TECSYS Posts 9% Revenue Growth & Five Cents EPS

• Press Release
• Source: Tecsys inc.
• On 3:13 pm EST, Tuesday November 25, 2008

MONTREAL, QUEBEC--(MARKET WIRE)--Nov 25, 2008 -- TECSYS Inc. (Toronto:TCS.TO - News), an industry-leading supply chain management software company announced today its results for the second quarter and first half of fiscal year 2009, ended October 31st, 2008. All dollar amounts are expressed in Canadian currency and reported in accordance with Canadian Generally Accepted Accounting Principles (GAAP), and are unaudited.

Highlights of the Second Quarter include:

- Revenue increased 9% to $10.7M in Q2 of fiscal 2009 from $9.8M in Q2 of fiscal 2008.

- Earnings from operations for Q2, 2009 were $771K compared to $970K for Q2, 2008.

- EBITDA increased 37% to $1,018K in Q2, 2009 compared to $741K for Q2, 2008.

- Net earnings increased to $644K or $0.05 per share in Q2, 2009 compared to $414K or $0.03 per share for the same period of the prior fiscal year.

- Annualized return-on-equity was equal to 16.5% in Q2 of fiscal 2009 compared to 10.9% in Q2 of last fiscal year.

- At the end of Q2, 2009 annualized recurring revenue stood at $13.1M. Recurring revenue is principally made up of annual software maintenance contracts.

- At the end of Q2, 2009 backlog stood at $20.1M up from $16.9M at the end of Q2 of last fiscal year.

- The Company generated $1.2M in cash from operations during the quarter.

- The Company ended the quarter with cash and cash equivalents of $6.75M and no significant long term debt.

Peter Brereton, President and CEO of TECSYS Inc. commented on the results: "We are pleased to report continued growth in both revenue and earnings, particularly in this business climate. Revenue growth was attained through a mix of contributions from Streamline; a company we acquired last November, as well as new and existing customers, and a significant number of go lives during the quarter. We remain optimistic about our business development initiatives in key verticals with our differentiated offerings while continuing to closely manage our spending in light of the changing landscape."

The Company signed seven new customers, including:

- A major University in the U.S.

- Five industrial distributors in Canada

- A third party logistics provider in Canada

Furthermore, TECSYS also signed a substantial number of business contracts with existing customers and deployed its solutions at a number of customers in healthcare, import to retail, parts distribution, and general high volume distribution sectors in Canada and the U.S.

Highlights of the first half of fiscal year 2009 include:

- Revenue for the first half of fiscal 2009 increased 15% to $20.9M from $18.2M in the same period of last fiscal year.

- Earnings from operations for the first half of fiscal 2009 were $1,037K compared to $1,118K for the same period in last fiscal year.

- EBITDA increased 59% to $1,675K in the first half, 2009 compared to $1,054K for the first half of 2008.

- Net earnings for the first half of fiscal 2009 increased to $918K or $0.07 per share compared to $491K or $0.04 per share for the same period of the prior fiscal year.

- Annualized return-on-equity was equal to 11.9% in the first half of fiscal 2009 compared to 6.5% for the same period in last fiscal year.

 

TECSYS' Second Quarter, Fiscal 2009 Earnings Conference Call:

Date: November 25, 2008
Time: 4:30 pm
Phone number: 888-633-8405 or 416-641-6665
The call can be replayed by calling: 800-558-5253 (access code: 21400266)
or 416-626-4100 (access code: 21400266).

About TECSYS

TECSYS is a leading supply chain management software provider that delivers powerful enterprise distribution, warehouse and transportation logistics software solutions. The company's customers include over 500 mid-size and Fortune 1000 corporations in healthcare, heavy equipment, third-party logistics, and general wholesale high-volume distribution industries. TECSYS' shares are listed on the Toronto Stock Exchange under the ticker symbol TCS.

The statements in this news release relating to matters that are not historical fact are forward looking statements that are based on management's beliefs and assumptions. Such statements are not guarantees of future performance and are subject to a number of uncertainties, including but not limited to future economic conditions, the markets that TECSYS Inc. serves, the actions of competitors, major new technological trends, and other factors beyond the control of TECSYS Inc., which could cause actual results to differ materially from such statements. More information about the risks and uncertainties associated with TECSYS Inc.'s business can be found in the MD&A section of the Company's annual report and annual information form for the fiscal year ended April 30th, 2008. These documents have been filed with the Canadian securities commissions and are available on our website (www.tecsys.com) and on SEDAR (www.sedar.com).

Copyright © TECSYS Inc. 2008. All names, trademarks, products, and services mentioned are registered or unregistered trademarks of their respective owners.

