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 7, 2020

(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 10^th Street West, Lancaster, California 93534-7059

(Address of principal executive offices) (Zip Code)

661-723-7723

Registrant's telephone number, including area code

N/A

(Former name or former address, if changed since last report)

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 7.01 Regulation FD Disclosure

On July 9, 2020, Simulations Plus, Inc., a California corporation (the "Company"), issued a press release announcing that its board of directors has declared a quarterly cash dividend of $0.06 per share of common stock, payable on August 3, 2020 to shareholders of record on July 27, 2020.

A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.

Item 8.01 Other Events

On July 9, 2020, Simulations Plus, Inc., a California corporation (the "Company"), issued a press release announcing financial results for its third quarter of fiscal year 2020 ended May 31, 2020. The press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

On July 9, 2020, Simulations Plus, Inc., a California corporation (the "Company"), held an investor conference call reporting its third quarter financial results of fiscal year 2020 ended May 31, 2020. The PowerPoint slides, which were used for this Investor Conference Call, are attached herein as exhibit 99.2 to this Current Report on Form 8-K.

The information contained in this Current Report on Form 8-K shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. The information set forth in this Current Report on Form 8-K shall not be deemed an admission as to the materiality of any information in this report on Current Report on Form 8-K that is required to be disclosed solely to satisfy the requirements of Regulation FD.

This report on Form 8-K (the "Report"), including the disclosures set forth herein, 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 hereafter, including in other publicly available documents filed with the Securities and Exchange Commission (the "Commission"), reports to the stockholders of Simulations Plus, Inc., a California corporation (the "Company" or "us," "our" or "we") 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 9, 2020.

99.2 PowerPoint presentation at the Investor Conference Call on July 9, 2020.

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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 13, 2020	By: /s/ John R. Kneisel
	John R. Kneisel
	Chief Financial Officer

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EX-99.1

Exhibit 99.1

For Further Information:

Simulations Plus, Inc.

42505 10^th Street West

Lancaster, CA 93534-7059

CONTACT:

Simulations Plus Investor Relations	Hayden IR
Ms. Renée Bouché	Mr. Cameron Donahue
661-723-7723	651-653-1854
renee@simulations-plus.com	slp@haydenir.com

For Immediate Release:

July 9, 2020

Simulations Plus Reports Third Quarter FY2020 Financial Results

Third Quarter and 9MoFY20 Revenues Grow 24%

Board of Directors Announces Quarterly Dividend of $0.06 Per Share

Company Files Shelf Registration Statement

LANCASTER, CA, July 9, 2020 – Simulations Plus, Inc. (Nasdaq: SLP), the leading provider of modeling and simulation solutions for the pharmaceutical, biotechnology, chemicals, and consumer goods industries, today reported financial results for its third quarter of fiscal year 2020 (3QFY20) and the first nine months of fiscal year 2020 (9moFY20), the period ended May 31, 2020.

3QFY20 highlights compared with 3QFY19:

· Net revenues increased 23.8% to $12.3 million, an increase of $2.4 million over $9.9 million

· Gross profit was up 26.5% to $9.6 million, an increase of $2.0 million over $7.6 million

· SG&A was $5.0 million, an increase of 62.6% or $1.9 million over $3.1 million

· SG&A as a percentage of revenues increased to 40.9% from 31.1%, inclusive of $1.1 million in one-time transaction costs related to the Lixoft acquisition

· Total R&D expenditures were $1,359,000, an increase of $293,000, or 27.5% over $1,066,000

o In 3QFY20, $606,000 was capitalized and $753,000 was expensed

o In 3QFY19, $422,000 was capitalized and $643,000 was expensed

· Income before taxes remained flat at $3.9 million

· Net income increased 1.6% to $2.9 million, an increase of $47,000 over $2.9 million

· Diluted earnings per share remained unchanged at $0.16. One-time transaction costs related to the Lixoft acquisition of $1.1 million (approx. $837,000 net of tax) effected a decrease of $0.04 diluted earnings per share for the quarter

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9moFY20 highlights compared with 9moFY19:

· Net revenues increased 23.5% to $32.0 million, an increase of $6.1 million over $25.9 million

· Gross profit was up 25.3% to $24.1 million, an increase of $4.9 million over $19.2 million

