INC.

Trended Financial Information*

(Unaudited)

(in millions except earnings per share amounts)

	FY 2023												FY 2024									FY 2023			FY 2024
	Q1			Q2			Q3			Q4			Q1			Q2			Q3			Full Year			YTD
Revenue
Software	$	6.1		$	10.5		$	10.6		$	9.3		$	7.6		$	11.6		$	11.9		$	36.5		$	31.1
Services	$	5.9		$	5.3		$	5.6		$	6.3		$	6.9		$	6.7		$	6.6		$	23.1		$	20.2
Total	$	12.0		$	15.8		$	16.2		$	15.6		$	14.5		$	18.3		$	18.5		$	59.6		$	51.3
Gross Margin
Software	85.4		%	92.0		%	91.5		%	89.4		%	86.9		%	88.4		%	88.2		%	90.1		%	88.0		%
Services	69.7		%	66.2		%	63.4		%	62.1		%	47.0		%	44.2		%	41.4		%	65.3		%	44.2		%
Total	77.7		%	83.4		%	81.8		%	78.4		%	67.9		%	72.2		%	71.5		%	80.5		%	70.7		%
Income from operations	$	0.9		$	4.0		$	4.1		$	(0.3)		$	1.0		$	4.4		$	1.9		$	8.7		$	7.3
Operating Margin	7.3		%	25.6		%	25.2		%	-1.8		%	6.6		%	24.3		%	10.1		%	14.6		%	14.2		%
Net Income	$	1.2		$	4.2		$	4.0		$	0.5		$	1.9		$	4.0		$	3.1		$	10.0		$	9.1
Diluted Earnings Per Share	$	0.06		$	0.20		$	0.20		$	0.03		$	0.10		$	0.20		$	0.15		$	0.49		$	0.45
Adjusted EBITDA	$	3.0		$	6.2		$	6.5		$	4.9		$	3.4		$	7.1		$	5.7		$	20.6		$	16.2
Adjusted Diluted EPS	$	0.07		$	0.21		$	0.21		$	0.18		$	0.10		$	0.20		$	0.19		$	0.67		$	0.10
Cash Flow from Operations	$	4.7		$	5.5		$	8.5		$	3.1		$	0.2		$	5.8		$	5.7		$	21.9		$	11.7
Revenue Breakdown by Region
Americas	$	8.5		$	10.6		$	10.8		$	11.0		$	10.9		$	12.5		$	12.4		$	40.8		$	35.8
EMEA	2.1			3.6			3.4			2.6			2.3			4.7			4.5			11.7			11.5
Asia Pacific	1.3			1.5			2.1			2.1			1.3			1.2			1.6			7.0			4.1
Total	$	12.0		$	15.8		$	16.2		$	15.6		$	14.5		$	18.3		$	18.5		$	59.6		$	51.3
Software Performance Metrics
Average Revenue per Customer (in thousands)
Commercial	$68.0			$110.0			$97.0			88.0			$79.0			$113.0			$97.0
Services Performance Metrics
Backlog (in millions)	$15.8			$15.4			$15.7			$19.5			$18.9			$18.0			$19.6

*Numbers may not add due to rounding

4

SIMULATIONS PLUS, INC.

Reconciliation of Adjusted EBITDA to Net Income*

(Unaudited)

(in millions)

