Cover
Cover - shares | 9 Months Ended | |
May 31, 2022 | Jun. 30, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --08-31 | |
Entity File Number | 001-32046 | |
Entity Registrant Name | Simulations Plus, Inc. | |
Entity Central Index Key | 0001023459 | |
Entity Incorporation, State or Country Code | CA | |
Entity Tax Identification Number | 95-4595609 | |
Entity Address, Address Line One | 42505 10th Street West | |
Entity Address, City or Town | Lancaster | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 93534-7059 | |
City Area Code | (661) | |
Local Phone Number | 723-7723 | |
Trading Symbol | SLP | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Document Period End Date | May 31, 2022 | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 20,235,562 | |
Entity Filer Category | Large Accelerated Filer | |
Title of 12(b) Security | Common Stock, par value $0.001 per share |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | May 31, 2022 | Aug. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 42,353 | $ 36,984 |
Accounts receivable, net of allowance for doubtful accounts of $12 and $78 | 18,587 | 9,851 |
Prepaid income taxes | 322 | 1,012 |
Prepaid expenses and other current assets | 3,472 | 4,846 |
Short-term investments | 80,120 | 86,620 |
Total current assets | 144,854 | 139,313 |
Long-term assets | ||
Capitalized computer software development costs, net of accumulated amortization of $15,376 and $14,438 | 8,974 | 7,646 |
Property and equipment, net | 607 | 1,838 |
Operating lease right-of-use assets | 1,533 | 1,276 |
Intellectual property, net of accumulated amortization of $7,585 and $6,516 | 9,400 | 10,469 |
Other intangible assets, net of accumulated amortization of $2,635 and $2,186 | 7,717 | 6,464 |
Goodwill | 12,921 | 12,921 |
Other assets | 217 | 51 |
Total assets | 186,223 | 179,978 |
Current liabilities | ||
Accounts payable | 426 | 387 |
Accrued payroll and other expenses | 2,947 | 5,604 |
Contracts payable - current portion | 0 | 4,550 |
Operating lease liability - current portion | 459 | 382 |
Deferred revenue | 2,083 | 651 |
Total current liabilities | 5,915 | 11,574 |
Long-term liabilities | ||
Deferred income taxes, net | 1,680 | 1,726 |
Operating lease liability | 1,069 | 896 |
Total liabilities | 8,664 | 14,196 |
Commitments and contingencies | ||
Shareholders' equity | ||
Preferred stock, $0.001 par value 10,000,000 shares authorized, no shares issued and outstanding | 0 | 0 |
Common stock, $0.001 par value and additional paid-in capital —50,000,000 shares authorized, 20,234,654 and 20,141,521 shares issued and outstanding | 137,556 | 133,418 |
Retained earnings | 40,297 | 32,407 |
Accumulated other comprehensive loss | (294) | (43) |
Total shareholders' equity | 177,559 | 165,782 |
Total liabilities and shareholders' equity | $ 186,223 | $ 179,978 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | May 31, 2022 | Aug. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Accounts receivable, allowance for credit loss, current | $ 12 | $ 78 |
Capitalized computer software, accumulated amortization | $ 15,376 | $ 14,438 |
Preferred stock, par or stated value per share (in usd per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par or stated value per share (in usd per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares, outstanding (in shares) | 20,234,654 | 20,141,521 |
Common stock, shares, issued (in shares) | 20,234,654 | 20,141,521 |
Intellectual property | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, accumulated amortization | $ 7,585 | $ 6,516 |
Other intangible assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, accumulated amortization | $ 2,635 | $ 2,186 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Revenues | ||||
Total revenues | $ 14,959 | $ 12,777 | $ 42,172 | $ 36,625 |
Cost of revenues | ||||
Total cost of revenues | 2,559 | 2,471 | 8,145 | 7,815 |
Gross profit | 12,400 | 10,306 | 34,027 | 28,810 |
Operating expenses | ||||
Research and development | 655 | 670 | 2,439 | 2,771 |
Selling, general, and administrative | 6,799 | 5,094 | 17,371 | 14,960 |
Total operating expenses | 7,454 | 5,764 | 19,810 | 17,731 |
Income from operations | 4,946 | 4,542 | 14,217 | 11,079 |
Other income (expense), net | (112) | (51) | 6 | (169) |
Income before income taxes | 4,834 | 4,491 | 14,223 | 10,910 |
Provision for income taxes | (747) | (704) | (2,701) | (1,433) |
Net income | $ 4,087 | $ 3,787 | $ 11,522 | $ 9,477 |
Earnings per share | ||||
Basic (in usd per share) | $ 0.20 | $ 0.19 | $ 0.57 | $ 0.47 |
Diluted (in usd per share) | $ 0.20 | $ 0.18 | $ 0.56 | $ 0.46 |
Weighted-average common shares outstanding | ||||
Basic (in shares) | 20,212 | 20,105 | 20,180 | 20,014 |
Diluted (in shares) | 20,768 | 20,802 | 20,731 | 20,750 |
Other Comprehensive income, net of tax | ||||
Foreign currency translation adjustments | $ 24 | $ 40 | $ (251) | $ 36 |
Comprehensive Income | 4,111 | 3,827 | 11,271 | 9,513 |
Software | ||||
Revenues | ||||
Total revenues | 9,647 | 8,298 | 26,767 | 22,337 |
Cost of revenues | ||||
Total cost of revenues | 730 | 800 | 2,245 | 2,448 |
Gross profit | 8,917 | 7,498 | 24,522 | 19,889 |
Services | ||||
Revenues | ||||
Total revenues | 5,312 | 4,479 | 15,405 | 14,288 |
Cost of revenues | ||||
Total cost of revenues | 1,829 | 1,671 | 5,900 | 5,367 |
Gross profit | $ 3,483 | $ 2,808 | $ 9,505 | $ 8,921 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common stock and additional paid in capital | Retained earnings | Accumulated other comprehensive income (loss) |
Balance, beginning of period at Aug. 31, 2020 | $ 128,541 | $ 27,436 | $ 58 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Exercise of stock options | 1,412 | |||
Stock-based compensation | 1,784 | |||
Shares issued to Directors for services | 257 | |||
Shares issued - Lixoft | 0 | |||
Declaration of dividend | (3,603) | |||
Net income | $ 9,477 | 9,477 | ||
Other comprehensive income (loss) | 36 | |||
Total shareholders’ equity at May. 31, 2021 | $ 165,398 | 131,994 | 33,310 | 94 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Cash dividends declared per common share | $ 0.18 | |||
Balance, beginning of period at Feb. 28, 2021 | 130,713 | 30,730 | 54 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Exercise of stock options | 576 | |||
Stock-based compensation | 618 | |||
Shares issued to Directors for services | 87 | |||
Shares issued - Lixoft | 0 | |||
Declaration of dividend | (1,207) | |||
Net income | $ 3,787 | 3,787 | ||
Other comprehensive income (loss) | 40 | |||
Total shareholders’ equity at May. 31, 2021 | $ 165,398 | 131,994 | 33,310 | 94 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Cash dividends declared per common share | $ 0.06 | |||
Balance, beginning of period at Aug. 31, 2021 | $ 165,782 | 133,418 | 32,407 | (43) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Exercise of stock options | 693 | |||
Stock-based compensation | 2,016 | |||
Shares issued to Directors for services | 263 | 263 | ||
Shares issued - Lixoft | 1,166 | |||
Declaration of dividend | (3,632) | |||
Net income | 11,522 | 11,522 | ||
Other comprehensive income (loss) | (251) | |||
Total shareholders’ equity at May. 31, 2022 | $ 177,559 | 137,556 | 40,297 | (294) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Cash dividends declared per common share | $ 0.18 | |||
Balance, beginning of period at Feb. 28, 2022 | 135,472 | 37,422 | (318) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Exercise of stock options | 152 | |||
Stock-based compensation | 679 | |||
Shares issued to Directors for services | $ 87 | 87 | ||
Shares issued - Lixoft | 1,166 | |||
Declaration of dividend | (1,212) | |||
Net income | 4,087 | 4,087 | ||
Other comprehensive income (loss) | 24 | |||
Total shareholders’ equity at May. 31, 2022 | $ 177,559 | $ 137,556 | $ 40,297 | $ (294) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Cash dividends declared per common share | $ 0.06 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
May 31, 2022 | May 31, 2021 | |
Cash flows from operating activities | ||
Net income | $ 11,522 | $ 9,477 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 2,724 | 2,662 |
Change in value of contingent consideration | 283 | 364 |
Amortization of investment premiums | 1,493 | 1,752 |
Stock-based compensation | 2,279 | 2,041 |
Deferred income taxes | (46) | (84) |
Currency translation adjustments | (251) | 36 |
(Increase) decrease in | ||
Accounts receivable | (8,736) | (5,540) |
Prepaid income taxes | 690 | 478 |
Prepaid expenses and other assets | 1,208 | (796) |
Accounts payable | 32 | (51) |
Accrued payroll and other expenses | (2,657) | 363 |
Deferred revenue | 1,432 | 228 |
Net cash provided by operating activities | 9,973 | 10,930 |
Cash flows from investing activities | ||
Purchases of property and equipment | (740) | (966) |
Purchases of short-term investments | (70,924) | (63,964) |
Proceeds from sale of short-term investments | 75,932 | 68,068 |
Capitalized computer software development costs | (2,266) | (2,273) |
Net cash provided by investing activities | 2,002 | 865 |
Cash flows from financing activities | ||
Payment of dividends | (3,632) | (3,603) |
Payments on contracts payable | (3,667) | 0 |
Proceeds from the exercise of stock options | 693 | 1,412 |
Net cash used in financing activities | (6,606) | (2,191) |
Net increase in cash and cash equivalents | 5,369 | 9,604 |
