Simulations Plus, Inc. (NASDAQ: SLP), a leading provider of software for pharmaceutical discovery and development, today reported its financial results for its 2016 fiscal year (FY16) and fourth quarter (4Q16) ended August 31, 2016.

Results for the 2016 fiscal year (FY16):

  • Revenues were $19.97 million, representing an increase of 9.1% over $18.31 million in FY15
  • Gross profit was up 10.4% to $15.4 million, an increase of $1.45 million from $13.9 million in FY15
  • SG&A expense decreased 0.64% to $6.69 million from $6.74 million in FY15
    • As a percent of sales, SG&A decreased to 33.5% from 36.8% in FY15
  • R&D expenditures were $2.64 million in FY16, an increase of 5.8%, or $145,000 over $2.50 million in FY15
    • For FY16, $1.20 million was capitalized and $1.45 million was expensed
    • For FY15, $1.17 million was capitalized and $1.33 million was expensed
  • Net income was $4.95 million, representing an increase of 28.8% from $3.84 million in FY15
  • Net income from operations increased 23.5%
  • Net income per fully diluted share was $0.288 (29¢), representing an increase of 27.5% from $0.226 (23¢) for FY15
  • Cash was $8.03 million, a decrease of $521,000, or 6.1%, from $8.55 million at the end of FY15.

Results for the fourth quarter FY16 (4Q16):

  • Revenues were $3.96 million, representing an increase of 6.6% over $3.71 million in 4Q15
  • Gross profit was up 10.3% to $2.90 million, an increase of $270,000 from $2.63 million in 4Q15
  • SG&A increased 7.4% to $1.61 million from $1.50 million in 4Q15
  • R&D expenditures were $662,000, an increase of 22.6% from $540,000 in 4Q15
    • For 4Q16, $378,000 was capitalized and $284,000 was expensed
    • For 4Q15, $193,000 was capitalized and $347,000 was expensed
  • Net income was $789,000, representing an increase of 60.6% over $491,000 in 4Q15
  • Earnings per fully diluted share were $0.046 (5¢), representing an increase of 58.9% over $0.029 (3¢) in 4Q15

Walt Woltosz, chairman and chief executive officer of Simulations Plus, said: “Fiscal year 2016 was an excellent year for Simulations Plus, with record revenues, an increase in net income of nearly 29% and EPS up 27.5%. We remain committed to rewarding our shareholders, as evidenced by the recently announced dividend. We have continued to improve our software offerings and released new versions of ADMET Predictor™, DDDPlus™, and KIWI during 2016, and introduced our newest product, PKPlus™, to the market just before the end of the fiscal year. Our approximately $5 million contract with a major research foundation is the first of its kind for us, and we believe future opportunities may exist for similar work in other areas. Our funded projects with the FDA continue to progress well, adding improvements to our flagship GastroPlus™ software that will be available in future releases.”

Dr. Ted Grasela, president of Simulations Plus and Cognigen, added: “We continue to find new ways of combining the expertise in Buffalo with Lancaster and solve interesting and important challenges for our clients. Our scientists are involved in industry-wide initiatives, such as the SimInhale consortium to ensure that we can incorporate emerging science into our software products and consulting services.”

John DiBella, vice president for marketing and sales for Simulations Plus, said: “This was an exciting year for us, as we made positive strides with the diversification of our user base and the consulting projects on which we worked. For FY16, software license revenue increased 11%, with 75 new organizations, or new departments at existing organizations, now utilizing our technology, growing our installed base. We realized significant growth in software licensing from contract research organizations and companies outside our core pharmaceutical market, which highlights the utility of our tools for various research activities. We also experienced a strong 88% account, and 94% revenue, renewal rate for the year. The consulting services division, which worked with more than 35 companies and continues to maintain a robust project pipeline heading into 2017, had revenue that comprised 31% of total revenue in FY16. With our continued focus on education and training, increased marketing efforts, and the upcoming releases of GastroPlus™ 9.5 and other programs, we believe we are in an excellent position to address the needs set forth by regulatory agencies and capitalize on the increased adoption of modeling and simulation technology across industries.”

Investor Conference Call November 11, 2016, 4:15 p.m. EST/1:15 p.m. PST

The Company will host a conference call to discuss the Company’s performance on Friday, November 11, 2016, at 4:15 p.m. Eastern Time. All interested parties are invited to join the call by registering at: https://attendee.gotowebinar.com/register/7098520015199435521. On registering, you will receive a confirmation e-mail with instructions for joining the call. Please dial in five to ten minutes prior to the scheduled start time. For listen-only mode, you may dial +1 (415) 930-5321, and enter access code: 591-425-045.