	FY 2023								FY 2024						FY 2022		FY 2023		FY 2024
	Q1		Q2		Q3		Q4		Q1		Q2		Q3		Full Year		Full Year		YTD
Net Income	$	1.2	$	4.2	$	4.0	$	0.5	$	1.9	$	4.0	$	3.1	$	12.5	$	10.0	$	9.1
Excluding:
Interest income and expense, net	(0.8)		(1.0)		(1.1)		(1.3)		(1.3)		(1.3)		(1.5)		(0.7)		(4.1)		(4.2)
Provision for income taxes	0.4		0.9		0.9		(0.5)		0.5		1.2		0.8		2.6		1.7		2.4
Depreciation and amortization	0.9		0.9		0.9		1.1		1.1		1.1		1.3		3.6		3.9		3.5
Stock-based compensation	0.9		1.2		1.1		1.1		1.3		1.6		1.7		2.7		4.2		4.6
(Gain) loss on currency exchange	—		—		0.3		0.2		—		0.1		—		0.2		0.5		—
Impairment of other intangibles	—		—		—		0.5		—		—		—		—		0.5		—
Change in value of contingent consideration	—		—		—		0.7		(0.1)		0.4		(0.6)		0.3		0.7		(0.3)
Mergers & Acquisitions expense	0.3		0.1		0.4		2.5		—		—		0.9		0.3		3.3		0.9
Adjusted EBITDA	$	3.0	$	6.2	$	6.5	$	4.9	$	3.4	$	7.1	$	5.7	$	21.5	$	20.6	$	16.2

*Numbers may not add due to rounding

5

SIMULATIONS PLUS, INC.

Reconciliation of Adjusted Diluted EPS to Diluted EPS*

(Unaudited)

(in millions, except Diluted EPS and Adjusted Diluted EPS)

	FY 2023								FY 2024						FY 2022		FY 2023		FY 2024
	Q1		Q2		Q3		Q4		Q1		Q2		Q3		Full Year		Full Year		YTD
Net Income (GAAP)	$	1.2	$	4.2	$	4.0	$	0.5	$	1.9	$	4.0	$	3.1	$	12.5	$	10.0	$	9.1
Excluding:
Mergers & Acquisitions expense	0.3		0.1		0.4		0.9		—		—		0.9		0.3		1.7		0.9
Immunetrics transaction costs	—		—		—		2.3		—		—		—		—		2.3		—
Cognigen trade name write-off	—		—		—		0.5		—		—		—		—		0.5		—
Tax effect on above adjustments	(0.1)		—		(0.1)		(0.5)		—		—		(0.2)		(0.1)		(0.7)		(0.2)
Adjusted Net income (Non-GAAP)	$	1.5	$	4.2	$	4.3	$	3.7	$	1.9	$	4.0	$	3.9	$	12.8	$	13.8	$	9.9
Weighted-average common shares outstanding:
Diluted	20.8		20.5		20.4		20.4		20.3		20.3		20.4		20.7		20.5		20.3
Diluted EPS (GAAP)	$	0.06	$	0.20	$	0.20	$	0.03	$	0.10	$	0.20	$	0.15	$	0.60	$	0.49	$	0.45
Adjusted Diluted EPS (Non-GAAP)	$	0.07	$	0.21	$	0.21	$	0.18	$	0.10	$	0.20	$	0.19	$	0.61	$	0.67	$	0.49

*Numbers may not add due to rounding

6

EX-99.2

1 Earnings Call – Q3 - FY24 July 2, 2024

Except for historical information, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties. Words like “believe,” “expect,” and “anticipate” mean that these are our best estimates as of this writing, but there can be no assurances that expected or anticipated results or events will actually take place, so our actual future results could differ significantly from those statements. Factors that could cause or contribute to such differences include, but are not limited to: our ability to successfully integrate the Pro-ficiency business with our own, as well as expenses we may incur in connection therewith, our ability to maintain our competitive advantages, acceptance of new software and improved versions of our existing software by our customers, the general economics of the pharmaceutical industry, our ability to finance growth, our ability to continue to attract and retain highly qualified technical staff, market conditions, macroeconomic factors, and a sustainable market. Further information on our risk factors is contained in our quarterly and annual reports and filed with the U.S. Securities and Exchange Commission. Safe Harbor Statement 2

Third Quarter Highlights $0.15 Diluted EPS $18.5M Revenue 31% Adj. EBITDA as % of Revenue $19.6M Backlog 3 CURRENT PERIOD Prior Year Comparison (3Q23) $16.2M Revenue $0.20 Diluted EPS 40% Adj. EBITDA as % of Revenue $15.7M Backlog $0.19 Adj. Diluted EPS $0.21 Adj. Diluted EPS

