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CALGARY, April 30, 2018 /CNW/ - Sylogist Ltd. (TSXV:SYZ) ("Sylogist" or the "Company"), a provider of enterprise information management solutions, is pleased to announce its unaudited financial results for the second quarter of the 2018 fiscal year, ended March 31, 2018.
Q2 2018 Summary (Comparisons are to Q2 2017, unless otherwise noted)
- Revenues were $9.3 million, compared to $8.1 million, an increase of 15%.
- Gross profit margins improved to 75% from 71%.
- Reported earnings were $2.5 million compared to $1.8 million in Q2 2017, an increase of 37%.
- Earnings per fully diluted common share increased 38% to $0.11 per share, up from $0.08 per share.
- Adjusted EBITDA(1) was $4.4 million, an increase of 32%, or $0.20 per fully diluted common share, up 33%.
- Adjusted EBITDA Margin(1) was 48%, compared to 41%.
- Cash from operating activities (before non-cash changes in working capital) totalled $4.5 million ($0.20 per share), up from $3.1 million ($0.14 per share) in Q2 2017.
- The Company paid regular dividends to shareholders totalling $1.8 million during the quarter.
- Adjusted Working Capital(1) was $32.1 million, a decrease of 3%, or $1.44 per share.
- Combined tax pools at the end of the second quarter 2018 were approximately $16.6 million (CAD).
- For the quarter ended March 31, 2018, the Company repurchased 119,700 common shares at an average price of $10.01 for a total cost of $1.2 million.
- The Company's Board of Directors has approved a quarterly dividend of $0.08 per common share for shareholders of record as at May 31, 2018 to be paid on June 13, 2018, which is treated as an eligible dividend under the Income Tax Act (Canada).
First half of fiscal 2018 (Comparisons are to the first half of fiscal 2017, unless otherwise noted)
- Revenues were $18.1 million, compared to $16 million, up 14%.
- Gross profit margins improved to 75% of revenue compared to 68%.
- Reported earnings were $5.5 million ($0.25 per share) compared to $3.1 million ($0.14 per share).
- Adjusted EBITDA(1) was $8.7 million ($0.39 per share), compared to $6.1 million ($0.27 per share).
- Adjusted EBITDA Margin (1) was 48%, compared to 38%.
- Cash from operating activities (before non-cash changes in working capital) was $8.7 million ($0.39 per share) compared to $5.1 million ($0.22 per share), an increase of 71% and a per share increase of 77%.
- The Company paid regular and special dividends to shareholders totalling $4.7 million during the first half of fiscal 2018.
Jim Wilson, President & Chief Executive Officer of Sylogist, commented, "In the second quarter, we continued to see growth in revenue while profitability was leveraged through the benefits of our improved efficiencies. Operating metrics demonstrated improvement with the gross profit margin increasing to 75% of revenue and the Adjusted EBITDA margin improving to 48% of revenue. Higher revenues (up 15%) resulted from a greater contribution from the educational sector related to our U.S. acquisition of K12 Enterprise and Sunpac Systems earlier in the fiscal year.
At the end of the second quarter we released the educational market version of our flagship product, Navigator K-12 Education, ahead of schedule. Our development team married the human resources and school administration intellectual property acquired in our October 2017 acquisition with the latest version of our Navigator public sector foundation. Navigator K-12 Education was further enhanced through integrating our Analytics and Field Connect solutions into a single comprehensive offering. Navigator K-12 Education is the leading platform available for the educational market based on Microsoft application level technology. In the first half of fiscal 2018, we have widened our technology lead in the public sector vertical markets we serve while simultaneously providing material improvements in efficiencies and financial performance. We are well positioned for continued success," concluded Mr. Wilson.
Sylogist is a technology innovation company that, through strategic acquisitions, investments and operations management, provides intellectual property solutions to a wide range of Public Sector customers. We are an industry-leading publisher of mission-critical software products that satisfy the unique and sophisticated functionality requirements of Public Sector entities, including nonprofit organizations, educational institutions and government agencies, as well as public compliance driven and funded businesses. Our Company delivers highly scalable, multi-language, multi-currency software solutions, which serve the needs of an international clientele.
Full financial statements together with Management's Discussion and Analysis are available on SEDAR at www.sedar.com.
The Company's stock is traded on the TSX Venture Exchange under the symbol SYZ. Information about Sylogist can be found at http://www.sylogist.com.
Certain statements in this news release may be forward-looking statements within the meaning of applicable securities laws and regulations. These statements typically use words such as expect, believe, estimate, project, anticipate, plan, may, should, could and would, or the negative of these terms, variations thereof or similar terminology. Forward-looking information in this news release includes statements with respect to the Company's payment of dividend to shareholders of record as at May 31, 2018 to be paid on June 13, 2018 and the Company being well positioned for continued success. By their very nature, forward-looking statements are based on assumptions and involve inherent risks and uncertainties, both general and specific in nature. It is therefore possible that the beliefs and plans and other forward-looking expectations expressed herein will not be achieved or will prove inaccurate. Although Sylogist believes that the expectations reflected in these forward-looking statements are reasonable, it provides no assurance that these expectations will prove to have been correct. Forward-looking information involves risks, uncertainties and other factors that could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information. Additional information regarding some of these risks, uncertainties and other factors may be found under in the management's discussion and analysis for the quarter ended March 31, 2018 and other documents available on the Company's profile at www.sedar.com. Material assumptions and factors that could cause actual results to differ materially from such forward-looking information include Sylogist's ability to attract and retain customers and to realize on its investments. Although Sylogist believes that the material assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur. Sylogist disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law.
Certain information set out herein may be considered as "financial outlook" within the meaning of applicable securities laws. The purpose of this financial outlook is to provide readers with disclosure regarding Sylogist's reasonable expectations as to the anticipated results of its proposed business activities for the periods indicated. Readers are cautioned that the financial outlook may not be appropriate for other purposes.
Non-GAAP Financial Measures
(1) Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Working Capital are non-GAAP financial measures: Adjusted EBITDA is defined as: profit for the period before stock based compensation, foreign exchange gains or losses, interest expense, bargain purchase price on acquisition, income taxes, acquisition-related costs, depreciation and amortization. Adjusted EBITDA Margin refers to Adjusted EBITDA as a percentage of revenue. Adjusted Working Capital is defined as current assets less current liabilities adjusted for deferred revenue.
This news release makes reference to certain non-GAAP measures. These measures are not recognized measures under Canadian GAAP, do not have a standardized meaning prescribed by Canadian GAAP and are therefore may not be comparable to similar measures presented by other issuers. These measures are provided as additional information to complement measures under GAAP by providing further understanding of the Company's expected results of operations from management's perspective. Accordingly, such measures should not be considered in isolation nor as a substitute for analysis of the Company's financial information reported under Canadian GAAP.
Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Working Capital are provided to investors as alternative methods for assessing the Company's operating results in a manner that is focused on the Company's ongoing operations and to provide a more consistent basis for comparison between periods. These measures should not be construed as alternatives to net profit (loss) or cash flow from operating activities determined in accordance with GAAP as an indicator of the Company's performance.
- Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release-
SOURCE Sylogist Ltd.
For further information: Jim Wilson, President and CEO or Xavier Shorter, Vice President, Finance and CFO or Andre Drouillard, Vice President, Business Development and Investor Relations; Sylogist Ltd., (403) 266-4808