 

TECSYS Inc.
Consolidated Balance Sheets
Prepared in Accordance with Canadian Generally Accepted Accounting
 Principles
-------------------------------------------------------------------------
(in thousands of Canadian dollars)

                                                 October 31,     April 30,
                                                       2008          2008
                                                 (unaudited)
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Assets
Current assets
Cash and cash equivalents                             6,010         5,693
Accounts receivable                                  10,777         9,233
Work in progress                                        712           443
Other accounts receivable                               151           204
Tax credits receivable                                1,708         1,279
Inventory                                               228           216
Prepaid expenses                                        906           847
-------------------------------------------------------------------------
                                                     20,492        17,915

Restricted cash equivalents and other investments       695           672
Asset-backed commercial paper                         4,045         4,045
Long-term receivables                                    99           165
Long-term investment                                    325           350
Property and equipment, net                           1,650         1,713
Intangible assets, net                                1,183         1,480
Deferred development costs, net                       1,240           933
Goodwill                                              2,829         2,829
-------------------------------------------------------------------------
                                                     32,558        30,102
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Liabilities

Current liabilities
Bank advances                                         4,000         4,003
Accounts payable and accrued liabilities              7,099         5,589
Current portion of long-term debt                       166           207
Deferred revenue                                      5,451         4,830
-------------------------------------------------------------------------
                                                     16,716        14,629

Long-term debt                                          200           200
-------------------------------------------------------------------------

                                                     16,916        14,829
-------------------------------------------------------------------------


Shareholders' equity

Capital stock                                         1,444         1,444
Contributed surplus                                  12,532        12,826

Retained earnings                                     1,666         1,003
-------------------------------------------------------------------------
                                                     15,642        15,273
-------------------------------------------------------------------------

-------------------------------------------------------------------------
                                                     32,558        30,102
-------------------------------------------------------------------------
-------------------------------------------------------------------------



TECSYS Inc.
Consolidated Statements of Earnings
Prepared in Accordance with Canadian Generally Accepted Accounting
 Principles
-------------------------------------------------------------------------
(in thousands of Canadian dollars, except share and per share data)

                 Three Months   Three Months     Six Months    Six Months
                        Ended          Ended          Ended         Ended
                   October 31,    October 31,    October 31,   October 31,
                         2008           2007           2008          2007

                   (unaudited)    (unaudited)    (unaudited)   (unaudited)
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Revenue
Products                4,517          4,550          8,962         7,443
Services                5,893          5,058         11,442        10,276
Reimbursable expenses     301            238            544           474
-------------------------------------------------------------------------
                       10,711          9,846         20,948        18,193
Cost of revenue
Products                2,056          1,672          4,341         2,873
Services                3,744          3,106          7,433         6,354
Reimbursable expenses     301            238            544           474
-------------------------------------------------------------------------
                        6,101          5,016         12,318         9,701
-------------------------------------------------------------------------
Gross margin            4,610          4,830          8,630         8,492
-------------------------------------------------------------------------

Operating expenses
Sales and marketing     1,582          1,569          3,162         2,915
General and
 administration           908            820          1,715         1,638
Gross research and
 development            1,371          1,291          2,615         2,529
Research and
 development tax
 credits                 (152)          (112)          (289)         (216)
Deferred development
 costs                   (249)           (58)          (381)         (155)
Stock-based
 compensation              32             11             62            21
Amortization of
 property and
 equipment                133            143            265           276
Amortization of
 intangible assets        177            158            370           316
Amortization of
 deferred development
 costs                     37             38             74            50
-------------------------------------------------------------------------
                        3,839          3,860          7,593         7,374
-------------------------------------------------------------------------

Earnings from
 operations               771            970          1,037         1,118

Interest income            17             25             38           107
Interest expense          (29)            (1)           (55)           (4)
Foreign exchange
 losses                   (89)          (333)           (77)         (476)
Changes in fair
 value of
 asset-backed
 commercial paper           -           (250)             -          (250)
Share of net
 earnings (loss)
 and amortization
 of intangible
 assets of a
 company subject
 to significant
 influence                (26)             3            (25)           (4)
-------------------------------------------------------------------------
Net earnings for
 the period               644            414            918           491
-------------------------------------------------------------------------
-------------------------------------------------------------------------

Weighted average
 number of common
 shares outstanding
  - basic          12,827,687     13,478,076     12,917,035    13,578,602
-------------------------------------------------------------------------
  - diluted        12,827,975     13,495,069     12,944,070    13,603,391
-------------------------------------------------------------------------
Basic and diluted
 net earnings per
 common share           $0.05          $0.03          $0.07         $0.04
-------------------------------------------------------------------------
-------------------------------------------------------------------------



TECSYS Inc.
Consolidated Statements of Cash Flows
Prepared in Accordance with Canadian Generally Accepted Accounting
 Principles
-------------------------------------------------------------------------
(in thousands of Canadian dollars)

                 Three Months   Three Months     Six Months    Six Months
                        Ended          Ended          Ended         Ended
                   October 31,    October 31,    October 31,   October 31,
                         2008           2007           2008          2007

                   (unaudited)    (unaudited)    (unaudited)   (unaudited)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Cash flows from