▪ Overall software revenue growth of 12% ▪ Good renewal rate, upsell and new logo activity ▪ Active and strong pipeline Third Quarter Software Highlights +13% +7% ▪ 14 new customers ▪ 8 upsells to existing customers ▪ 15 new customers ▪ 10 upsells to existing customers +15% Q3 Revenue Growth Q3 Revenue Growth Q3 Revenue Growth General GastroPlus® (Physiologically Based Pharmacokinetics) MonolixSuite® (Clinical Pharmacology & Pharmacometrics) ADMET Predictor® (Cheminformatics) ▪ 13 new customers ▪ 3 upsells to existing customers 4 +18% +9% +12% YTD Revenue Growth YTD Revenue Growth YTD Revenue Growth

▪ Overall services revenue growth of 18% ▪ Total backlog $19.6M – strong as we enter fourth quarter of fiscal 2024 ▪ Good momentum into fourth fiscal quarter of 2024 Third Quarter Services Highlights +49% +27% ▪ Solid performance despite impact of volatility Q3 Revenue Growth Q3 Revenue Growth General Clinical Pharmacology & Pharmacometrics (CPP) Quantitative Systems Pharmacology (QSP) ▪ Benefiting from immunology and cancer model projects 5 Physiologically Based Pharmacokinetics (PBPK) ▪ Client sourced data delays impacting the initiation of contracted projects-10% Q3 Revenue Decline +74% +16% YTD Revenue Growth YTD Revenue Growth +4% YTD Revenue Growth

Financial Results

64% 36% Software Services 65% 35% Software Services Revenue - Q3 FY24 (in millions) Software RevenueTotal Revenue Services Revenue +14% +12% +18% 3Q24 Mix 3Q23 Mix 7 $9.6 $10.6 $11.9 $5.3 $5.6 $6.6 $15.0 $16.2 $18.5 Software Services 3Q22 3Q23 3Q24

61% 39% Software Services 62% 38% Software Services Revenue - YTD (in millions) Software RevenueTotal Revenue Services Revenue +17% +14% +21% FY24 Mix FY23 Mix 8 $26.8 $27.2 $31.1 $15.4 $16.8 $20.2 $42.2 $43.9 $51.3 Software Services FY22 FY23 FY24

60% 40% Software Services 59% 41% Software Services Revenue - Trailing Twelve Months (TTM) (in millions) Software RevenueTotal Revenue Services Revenue +20% +22% +17% 3Q24 Mix 3Q23 Mix 9 $32.1 $33.1 $40.4 $19.9 $22.6 $26.5$52.0 $55.7 $67.0Software Services 3Q22 3Q23 3Q24

Gross Margin Trends - Q3 FY24 10 92% 91% 88% 66% 63% 41% 83% 82% 71% Software Services Total 3Q22 3Q23 3Q24 1 Decrease in gross margin was partially due to a shift in reporting effective 1Q’24, where certain cost items are reflected in cost of revenues for services that were previously in SG&A expense. 1

Gross Margin Trends - YTD 11 92% 90% 88% 62% 66% 44% 81% 81% 71% Software Services Total FY22 FY23 FY24 1 Decrease in gross margin was partially due to a shift in reporting effective 1Q’24, where certain cost items are reflected in cost of revenues for services that were previously in SG&A expense. 1

Gross Margin Trends - TTM 12 91% 90% 88% 60% 67% 48% 79% 80% 73% Software Services Total 3Q22 3Q23 3Q24 1 Decrease in gross margin was partially due to a shift in reporting effective 1Q’24, where certain cost items are reflected in cost of revenues for services that were previously in SG&A expense. 1

20% 56% 6% 18% Software Revenue by Business Unit 13 Software Business Unit as % of Software Revenue 3Q24 18% 54% 7% 21% CHEM PBPK QSP CPP YTD 19% 54% 7% 20% TTM

Avg. Revenue per Customer (in thousands) Software Performance Metrics - Q3 FY24 Commercial Customers Renewal Rates 14 $95 $97 $97 3Q22 3Q23 3Q24 87% 87% 86% 92% 96% 93% Accounts Fees 3Q22 3Q23 3Q24