Cash and cash equivalents, beginning of year | 36,984 | 49,207 |
Cash and cash equivalents, end of period | 42,353 | 58,811 |
Supplemental disclosures of cash flow information | ||
Income taxes paid | 2,001 | 893 |
Non-cash investing and financing activities | ||
Right of use assets capitalized | $ 624 | $ 905 |
GENERAL
GENERAL | 9 Months Ended |
May 31, 2022 | |
Accounting Policies [Abstract] | |
GENERAL | GENERAL This Quarterly Report on Form 10-Q for the quarter ended May 31, 2022 should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended August 31, 2021, filed with the Securities and Exchange Commission (“SEC”) on October 27, 2021. As contemplated by the SEC under Article 8 of Regulation S-X, the accompanying consolidated financial statements and footnotes have been condensed and therefore do not contain all disclosures required by generally accepted accounting principles. The interim financial data are unaudited; however, in the opinion of Simulations Plus, Inc., the interim data include all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of the results for the interim periods. Results for interim periods are not necessarily indicative of those to be expected for the full year. Organization Simulations Plus, Inc. (“Simulations Plus”) was incorporated on July 17, 1996. In September 2014, Simulations Plus acquired all of the outstanding equity interests of Cognigen Corporation (“Cognigen”) and Cognigen became a wholly owned subsidiary of Simulations Plus, Inc. In June 2017, Simulations Plus acquired DILIsym Services, Inc. (“DILIsym”) as a wholly owned subsidiary. In April 2020, Simulations Plus, Inc. acquired Lixoft, a French société par actions simplifiée (“Lixoft”), as a wholly owned subsidiary pursuant to a stock purchase and contribution agreement (Simulations Plus together with its subsidiaries, collectively, the “Company,” “we,” “us,” “our”). Effective September 1, 2021, the Company merged Cognigen and DILIsym with and into Simulations Plus, Inc. through short form mergers (the “Mergers”). To effectuate the Mergers, the Company filed Certificates of Ownership with the Secretaries of State of the states of Delaware (Cognigen’s and DILIsym’s state of incorporation) and California (Simulation Plus’ state of incorporation). Consummation of the Mergers was not subject to approval of the Company’s stockholders and did not impact the rights of the Company’s stockholders. Lines of Business We are a premier developer of drug discovery and development software for modeling and simulation, and for the prediction of molecular properties utilizing artificial intelligence (“AI”) and machine-learning-based technology. We also provide consulting services ranging from early drug discovery through preclinical and clinical trial data analysis and for submissions to regulatory agencies. Our software and consulting services are provided to major pharmaceutical, biotechnology, agrochemical, cosmetics, and food industry companies. They are also provided to academic agencies for use in the conduct of industry-based research and to regulatory agencies for product approval. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
May 31, 2022 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2: SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The accompanying consolidated financial statements include the accounts of Simulations Plus and its wholly owned subsidiaries as applicable for the periods presented. All significant intercompany accounts and transactions have been eliminated upon consolidation. Use of Estimates Our financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management’s application of accounting policies. Actual results could differ from those estimates. Significant accounting policies for us include revenue recognition, accounting for capitalized computer software development costs, valuation of stock options, and accounting for income taxes. Reclassifications Certain numbers in the prior year have been reclassified to conform to the current year's presentation. Revenue Recognition We generate revenue primarily from the sale of software licenses and by providing consulting services to the pharmaceutical industry for drug development. In accordance with Accounting Standards Codification Topic 606 ("ASC Topic 606"), “ Revenue from Contracts with Customers” , we determine revenue recognition through the following steps: i. Identification of the contract, or contracts, with a customer ii. Identification of the performance obligations in the contract iii. Determination of the transaction price iv. Allocation of the transaction price to the performance obligations in the contract v. Recognition of revenue when, or as, we satisfy a performance obligation Remaining Performance Obligations Transaction price allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and unbilled amounts that will be recognized as revenue in future periods. As of May 31, 2022, remaining performance obligations were approximately $13.2 million. Approximately 89% of the remaining performance obligations are expected to be recognized over the next 12 months, with the remainder recognized thereafter. Remaining performance obligations estimates are subject to change and are affected by several factors, including contract terminations and changes in the scope of contracts. Disaggregation of Revenue The components of disaggregation of revenue for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended Nine Months Ended 2022 2021 2022 2021 Software licenses: Point in time $ 9,380 $ 8,098 $ 25,980 $ 21,570 Over time 267 200 787 703 Consulting services: Over time 5,312 4,479 15,405 14,352 Total revenue $ 14,959 $ 12,777 $ 42,172 $ 36,625 Contract Balances We receive payments from customers based upon contractual billing schedules, while we recognize revenue when, or as, we satisfy our performance obligations. This timing difference results in accounts receivable, contract assets, and contract liabilities. We record accounts receivable when the right to consideration becomes unconditional. We record a contract asset if the right to consideration is conditioned on something other than the passage of time, such as our future performance. Contract assets are included in prepaid expenses and other current assets on our condensed consolidated balance sheets. We record a contract liability when we have an obligation to transfer goods or services to a customer for which we have received consideration from a customer. We refer to contract liabilities as deferred revenue on our condensed consolidated balance sheets. Contract asset balances as of May 31, 2022 and August 31, 2021 were $1.8 million and $3.2 million, respectively. During the three and nine months ended May 31, 2022, we recognized $68 thousand and $608 thousand, respectively, of revenue that was included in contract liabilities as of August 31, 2021, and during the three and nine months ended May 31, 2021, we recognized $30 thousand and $430 thousand, respectively, of revenue that was included in contract liabilities as of August 31, 2020. Deferred Commissions Sales commissions earned by our sales force and our commissioned sales representatives are considered incremental and recoverable costs of obtaining a contract with a customer. We apply the practical expedient as described in ASC 340-40-25-4 to expense costs as incurred for sales commissions, since the amortization period of the asset that we otherwise would have recognized is one year or less. This expense is included in the condensed consolidated statements of operations and comprehensive income as selling, general, and administrative expense. Cash and Cash Equivalents For purposes of the statements of cash flows, we consider all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. Accounts Receivable and Allowances for Credit Losses The Company extends credit to its customers in the normal course of business. The Company evaluates its allowance for credit losses based on its estimate of the collectability of its trade accounts receivable. As part of this assessment, the Company considers various factors including the financial condition of the individual companies with which it does business, the aging of receivable balances, historical experience, changes in customer payment terms, current market conditions, and reasonable and supportable forecasts of future economic conditions. In times of economic turmoil, the Company’s estimates and judgments with respect to the collectability of its receivables is subject to greater uncertainty than in more stable periods. Accounts receivable balances will be charged off against the allowance for credit losses after all means of collection have been exhausted and the potential for recovery is considered remote. Investments The Company may invest excess cash balances in short-term and long-term marketable debt securities. Investments may consist of certificates of deposit, money market accounts, government-sponsored enterprise securities, corporate bonds, and/or commercial paper within the parameters of our Investment Policy and Guidelines. The Company accounts for its investments in marketable securities in accordance with Financial Accounting Standards Board (“FASB”) ASC 320, Investments – Debt and Equity Securities. This statement requires debt securities to be classified into three categories: Held-to-maturity—Debt securities that the entity has