Simulations Plus Reports First Quarter FY2009 Financial Results
Simulations Plus, Inc. (NASDAQ: SLP), a leading provider of simulation and modeling software for pharmaceutical discovery and development, today reported financial results for its first fiscal quarter of fiscal year 2009 ended November 30, 2008 (1QFY09).
Ms. Momoko Beran, chief financial officer of Simulations Plus, stated: “I’m pleased to report that in spite of the global economic crisis that has dominated the media during our first quarter, we set a new first quarter record for both revenues and earnings. Consolidated net sales increased 7.5% to $2,133,000 in 1QFY09 from $1,984,000 in the first fiscal quarter of fiscal year 2008 (1QFY08), which had been the previous record first quarter by a large margin. Pharmaceutical software and services revenues for 1QFY09 were nearly identical with 1QFY08 at $1,430,000 as compared with $1,438,000 in 1QFY08, a slight decrease of $8,000, or 0.6%. It’s worth noting that this was achieved in spite of $260,000 in software license renewal revenues that shifted out of the quarter, either being received earlier in 4QFY08 or slipping to 2QFY09. Revenues from our Words+ subsidiary were $703,000 in 1QFY09, an increase of $158,000 or 29.0% from $545,000 in 1QFY08.”
Ms. Beran continued: “For 1QFY09, consolidated gross profit increased 7.3% to $1,607,000 from $1,498,000 in 1QFY08. R&D expense increased 33.4% to $301,000 in 1QFY09 from $226,000 in 1QFY08; and total R&D expenditures, which include capitalized software development costs, increased by 25.8%, primarily due to expansion of our Life Sciences staff and salary increases. Consolidated SG&A decreased 2.9% to $904,000 in 1QFY09, compared to $930,000 in 1QFY08. As a percentage of sales, SG&A decreased to 42.4% in 1QFY09 from 46.9% in 1QFY08. For 1QFY09, net income before taxes increased 11.8% or $48,000 to $453,000 compared with $405,000 in 1QFY08. The provision for income taxes decreased by 12.9% to $141,000 for 1QFY09 from $162,000 in 1QFY08. Using our best estimates for the additional revenues and profits we expect during the remainder of the year, we anticipate a tax rate for the year of about 32 ~ 38%, which will depend on the amount of R&D tax credits generated during the current fiscal year.
“Consolidated net earnings for 1QFY09 increased over 28% to $312,000, or $0.02 per diluted share, as compared to $243,000, or $0.01 per diluted share for 1QFY08. Our cash continues to grow, with cash at the end of 1QFY09 of $6,814,000 including the $750,000 in ARSs held in our UBS account (which were purchased at face value plus interest by UBS on January 2, 2009), a 49% increase from $4,584,000 at the end of 1QFY08. Shareholders’ equity increased by 4% during the first quarter to $10,315,000 from $9,915,000.”
Walt Woltosz, chairman and chief executive officer of Simulations Plus, said: “We’re very pleased with our first quarter results, not only because it sets new records for revenues and earnings, but because in light of the global economic situation, Simulations Plus continues to thrive and grow. Last year’s first quarter was a significant jump over the previous highest first quarter – almost 48%. We matched that and exceeded it in spite of the current climate, and we increased earnings by over 28%. We believe our emphasis on product quality and strong customer support is serving us well. Our team continues to enhance our best-in-class software offerings, and we continue to move ahead nicely on our funded collaborations, which will add new capabilities and markets for GastroPlus™ and ADMET Predictor™. We’re financially strong, with more cash in the bank than at any time in our history. We continue to seek good acquisition opportunities. While we’re cautiously optimistic that we will close one or more in the coming months, there can be no assurances that any will be completed.”
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