Avg. Revenue per Customer (in thousands) Software Performance Metrics - TTM Commercial Customers Renewal Rates 15 $82 $86 $95 3Q22 3Q23 3Q24 86% 83% 84% 93% 94% 92% Accounts Fees 3Q22 3Q23 3Q24

19% 29% 48% 4% Services Revenue by Business Unit 16 Services Business Unit as % of Services Revenue 3Q24 21% 29% 46% 4% PBPK QSP CPP REG YTD 21% 31% 44% 4% TTM

$17.0 $15.7 $19.6 3Q22 3Q23 3Q24 83 67 74 21 23 22 76 76 72 16 46 13 196 212 181 PBPK QSP CPP REG 3Q22 3Q23 3Q24 Services Performance Metrics Total Projects Backlog (in millions) 17

Income Statement Summary - Q3 FY24 18 (in millions, except Diluted EPS and Adjusted Diluted EPS) 3Q24 % of Rev 3Q23 % of Rev Revenue $18.5 100% $16.2 100% Revenue growth 14% 9% Gross profit 13.3 71% 13.3 82% R&D 1.3 7% 0.9 6% S&M 2.4 13% 1.7 10% G&A 7.7 41% 6.5 40% Total operating exp 11.4 61% 9.2 57% Income from operations 1.9 10% 4.1 25% Income before income taxes 3.9 21% 4.9 30% Income taxes (0.8) 4% (0.9) 6% Effective tax rate 19% 19% Net income $3.1 17% $4.0 25% Diluted earnings per share $0.15 $0.20 Adjusted EBITDA $5.7 31% $6.5 40% Excluded items: $0.7 $0.3 Adjusted Diluted EPS $0.19 $0.21

Income Statement Summary - YTD 19 3Q24 % of Rev 3Q23 % of Rev Revenue $51.3 100% $43.9 100% Revenue growth 17% 4% Gross profit 36.3 71% 35.7 81% R&D 3.8 7% 3.4 8% S&M 6.3 12% 4.9 11% G&A 18.9 37% 18.4 42% Total operating exp 29.0 57% 26.7 61% Income from operations 7.3 14% 9.0 20% Income before income taxes 11.5 22% 11.6 26% Income taxes (2.4) 5% (2.2) 5% Effective tax rate 21% 19% Net income $9.1 18% $9.4 21% Diluted earnings per share $0.45 $0.46 Adjusted EBITDA $16.2 32% $15.7 36% Excluded items: $0.8 $0.7 Adjusted Diluted EPS $0.49 $0.49 (in millions, except Diluted EPS and Adjusted Diluted EPS)

Balance Sheet Summary 20 May 31, 2024 August 31, 2023 Cash and short-term investments $119.0 $115.5 Total current assets 135.6 130.4 Total assets $192.7 $186.1 Current liabilities 11.3 12.0 Long-term liabilities 0.5 4.1 Total liabilities 11.8 16.1 Shareholders’ equity 180.9 170.0 Total liabilities and shareholders’ equity $192.7 $186.1 (in millions)

Fiscal 2024 Guidance 21 Guidance Total Revenue $69M - $72M Total Revenue Growth 15% - 20% Software Revenue Mix 55% - 60% Services Revenue Mix 40% - 45% Diluted EPS $0.46 - $0.48 Adjusted Diluted EPS $0.54 - $0.56

STRONG YTD PERFORMANCE IN FISCAL 2024 Delivering on our commitment to scientific leadership Expanding our software and services portfolio 22 • FDA renewal of DILIsym licenses • Collaboration with Toxicology Research Agency • Collaboration with Northeastern University and The TIM Company through new FDA Grant Developing organization to drive growth Creating shareholder value CONTINUED LEADERSHIP POSITION IN BIOSIMULATION MARKET Conclusion • Leadership appointments supporting commitment to clients and drive growth • Reorganized operations to put clients first • Focus on supporting accelerated growth in distributor network • Release of GastroPlusX • Acquisition of Pro- ficiency • Delivering consistent revenue growth and profitability • Increase in services backlog and TTM avg. revenue per customer • Strategic M&A • Corporate development initiative