· SG&A was $12.6 million, an increase of $4.0 million, or 46.8%, over $8.6 million

· SG&A as a percentage of revenues increased to 39.5% from 33.2%, inclusive of $1.4 million in one-time transaction costs related to the Lixoft acquisition

· Total R&D expenditures were $3.8 million, an increase of $500,000, or 15.4% over $3.3 million

o For 9moFY20, $1.7 million was capitalized and $2.0 million was expensed

o For 9moFY19, $1.4 million was capitalized and $1.9 million was expensed

· Income before taxes increased 9.1% to $9.4 million, an increase of $779.000 over $8.6 million

· Net income increased 9.5% to $7.1 million, an increase of $620,000 over $6.5 million

· Diluted earnings per share increased 7.7% to $0.39 from $0.36. One-time transaction costs related to the Lixoft acquisition of $1.4 million (approx. $1.1 million net of tax) effected a $0.06 decrease in 9moFY20 diluted earnings per share

Shawn O’Connor, chief executive officer of Simulations Plus, said: “Keeping with historical seasonality trends, the third quarter was again a strong quarter with revenue increasing 24% year-over-year to $12.3 million, demonstrating the significant progress we have made to accelerate growth. A solid base of recurring revenue and a large backlog of project-based service business have minimized the impact from current economic conditions resulting from the effects of the COVID-19 pandemic. While certain new customer software license and service projects were delayed in recent months, we continue to believe opportunities have been delayed, but not lost. Our backlog remains healthy, and we are encouraged by the pickup of new software license closures and consulting contracts at the end of the quarter. We expect double-digit, year-over-year revenue growth in the fiscal fourth quarter, despite the impact of seasonality on a sequential basis.”

“The integration of Lixoft is going well and initial feedback from the marketplace has been overwhelmingly positive as customers acknowledge the strengthening of our offerings with the Monolix Suite,” Mr. O’Connor continued. “We are collaborating across the enterprise to fully integrate our sales and marketing efforts and leverage our existing infrastructure to extract maximum synergies and present a unified approach to our customers.”

John Kneisel, chief financial officer of Simulations Plus, added: “The dependable cash flow generation of our business was further enhanced with the immediately accretive acquisition of Lixoft in the third quarter. Following this cash investment, our financial position remains strong with a solid balance sheet that includes $7 million in unrestricted cash and no outstanding borrowed debt at the end of the third quarter and access to additional capital via a new, undrawn $3.5 million line of credit. Through a steady approach to growth and the prudent allocation of capital, we are able to maintain the economic engine of our business, invest for future growth, and return capital to shareholders in the form of quarterly cash dividends.”

Registration Statement Filing

In addition, the Company today filed with the Securities and Exchange Commission (the “Commission”) its Registration Statement on Form S-3 (the “Registration Statement”) filed pursuant to the Securities Act of 1933, as amended (the “Securities Act”). The Registration Statement, including the prospectus which forms a part of the Registration Statement (the “Base Prospectus”), and as will be supplemented from time to time by one or more prospectus supplements (each, a “Prospectus Supplement,” and together with the Base Prospectus, a “Prospectus”), provides for the registration by the Company of the following securities: (a) shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”); (b) shares of one or more series of the Company’s preferred stock, par value $0.001 per share (the “Preferred Stock”); (c) warrants for the purchase of Common Stock, Preferred Stock and other securities or rights (individually or collectively, the “Warrants”); (d) depositary shares (the “Depositary Shares”); and/or (e) units of the Company consisting of one or more of the securities described above (the “Units”). The prospectus was filed as a “well-known seasoned issuer” as defined in Rule 405 under the Securities Act of 1933, as amended, or the Securities Act, using a “shelf” registration process. By using a shelf registration statement, the Company may sell securities from time to time and in one or more offerings as described in the prospectus.

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Shawn O’Connor, chief executive officer of Simulations Plus, said: “The Company’s filing of its shelf registration provides the company the flexibility required to support any future need to issue securities for any working capital, mergers and acquisitions, or general corporate purposes. Our recent qualification under the well-known seasoned issuer requirements made this undertaking timely and efficient.”

