Ohio | 000-5734 | 34-0907152 | ||
(State or other jurisdiction | (Commission File Number) | (IRS Employer Identification No.) | ||
of incorporation) |
425 Walnut Street, Suite 1800 Cincinnati, Ohio | 45202 | |
(Address of principal executive offices) | (ZIP Code) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 | Results of Operations and Financial Condition; and | |
Item 7.01 | Regulation FD Disclosure |
Item 9.01 | Financial Statements and Exhibits |
Exhibit Number | Description | |
99.1 | Press release issued by Agilysys, Inc. dated May 14, 2014, announcing its results for the fourth quarter and year ended March 31, 2014. |
AGILYSYS, INC. | |||
By: | /s/Janine K. Seebeck | ||
Janine K. Seebeck | |||
Senior Vice President, Chief Financial Officer, | |||
and Treasurer |
Exhibit Number | Description | |
99.1 | Press release issued by Agilysys, Inc. dated May 14, 2014, announcing its results for the fourth quarter and year ended March 31, 2014. |
• | Total net revenue increased $5.7 million, or 26%, to $27.8 million, compared to total net revenue of $22.1 million in the comparable prior-year period. |
• | Recurring revenues (which are comprised of support, maintenance and subscription services) for the quarter were $14.1 million, an increase of 11% over the same period in fiscal 2013. |
• | Gross margin was 60% in the fiscal 2014 fourth quarter, compared to 67% in the prior-year period. |
• | Adjusted operating income (non-GAAP) from continuing operations (excluding stock-based compensation, amortization of intangibles and other one-time items) increased $1.6 million year over year to $1.1 million from an adjusted operating loss from continuing operations of $(0.5) million in the year-ago period (see reconciliation below). |
• | Adjusted income (non-GAAP) from continuing operations grew $1.4 million to $1.3 million, or $0.06 per diluted share, compared with an adjusted net loss of $(0.1) million, or $(0.01) per share, last year (see reconciliation below). |
• | Net loss in the period was $(4.1) million, or $(0.18) per diluted share, inclusive of a net loss from discontinued operations of $(2.9) million, or $(0.13) per diluted share, compared to net income of $0.3 million, or $0.02, in the prior-year period, which included net income from discontinued operations of $2.0 million, or $0.09 per diluted share. |
• | Total net revenue for the year increased $7.3 million, or 8%, to $101.3 million, compared with $94.0 million last year. |
• | Recurring revenues (which are comprised of support, maintenance and subscription services) for the full year were $53.2 million, an increase of 8% over fiscal 2013. |
• | Gross margin of 63% in fiscal 2014 compares to gross margin of 61% in fiscal 2013. |
• | Adjusted operating income (non-GAAP) from continuing operations (excluding stock-based compensation, amortization of intangibles and other one-time items) for fiscal 2014 increased year over year by $5.2 million to $4.1 million, from an adjusted operating loss of $(1.1) million in fiscal 2013 (see reconciliation below). |
• | Adjusted income (non-GAAP) from continuing operations grew to $4.3 million, or $0.19 per diluted share, compared with an adjusted net loss of $(1.2) million, or $(0.06) per share, in fiscal 2013 (see reconciliation below). |
• | Net income was $15.0 million, or $0.68 per diluted share, in fiscal 2014 inclusive of net income from discontinued operations of $18.4 million, or $0.83 per diluted share, compared with a net loss of $(1.3) million, or $(0.06) per share, in fiscal 2013 inclusive of net income of $4.9 million, or $0.22 per diluted share, from discontinued operations. |
