Agilysys(US:AGYS)2024-05-21 23:33Revenue Growth - Total net revenue increased by $39.4 million, or 19.9%, in fiscal 2024 compared to fiscal 2023, reaching $237.5 million[200] - Subscription and maintenance revenue grew by $19.8 million, or 16.7%, driven by a 29.6% increase in subscription-based revenue[200] - Professional services revenue surged by $14.2 million, or 39.2%, due to higher sales and service activity[200] - Total net revenue increased by $35.4 million, or 21.8%, in fiscal 2023 compared to fiscal 2022, reaching $198.1 million[216] - Subscription and maintenance revenue grew by $19.3 million, or 19.5%, driven by a 27.5% increase in subscription-based revenue[217] Profitability - Gross profit increased by $23.4 million, or 19.4%, with a gross profit margin slightly decreasing from 61.0% to 60.7%[201] - Operating income rose by $2.9 million, or 22.4%, reaching $15.8 million, with an operating income percentage of 6.6%[198] - Gross profit increased by $19.3 million, or 19.0%, with a gross profit margin decreasing from 62.4% to 61.0%[218] - Operating income increased to $12.9 million in fiscal 2023, with an operating income percentage of 6.5% compared to 3.9% in fiscal 2022[216] Expenses - Product development expenses increased by $6.5 million, or 12.9%, due to hiring and increased compensation rates[203] - Sales and marketing expenses rose by $5.7 million, or 25.2%, reflecting hiring and expanded marketing activities[204] - Operating expenses, excluding legal settlements and other charges, rose by $14.5 million, or 15.6%, in fiscal 2023 compared to fiscal 2022[219] - Sales and marketing expenses surged by $8.0 million, or 54.2%, due to increased investments in marketing activities and key hires[221] Cash Flow and Financial Position - Cash flows provided by operating activities were $48.2 million in fiscal 2024, up from $34.5 million in fiscal 2023[237] - As of March 31, 2024, the company had cash on hand of $144.9 million, with 95% held in the United States[236] - Cash flows used in financing activities in fiscal 2024 were $8.6 million, including share repurchases of $6.9 million and $1.7 million in preferred stock dividends[242] - Cash flows used in financing activities in fiscal 2023 were $11.1 million, with share repurchases of $9.3 million and $1.8 million in preferred stock dividends[243] - Cash flows used in financing activities in fiscal 2022 were $4.9 million, primarily from share repurchases of $3.0 million and $1.8 million in preferred stock dividends[243] Taxation - The effective tax rate for fiscal 2024 was not meaningful due to the release of valuation allowances against deferred tax assets[212] - The effective tax rate for fiscal 2023 was 7.5%, significantly higher than 0.5% in fiscal 2022, due to adjustments to deferred tax assets[230] - The company anticipates a potential release of valuation allowances on deferred tax assets, which could result in significant income tax benefits[233] Revenue Recognition - The company recognizes subscription service revenue over a one-month period based on typical monthly invoicing and renewal cycles[254] - The company recognizes revenue for hardware sales when the product is shipped to the customer, fulfilling obligations affecting customer acceptance[253] - The company utilizes the market approach to determine standalone selling price by maximizing observable data points from recently executed customer contracts[257] International Operations - Revenue from international operations constituted 6% of total revenue in fiscal 2024, down from 7% in both fiscal 2023 and 2022[262] Other Financial Information - The cash surrender value of corporate-owned life insurance policies was recorded at $1.0 million, with future proceeds owed to beneficiaries approximating $0.1 million[244] - The company has not entered into any off-balance sheet arrangements that could affect its financial condition or results of operations[245]