Adjusted EBITDA Non-GAAP Reconciliation* 23 FY 2022 FY 2023 FY 2024 FY 2022 FY 2023 FY 2024 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Full Year Full Year YTD Net Income $3.0 $4.4 $4.1 $1.0 $1.2 $4.2 $4.0 $0.5 $1.9 $4.0 $3.1 $12.5 $10.0 $9.1 Excluding: Interest income and expense, net (0.1) (0.1) (0.1) (0.4) (0.8) (1.0) (1.1) (1.3) (1.3) (1.3) (1.5) (0.7) (4.1) (4.2) Provision for income taxes 0.8 1.1 0.7 (0.1) 0.4 0.9 0.9 (0.5) 0.5 1.2 0.8 2.6 1.7 2.4 Depreciation and amortization 0.8 1.0 0.9 0.9 0.9 0.9 0.9 1.1 1.1 1.1 1.3 3.6 3.9 3.5 Stock-based compensation 0.6 0.7 0.7 0.7 0.9 1.2 1.1 1.1 1.3 1.6 1.7 2.7 4.2 4.6 (Gain) loss on currency exchange (0.1) (0.1) 0.2 0.2 — — 0.3 0.2 — 0.1 — 0.2 0.5 — Impairment of other intangibles — — — — — — — 0.5 — — — — 0.5 — Change in value of contingent consideration 0.1 0.1 — — — — — 0.7 (0.1) 0.4 (0.6) 0.3 0.7 (0.3) Mergers & Acquisitions expense — — — 0.3 0.3 0.1 0.4 2.5 — — 0.9 0.3 3.3 0.9 Adjusted EBITDA $5.3 $7.2 $6.5 $2.5 $3.0 $6.2 $6.5 $4.9 $3.4 $7.1 $5.7 $21.5 $20.6 $16.2 (in millions) *Numbers may not add due to rounding

Adjusted EPS Non-GAAP Reconciliation* 24 FY 2023 FY 2024 FY 2022 FY 2023 FY 2024 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Full Year Full Year YTD Net Income (GAAP) $1.2 $4.2 $4.0 $0.5 $1.9 $4.0 $3.1 $12.5 $10.0 $9.1 Excluding: Mergers & Acquisitions expense 0.3 0.1 0.4 0.9 — — 0.9 0.3 1.7 0.9 Immunetrics transaction costs — — — 2.3 — — — — 2.3 — Cognigen trade name write-off — — — 0.5 — — — — 0.5 — Tax effect on above adjustments (0.1) — (0.1) (0.5) — — (0.2) (0.1) (0.7) (0.2) Adjusted Net income (Non-GAAP) $1.5 $4.2 $4.3 $3.7 $1.9 $4.0 $3.9 $12.8 $13.8 $9.9 Weighted-average common shares outstanding: Diluted 20.8 20.5 20.4 20.4 20.3 20.3 20.4 20.7 20.5 20.3 Diluted EPS (GAAP) $0.06 $0.20 $0.20 $0.03 $0.10 $0.20 $0.15 $0.60 $0.49 $0.45 Adjusted Diluted EPS (Non-GAAP) $0.07 $0.21 $0.21 $0.18 $0.10 $0.20 $0.19 $0.61 $0.67 $0.49 (in millions, except Diluted EPS and Adjusted Diluted EPS) *Numbers may not add due to rounding

Investor Relations Contacts: Lisa Fortuna Financial Profiles 310-622-8251 slp@finprofiles.com Renee Bouche Simulations Plus Investor Relations 661-723-7723 renee.bouche@simulations-plus.com

XML

Cover	Jul. 02, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Jul. 02, 2024
Entity Registrant Name	Simulations Plus, Inc.
Entity Central Index Key	0001023459
Entity Incorporation, State or Country Code	CA
Entity File Number	001-32046
Entity Tax Identification Number	95-4595609
Entity Address, Address Line One	42505 10th Street West
Entity Address, City or Town	Lancaster
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	93534-7059
City Area Code	661
Local Phone Number	723-7723
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	SLP
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false