(In thousands, except per share data) | Three Months Ended | Twelve Months Ended | ||||||
March 31, | March 31, | |||||||
2014 | 2013 | 2014 | 2013 | |||||
Net revenue: | ||||||||
Products | $ 10,410 | $ 5,819 | $ 34,629 | $ 31,030 | ||||
Support, maintenance and subscription services | 14,130 | 12,737 | 53,169 | 49,110 | ||||
Professional services | 3,210 | 3,512 | 13,463 | 13,868 | ||||
Total net revenue | 27,750 | 22,068 | 101,261 | 94,008 | ||||
Cost of goods sold: | ||||||||
Products | 5,788 | 2,573 | 17,027 | 17,109 | ||||
Support, maintenance and subscription services | 2,870 | 2,470 | 10,786 | 10,326 | ||||
Professional services | 2,432 | 2,175 | 9,408 | 8,954 | ||||
Total cost of goods sold | 11,090 | 7,218 | 37,221 | 36,389 | ||||
Gross profit | 16,660 | 14,850 | 64,040 | 57,619 | ||||
Operating expenses: | ||||||||
Product development | 6,494 | 6,487 | 25,212 | 23,892 | ||||
Sales and marketing | 3,916 | 3,643 | 14,059 | 13,350 | ||||
General and administrative | 5,270 | 5,345 | 20,750 | 20,984 | ||||
Depreciation of fixed assets | 503 | 508 | 2,074 | 2,137 | ||||
Amortization of intangibles | 2,461 | 806 | 6,414 | 3,284 | ||||
Asset impairment and related charges | - | (88) | 327 | 120 | ||||
Legal settlement | - | 1,664 | - | 1,664 | ||||
Restructuring, severance and other charges | 569 | (29) | 1,392 | 1,495 | ||||
Operating loss | (2,553) | (3,486) | (6,188) | (9,307) | ||||
Other (income) expenses : | ||||||||
Interest income | (22) | (5) | (74) | (13) | ||||
Interest expense | 34 | 35 | 184 | 266 | ||||
Other income, net | (175) | (393) | (392) | (228) | ||||
Loss before income taxes | (2,390) | (3,123) | (5,906) | (9,332) | ||||
Income tax benefit | (1,207) | (1,493) | (2,491) | (3,118) | ||||
Loss from continuing operations | (1,183) | (1,630) | (3,415) | (6,214) | ||||
(Loss) income from discontinued operations, net of taxes | (2,920) | 1,960 | 18,418 | 4,916 | ||||
Net (loss) income | $ (4,103) | $ 330 | $ 15,003 | $ (1,298) | ||||
Basic and diluted weighted average shares outstanding | 22,222 | 21,901 | 22,135 | 21,880 | ||||
Net (loss) income per share – basic and diluted: | ||||||||
Loss from continuing operations | $ (0.05) | $ (0.07) | $ (0.15) | $ (0.28) | ||||
(Loss) income from discontinued operations | (0.13) | 0.09 | 0.83 | 0.22 | ||||
Net (loss) income per share | $ (0.18) | $ 0.02 | $ 0.68 | $ (0.06) | ||||
(In thousands, except share data) | March 31, | March 31, | ||
2014 | 2013 | |||
ASSETS | ||||
Current assets: | ||||
Cash and cash equivalents | $ 99,566 | $ 82,444 | ||
Accounts receivable, net of allowance of $1,101 and $721, respectively | 23,615 | 15,591 | ||
Inventories | 481 | 809 | ||
Prepaid expenses | 3,300 | 3,699 | ||
Other current assets | 2,372 | 688 | ||
Current assets - discontinued operations | - | 43,065 | ||
Total current assets | 129,334 | 146,296 | ||
Property and equipment, net | 12,251 | 13,791 | ||
Goodwill | 15,584 | 12,140 | ||
Intangible assets, net | 10,626 | 11,283 | ||
Capitalized software development, net | 17,221 | 5,579 | ||
Other non-current assets | 3,785 | 4,179 | ||
Non-current assets - discontinued operations | - | 4,230 | ||
Total assets | $ 188,801 | $ 197,498 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
Current liabilities: | ||||
Accounts payable | $ 11,073 | $ 9,860 | ||
Deferred revenue | 22,795 | 19,320 | ||
Accrued and other current liabilities | 14,232 | 12,838 | ||
Capital lease obligations – current | 43 | 58 | ||
Current liabilities – discontinued operations | - | 32,098 | ||
Total current liabilities | 48,143 | 74,174 | ||
