Stock in Motions: Agilysys, Inc. (NASDAQ: AGYS)

On 17 October Wednesday, Agilysys, Inc. (NASDAQ: AGYS) shares price traded between $15.43 and $15.79 during the last trading session upbeat/downbeat with -0.64% at $15.55. The shares recorded a trading volume 28,799 million shares as compared to its average volume of 88,632 shares. Over the one year trading period, the stock has a peak price of $16.87 and its down is recorded at $10.77.

Agilysys, Inc. (AGYS) stated operating results for its fiscal 2019 first quarter ended June 30, 2018.

Summary of Fiscal 2019 First Quarter Financial Results

  • Total net revenue was $34.0M, contrast to total net revenue of $33.9M in the comparable prior-year period. Without the adoption of ASC 606, revenue in the fiscal 2019 first quarter would have been about $50,000 higher.
  • Recurring revenues (which are comprised of support, maintenance and subscription services) were $17.9M, or 53% of total net revenue, contrast to $16.7M, or 49% of total net revenue, for the same period in fiscal 2018. SaaS revenues raised 19% year over year and comprised 32% of total recurring revenues, contrast to 29% of total recurring revenues in the first quarter of fiscal 2018.
  • Gross margin was 52.6% in the fiscal 2019 first quarter, contrast to 49.2% in the prior-year period.
  • Net loss in the fiscal 2019 first quarter was $(1.7)M, or $(0.08) per diluted share, contrast to a net loss of $(3.0)M, or $(0.13) per diluted share, in the prior-year period. Without the adoption of ASC 606, the net loss in the fiscal 2019 first quarter would have improved by about $80,000.
  • Adjusted EBITDA (non-GAAP) was $3.1M, contrast to Adjusted EBITDA of $1.6M in the same period last year (see reconciliation below).
  • Adjusted earnings from operations (non-GAAP) in the fiscal 2019 first quarter was $0.2M, contrast to Adjusted loss from operations in the fiscal 2018 first quarter of $(3.5)M (see reconciliation below).

Ramesh Srinivasan, President and CEO of Agilysys, commented, “Our positive operating momentum continued in the first quarter of fiscal 2019 as we generated our highest ever quarterly revenue. This was also our third consecutive quarter of sequential revenue growth. Recurring revenue raised 8% year over year to $17.9M and continues to be driven primarily by SaaS revenue growth. Over the last three quarters, our sales growth has been broad-based with improvement across multiple product and vertical market sections. As in other recent quarters, revenue growth in the fiscal 2019 first quarter included net positive competitive replacements, growth in sales of additional products to existing consumers and expansion of business with certain large planned accounts. We expect such growth opportunities to continue driving us forward in fiscal 2019 and beyond.

“We also continue to make good progress towards positioning Agilysys for consistent near and long-term profitability improvement. The fiscal 2019 first quarter represented the second consecutive quarter in which we generated positive Adjusted Earnings from Operations (AOE), the first two quarters we have achieved this since transforming Agilysys into a pure-play hospitality software solutions technology provider in fiscal 2014. AOE improved by over $3.7M year over year in the first quarter, and we now believe AOE will be about break-even for fiscal 2019.

“Overall, we are happy with our strong start to fiscal 2019, our increasing momentum in the marketplace and in our internal culture transformation. There has never been a better time to work at and do business with Agilysys and these factors have positioned us well to consistently grow shareholder value.”

New Revenue Recognition Standard

On April 1, 2018, Agilysys adopted accounting standard update No. 2014-09 (“ASC 606”), the Financial Accounting Standards Board’s new revenue recognition standard. Financial results for the three month period ended June 30, 2018 reflect this accounting standard. Financial results for the three month period ended June 30, 2017 have not been restated and are stated under the accounting standards in effect during that period. The impact on revenue, net loss, Adjusted EBITDA, and Adjusted Earnings from Operations (“AOE”) from the adoption of ASC 606 was immaterial.

Updated Fiscal 2019 Outlook

Agilysys recently reiterated its before provided forecast for fiscal 2019 full year revenue growth of about 10% contrast to fiscal 2018 revenue of about $127M. In addition, the Company now expects to record about break-even Adjusted Earnings from Operations (non-GAAP measure) in fiscal 2019, contrast to the loss of about $6.0M for this metric in fiscal 2018. Agilysys also expects fiscal 2019 year-end cash and cash equivalents to reflect a decline of about $3M to $5M, from the fiscal 2018 year-end balance of $39.9M, a important improvement from the over $9M decline in fiscal 2018.

AGYS price volatility for a month noted as 2.81% however its price volatility for a week documented as 2.44%. The corporation holds 23.39 million outstanding shares and its 22.51 million shares were floated in the market. The stock established a positive trend of 0.45% in last week and indicated fall of -2.81% in previous month.