the positive intent and ability to hold to maturity are measured at amortized cost and are presented at the net amount expected to be collected. Any change in the allowance for credit losses during the period is reflected in earnings. Discounts and premiums to par value of the debt securities are amortized to interest income/expense over the term of the security. Trading Securities—Debt securities that are bought and held primarily for the purpose of selling in the near term are reported at fair value, with unrealized gains and losses included in earnings. Available-for-Sale—Debt securities not classified as either securities held-to-maturity or trading securities are reported at fair value. For available-for-sale debt securities in an unrealized loss position, we evaluate as of the balance sheet date whether the unrealized losses are attributable to a credit loss or other factors. The portion of unrealized losses related to a credit loss is recognized in earnings, and the portion of unrealized loss not related to a credit loss is recognized in other comprehensive income. We classify our investments in marketable debt securities based on the facts and circumstances present at the time of purchase of the securities. We subsequently reassess the appropriateness of that classification at each reporting date. During the quarter ended May 31, 2022, all of our investments were classified as held-to-maturity. Capitalized Computer Software Development Costs Software development costs are capitalized in accordance with FASB ASC 985-20, Costs of Software to Be Sold, Leased, or Marketed . Capitalization of software development costs begins upon the establishment of technological feasibility and is discontinued when the product is available for sale. The establishment of technological feasibility and the ongoing assessment for recoverability of capitalized software development costs require considerable judgment by management with respect to certain external factors including, but not limited to, technological feasibility, anticipated future gross revenue, estimated economic life, and changes in software and hardware technologies. Capitalized software development costs are comprised primarily of salaries and direct payroll-related costs and the purchase of existing software to be used in our software products. Amortization of capitalized software development costs is calculated on a product-by-product basis on the straight-line method over the estimated economic life of the products (not to exceed five years). Amortization of software development costs amounted to $314 thousand and $344 thousand for the three months ended May 31, 2022 and 2021, respectively, and $938 thousand and $1.0 million for the nine months ended May 31, 2022 and 2021, respectively. We expect future amortization expense to vary due to increases in capitalized computer software development costs. We test capitalized computer software development costs for recoverability whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Property and Equipment Property and equipment are recorded at cost, less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives as follows: Equipment 5 years Computer equipment 3 to 7 years Furniture and fixtures 5 to 7 years Leasehold improvements Shorter of life of asset or lease Internal-use Software We have a service contract related to the implementation of internally used software. In accordance with ASC 350-40 “Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract” , we have capitalized certain internal-use software which are included in long-term assets. The amortization is classified as selling, general, and administrative expenses on the condensed consolidated statement of operations, and maintenance and minor upgrades are also charged to selling, general, and administrative expense as incurred. Leases Supplemental information related to operating leases was as follows as of May 31, 2022: (in thousands) Right-of-use assets $ 1,533 Lease liabilities, current $ 459 Lease liabilities, long-term $ 1,069 Operating lease costs $ 394 Weighted average remaining lease term 3.30 years Weighted average discount rate 3.41 % Intangible Assets and Goodwill We perform valuations of assets acquired and liabilities assumed on each acquisition accounted for as a business combination and recognize the assets acquired and liabilities assumed at their acquisition-date fair value. Acquired intangible assets include customer relationships, software, trade names, and noncompete agreements. We determine the appropriate useful life by performing an analysis of expected cash flows based on historical experience of the acquired businesses. Intangible assets are amortized over their estimated useful lives using the straight-line method, which approximates the pattern in which the majority of the economic benefits are expected to be consumed. Goodwill represents the excess of the cost of an acquired entity over the fair value of the acquired net assets. Goodwill is not amortized; instead, it is tested for impairment annually or when events or circumstances change that would indicate that goodwill might be impaired. Events or circumstances that could trigger an impairment review include, but are not limited to, a significant adverse change in legal factors or in the business climate, an adverse action or assessment by a regulator, unanticipated competition, a loss of key personnel, significant changes in the manner of our use of the acquired assets or the strategy for our overall business, significant negative industry or economic trends, or significant underperformance relative to expected historical or projected future results of operations. Goodwill is tested for impairment at the reporting unit level, which is one level below or the same as an operating segment. As of May 31, 2022, we determined that we have four reporting units: Simulations Plus, Cognigen, DILIsym, and Lixoft. When testing goodwill for impairment, we first perform a qualitative assessment to determine whether it is necessary to perform step one of a two-step annual goodwill impairment test for each reporting unit. We are required to perform step one only if it concludes that it is more likely than not that a reporting unit's fair value is less than its carrying value. Should this be the case, the first step of the two-step process is to identify whether a potential impairment exists by comparing the estimated fair values of our reporting units with their respective book values, including goodwill. If the estimated fair value of the reporting unit exceeds book value, goodwill is considered not to be impaired, and no additional steps are necessary. If, however, the fair value of the reporting unit is less than book value, then the second step is performed to determine if goodwill is impaired and to measure the amount of impairment loss, if any. The amount of the impairment loss is the excess of the carrying amount of the goodwill over its implied fair value. The estimate of implied fair value of goodwill is primarily based on an estimate of the discounted cash flows expected to result from that reporting unit but may require valuations of certain internally generated and unrecognized intangible assets such as our software, technology, patents, and trademarks. If the carrying amount of goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to the excess. As of May 31, 2022, the entire balance of goodwill was attributed to three of our reporting units: Cognigen, DILIsym, and Lixoft. Intangible assets subject to amortization are reviewed for impairment whenever events or circumstances indicate that the carrying amount of these assets may not be recoverable. We did not recognize any impairment charges during the three and nine months ended May 31, 2022 and 2021. Reconciliation of Goodwill as of May 31, 2022: (in thousands) Cognigen DILIsym Lixoft Total Balance, August 31, 2021 $ 4,789 $ — $ 5,598 $ — $ 2,534 $ 12,921 Addition — — — — — — Impairments — — — — — — Balance, May 31, 2022 $ 4,789 $ 5,598 $ 2,534 $ 12,921 Fair Value of Financial Instruments Assets and liabilities recorded at fair value in the Condensed Consolidated Balance Sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair value. The categories, as defined by the standard, are as follows: Level Input: Input Definition: Level I Inputs that are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date. Level II Inputs, other than quoted prices included in Level I, that are observable for the asset or liability through corroboration with market data at the measurement date. Level III Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. For certain of our financial instruments, including accounts receivable, accounts payable, and accrued payroll and other expenses, the amounts approximate fair value due to their short maturities. The following table summarizes fair value measurements at May 31, 2022 and August 31, 2021 for assets and liabilities measured at fair value on a recurring basis: May 31, 2022: (in thousands) Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 42,353 $ — $ — $ 42,353 Short-term investments $ 79,801 $ — $ — $ 79,801 Acquisition-related contingent consideration obligations $ — $ — $ — $ — August 31, 2021: (in thousands) Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 36,984 $ — $ — $ 36,984 Short-term investments $ 86,484 $ — $ — $ 86,484 Acquisition-related