Summary of Fiscal 2023 Fourth Quarter Financial Results
- Total net revenue increased 13.6% to a record $52.9 million, compared to total net revenue of $46.6 million in the comparable prior-year period.
- Recurring revenue (comprised of subscription and maintenance charges) was a record $31.4 million, or 59.3% of total net revenue compared to $26.6 million, or 57.1% of total net revenue for the same period in fiscal 2022. Subscription revenue increased 23.9% year over year and was 50.6% of total recurring revenue compared to 48.1% of total recurring revenue in the fourth quarter of fiscal 2022.
- Gross margin was 60.8% in the fiscal 2023 fourth quarter compared to 59.5% in the comparable prior-year period.
- Net income attributable to common shareholders in the fiscal 2023 fourth quarter was $3.6 million, or $0.14 per diluted share compared to $1.5 million, or $0.06 per diluted share in the comparable prior-year period.
- Adjusted EBITDA (non-GAAP) was $8.1 million compared to $7.5 million in the comparable prior-year period (reconciliation included in financial tables).
- Adjusted diluted EPS (non-GAAP) was $0.26 per share in the fiscal 2023 fourth quarter compared to $0.24 per share in the comparable prior-year period (reconciliation included in financial tables).
- Free cash flow (non-GAAP) in the fiscal 2023 fourth quarter was $13.2 million compared to free cash flow of $6.5 million in the fiscal 2022 fourth quarter (reconciliation included in financial tables). Ending cash balance was $112.8 million, compared to ending cash balance of $97.0 million as of fiscal 2022 year-end.
Summary of Full Fiscal Year 2023 Financial Results
- Total net revenue increased 21.8% to a record $198.1 million, compared to total net revenue of $162.6 million in the comparable prior-year period.
- Recurring revenue (comprised of subscription and maintenance charges) was a record $118.3 million, or 59.7% of total net revenue compared to $99.0 million, or 60.8% of total net revenue for fiscal year 2022. Subscription revenue increased 27.5% year over year and was 49.2% of total recurring revenue compared to 46.1% of total recurring revenue in fiscal year 2022.
- Gross margin was 61.0% in fiscal year 2023 compared to 62.4% in the comparable prior-year period.
- Net income attributable to common shareholders in fiscal year 2023 was $12.7 million, or $0.49 per diluted share compared to $4.6 million, or $0.18 per diluted share in the comparable prior-year period.
- Adjusted EBITDA (non-GAAP) was a record $30.3 million compared to $27.3 million in the comparable prior-year period (reconciliation included in financial tables).
- Adjusted diluted EPS (non-GAAP) was $0.97 per share in fiscal year 2023 compared to $0.82 per share in the comparable prior-year period (reconciliation included in financial tables).
- Free cash flow (non-GAAP) in fiscal year 2023 was $27.2 million compared to free cash flow of $27.3 million in fiscal year 2022 (reconciliation included in financial tables).
Ramesh Srinivasan, President and CEO of Agilysys, commented, “Despite macroeconomic volatility, we are pleased to have exceeded $50M in revenue during a quarter for the first time in our history thanks to the growing strength and competitive advantages of our products and services.Subscription revenue grew 23.9% year over year during the fourth quarter, while one-time revenue, consisting of product and services revenue, was 7.8% higher. Adjusted EBITDA was 15.3% of revenue for the full fiscal year.
Demand for our state-of-the-art cloud native products has remained strong during each of the past three quarters. Full year fiscal 2023 was our best sales year and the January through March fourth quarter was our best sales quarter, both by a fair distance, measured in annual contract value terms. This selling success has driven backlog across all three revenue lines – recurring revenue, product and services – to record levels. We are well positioned to achieve a revenue level of $230 to $235 million during fiscal year 2024. Increased investments across multiple business areas to drive future revenue growth beyond fiscal 2024 are resulting in reduced profitability expectations for this year with Adjusted EBITDA expected to be 13% of revenue for the full fiscal year, with profitability levels increasing throughout.”
Fiscal 2024 Outlook
We are expecting full year fiscal 2024 revenue to be $230 to $235 million, inclusive of 25% year-over-year subscription revenue growth. Adjusted EBITDA is expected to be 13% of revenue for the full fiscal year.
Dave Wood, Chief Financial Officer, commented, “We continue to show strong results across all aspects of our business. The record sales and revenue quarter and full fiscal year are further validation of the investments made during the past few years in our new cloud-native solutions and the success of recent, increased investments in sales and marketing. Subscription revenue continues to grow faster than total revenue and now makes up more than 50% of total recurring revenue. Record backlog levels have us well positioned to achieve our fiscal 2024 plan. We will remain dedicated to executing on disciplined profitable growth while increasing investments in various areas to drive the next growth phase of our business.”
Tags: Agilysys, Inc., Ramesh Srinivasan, Dave Wood