Quarterly Dividend Declared

The Company’s Board of Directors has declared a cash dividend of $0.06 per share of the Company’s common stock payable on August 3, 2020, to shareholders of record as of July 27, 2020. The declaration of any future dividends will be determined by the Board of Directors each quarter and will depend on earnings, financial condition, capital requirements, and other factors.

Investor Conference Call

The Company invites all interested persons to attend its conference call at 4:15 p.m. Eastern Time on July 9, 2020. The live webcast/teleconference will be accessible by registering here. A live, listen-only teleconference will also be available by dialing (562) 247-8422. Please dial in five to ten minutes prior to the scheduled start time. A replay of the webcast will be available at the Investors section of the Simulations Plus website following the call.

About Simulations Plus, Inc.

Simulations Plus, Inc., is a premier developer of drug discovery and development software as well as a leading provider of both preclinical and clinical pharmacometric consulting services for regulatory submissions and quantitative systems pharmacology/toxicology models for drug-induced liver injury and nonalcoholic fatty liver disease. The company is a global leader focused on improving the ways scientists use knowledge and data to predict the properties and outcomes of pharmaceutical, biotechnology, and chemical agents. Our software is licensed to and used in the conduct of research by major pharmaceutical, biotechnology, chemical, consumer goods companies, and regulatory agencies worldwide. Our innovations in integrating new and existing science in medicinal chemistry, computational chemistry, artificial intelligence, pharmaceutical science, biology, and physiology into our software have made us the leading software provider for molecular property prediction from structure and physiologically based pharmacokinetic modeling and simulation. For more information, visit our website at www.simulations-plus.com.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 – With the exception of historical information, the matters discussed in this press release are forward-looking statements that involve a number of risks and uncertainties. Words like “believe,” “expect” and “anticipate” mean that these are our best estimates as of this writing, but that 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 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, our ability to identify and close acquisitions on terms favorable to the Company, 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.

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– Tables follow –

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SIMULATIONS PLUS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	(Unaudited)		(Audited)
	May 31		August 31,
	2020		2019
ASSETS
Current assets
Cash and cash equivalents	$	7,354,496	$	11,435,499
Accounts receivable, net of allowance for doubtful accounts of $25,000 and $0		10,853,452		5,026,558
Revenues in excess of billings		2,838,072		3,233,659
Prepaid income taxes		392,099		765,110
Prepaid expenses and other current assets		745,468		704,316
Total current assets		22,183,587		21,165,142
Long-term assets
Capitalized computer software development costs,
net of accumulated amortization of $13,293,943 and $12,356,055		5,754,971		4,959,736
Property and equipment, net		356,784		341,145
Operating lease right of use asset		1,019,408		–
Intellectual property, net of accumulated amortization of $4,729,270 and $3,948,750		12,275,730		5,026,249
Other intangible assets net of accumulated amortization of $1,503,481 and $1,210,000		7,146,519		3,280,000
Goodwill		12,792,171		10,387,198
Other assets		49,957		37,227
Total assets	$	61,579,127	$	45,196,697
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable	$	663,337	$	204,075
Accrued payroll and other expenses		2,137,383		1,639,038
Current portion - Contracts payable		3,761,028		1,761,028
Billings in excess of revenues		269,232		798,549
Operating lease liability, current portion		525,454		–
Deferred revenue		428,611		380,787
Total current liabilities		7,785,045		4,783,477
Long-term liabilities
Deferred income taxes, net		2,775,398		2,731,616
Operating Lease Liability		489,463		–
Payments due under Contracts payable		3,942,333		–
Total liabilities		14,992,239		7,515,093
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 50,000,000 shares authorized 17,788,498 and 17,591,834 shares issued and outstanding		7,791		7,595
Additional paid-in capital		20,231,443		15,319,474
Accumulated Translation Adjustment		30,460		–
Retained earnings		26,317,194		22,354,535
Total shareholders' equity	$	46,586,888	$	37,681,604
Total liabilities and shareholders' equity	$	61,579,127	$	45,196,697

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SIMULATIONS PLUS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