contingent consideration obligations $ — $ — $ 3,217 $ 3,217 As of May 31, 2022, we had no liability for contingent consideration related to our acquisition of Lixoft, and as of August 31, 2021, we had a liability for contingent consideration related to our acquisition of Lixoft. The fair value measurement of the contingent consideration obligations is determined using Level 3 inputs. The fair value of contingent consideration obligations is based on a discounted cash flow model using a probability-weighted income approach. These fair value measurements represent Level 3 measurements as they are based on significant inputs not observable in the market. Significant judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and for each subsequent period. Accordingly, changes in assumptions could have a material impact on the amount of contingent consideration expense we record in any given period. The liability is recorded as contracts payable on the condensed consolidated balance sheet, and changes in the value of the contingent consideration obligations are recorded as other income (expense), net in our Condensed Consolidated Statement of Operations and Comprehensive Income. The following is a reconciliation of contingent consideration value: (in thousands) Value at August 31, 2021 $ 3,217 Contingent consideration payments - cash (2,334) Contingent consideration payments - stock (1,166) Change in value of contingent consideration 283 Value at May 31, 2022 $ — Research and Development Costs Research and development costs are charged to expense as incurred until technological feasibility has been established. These costs include salaries, laboratory experiments, and purchased software that was developed by other companies and incorporated into, or used in the development of, our final products. Income Taxes We account for income taxes in accordance with ASC 740-10, “Income Taxes” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each year-end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The provision for income taxes represents the tax payable for the period and the change during the period in deferred tax assets and liabilities. Intellectual property The following table summarizes intellectual property as of May 31, 2022: (in thousands) Amortization Acquisition Accumulated Net Book Royalty Agreement buy out-Enslein Research Straight line 10 years $ 75 $ 75 $ — Termination/nonassertion agreement-TSRL Inc. Straight line 10 years 6,000 4,825 1,175 Developed technologies–DILIsym acquisition Straight line 9 years 2,850 1,583 1,267 Intellectual rights of Entelos Holding Corp. Straight line 10 years 50 19 31 Developed technologies–Lixoft acquisition Straight line 16 years 8,010 1,083 6,927 $ 16,985 $ 7,585 $ 9,400 The following table summarizes intellectual property as of August 31, 2021: (in thousands) Amortization Acquisition Accumulated Net Book Royalty Agreement buy out-Enslein Research Straight line 10 years $ 75 $ — $ 71 $ 4 Termination/nonassertion agreement-TSRL Inc. Straight line 10 years 6,000 — 4,375 1,625 Developed technologies–DILIsym acquisition Straight line 9 years 2,850 — 1,346 1,504 Intellectual rights of Entelos Holding Corp. Straight line 10 years 50 — 15 35 Developed technologies–Lixoft acquisition Straight line 16 years 8,010 — 709 7,301 $ 16,985 $ 6,516 $ 10,469 Amortization expense for intellectual property agreements for the three months ended May 31, 2022 and 2021 was $354 thousand and $358 thousand, respectively, and amortization expense for intellectual property agreements for the nine months ended May 31, 2022 and 2021 was $1.1 million and $1.1 million, respectively. Other intangible assets The following table summarizes our other intangible assets as of May 31, 2022: (in thousands) Amortization Acquisition Accumulated Net Book Simulations Plus ERP Straight line 15 years $ 1,702 $ 52 $ 1,650 Cognigen Customer relationships Straight line 8 years 1,100 1,065 35 Trade name None 500 — 500 Covenants not to compete Straight line 5 years 50 50 — DILIsym Customer relationships Straight line 10 years 1,900 951 949 Trade name None 860 — 860 Covenants not to compete Straight line 4 years 80 80 — Lixoft Customer relationships Straight line 14 years 2,550 394 2,156 Trade name None 1,550 — 1,550 Covenants not to compete Straight line 3 years 60 43 17 $ 10,352 $ 2,635 $ 7,717 The following table summarizes our other intangible assets as of August 31, 2021: (in thousands) Amortization Acquisition Accumulated Net Book Cognigen Customer relationships Straight line 8 years $ 1,100 $ 963 $ 137 Trade name None 500 — 500 Covenants not to compete Straight line 5 years 50 50 — DILIsym Customer relationships Straight line 10 years 1,900 807 1,093 Trade name None 860 — 860 Covenants not to compete Straight line 4 years 80 80 — Lixoft Customer relationships Straight line 14 years 2,550 258 2,292 Trade name None 1,550 — 1,550 Covenants not to compete Straight line 3 years 60 28 32 $ 8,650 $ 2,186 $ 6,464 Amortization expense for other intangible assets for the three months ended May 31, 2022 and 2021 was $160 thousand and $137 thousand, respectively, and amortization expense for other intangible assets for the nine months ended May 31, 2022 and 2021 was $449 thousand and $412 thousand, respectively. In addition to normal amortization, these assets are tested for impairment as needed. Earnings per Share We report earnings per share in accordance with FASB ASC 260-10. Basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding. Diluted earnings per share is computed similarly to basic earnings per share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The components of basic and diluted earnings per share for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended Nine Months Ended 2022 2021 2022 2021 Numerator: Net income attributable to common shareholders $ 4,087 $ 3,787 $ 11,522 $ 9,477 Denominator: Weighted-average number of common shares outstanding during the period 20,212 20,105 20,180 20,014 Dilutive effect of stock options 556 697 551 736 Common stock and common stock equivalents used for diluted earnings per share 20,768 20,802 20,731 20,750 Stock-Based Compensation Compensation costs related to stock options are determined in accordance with FASB ASC 718-10, “Compensation-Stock Compensation” . Compensation cost is calculated based on the grant-date fair value estimated in accordance with FASB ASC 718-10, amortized on a straight-line basis over the options’ vesting period. Stock-based compensation expense related to stock options, not including shares issued to directors for services, was $679 thousand and $618 thousand for the three months ended May 31, 2022 and 2021, respectively, and $2.0 million and $1.8 million for the nine months ended May 31, 2022 and 2021, respectively. This expense is included in the condensed consolidated statements of operations as selling, general, and administration and research and development expense. Impairment of Long-lived Assets We account for the impairment and disposition of long-lived assets in accordance with ASC 350, “Intangibles – Goodwill and Other ” and ASC 360, “Property and Equipment” . Long-lived assets to be held and used are reviewed for events or changes in circumstances that indicate that their carrying value may not be recoverable. We measure recoverability by comparing the carrying amount of an asset to the expected future undiscounted net cash flows generated by the asset. If we determine that the asset may not be recoverable, or if the carrying amount of an asset exceeds its estimated future undiscounted cash flows, we recognize an impairment charge to the extent of the difference between the fair value and the asset's carrying amount. No impairment losses were recorded during the nine months ended May 31, 2022 and 2021. Recently Issued Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04 , Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). The amendments in ASU 2020-04 provide temporary optional expedients and exceptions for applying GAAP to contract modifications, hedging relationships, and other transactions to ease the potential accounting and financial reporting burden associated with transitioning away from reference rates that are expected to be discontinued, including the London Interbank Offered Rate (“LIBOR”). This ASU is effective as of March 12, 2020, through December 31, 2022. The adoption of the new standard has not had and is not expected to have, a material impact on our consolidated financial statements or related disclosures. In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”). The amendment requires contract assets and contract liabilities acquired in a business combination to be recognized and measured in accordance with ASC 606, Revenue from Contracts with Customers, as if the acquirer had originated the contract. The amendment is intended to improve the accounting for acquired revenue contracts with customers in a business combination, related to the recognition of an acquired contract liability, and to payment terms and their effect on subsequent revenue recognized by the acquirer. The amendment also provides certain practical expedients when applying the guidance. ASU 2021-08 is effective for interim and annual periods beginning after December 15, 2022, on a prospective basis, with early adoption permitted. The Company expects to adopt ASU 2021-08 in the first quarter of fiscal year 2024. The Company is currently evaluating the potential impact of ASU 2021-08 to its consolidated financial statements. In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832), which requires business entities to disclose information about transactions with a government that are accounted for by applying a grant or contribution model by analogy (for example, IFRS guidance in IAS 20 or guidance on contributions for not-for-profit entities in ASC 958-605). For transactions within scope, the new standard requires the disclosure of information about the nature of the transaction, including significant terms and conditions, as well as the amounts and specific financial statement line items affected by the transaction. The new guidance is effective for annual reporting periods beginning after December 15, 2021. The Company does not expect that the adoption of this standard will have a material impact on its condensed consolidated financial statements; however, the Company expects to increase its disclosures with respect to government assistance beginning in the first quarter of fiscal year 2023. |