About Simulations Plus, Inc.

Simulations Plus, Inc., is a premier developer of drug discovery and development software, which is licensed to and used in the conduct of drug research by major pharmaceutical and biotechnology companies worldwide. The company is a global leader focused on improving the ways scientists use knowledge and data to predict the properties and outcomes of pharmaceutical and biotechnology agents. Our innovations in integrating new and existing science in medicinal chemistry, computational chemistry, pharmaceutical science, biology, and physiology into our software have made us the leading software provider for physiologically based pharmacokinetic modeling and simulation as well as a leading provider of both preclinical and clinical pharmacometric consulting services for regulatory submissions. For more information, visit our website at www.simulations-plus.com.

Follow Us on Twitter

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 – With the exception of historical information, the matters discussed in this press release are forward-looking statements that involve a number of risks and uncertainties. Our actual future results could differ significantly from those statements. Factors that could cause or contribute to such differences include, but are not limited to: our ability to maintain our competitive advantages, acceptance of our new software products as well as improved versions of our existing software by our customers, the general economics of the pharmaceutical industry, our ability to finance growth, our ability to continue to attract and retain highly qualified technical staff, and a sustainable market. Further information on our risk factors is contained in our quarterly and annual reports as filed with the U.S. Securities and Exchange Commission.

 

SIMULATIONS PLUS, INC.

CONSOLIDATED BALANCE SHEETS

As of August 31

                 
ASSETS            

2016

2015

Current assets
Cash and cash equivalents $ 8,030,284 $ 8,551,275
Accounts receivable, net of allowance for doubtful accounts of $0 3,009,517 1,593,707
Revenues in excess of billings 694,131 795,125
Prepaid income taxes 555,486 -
Prepaid expenses and other current assets 410,811 381,718
Deferred income taxes   228,713   210,972
Total current assets   12,928,942   11,532,797
Long-term assets

Capitalized computer software development costs, net of accumulated amortization of $8,613,487 and $7,632,421

4,013,127 3,798,339
Property and equipment, net 256,381 413,510
Intellectual property, net of accumulated amortization of $1,408,750 and $801,250 4,666,250 5,273,750
Other intangible assets net of accumulated amortization of $295,000 and $147,500 1,355,000 1,502,500
Goodwill 4,789,248 4,789,248
Other assets   34,082   34,082
Total assets$28,043,030$27,344,226
 
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable $ 108,111 $ 209,407
Accrued payroll and other expenses 481,610 429,580
Accrued bonuses to officers 121,000 121,000
Income taxes payable - 43,602
Other current liabilities 8,274 19,859
Current portion - Contracts payable 1,000,000 2,604,404
Billings in excess of revenues 230,100 106,534
Deferred revenue   176,422   78,945
Total current liabilities   2,125,517   3,613,331
 
Long-term liabilities
Deferred income taxes 3,184,919 3,190,419
Payments due under Contracts payable - 1,000,000
Other long-term liabilities   -   8,274
Total liabilities $ 5,310,436 $ 7,812,024
 
Commitments and contingencies
 
Shareholders' equity
Preferred stock, $0.001 par value
10,000,000 shares authorized
no shares issued and outstanding $ - $ -
Common stock, $0.001 par value
50,000,000 shares authorized
17,225,478 and 16,943,001 shares issued and outstanding 7,227 5,414
Additional paid-in capital 11,376,007 9,714,290
Retained earnings   11,349,360   9,812,498
Total shareholders' equity $ 22,732,594 $ 19,532,202
 
Total liabilities and shareholders' equity$28,043,030$27,344,226

 

 

 
SIMULATIONS PLUS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
For the years ended August 31,
 
     

2016

      

2015

 
Net Revenues $ 19,972,079 $ 18,314,248
Cost of revenues   4,601,513     4,392,477  
Gross margin   15,370,566     13,921,771  
Operating expenses
Selling, general, and administrative 6,693,691 6,736,767
Research and development   1,445,069     1,328,476  
Total operating expenses   8,138,760     8,065,243  
 
Income from operations   7,231,806     5,856,528  
 
Other income (expense)
Interest income 18,014 17,935
Gain(loss) on currency exchange   (13,428 )   (181,534 )
Total other income (expense)   4,586     (163,599 )

Income from operations before provision for income taxes

 7,236,392 5,692,929
Provision for income taxes   (2,286,256 )   (1,849,968 )
Net Income$4,950,136   $3,842,961  
 
Earnings per share
Basic $ 0.29 $ 0.23
Diluted $ 0.29 $ 0.23
 
Weighted-average common shares outstanding
Basic 17,028,566 16,864,670
Diluted 17,209,506 17,032,158