American Software has released its preliminary financial results for the fourth quarter and fiscal year 2024. The company divested its non-core information technology staffing firm, The Proven Method, during the second quarter of fiscal year 2024, with its results now included in discontinuing operations.
Allan Dow, CEO and President of American Software, commented on the fiscal year, stating, “Fiscal 2024 was a transformative period for our company, marked by divestitures of non-core assets, the introduction of next-generation AI-first supply chain planning solutions, and progress towards eliminating our dual class structure. As we step into fiscal 2025, our pipeline has significantly expanded, driven in part by growing client interest in cloud conversions to leverage our new AI capabilities. Despite ongoing macroeconomic challenges affecting customer spending decisions in the short term, we anticipate accelerating subscription fee growth.”
Here’s a snapshot of the financial outlook for fiscal year 2025 from continuing operations:
- Total revenues are projected to range between $104.0 million to $108.0 million, including total recurring revenues estimated at $87.0 million to $89.0 million.
- Adjusted EBITDA is anticipated to be in the range of $15.0 million to $16.4 million.
Key highlights from the fourth quarter financial report from continuing operations include:
- Subscription fees for the quarter ended April 30, 2024, amounted to $14.1 million, reflecting an 8% increase compared to the same period last year.
- Total revenues for the same quarter decreased by 5% to $25.4 million, primarily due to declines in license fee, services, and maintenance fee revenue.
- Recurring revenue streams for Maintenance and Subscriptions constituted $21.5 million or 85% of total revenues for the quarter, compared to $21.2 million or 79% in the corresponding period last year.
- Maintenance revenues for the quarter decreased by 9% to $7.4 million, attributed partially to the divestiture of the Transportation group in November 2023 and client conversions to the cloud.
- Professional services and other revenues for the quarter declined by 23% to $3.7 million compared to the same period last year, primarily due to lower than expected seasonal project work and outsourcing of some services.
- Operating earnings for the quarter were $0.7 million, down from $2.2 million in the same period last year.
For the full fiscal year 2024, key financial highlights from continuing operations include:
- Subscription fees for the twelve months ended April 30, 2024, increased by 10% to $55.3 million compared to the same period last year.
- Total revenues for the twelve months decreased by 5% to $102.5 million compared to the previous year.
- Recurring revenue streams for Maintenance and Cloud Services constituted 85% and 78% of total revenues, respectively.
- Maintenance revenues for the twelve months decreased by 9% to $31.4 million compared to the previous year.
- Professional services and other revenues for the twelve months decreased by 28% to $14.8 million compared to the previous year.
Despite these challenges, the company maintains a robust financial position, with approximately $83.8 million in cash and investments. During the fourth quarter of fiscal year 2024, the company disbursed shareholder dividends of approximately $3.7 million.
Key highlights for the fourth quarter and fiscal year 2024 include:
Clients & Channels:
- Notable new and existing customers include Bob’s Discount Furniture, Inc., CertainTeed LLC., Hamilton Beach Brands, Inc., and others.
- SaaS subscription and software license agreements were signed with customers from various countries including Australia, Italy, Mexico, New Zealand, and the United States.
Company & Technology:
- Logility, a subsidiary of American Software, was recognized as a Leader in the 2024 Gartner Magic Quadrant for Supply Chain Planning Solutions.
- Logility introduced generative AI capabilities and enhanced features to its Digital Supply Chain Platform, aimed at boosting supply chain efficiency and decision-making.
- The company received recognition in various industry publications, including Supply Chain Brain and Inbound Logistics, for its innovative solutions and thought leadership.
Additionally, significant solution advancements were made earlier in FY2024, including the introduction of DemandAI+ and InventoryAI+, designed to enhance demand planning and inventory optimization capabilities.
These developments underscore American Software’s commitment to innovation and its focus on delivering value to customers in an ever-evolving market landscape.
