CALGARY, ALBERTA–(Marketwired – May 11, 2017) –
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Sylogist Ltd. (TSX VENTURE: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 fiscal year, ended March 31, 2017 and the appointment of Mr. Andre Drouillard, Vice President, Business Development & Investor Relations.
Q2 2017 Summary (Comparisons are to Q2 2016, unless otherwise noted)
- Reported earnings increased 13% to $1.8 million ($0.08 per share), up from $1.6 million ($0.07 per share) in Q2 2016.
- Gross profit margins improved to 71% of revenue compared to 65% in the comparable quarter last fiscal year.
- Adjusted Earnings(1) were $2.9 million ($0.13 per share).
- Revenues were $8.1 million, compared to $9.8 million in second quarter last year.
- Adjusted EBITDA(1) was $3.3 million ($0.15 per share), compared to $3.9 million ($0.17 per share) in Q2 2016.
- Cash from operating activities (before non-cash changes in working capital) was $3.1 million, compared to $3.5 million in the second quarter last year.
- The Company paid regular dividends to shareholders totaling $1.6 million during the quarter.
- Combined tax pools at the end of the second quarter of fiscal 2017 stood at approximately $22 million (CDN).
- Cash as at March 31, 2017 totalled $31 million. Sylogist has no debt.
- There are currently 22.7 million Sylogist common shares outstanding.
- The Company’s Board of Directors has approved an eligible dividend of $0.07 per common share for shareholders of record as at May 31, 2017 to be paid on June 14, 2017.
In the first 6 months of fiscal 2017 (Comparisons are to the first six months of fiscal 2016, unless otherwise noted)
- Reported earnings for the six months ended March 31, 2017 were $3.1 million ($0.14 per share) compared to $3.1 million ($0.13 per share).
- Gross profit margins improved to 68% of revenue compared to 66% in the comparable period last fiscal year.
- Adjusted EBITDA(1) was $6.1 million ($0.27 per share), compared to $7.2 million ($0.30 per share) in the first six months of fiscal 2016.
- Revenues were $16 million, compared to $18.1 million in the first half of 2016.
- Adjusted Earnings(1) were $5.4 million ($0.24 per share) compared with $5.9 million ($0.25 per share).
- Cash from operating activities (before non-cash changes in working capital) was $5.1 million compared to $6.4 million.
- The Company paid regular and special dividends to shareholders totaling $4.3 million during the first half of fiscal 2017.
Jim Wilson, President & Chief Executive Officer of Sylogist commented, “We are pleased to announce the appointment of Andre Drouillard, as Vice President, Business Development & Investor Relations. Andre has over 15 years of experience in the Canadian investment industry, focused on sales and marketing of Equities, Structured Products, Mutual Funds and Flow-Through funds. Most recently he spent over 6 years with an independent dealer as its Vice President, Institutional Sales, working with Institutional and Corporate clients. He is a CFA charter holder and earned a Bachelor of Administration degree from the University of Regina. Andre’s role with Sylogist will be focused on growth, through acquisitions and continuing organic initiatives. He will be working with the current executive team to expand our Public Sector software offerings, in conjunction with Microsoft, through broader markets in North America and beyond.”
Concurrent with his appointment, Mr. Drouillard was granted 75,000 stock options, and Mr. Xavier Shorter, Vice President, Finance & Chief Financial Officer was granted an additional 25,000 options, all at the market price of Sylogist shares.
Mr. Wilson continued by stating that “in the second quarter, as we had earlier indicated, we continued our internal development efforts to prepare our technology offerings and corporate foundation for broader markets in the United States and internationally, while experiencing the benefits of our global Public Sector agreement with Microsoft on our cost structure and margins. Our Gross Profit Margin increased for the second quarter 2017 to 71% from 65% for the same period last year and to 68% for the first half of 2017, from 66% in the prior period. Revenue for the second quarter and the first half of the fiscal 2017 was consistent with our expectations, as we continue to build on our relationship with Microsoft and the shift in our market place to a subscription model. With the move to a software subscription model, revenue does not experience the same volatility as it does with license sales. The revenue volatility becomes evident when comparing fiscal 2016 results with fiscal 2017 revenue performance because of two significant license sales in 2016 with no comparable license sales in the first six months of fiscal 2017.”
“During the second quarter, as a result of our development efforts, we successfully launched our Business Intelligence and Analytics platform for our flagship Public Sector ERP system, Navigator, consistent with our planned schedule set in late fiscal 2016. Overall, fiscal 2017 continues to be a transformational year for Sylogist, as we finalize laying the foundation for future growth,” concluded Mr. Wilson.
About Sylogist
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, nonprofit organizations, educational institutions, 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.
(1) Adjusted EBITDA and Adjusted Earnings 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 Earnings is defined as profit for the period adjusted for certain non-cash expenses (income), such as amortization of intangible assets, stock based compensation, deferred income taxes as well as foreign exchange gains or losses and certain other expenses (income).
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.
Forward-looking Statements
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. 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. Forward-looking information in this news release includes statements with respect to Sylogist’s key organizational changes and investments, its key relationships and its products potentially reaching broader markets. 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.
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.
President and CEO
Xavier Shorter
Vice President, Finance and CFO
Sylogist Ltd.
(403) 266-4808
www.sylogist.com