For the three and nine months ended May 31, 2020 and May 31, 2019

	Three months ended						Nine months ended
	(Unaudited)						(Unaudited)
	2020			2019			2020			2019
Revenues	$	12,298,036		$	9,936,921		$	32,049,003		$	25,944,545
Cost of revenues		2,665,405			2,324,188			7,974,702			6,734,890
Gross margin		9,632,630			7,612,733			24,074,301			19,209,655
Operating expenses
Selling, general, and administrative		5,023,132			3,087,445			12,646,512			8,613,788
Research and development		752,719			643,255			2,026,684			1,896,926
Total operating expenses		5,775,851			3,730,700			14,673,197			10,510,714
Income from operations		3,856,779			3,882,033			9,401,104			8,698,941
Other income (expense)
Interest income		4,465			11,050			27,814			20,296
Interest expense		–			(32,702	)		–			(109,078	)
Change in value of contingent consideration		(81,000	)		–			(81,000	)		–
(Loss) income on currency exchange		(602	)		(7,941	)		1,283			(40,467	)
Total other income (expense)		(77,137	)		(29,593	)		(51,902	)		(129,249	)
Income before provision for income taxes		3,779,642			3,852,440			9,349,202			8,569,692
Provision for income taxes		(844,073	)		(963,734	)		(2,205,276	)		(2,045,590	)
Net Income	$	2,935,569		$	2,888,706		$	7,143,925		$	6,524,102
Earnings per share
Basic	$	0.17		$	0.16		$	0.40		$	0.37
Diluted	$	0.16		$	0.16		$	0.39		$	0.36
Weighted-average common shares outstanding
Basic		17,735,354			17,519,849			17,661,189			17,472,922
Diluted		18,426,872			18,096,195			18,333,596			18,008,336

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EX-99.2

Exhibit 99.2

Q3FY2020 Investor Conference Call Shawn O’Connor, CEO John Kneisel, CFO July 9, 2020 (NASDAQ:SLP)

2 With the exception of historical information, the matters discussed in this presentation are forward - looking statements that involve a number of risks and uncertainties . The actual results of the Company could differ significantly from those statements . Factors that could cause or contribute to such differences include but are not limited to : continuing demand for the Company’s products, competitive factors, the Company’s ability to finance future growth, the Company’s ability to produce and market new products in a timely fashion, the Company’s ability to continue to attract and retain skilled personnel, and the Company’s ability to sustain or improve current levels of productivity . Further information on the Company’s risk factors is contained in the Company’s quarterly and annual reports and filed with the Securities and Exchange Commission . Safe Harbor Statement

Steady and Consistent Revenue Growth 3 Organic Revenue Growth has accelerated to new 15 - 20% range $11.2 $12.0 $13.5 $14.7 $16.8 $4.8 $5.9 $9.4 $11.2 $15.2 $16.0 $17.9 $22.9 $25.9 $32.0 2016 2017 2018 2019 2020 9 Months Revenue $ in millions Software Consulting Key Highlights • Q3 FY2020 Financial Highlights – Revenue up 23.8% for Q3FY20 vs Q3FY19 – Gross profit 78.3% for Q3FY20 vs 76.6% Q3FY19 – Net income before taxes 39.7% Q3FY20 (excluding one - time acquisition expenses) vs 38.8% Q3FY19 – EPS $0.16 Q3FY20 ($0.20 excluding one - time acquisition expenses) vs $0.16 Q3FY19 – Cash generated from operations during the quarter of $6.1M with cash on hand at end of quarter of $7.4M • Operational Highlights – Software revenue: 56% of total revenue, 18% y/y growth – Service revenue: 44% of total revenue, 32% y/y growth – 133 Employees (including 97 with advanced degrees) up 23% y/y (60% of that growth is billable consulting staff) $4.5 $4.7 $5.5 $5.8 $6.8 $1.5 $2.0 $3.0 $4.1 $5.5 $6.0 $6.7 $8.5 $9.9 $12.3 16.3 17.3 18.3 19.3 20.3 Third Quarter Revenue $ in millions

COVID - 19 Impact • Operational Impact - Minimal – Operational transition achieved without disruption – Offices are re - opening on a voluntary basis but anticipate continued highly remote workforce into the future • Financial Impact – Minimal – Recurring revenues • 85% of software revenue this quarter sourced from renewals • 47% of total company revenues this quarter sourced from renewals – Service backlog • Ended quarter with more that $12 million in contract backlog representing more than 3 quarters of average service revenue • New Business Impact – Moderate but improving – Slowdown in new business closures both in terms of new software licenses and new service business – Software delays especially in our Asian market – Software and service sales cycles transitioned to lead generation, virtual meetings and presentations and our pipeline of business is growing – Recently introduced service offerings in regulatory guidance and Covid rapid response have generated new opportunities 4