OTHER INCOME (EXPENSE), NET
OTHER INCOME (EXPENSE), NET | 9 Months Ended |
May 31, 2022 | |
Other Income and Expenses [Abstract] | |
OTHER INCOME (EXPENSE), NET | OTHER INCOME (EXPENSE), NET The components of other income (expense), net for the three and nine months ended May 31, 2022 and 2021, were as follows: (in thousands) Three Months Ended Nine Months Ended 2022 2021 2022 2021 Interest income $ 139 $ 37 $ 278 $ 156 Interest expense — — — (22) Change in valuation of contingent consideration (40) (121) (283) (364) Gain on sale of assets — — 1 — Gain (loss) on currency exchange (211) 33 10 61 Total other income (expense), net $ (112) $ (51) $ 6 $ (169) |
INVESTMENTS
INVESTMENTS | 9 Months Ended |
May 31, 2022 | |
Investments, All Other Investments [Abstract] | |
INVESTMENTS | INVESTMENTS We invest a portion of our excess cash balances in short-term debt securities within the parameters of our Investment Policy and Guidelines. Investments as of May 31, 2022, consisted of corporate bonds and term deposits with maturities remaining of less than twelve months. We may also invest excess cash balances in certificates of deposit, money market accounts, government-sponsored enterprise securities, corporate bonds, and/or commercial paper. We account for investments in accordance with FASB ASC 320 , Investments – Debt and Equity Securities . As of May 31, 2022, all investments were classified as held-to-maturity securities. The following tables summarize our short-term investments as of May 31, 2022 and August 31, 2021: May 31, 2022 (in thousands) Amortized Cost Gross Gross Fair Value Commercial notes (due within one year) $ 75,620 $ — $ (319) $ 75,301 Term deposits (due within one year) $ 4,500 $ — $ — $ 4,500 Total $ 80,120 $ — $ (319) $ 79,801 August 31, 2021 (in thousands) Amortized Cost Gross Gross Fair Value Commercial notes (due within one year) $ 86,620 $ — $ (136) $ 86,484 Total $ 86,620 $ — $ (136) $ 86,484 |
CONTRACTS PAYABLE
CONTRACTS PAYABLE | 9 Months Ended |
May 31, 2022 | |
Other Liabilities Disclosure [Abstract] | |
CONTRACTS PAYABLE | CONTRACTS PAYABLE Lixoft Acquisition Liabilities : On April 1, 2020, we acquired Lixoft. The agreement provided for a 24-month, $2.0 million holdback provision against certain representations and warranties, comprised of $1.3 million of cash and shares of common stock valued at $0.7 million issued and deposited into an escrow account at the date of the agreement. In April 2022, the shares of common stock were released from escrow and $1.3 million of cash was paid to settle the holdback liability. In addition, based on a revenue-growth formula for the two years subsequent to April 1, 2020, the agreement called for earnout payments of up to $5.5 million (two-thirds cash and one-third newly issued, unregistered shares of our common stock). The former shareholders of Lixoft could earn up to $2.0 million the first year and $3.5 million in year two. In June 2021, $2.0 million was paid out under the first earnout payment, which was comprised of $1.3 million of cash and shares of common stock valud at $0.7 million. In May 2022, $3.5 million was paid out under the second earnout payment, which was comprised of $2.3 million cash and shares of common stock valud at $1.2 million. As of May 31, 2022 and August 31, 2021, the following liabilities have been recorded: (in thousands) May 31, August 31, Holdback liability $ — $ 1,333 Earnout liability — 3,217 Sub total $ — $ 4,550 Less: current portion — 4,550 Long-term portion $ — $ — |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
May 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Leases We lease approximately 9,255 square feet of office space in Lancaster, California, where our corporate headquarters are located. The lease term extends to January 31, 2026, and the base rent is $17 thousand per month. The lease agreement gives the Company the right, upon 180 days’ prior notice, to opt out of all or part of the last four years of the term, with no penalty. We lease approximately 4,317 square feet of office space in Buffalo, New York. The lease term extends to November 30, 2026, and the base rent is $7 thousand per month with an annual 2% increase. The lease agreement provides the Company with two five-year renewal options and the right to terminate the lease with one year’s prior written notice with certain penalties. We previously leased approximately 12,623 square feet of office space at a different location in Buffalo, New York. That lease term extended to November 2021 and the base rent was $16 thousand per month. We lease approximately 3,386 square feet of office space in Durham, North Carolina. The lease term extends to September 30, 2023, and the base rent is $8 thousand per month with an annual 3% increase. We lease approximately 2,300 square feet of office space in Paris, France. The lease term extends to November 2024 and the rent is $5 thousand per month and adjusted each December based on a consumer price index. We lease approximately 64 square feet consisting of 3 server cabinets in a data center colocation space in Buffalo, New York. The lease term extends to November 30, 2026 and the rent is $4 thousand per month with an annual 3% increase. Rent expense, including common area maintenance fees for the three months ended May 31 2022 and 2021, was $138 thousand and $167 thousand, respectively, and $414 thousand and $499 thousand for the nine months ended May 31, 2022 and 2021, respectively. The following table presents maturities of operating lease liabilities on an undiscounted basis as of May 31, 2022: (in thousands) Years Ending May 31, 2023 $ 509 2024 438 2025 363 2026 269 2027 50 Total undiscounted liabilities 1,629 Less: imputed interest (101) Total operating lease liabilities (including current portion) $ 1,528 Line of Credit On March 31, 2020, we entered into a Credit Agreement with Wells Fargo Bank, N.A. The Credit Agreement provided us with a credit facility of $3.5 million through April 15, 2022 (the “Termination Date”), on which date the Credit Agreement terminated in accordance with its terms. As a result, we can no longer draw down against the line of credit. We chose not to renew or pursue an alternative credit facility as we do not foresee a need to utilize such credit facility within the next twelve months. As of the Termination Date, there were no amounts drawn against the line of credit. Employment Agreements In the normal course of business, we have entered into employment agreements with certain of our key management personnel that may require compensation payments upon termination. Income Taxes We follow guidance issued by the FASB with regard to our accounting for uncertainty in income taxes recognized in the financial statements. Such guidance prescribes a recognition threshold of more likely than not and a measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. In making this assessment, a company must determine whether it is more likely than not that a tax position will be sustained upon examination, based solely on the technical merits of the position, and must assume that the tax position will be examined by taxing authorities. Our policy is to include interest and penalties related to income tax expense. We file income tax returns with the IRS and various state jurisdictions as well as with the countries of India and France. Our federal income tax returns for fiscal years 2018 through 2021 are open for audit, and our state tax returns for fiscal years 2017 through 2021 remain open for audit. Our review of prior year tax positions using the criteria and provisions presented in guidance issued by FASB did not result in a material impact on our financial position or results of operations. Litigation We are not a party to any legal proceedings and are not aware of any pending, threatened, or unasserted legal proceedings of any kind. |
SHAREHOLDERS_ EQUITY
SHAREHOLDERS’ EQUITY | 9 Months Ended |
May 31, 2022 | |
Equity [Abstract] | |