Deferred income taxes – non-current | 3,422 | 3,727 | ||
Capital lease obligations – non-current | 292 | 28 | ||
Other non-current liabilities | 6,165 | 4,621 | ||
Non-current liabilities - discontinued operations | - | 1,092 | ||
Shareholders’ equity: | ||||
Common shares, without par value, at $0.30 stated value; authorized 80,000,000 shares; 31,606,831 issued; and 22,467,970 and 22,145,915 shares outstanding at March 31, 2014 and 2013, respectively | 9,482 | 9,482 | ||
Treasury shares (9,138,861 and 9,460,916 shares at March 31, 2014 and 2013, respectively) | (2,741) | (2,838) | ||
Capital in excess of stated value | (13,409) | (14,267) | ||
Retained earnings | 137,581 | 122,578 | ||
Accumulated other comprehensive income (loss) | (134) | (1,099) | ||
Total shareholders’ equity | 130,779 | 113,856 | ||
Total liabilities and shareholders’ equity | $ 188,801 | $ 197,498 | ||
Twelve Months Ended | |||
(In thousands) | March 31, | ||
2014 | 2013 | ||
Operating activities: | |||
Net income (loss) | $ 15,003 | $ (1,298) | |
Less: Income from discontinued operations | 18,418 | 4,916 | |
Loss from continuing operations | (3,415) | (6,214) | |
Adjustments to reconcile net loss from continuing operations to net cash used in operating activities: | |||
Restructuring, severance and other charges | 1,392 | 1,495 | |
Payments for restructuring, severance and other charges | (1,741) | (6,673) | |
Legal settlements | - | 1,664 | |
Payments for legal settlements | (110) | - | |
Asset impairments and related charges | 327 | 120 | |
Depreciation | 2,074 | 2,137 | |
Amortization of intangibles | 6,726 | 4,089 | |
Share-based compensation | 2,119 | 1,638 | |
Deferred income taxes | (178) | (244) | |
Excess tax benefit from equity awards | (37) | - | |
Changes in operating assets and liabilities: | |||
Accounts receivable | (7,846) | (741) | |
Inventories | 380 | 426 | |
Prepaids | (498) | (801) | |
Accounts payable | 1,073 | 1,595 | |
Deferred revenue | 2,784 | (5,046) | |
Accrued and other liabilities | 1,624 | (3,170) | |
Income taxes payable | (2,702) | (2,960) | |
Other changes, net | (588) | (365) | |
Net cash provided by (used in) operating activities from continuing operations | 1,384 | (13,050) | |
Net cash (used in) provided by operating activities from discontinued operations | (1,311) | 2,345 | |
Net cash provided (used in) by operating activities | 73 | (10,705) | |
Investing activities: | |||
Proceeds from sale of business units | 35,846 | - | |
Cash paid for acquisitions, net | (1,812) | - | |
Capital expenditures | (4,023) | (2,532) | |
Capitalized software development costs | (12,200) | (3,906) | |
(Investments in) proceeds from company owned life insurance policies, net and marketable securities | (87) | 4,239 | |
Net cash provided by (used in) investing activities from continuing operations | 17,724 | (2,199) | |
Net cash used in investing activities from discontinued operations | (155) | (854) | |
Net cash provided by (used in) investing activities | 17,569 | (3,053) | |
Financing activities: | |||
Repurchases of shares to satisfy employee tax withholding and option price | (912) | (278) | |
Exercise of employee stock options | 169 | 67 | |
Excess tax benefit from equity awards | 37 | - | |
Principal payment under long-term obligations | (177) | (289) | |
Net cash used in financing activities from continuing operations | (883) | (500) | |
Net cash used in financing activities from discontinued operations | (80) | (377) | |
Net cash used in financing activities | (963) | (877) | |
Effect of exchange rate changes on cash | (44) | (21) | |