Simulations Plus Division (Lancaster) 5 The genesis of the company… providing software, training and consulting services $11.1 $11.9 $12.8 $13.8 $15.5 $0.7 $0.8 $1.4 $1.6 $2.1 $11.8 $12.7 $14.2 $15.4 $17.6 2016 2017 2018 2019 2020 9 Months Revenue $ in millions Software Consulting Simulations Plus represented 55% of total revenue and 63% of EBITDA for Q3 FY2020 Key Highlights • Q3 FY2020 Financial Highlights – Revenue up 12% for the quarter – Q3 Revenue breakdown: 79% Renewal; 10% New; 11% Services – Software renewal: 88% (accounts), 94% (fees) – 11 new commercial companies added software licenses – 12 new non - profit research groups added software licenses – Projects with 28 companies and 7 funded collaborations • Operational Highlights – Continued progress on research initiatives: • GastroPlus® X (GPX) • ADMET Predictor® X (APX) – New FDA grant award to develop strategies for PBPK/PD model translation from animals to human for ocular products – New Regulatory Strategies resulted in >$250K in time/materials contracts this quarter $4.5 $4.7 $5.3 $5.5 $6.0 $0.2 $0.2 $0.4 $0.5 $0.7 $4.7 $4.9 $5.7 $6.0 $6.7 16.3 17.3 18.3 19.3 20.3 Third Quarter Revenue $ in millions

Key Highlights • Q3 FY2020 Financial Highlights – Revenue up 20% for the quarter – 64 active projects in 3QFY20 across 31 companies – 33 contracts signed in 3QFY20, including 18 new projects • Operational Highlights – 28 proposals across 24 different companies, outstanding at the start of 4QFY20 – Currently involved in discussions at various stages with several clients related to potential COVID - 19 projects – Hired Director, Quantitative Clinical Pharmacology, to focus on PBPK modeling services, popPK M&S, and related quantitative support for multiple programs as well as business development Cognigen Division (Buffalo) 6 A leading provider of population modeling and simulation services for the pharma and biotech industries $0.1 $0.1 $0.2 $0.2 $0.1 $4.2 $5.1 $5.6 $6.8 $8.1 $4.3 $5.2 $5.8 $7.0 $8.2 2016 2017 2018 2019 2020 9 Months Revenue $ in millions Software Consulting Cognigen represented 25% of total revenue and 15% of EBITDA for Q3 FY2020 $0.03 $0.04 $0.04 $0.09 $0.04 $1.3 $1.8 $1.9 $2.4 $3.0 $1.4 $1.8 $1.9 $2.5 $3.0 16.3 17.3 18.3 19.3 20.3 Third Quarter Revenue $ in millions

$0.6 $0.7 $0.6 $2.4 $2.9 $5.1 $3.0 $3.7 $5.7 2018 2019 2020 9 Months Revenue $ in millions Software Consulting DILIsym Division (RTP) 7 A leading provider of software products and services in QST and QSP Key Highlights • Q3 FY2020 Financial Highlights – Revenue up 39% for the quarter – Revenue breakdown: 55% DILIsym ® software and service projects; 5% RADAsym™ model services; 22% IPFsym™ model services; 10% RENAsym ® model services; 8% Heart Failure model services • Operational Highlights – 13 active DILIsym consulting projects – 7 active consortium contracts, which is one vehicle used for DILIsym licensing – 1 consulting project and software capability enhancements completed for NAFLDsym ® – Focused on adding new science and features to DILIsym including immunology, new simulated populations, and advance integration with GastroPlus ® DILIsym represented 16% of total revenue and 12% of EBITDA for Q3 FY2020 $0.2 $0.2 $0.2 $0.7 $1.1 $1.7 $0.9 $1.4 $1.9 18.3 19.3 20.3 Third Quarter Revenue $ in millions