SHAREHOLDERS' EQUITY | SHAREHOLDERS’ EQUITY Shares Outstanding Shares of common stock outstanding for the three and nine months ended May 31, 2022 and 2021 were as follows: Three Months Ended Nine Months Ended 2022 2021 2022 2021 Common stock outstanding, beginning of the period 20,181,784 20,059,528 20,141,521 19,923,277 Common stock issued during the period 52,870 61,512 93,133 197,763 Common stock outstanding, end of the period 20,234,654 20,121,040 20,234,654 20,121,040 Dividends Our Board of Directors declared cash dividends during fiscal years 2022 and 2021. The details of the dividends paid are in the following tables: (in thousands, except dividend per share) Fiscal Year 2022 Record Date Distribution Date Number of Shares Dividend per Total Amount 10/25/2021 11/01/2021 20,148 $ 0.06 1,209 1/31/2022 2/07/2022 20,178 $ 0.06 1,211 4/25/2022 5/02/2022 20,207 $ 0.06 1,212 Total $ 3,632 (in thousands, except dividend per share) Fiscal Year 2021 Record Date Distribution Date Number of Shares Dividend per Total Amount 10/26/2020 11/02/2020 19,924 $ 0.06 $ 1,195 1/25/2021 2/01/2021 20,010 $ 0.06 1,201 4/26/2021 5/03/2021 20,115 $ 0.06 1,207 7/26/2021 8/02/2021 20,139 $ 0.06 1,208 Total $ 4,811 Stock Option Plans On February 23, 2007, the Company’s Board of Directors adopted, and its shareholders approved, the 2007 Stock Option Plan (the “2007 Plan”), under which a total of 1.0 million shares of common stock were reserved for issuance. On February 25, 2014, the shareholders approved an additional 1.0 million shares, increasing the total number of shares available to be granted under the 2007 Plan to 2.0 million. This plan terminated in February 2017 by its terms. On December 23, 2016, the Company’s Board of Directors adopted, and on February 23, 2017, its shareholders approved, the Company’s 2017 Equity Incentive Plan (the “2017 Plan”), under which a total of 1.0 million shares of common stock were reserved for issuance. The 2017 Plan will terminate in December 2026. The 2017 Plan was replaced by the Company’s 2021 Plan (as defined below), and as a result, no further issuances of shares may be made under the 2017 Plan. On April 9, 2021, the Company’s Board of Directors adopted, and on June 23, 2021, its shareholders approved, the Company’s 2021 Equity Incentive Plan (the “2021 Plan,” and together with the 2007 Plan and 2017 Plan, the “Plans”), under which 1.3 million shares of common stock were reserved for issuance. The 2021 Plan became effective as of April 9, 2021, and the Company may issue equity awards to permitted recipients thereunder. The maximum contractual life of the plan is ten years. As of May 31, 2022, employees and directors hold Incentive Stock Options (“ISOs”) and Non-Qualified Stock Options (“NQSOs”) to purchase 1.3 million shares of common stock at exercise prices ranging from $6.85 to $66.14. The following table summarizes information about stock options: (in thousands, except per share and weighted-average amounts) Number of Weighted- Weighted- Transactions during the nine months ended May 31, 2022 Outstanding, August 31, 2021 1,184 $ 25.63 6.47 Granted 232 $ 41.40 Exercised (76) $ 15.93 Cancelled/Forfeited (64) $ 41.04 Outstanding, May 31, 2022 1,276 $ 28.31 6.33 Exercisable, May 31, 2022 722 $ 16.96 4.66 The total fair value of nonvested stock options as of May 31, 2022 was $7.5 million and is amortizable over a weighted average period of 3.33 years. The fair value of these options was estimated at the date of grant using the Black-Scholes option-pricing model. The Black-Scholes option-valuation model was developed for use in estimating the fair value of traded options, which do not have vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions, including the expected stock price volatility. The following table summarizes the fair value of the options, including both ISOs and NQSOs, granted during the nine months ended May 31, 2022 and fiscal year 2021: (in thousands except pricing) Nine Months Ended Fiscal Year 2021 Estimated fair value of awards granted $ 4,066 $ — $ 5,092 Unvested forfeiture rate 1 % 0 % Weighted average grant price $ 41.40 $ 57.60 Weighted average market price $ 41.40 $ 57.60 Weighted average volatility 42.71 % 40.49 % Weighted average risk-free rate 1.62 % 0.64 % Weighted average dividend yield 0.59 % 0.42 % Weighted average expected life 6.59 years 6.63 years The exercise prices for the options outstanding at May 31, 2022 ranged from $6.85 to $66.14, and the information relating to these options is as follows: (in thousands except prices) Exercise Price Awards Outstanding Awards Exercisable Low High Quantity Weighted Weighted Quantity Weighted Weighted $ 6.85 $ 9.77 296 3.02 years $ 8.33 296 3.02 years $ 8.33 $ 9.78 $ 18.76 208 4.58 years $ 10.37 207 4.58 years $ 10.35 $ 18.77 $ 33.40 253 6.64 years $ 25.15 129 6.26 years $ 24.11 $ 33.41 $ 47.63 240 8.86 years $ 38.37 34 7.31 years $ 35.75 $ 47.64 $ 66.14 279 8.69 years $ 57.06 56 8.39 years $ 58.93 1,276 6.33 years $ 28.31 722 4.66 years $ 16.96 During the three and nine months ended May 31, 2022, the Company issued 1,875 and 5,326 shares of stock valued at $87 thousand and $263 thousand, respectively, to our non-management directors as compensation for board-related duties. The balance of par value common stock and additional paid-in capital as of May 31, 2022, was $11 thousand and $137.5 million, respectively. |
CONCENTRATIONS AND UNCERTAINTIE
CONCENTRATIONS AND UNCERTAINTIES | 9 Months Ended |
May 31, 2022 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS AND UNCERTAINTIES | CONCENTRATIONS AND UNCERTAINTIES Financial instruments that potentially subject us to concentration of credit risk consist principally of cash, cash equivalents, trade accounts receivable, and short-term investments. In addition, we hold cash at a bank in France that is not FDIC-insured. Historically, we have not experienced any losses in such accounts. However, we are investigating alternative ways to minimize our exposure to such risks. While we may be exposed to credit losses due to the nonperformance of our counterparties, we do not expect the settlement of these transactions to have a material effect on our results of operations, cash flows, or financial condition. We maintain cash and cash equivalents at financial institutions that may, at times, exceed federally insured limits. Revenue concentration shows that international sales accounted for 30% and 31% of net sales for the nine months ended May 31, 2022 and 2021, respectively. Four customers accounted for 5%, 4%, 3%, and 3% of net sales during the nine months ended May 31, 2022. Three customers accounted for 12%, 4%, and 4% of net sales during the nine months ended May 31, 2021. Accounts receivable concentration shows that four customers each comprised between 5% and 6% of accounts receivable as of May 31, 2022, compared to four customers each comprising between 7% and 10% of accounts receivable as of May 31, 2021. We operate in the computer software industry, which is highly competitive and changes rapidly. Our operating results could be significantly affected by our ability to develop new products and find new distribution channels for new and existing products. The majority of our customers are in the pharmaceutical industry. During economic downturns, we have seen consolidations in the pharmaceutical industry. The extent to which the COVID-19 pandemic continues to impact our business going forward will depend on numerous factors we cannot reliably predict, including the duration and scope of the pandemic; businesses and individuals' actions in response to the pandemic; and the impact on economic activity, including the possibility of recession or financial market instability. These factors may adversely impact consumer, business, and government spending as well as customers' ability to pay for our products and services on an ongoing basis. As a result, our growth rate could be affected by consolidation and downsizing in the pharmaceutical industry. |
SEGMENT AND GEOGRAPHIC REPORTIN
SEGMENT AND GEOGRAPHIC REPORTING | 9 Months Ended |
May 31, 2022 | |
Segment Reporting [Abstract] | |
SEGMENT AND GEOGRAPHIC REPORTING | SEGMENT AND GEOGRAPHIC REPORTING We account for segments and geographic revenue in accordance with guidance issued by the FASB. Our reportable segments are strategic business units that offer different products and services. Results for each business unit segment and consolidated results for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended May 31, 2022 Software Services Total Revenue $ 9,647 $ 5,312 $ 14,959 Cost of revenue 730 1,829 2,559 Gross profit $ 8,917 $ 3,483 $ 12,400 Gross margin 92 % 66 % 83 % Our software business and services business represented 64% and 36% of total revenue, respectively, for the three months ended May 31, 2022. (in thousands) Three Months Ended May 31, 2021 Software Services Total Revenue $ 8,298 $ 4,479 $ 12,777 Cost of revenue 800 1,671 2,471 Gross profit $ 7,498 $ 2,808 $ 10,306 Gross margin 90 % 63 % 81 % Our software business and services business represented 65% and 35% of total revenue, respectively, for the three months ended May 31, 2021. (in thousands) Nine Months Ended May 31, 2022 Software Services Total Revenue $ 26,767 $ 15,405 $ 42,172 Cost of revenue 2,245 5,900 8,145 Gross profit $ 24,522 $ 9,505 $ 34,027 Gross margin 92 % 62 % 81 % Our software business and services business represented 63% and 37% of total revenue, respectively, for the nine months ended May 31, 2022. (in thousands) Nine Months Ended May 31, 2021 Software Services Total Revenue $ 22,337 $ 14,288 $ 36,625 Cost of revenue 2,448 5,367 7,815 Gross profit $ 19,889 $ 8,921 $ 28,810 Gross margin 