Simulations Plus Reports Second Quarter FY2016 Financial Results

Keywords: financial results, gross profit, net revenues
Division: PBPK

Simulations Plus, Inc. (NASDAQ: SLP), the premier provider of simulation and modeling software and consulting services for all phases of pharmaceutical discovery and development from the earliest discovery through all phases of clinical trials, today reported financial results for its second quarter of fiscal year 2016, the period ended February 29, 2016 (2QFY16).

2QFY16 highlights compared with 2QFY15:

  • Net revenues increased 12.9%, or $590,000, to $5.16 million from $4.57 million
  • Gross profit increased 13.3%, or $457,000, to $3.90 million from $3.44 million
  • SG&A increased 7.2%, or $115,000, to $1.72 million from $1.61 million
  • Income before taxes increased 17.1%, or $247,000, to $1.69 million from $1.44 million
  • Net income was up by 18%, or $175,000, to $1.15 million from $970,000
  • Diluted earnings per share increased 16.9% to $0.066 from $0.057 per share

6moFY16 highlights compared with 6moFY15:

  • Net revenues increased 15.5%, or $1.34 million, to $10 million from $8.66 million
  • Gross profit increased 18%, or $1.17 million, to $7.66 million from $6.48 million
  • SG&A decreased 6.3%, or $228,000, to $3.4 million from $3.63 million
  • R&D expenditures increased 8.8%, or $110,000, to $1.36 million from $1.25 million in 6moFY15
    • In 6moFY16, $545,000 was capitalized and $813,000 was expensed
    • In 6moFY15, $631,000 was capitalized and $633,000 was expensed
  • Income before taxes increased 55.6%, or $1.22 million, to $3.41 million from $2.19 million
  • Net income increased 50.2%, or $753,000, to $2.25 million from $1.5 million
  • Diluted earnings per share increased 49.0% to $0.131 per share from $0.088 per share

John Kneisel, chief financial officer of Simulations Plus, said: “We continue our nearly decade-long trend of consistent revenue and earnings growth. Cash is back up above $8 million after two dividend distributions totaling over $1.7 million. As announced earlier, we will use approximately $1.47 million in cash this fiscal year to make a payment to TSRL as part of the royalty agreement buyout announced in May 2014, and the final payment to the former shareholders of Cognigen Corporation to close out our acquisition of Cognigen that took place in September 2014. We expect our cash reserves to remain more than adequate after these disbursements, and we anticipate continuing our quarterly dividend distributions; although, such distributions are always at the discretion of the Board of Directors, which votes on them each quarter.”

John DiBella, vice president for marketing and sales of Simulations Plus, said: “At the halfway point of FY2016, we have maintained solid renewal rates for software licenses and continued growth in new license sales and consulting revenues. The marketing and sales staff and our scientists have supported our aggressive marketing and sales program with attendance and presentations at key scientific meetings, conducting training workshops and webinars, and providing the strong customer support that is a hallmark of Simulations Plus in the industry.”

Ted Grasela, president of Simulations Plus, added: “The addition of the recently announced 5-year, $4.7 million contract for data management and consulting services with a major research foundation will add significantly to the revenue growth of our Buffalo division. We believe this effort, which is based on our secure in-house computing cloud and our unique KIWI™ software platform, has the potential to lead to additional opportunities for such services with a number of other research organizations around the world. And we are now routinely providing physiologically based pharmacokinetics (PBPK) analysis to clinical pharmacology groups as we realize the expected synergies between our Lancaster and Buffalo divisions.”

Walt Woltosz, chairman and chief executive officer of Simulations Plus, concluded: “As John DiBella noted, we’re halfway through FY2016, with six-month results showing excellent continued revenues and earnings growth. Now we are beginning to perform on our 5-year contract and expecting the release of our newest software product, PKPlus™, along with updates to two other programs, in the third fiscal quarter. We’re excited about these developments and expect them to add to a strong finish to FY2016.”