Lixoft (Paris Division) 8 A leading provider of software products and services in QST and QSP Key Highlights • Q3 FY2020 Financial Highlights (Two months 4/1/20 - 5/31/20) • Revenue – Revenue growth 15% vs Q3FY19 – 98% of revenue is software related • Key highlights: – 52 customers – increase of 10 over Q3FY19 – Software renewal: 84% (fees), 98% (accounts) • Post acquisition efforts – Software sales and Marketing – Integrated software development plans – Monolix based consulting services – Organizational integration Lixoft represented 5% of total revenue and 9% of EBITDA for Q3 FY2020 $0.6 20.3 Third Quarter Revenue $ in millions Software

Financial Results

10 Income Statement: 3QFY20 Versus 3QFY19 (in millions) Note : Some numbers may not foot or crossfoot due to rounding . 3Q20 SG &A includes $1.1M of acquisition related costs. 3QFY20 3QFY19 Diff % chg Net sales $ 12.3 $ 9.9 $ 2.4 23.8% Gross profit 9.6 7.6 2.0 26.5% Gross profit margin 78.3% 76.6% 1.7% 2.2% SG&A $ 5.0 $ 3.1 $ 1.9 62.7% R&D 0.8 $ 0.6 0.1 17.0% Total operating expenses 5.8 $ 3.7 2.0 54.8% Income from operations 3.9 $ 3.9 (0.0) - 0.6% Other income (expense) (0.1) $ (0.0) (0.0) 160.7% Income from operations before income taxes 3.8 $ 3.9 (0.1) - 1.9% Net income $ 2.9 $ 2.9 $ 0.0 1.6% Diluted earnings per share (in dollars) $ 0.16 $ 0.16 $ (0.00) - 0.2% EBITDA $ 4.6 $ 4.6 $ 0.0 0.2%

11 Income Statement: 9MoFY20 Versus 9MoFY19 (in millions) 9MoFY20 9MoFY19 Diff % chg Net sales $ 32.0 $ 25.9 $ 6.1 23.5% Gross profit 24.1 19.2 4.9 25.3% Gross profit margin 75.1% 74.0% 1.1% 1.5% SG&A $ 12.6 8.6 $ 4.0 46.8% R&D 2.0 1.9 0.1 6.8% Total operating expenses 14.7 10.5 4.2 39.6% Income from operations 9.4 8.7 0.7 8.1% Other income (expense) (0.1) (0.1) 0.1 - 59.8% Income from operations before income taxes 9.3 8.6 0.8 9.1% Net income $ 7.1 $ 6.5 $ 0.6 9.5% Diluted earnings per share (in dollars) $ 0.39 $ 0.36 $ 0.03 7.6% EBITDA $ 11.5 $ 10.7 $ 0.7 6.8% Note : some numbers may not foot or crossfoot due to rounding . 9moFY20 SG &A includes $1.4M of acquisition related costs.

12 Consolidated Revenues: Fiscal Quarter ( in millions) $4.8 $5.2 $6.0 $4.0 $5.4 $5.7 $6.8 $6.3 $7.1 $7.4 $8.6 $6.7 $7.5 $8.5 $9.9 $8.0 $9.4 $10.3 $12.3 $0 $1 $2 $3 $4 $5 $6 $7 $8 $9 $10 $11 $12 $13 Q1 Q2 Q3 Q4 2016 2017 2018 2019 2020

13 Consolidated Income from Operations: Fiscal Quarter (in millions) $1.7 $1.7 $2.8 $1.0 $1.9 $1.8 $3.1 $1.4 $2.6 $2.4 $3.4 $1.9 $2.1 $2.7 $3.9 $2.0 $2.7 $2.8 $3.9 $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 $4.5 Q1 Q2 Q3 Q4 2016 2017 2018 2019 2020

$1.1 $1.2 $1.9 $0.8 $1.4 $1.2 $2.1 $1.2 $1.7 $3.5 $2.4 $1.3 $1.5 $2.1 $2.9 $2.1 $2.1 $2.2 $2.9 $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 Q1 Q2 Q3 Q4 2016 2017 2018 2019 2020 $2.0 14 Note: 2Q18 $1.5M tax benefit of deferred tax adjustment Consolidated Net Income: Fiscal Quarter (in millions)