89 % 62 % 79 % Our software business and services business represented 61% and 39% of total revenue, respectively, for the nine months ended May 31, 2021. Revenue by product and consolidated revenue for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended May 31, 2022 2021 Software revenue GastroPlus $ 6,434 67 % $ 5,426 65 % MonolixSuite 1,025 11 % 948 11 % ADMET Predictor 1,593 17 % 1,488 18 % Other 595 6 % 436 5 % Total software revenue $ 9,647 100 % $ 8,298 100 % Services revenue PKPD $ 2,482 47 % $ 1,925 43 % QSP/QST 1,197 23 % 1,180 26 % PBPK 1,351 25 % 739 17 % Other 282 5 % 635 14 % Total services revenue $ 5,312 100 % $ 4,479 100 % Total consolidated revenue $ 14,959 $ 12,777 (in thousands) Nine Months Ended May 31, 2022 2021 Software revenue GastroPlus $ 15,869 59 % $ 13,245 59 % MonolixSuite 4,817 18 % 3,664 16 % ADMET Predictor 4,419 17 % 3,872 17 % Other 1,662 6 % 1,556 7 % Total software revenue $ 26,767 100 % $ 22,337 100 % Services revenue PKPD $ 7,030 46 % $ 6,755 47 % QSP/QST 4,190 27 % 4,047 28 % PBPK 3,158 20 % 2,312 16 % Other 1,027 7 % 1,174 8 % Total services revenue $ 15,405 100 % $ 14,288 100 % Total consolidated revenue $ 42,172 $ 36,625 Revenue by division and consolidated revenue for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended May 31, 2022 2021 Simulations Plus $ 9,412 63 % $ 7,916 62 % Cognigen 2,745 18 % 2,536 20 % DILIsym 1,723 12 % 1,331 10 % Lixoft 1,079 7 % 994 8 % Total $ 14,959 100 % $ 12,777 100 % (in thousands) Nine Months Ended May 31, 2022 2021 Simulations Plus $ 23,916 57 % $ 19,994 55 % Cognigen 7,685 18 % 7,987 22 % DILIsym 5,542 13 % 4,817 13 % Lixoft 5,029 12 % 3,827 10 % Total $ 42,172 100 % $ 36,625 100 % In addition, we allocate revenue to geographic areas based on the locations of our customers. Revenue for each geographical area and consolidated revenue for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended May 31, 2022 2021 Americas $ 11,163 75 % $ 9,651 76 % EMEA 1,925 13 % 1,462 11 % Asia Pacific 1,871 13 % 1,664 13 % Total $ 14,959 100 % $ 12,777 100 % (in thousands) Nine Months Ended May 31, 2022 2021 Americas $ 29,318 70 % $ 25,436 69 % EMEA 8,656 21 % 7,022 19 % Asia Pacific 4,198 10 % 4,167 11 % Total $ 42,172 100 % $ 36,625 100 % |
EMPLOYEE BENEFIT PLAN
EMPLOYEE BENEFIT PLAN | 9 Months Ended |
May 31, 2022 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLAN | EMPLOYEE BENEFIT PLANWe maintain a 401(k) Plan for all eligible employees, and we make matching contributions equal to 100% of the employee’s elective deferral, not to exceed 4% of total employee compensation. We can also elect to make a profit-sharing contribution. Our contributions to this 401(K) Plan amounted to $134 thousand and $151 thousand for the three months ended May 31, 2022 and 2021, respectively, and $442 thousand and $403 thousand for the nine months ended May 31, 2022 and 2021, respectively. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
May 31, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS On Wednesday, July 6, 2022, our Board of Directors declared a quarterly cash dividend of $0.06 per share to our shareholders. The dividend amount of approximately $1.2 million will be distributed on Monday, August 1, 2022, for shareholders of record as of Monday, July 25, 2022. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
May 31, 2022 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of ConsolidationThe accompanying consolidated financial statements include the accounts of Simulations Plus and its wholly owned subsidiaries as applicable for the periods presented. All significant intercompany accounts and transactions have been eliminated upon consolidation. |
Use of Estimates | Use of Estimates Our financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management’s application of accounting policies. Actual results could differ from those estimates. Significant accounting policies for us include revenue recognition, accounting for capitalized computer software development costs, valuation of stock options, and accounting for income taxes. |
Reclassifications | Reclassifications Certain numbers in the prior year have been reclassified to conform to the current year's presentation. |
Revenue Recognition | Revenue Recognition We generate revenue primarily from the sale of software licenses and by providing consulting services to the pharmaceutical industry for drug development. In accordance with Accounting Standards Codification Topic 606 ("ASC Topic 606"), “ Revenue from Contracts with Customers” , we determine revenue recognition through the following steps: i. Identification of the contract, or contracts, with a customer ii. Identification of the performance obligations in the contract iii. Determination of the transaction price iv. Allocation of the transaction price to the performance obligations in the contract v. Recognition of revenue when, or as, we satisfy a performance obligation Remaining Performance Obligations Transaction price allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and unbilled amounts that will be recognized as revenue in future periods. As of May 31, 2022, remaining performance obligations were approximately $13.2 million. Approximately 89% of the remaining performance obligations are expected to be recognized over the next 12 months, with the remainder recognized thereafter. Remaining performance obligations estimates are subject to change and are affected by several factors, including contract terminations and changes in the scope of contracts. Disaggregation of Revenue The components of disaggregation of revenue for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended Nine Months Ended 2022 2021 2022 2021 Software licenses: Point in time $ 9,380 $ 8,098 $ 25,980 $ 21,570 Over time 267 200 787 703 Consulting services: Over time 5,312 4,479 15,405 14,352 Total revenue $ 14,959 $ 12,777 $ 42,172 $ 36,625 Contract Balances We receive payments from customers based upon contractual billing schedules, while we recognize revenue when, or as, we satisfy our performance obligations. This timing difference results in accounts receivable, contract assets, and contract liabilities. We record accounts receivable when the right to consideration becomes unconditional. We record a contract asset if the right to consideration is conditioned on something other than the passage of time, such as our future performance. Contract assets are included in prepaid expenses and other current assets on our condensed consolidated balance sheets. We record a contract liability when we have an obligation to transfer goods or services to a customer for which we have received consideration from a customer. We refer to contract liabilities as deferred revenue on our condensed consolidated balance sheets. Contract asset balances as of May 31, 2022 and August 31, 2021 were $1.8 million and $3.2 million, respectively. During the three and nine months ended May 31, 2022, we recognized $68 thousand and $608 thousand, respectively, of revenue that was included in contract liabilities as of August 31, 2021, and during the three and nine months ended May 31, 2021, we recognized $30 thousand and $430 thousand, respectively, of revenue that was included in contract liabilities as of August 31, 2020. Deferred Commissions |
Cash and Cash Equivalents | Cash and Cash EquivalentsFor purposes of the statements of cash flows, we consider all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. |
Accounts Receivable and Allowances for Credit Losses | Accounts Receivable and Allowances for Credit Losses The Company extends credit to its customers in the normal course of business. The Company evaluates its allowance for credit losses based on its estimate of the collectability of its trade accounts receivable. As part of this assessment, the Company considers various factors including the financial condition of the individual companies with which it does business, the aging of receivable balances, historical experience, changes in customer payment terms, current market conditions, and reasonable and supportable forecasts of future economic conditions. In times of economic turmoil, the Company’s estimates and judgments with respect to the collectability of its receivables is subject to greater uncertainty than in more stable periods. Accounts receivable balances will be charged off against the allowance for credit losses after all means of collection have been exhausted and the potential for recovery is considered remote. |