Cash flows provided by (used in) continuing operations | 18,181 | (15,770) | |
Cash flows (used in) provided by discontinued operations: | (1,546) | 1,114 | |
Net increase (decrease) in cash | 16,635 | (14,656) | |
Cash and cash equivalents at beginning of period | 82,931 | 97,587 | |
Cash and cash equivalents at end of period | $ 99,566 | $ 82,931 | |
Less cash presented in current assets of discontinued operations on balance sheet | - | (487) | |
Cash and cash equivalents at end of period - continuing operations | $ 99,566 | $ 82,444 | |
(In thousands, except per share data) | Three Months Ended | Twelve Months Ended | |||||
March 31, | March 31, | ||||||
2014 | 2013 | 2014 | 2013 | ||||
Operating loss | $ (2,553) | $ (3,486) | $ (6,188) | $ (9,307) | |||
Share-based compensation expense | 595 | 651 | 2,119 | 1,638 | |||
Amortization of intangibles | 2,461 | 806 | 6,414 | 3,284 | |||
Asset impairments and related charges | - | (88) | 327 | 120 | |||
Legal settlement | - | 1,664 | - | 1,664 | |||
Restructuring, severance and other charges | 569 | (29) | 1,392 | 1,495 | |||
Adjusted operating income (loss) from continuing operations (a) | 1,072 | (482) | 4,064 | (1,106) | |||
Other (income) expenses, net | (163) | (363) | (282) | 25 | |||
Cash income tax expense (b) | (27) | 2 | 60 | 105 | |||
Adjusted income (loss) from continuing operations (a) | $ 1,262 | $ (121) | $ 4,286 | $ (1,236) | |||
Weighted average shares outstanding: | |||||||
Basic and diluted | 22,222 | 21,901 | 22,135 | 21,880 | |||
Adjusted income (loss) per share from continuing operations (a): | |||||||
Basic and diluted | $ 0.06 | $ (0.01) | $ 0.19 | $ (0.06) | |||
(a) Non-GAAP financial measure | |||||||
(b) Taxes calculated based upon our estimated cash tax payments, exclusive of payments related to AMT, for the three and twelve months ended March 31, 2014 and 2013. |
Twelve Months Ended | ||||
(In thousands) | March 31, | |||
2014 | 2013 | |||
Operating activities: | ||||
Net cash provided by (used in) continuing operations | $ 1,384 | $ (13,050) | ||
Non-recurring cash items: | ||||
Restructuring, severance and other payments | 1,741 | 6,673 | ||
Payments for legal settlements | 110 | - | ||
BEP/SERP payments | - | 4,468 | ||
Adjusted cash provided by (used in) continuing operations (a) | $ 3,235 | $ (1,909) | ||
(a) Non-GAAP financial measure |
(In thousands, except per share data) | |||||||||
Fiscal 2014 | |||||||||
Three months ended | Twelve months ended | ||||||||
June 30 | September 30 | December 31 | March 31 | March 31, 2014 | |||||
Net revenue: | |||||||||
Products | $ 7,506 | $ 8,585 | $ 8,128 | $ 10,410 | $ 34,629 | ||||
Support, maintenance and subscription services | 12,874 | 12,881 | 13,284 | 14,130 | 53,169 | ||||
Professional services | 3,320 | 3,380 | 3,553 | 3,210 | 13,463 | ||||
Total net revenue | 23,700 | 24,846 | 24,965 | 27,750 | 101,261 | ||||
Cost of goods sold: | |||||||||
Products | 3,623 | 3,285 | 4,331 | 5,788 | 17,027 | ||||
Support, maintenance and subscription services | 2,269 | 2,578 | 3,069 | 2,870 | 10,786 | ||||
Professional services | 2,171 | 2,395 | 2,410 | 2,432 | 9,408 | ||||
Total cost of goods sold | 8,063 | 8,258 | 9,810 | 11,090 | 37,221 | ||||
Gross profit | 15,637 | 16,588 | 15,155 | 16,660 | 64,040 | ||||
Operating expenses: | |||||||||
Product development | 6,232 | 6,714 | 5,772 | 6,494 | 25,212 | ||||
Sales and marketing | 2,967 | 4,068 | 3,108 | 3,916 | 14,059 | ||||
General and administrative | 4,629 | 5,065 | 5,786 | 5,270 | 20,750 | ||||
Depreciation of fixed assets | 481 | 513 | 577 | 503 | 2,074 | ||||