15 Consolidated Diluted Earnings Per Share: Fiscal Quarter $0.06 $0.07 $0.11 $0.05 $0.08 $0.07 $0.12 $0.06 $0.10 $0.19 $0.13 $0.07 $0.09 $0.12 $0.16 $0.11 $0.11 $0.12 $0.16 $0.00 $0.02 $0.04 $0.06 $0.08 $0.10 $0.12 $0.14 $0.16 $0.18 $0.20 Q1 Q2 Q3 Q4 FY16 FY17 FY18 FY19 FY20 $0.11 Note: 2Q18 $0.08 tax benefit of deferred tax adjustment

16 Consolidated EBITDA: Fiscal Quarter (in millions) $2.2 $2.2 $3.3 $1.5 $2.5 $2.3 $3.6 $2.0 $3.2 $3.1 $4.1 $2.6 $2.8 $3.4 $4.6 $2.7 $3.4 $3.5 $4.6 $0 $1 $2 $3 $4 $5 Q1 Q2 Q3 Q4 2016 2017 2018 2019 2020

Revenue by Region – YTD 2020 Europe 16 % Americas 69 % Asia 15 % Japan = 50% China = 21% India = 16% Korea = 12% 17 A global and diversified base of revenue

18 Cash Position Excellent (in millions) Accumulating Cash while funding Acquisitions and Dividends $0.9 $0.9 $0.9 $0.9 $1.0 $1.0 $1.0 $1.1 $1.1 $1.1 $1.1 $1.1 $1.1 $1.1 $1.1 $1.0 $5.0 $1.6 $1.0 $1.7 $6.0 $8.8 $7.4 $8.2 $6.2 $7.0 $7.5 $7.2 $9.4 $9.4 $9.9 $10.3 $11.4 $12.6 $12.2 $7.4 $9.6 17.1 17.2 17.3 17.4 18.1 18.2 18.3 18.4 19.1 19.2 19.3 19.4 20.1 20.2 20.3 7/6/2020 Dividend Paid Acquisitions Cash on Hand Cash paid for DILIsym earnout in 19.1 ($1.6) in Dec 2018 ($1.0M) Cash paid for DILIsym earnout ($1.7M) Cash paid for DILIsym Final cash paid to TSRL * Chart covers period starting September 2016 . Net Cash paid for Lixoft

19 Selected Consolidated Balance Sheet Items (in millions, except where indicated) May 31, 2020 August 31, 2019 Cash and cash equivalents $ 7.4* $ 11.4 Cash per share ( in Dollars ) $ 0.41 $ 0.65 Total current assets 22.2 21.2 Total assets 61.6 45.2 Total current liabilities 7.8 4.8 Total liabilities 15.0 7.5 Current ratio 2.85x 4.42x Shareholders’ equity 46.6 37.7 Total liabilities and shareholders’ equity 61.6 45.2 Shareholders’ equity per diluted share ( in Dollars ) $2.5 $2.1 * Cash as of July 6, 2020 ~$9.6 million.

1 Dividend ratio for FY2019; No assurances of future cash dividends can be made as the BOD makes its decision on a quarterly ba si s based on current financial condition and strategic plans. Products & Services Software Portfolio • Modeling & simulation platform for drug R&D • Predictive software for >140 properties of chemical formulations • Analytical software for certain biological or disease states • Cloud - based web app for drug development lifecycle management Consulting Services • Provide multi - disciplinary modeling and simulation support Operating Divisions • Simulations Plus, Inc. • Cognigen • DILIsym • Lixoft Consistent Financial Results • > 10 years of consistent revenue growth • > 10 years of profitability • Cash generated of $6.1M from operations during nine months ended 5/31/20 with cash on hand of $9.6 Million at 7/6/2020 • Dividend payout ratio of 49% 1 • Quarterly dividend of $0.06 per share 1 Customers and Market Pharmaceutical and biotech companies ranging from the largest in the world to a number of medium - sized and smaller companies in the U.S., Europe and Japan Corporate Information • The company was founded in 1996 and now has 133 employees* worldwide. • Primary offices located in Lancaster, CA; Buffalo, NY; Raleigh, NC; and Paris, France. * As of 5/31/2020 Simulations Plus Our mission is to improve the productivity of science - based research & development enterprises by delivering innovative modeling and simulation software and insightful consulting services 20

21 Thank you! https://www.linkedin.com/company/simulations - plus https://www.linkedin.com/company/cognigen https://www.linkedin.com/company/dilisym https://www.linkedin.com/company/lixoft/