Operating
 activities
Net earnings for the
 period                   644            414            918           491
Adjustments for
  Amortization of
   property and
   equipment              133            143            265           276
  Amortization of
   intangible assets      177            158            370           316
  Amortization of
   deferred development
   costs                   37             38             74            50
  Stock-based
   compensation            32             11             62            21
  Changes in fair
   value of
   asset-backed
   commercial paper         -            250              -           250
  Unrealized foreign
   exchange losses
   (gains)                915           (223)         1,043          (114)
  Deferred development
   costs                 (249)           (58)          (381)         (155)
  Share of net loss
   (earnings) and
   amortization of
   intangible assets
   of a company subject
   to significant
   influence               26             (3)            25             4
-------------------------------------------------------------------------
                        1,715            730          2,376         1,139
Changes in non-cash
 working capital items
 related to operations
  Increase in accounts
   receivable          (1,381)          (182)        (1,544)         (526)
  Decrease (increase)
   in work in progress     74           (119)          (269)         (199)
  (Increase) decrease
   in other accounts
   receivable              (2)            19             64             9
  Increase in tax
   credits receivable    (318)          (250)          (429)         (484)
  Increase in inventory    (4)           (57)           (12)          (73)
  (Increase) decrease
    in prepaid expenses  (107)            35            (59)         (238)
  Decrease in long-term
   receivables             29              -             58             -
  Increase in accounts
   payable and accrued
   liabilities            396            974            441           286
  Increase in deferred
   revenue                798            159            621         1,427
-------------------------------------------------------------------------
                        1,200          1,309          1,247         1,341
-------------------------------------------------------------------------
Financing activities

  Bank advances             -          2,000             (3)        2,000
  Repayment of
   long-term debt         (41)             -            (41)            -
  Issuance of common
   shares                   -              -             20             4
  Purchase of common
   shares for
   cancellation          (366)          (562)          (376)         (571)
  Dividends paid on
   common shares         (255)             -           (255)            -
-------------------------------------------------------------------------
                         (662)         1,438           (655)        1,433
-------------------------------------------------------------------------
Investing activities
  Increase in
   short-term and
   other investments        -         (4,366)           (23)       (2,435)
  Acquisitions of
   property and
   equipment              (43)          (134)          (206)         (217)
  Proceeds on disposal
   of property and
   equipment                8              -              8             -
  Acquisitions of
   intangible assets       (8)             -            (85)          (25)
  Proceeds on disposal
   of intangible assets     7              -              7             -
  Decrease (increase)
   in long-term
   receivables
   including the
   current portion
   from a related party    12             (2)            24           (34)
-------------------------------------------------------------------------
                          (24)        (4,502)          (275)       (2,711)
-------------------------------------------------------------------------
Variation in cash and
 cash equivalents         514         (1,755)           317            63
Cash and cash
 equivalents - beginning
 of period              5,496          6,309          5,693         4,491

-------------------------------------------------------------------------
Cash and cash
 equivalents - end of
 period                 6,010          4,554          6,010         4,554
-------------------------------------------------------------------------
-------------------------------------------------------------------------



TECSYS Inc.
Consolidated Statements of Changes in Shareholders' Equity
Prepared in Accordance with Canadian Generally Accepted Accounting
 Principles
-------------------------------------------------------------------------
(in thousands of Canadian dollars, except number of shares)
(unaudited)

                           Common Shares  Contributed    Retained   Total
                         Number   Amount      surplus    earnings

-------------------------------------------------------------------------
Balance,
 April 30, 2008      13,003,684    1,444       12,826       1,003  15,273

Repurchase of
 common shares         (270,300)     (30)        (346)          -    (376)

Stock options
 exercised               12,500       20            -           -      20

Fair value
 associated with
 options exercised            -       10           (10)         -       -

Stock-based
 compensation                 -        -            62          -      62

Net earnings for
 the period                   -        -             -        918     918

Dividends                     -        -             -       (255)   (255)

-------------------------------------------------------------------------
Balance,
 October 31, 2008    12,745,884    1,444        12,532      1,666  15,642
-------------------------------------------------------------------------
-------------------------------------------------------------------------



                           Common Shares  Contributed    Retained   Total
                         Number   Amount      surplus    earnings
                                                         (deficit)
-------------------------------------------------------------------------
Balance, April 30,
 2007                13,678,297   56,133       11,042     (51,941) 15,234

Repurchase of
 common shares         (401,200)  (1,646)       1,075           -    (571)

Stock options
 exercised                3,000        4            -           -       4

Fair value
 associated with
 options exercised            -        2           (2)          -       -

Stock-based
 compensation                 -        -           21           -      21

Net earnings for
 the period                   -        -            -         491     491

-------------------------------------------------------------------------
Balance, October
 31, 2007            13,280,097   54,493       12,136     (51,450) 15,179
-------------------------------------------------------------------------
-------------------------------------------------------------------------

     Contacts:
     TECSYS Inc.
     514-866-0001 or 800-922-8649
     Solutions and general info: info@tecsys.com
     Investor relations: investor@tecsys.com
     Media relations: media@tecsys.com