Amortization of intangibles | 794 | 794 | 2,365 | 2,461 | 6,414 | ||||
Asset impairment and related charges | - | 18 | 309 | - | 327 | ||||
Restructuring, severance and other charges | 55 | 562 | 206 | 569 | 1,392 | ||||
Operating income (loss) | 479 | (1,146) | (2,968) | (2,553) | (6,188) | ||||
Other (income) expenses : | |||||||||
Interest income | (13) | (20) | (19) | (22) | (74) | ||||
Interest expense | 61 | 45 | 44 | 34 | 184 | ||||
Other expense (income), net | (28) | 39 | (228) | (175) | (392) | ||||
Income (loss) before income taxes | 459 | (1,210) | (2,765) | (2,390) | (5,906) | ||||
Income tax (benefit) expense | (330) | 100 | (1,054) | (1,207) | (2,491) | ||||
Income (loss) from continuing operations | $ 789 | $ (1,310) | $ (1,711) | $ (1,183) | $ (3,415) | ||||
Basic weighted average shares outstanding | 22,022 | 22,125 | 22,150 | 22,222 | 22,135 | ||||
Diluted weighted average shares outstanding | 22,292 | 22,125 | 22,150 | 22,222 | 22,135 | ||||
Net income (loss) per share | |||||||||
Income (loss) per share from continuing operations-basic | $ 0.04 | $ (0.06) | $ (0.08) | $ (0.05) | $ (0.15) | ||||
Income (loss) per share from continuing operations-diluted | $ 0.04 | $ (0.06) | $ (0.08) | $ (0.05) | $ (0.15) | ||||
(In thousands, except per share data) | ||||||||||
Fiscal 2013 | ||||||||||
Three months ended | Twelve months ended | |||||||||
June 30 | September 30 | December 31 | March 31 | March 31, 2013 | ||||||
Net revenue: | ||||||||||
Products | $ 6,380 | $ 7,125 | $ 11,706 | $ 5,819 | $ 31,030 | |||||
Support, maintenance and subscription services | 11,901 | 12,378 | 12,094 | 12,737 | 49,110 | |||||
Professional services | 3,340 | 3,774 | 3,242 | 3,512 | 13,868 | |||||
Total net revenue | 21,621 | 23,277 | 27,042 | 22,068 | 94,008 | |||||
Cost of goods sold: | ||||||||||
Products | 3,211 | 3,744 | 7,581 | 2,573 | 17,109 | |||||
Support, maintenance and subscription services | 2,624 | 2,651 | 2,581 | 2,470 | 10,326 | |||||
Professional services | 2,220 | 2,609 | 1,950 | 2,175 | 8,954 | |||||
Total cost of goods sold | 8,055 | 9,004 | 12,112 | 7,218 | 36,389 | |||||
Gross profit | 13,566 | 14,273 | 14,930 | 14,850 | 57,619 | |||||
Operating expenses: | ||||||||||
Product development | 4,281 | 7,006 | 6,118 | 6,487 | 23,892 | |||||
Sales and marketing | 3,842 | 2,499 | 3,366 | 3,643 | 13,350 | |||||
General and administrative | 4,919 | 5,051 | 5,669 | 5,345 | 20,984 | |||||
Depreciation of fixed assets | 581 | 542 | 506 | 508 | 2,137 | |||||
Amortization of intangibles | 855 | 817 | 806 | 806 | 3,284 | |||||
Asset impairment and related charges | 208 | - | - | (88) | 120 | |||||
Legal settlements | - | - | - | 1,664 | 1,664 | |||||
Restructuring, severance and other charges | 1,125 | 430 | (31) | (29) | 1,495 | |||||
Operating loss | (2,245) | (2,072) | (1,504) | (3,486) | (9,307) | |||||
Other (income) expenses : | ||||||||||
Interest income | (4) | (4) | - | (5) | (13) | |||||
Interest expense | 264 | (20) | (13) | 35 | 266 | |||||
Other expense (income), net | 52 | (75) | 188 | (393) | (228) | |||||
Loss before income taxes | (2,557) | (1,973) | (1,679) | (3,123) | (9,332) | |||||
Income tax benefit | (107) | (784) | (734) | (1,493) | (3,118) | |||||
Loss from continuing operations | $ (2,450) | $ (1,189) | $ (945) | $ (1,630) | $ (6,214) | |||||
Basic and diluted weighted average shares outstanding | 21,836 | 21,883 | 21,900 | 21,901 | 21,880 | |||||
Net loss per share – basic and diluted: | ||||||||||
Loss per share from continuing operations | $ (0.11) | $ (0.05) | $ (0.04) | $ (0.07) | $ (0.28) | |||||
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