Investments | Investments The Company may invest excess cash balances in short-term and long-term marketable debt securities. Investments may consist of certificates of deposit, money market accounts, government-sponsored enterprise securities, corporate bonds, and/or commercial paper within the parameters of our Investment Policy and Guidelines. The Company accounts for its investments in marketable securities in accordance with Financial Accounting Standards Board (“FASB”) ASC 320, Investments – Debt and Equity Securities. This statement requires debt securities to be classified into three categories: Held-to-maturity—Debt securities that the entity has the positive intent and ability to hold to maturity are measured at amortized cost and are presented at the net amount expected to be collected. Any change in the allowance for credit losses during the period is reflected in earnings. Discounts and premiums to par value of the debt securities are amortized to interest income/expense over the term of the security. Trading Securities—Debt securities that are bought and held primarily for the purpose of selling in the near term are reported at fair value, with unrealized gains and losses included in earnings. Available-for-Sale—Debt securities not classified as either securities held-to-maturity or trading securities are reported at fair value. For available-for-sale debt securities in an unrealized loss position, we evaluate as of the balance sheet date whether the unrealized losses are attributable to a credit loss or other factors. The portion of unrealized losses related to a credit loss is recognized in earnings, and the portion of unrealized loss not related to a credit loss is recognized in other comprehensive income. We classify our investments in marketable debt securities based on the facts and circumstances present at the time of purchase of the securities. We subsequently reassess the appropriateness of that classification at each reporting date. During the quarter ended May 31, 2022, all of our investments were classified as held-to-maturity. |
Capitalized Computer Software Development Costs | Capitalized Computer Software Development Costs Software development costs are capitalized in accordance with FASB ASC 985-20, Costs of Software to Be Sold, Leased, or Marketed . Capitalization of software development costs begins upon the establishment of technological feasibility and is discontinued when the product is available for sale. The establishment of technological feasibility and the ongoing assessment for recoverability of capitalized software development costs require considerable judgment by management with respect to certain external factors including, but not limited to, technological feasibility, anticipated future gross revenue, estimated economic life, and changes in software and hardware technologies. Capitalized software development costs are comprised primarily of salaries and direct payroll-related costs and the purchase of existing software to be used in our software products. Amortization of capitalized software development costs is calculated on a product-by-product basis on the straight-line method over the estimated economic life of the products (not to exceed five years). Amortization of software development costs amounted to $314 thousand and $344 thousand for the three months ended May 31, 2022 and 2021, respectively, and $938 thousand and $1.0 million for the nine months ended May 31, 2022 and 2021, respectively. We expect future amortization expense to vary due to increases in capitalized computer software development costs. We test capitalized computer software development costs for recoverability whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost, less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives as follows: Equipment 5 years Computer equipment 3 to 7 years Furniture and fixtures 5 to 7 years Leasehold improvements Shorter of life of asset or lease |
Internal-use Software | Internal-use Software We have a service contract related to the implementation of internally used software. In accordance with ASC 350-40 “Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract” , we have capitalized certain internal-use software which are included in long-term assets. |
Leases | Leases Supplemental information related to operating leases was as follows as of May 31, 2022: (in thousands) Right-of-use assets $ 1,533 Lease liabilities, current $ 459 Lease liabilities, long-term $ 1,069 Operating lease costs $ 394 Weighted average remaining lease term 3.30 years Weighted average discount rate 3.41 % |
Intangible Assets and Goodwill | Intangible Assets and Goodwill We perform valuations of assets acquired and liabilities assumed on each acquisition accounted for as a business combination and recognize the assets acquired and liabilities assumed at their acquisition-date fair value. Acquired intangible assets include customer relationships, software, trade names, and noncompete agreements. We determine the appropriate useful life by performing an analysis of expected cash flows based on historical experience of the acquired businesses. Intangible assets are amortized over their estimated useful lives using the straight-line method, which approximates the pattern in which the majority of the economic benefits are expected to be consumed. Goodwill represents the excess of the cost of an acquired entity over the fair value of the acquired net assets. Goodwill is not amortized; instead, it is tested for impairment annually or when events or circumstances change that would indicate that goodwill might be impaired. Events or circumstances that could trigger an impairment review include, but are not limited to, a significant adverse change in legal factors or in the business climate, an adverse action or assessment by a regulator, unanticipated competition, a loss of key personnel, significant changes in the manner of our use of the acquired assets or the strategy for our overall business, significant negative industry or economic trends, or significant underperformance relative to expected historical or projected future results of operations. Goodwill is tested for impairment at the reporting unit level, which is one level below or the same as an operating segment. As of May 31, 2022, we determined that we have four reporting units: Simulations Plus, Cognigen, DILIsym, and Lixoft. When testing goodwill for impairment, we first perform a qualitative assessment to determine whether it is necessary to perform step one of a two-step annual goodwill impairment test for each reporting unit. We are required to perform step one only if it concludes that it is more likely than not that a reporting unit's fair value is less than its carrying value. Should this be the case, the first step of the two-step process is to identify whether a potential impairment exists by comparing the estimated fair values of our reporting units with their respective book values, including goodwill. If the estimated fair value of the reporting unit exceeds book value, goodwill is considered not to be impaired, and no additional steps are necessary. If, however, the fair value of the reporting unit is less than book value, then the second step is performed to determine if goodwill is impaired and to measure the amount of impairment loss, if any. The amount of the impairment loss is the excess of the carrying amount of the goodwill over its implied fair value. The estimate of implied fair value of goodwill is primarily based on an estimate of the discounted cash flows expected to result from that reporting unit but may require valuations of certain internally generated and unrecognized intangible assets such as our software, technology, patents, and trademarks. If the carrying amount of goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to the excess. As of May 31, 2022, the entire balance of goodwill was attributed to three of our reporting units: Cognigen, DILIsym, and Lixoft. Intangible assets subject to amortization are reviewed for impairment whenever events or circumstances indicate that the carrying amount of these assets may not be recoverable. We did not recognize any impairment charges during the three and nine months ended May 31, 2022 and 2021. Reconciliation of Goodwill as of May 31, 2022: (in thousands) Cognigen DILIsym Lixoft Total Balance, August 31, 2021 $ 4,789 $ — $ 5,598 $ — $ 2,534 $ 12,921 Addition — — — — — — Impairments — — — — — — Balance, May 31, 2022 $ 4,789 $ 5,598 $ 2,534 $ 12,921 |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Assets and liabilities recorded at fair value in the Condensed Consolidated Balance Sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair value. The categories, as defined by the standard, are as follows: Level Input: Input Definition: Level I Inputs that are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date. Level II Inputs, other than quoted prices included in Level I, that are observable for the asset or liability through corroboration with market data at the measurement date. Level III Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. For certain of our financial instruments, including accounts receivable, accounts payable, and accrued payroll and other expenses, the amounts approximate fair value due to their short maturities. The following table summarizes fair value measurements at May 31, 2022 and August 31, 2021 for assets and liabilities measured at fair value on a recurring basis: May 31, 2022: (in thousands) Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 42,353 $ — $ — $ 42,353 Short-term investments $ 79,801 $ — $ — $ 79,801 Acquisition-related contingent consideration obligations $ — $ — $ — $ — August 31, 2021: (in thousands) Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 36,984 $ — $ — $ 36,984 Short-term investments $ 86,484 $ — $ — $ 86,484 Acquisition-related contingent consideration obligations $ — $ — $ 3,217 $ 3,217 As of May 31, 2022, we had no liability for contingent consideration related to our acquisition of Lixoft, and as of August 31, 2021, we had a liability for contingent consideration related to our acquisition of Lixoft. The fair value measurement of the contingent consideration obligations is determined using Level 3 inputs. The fair value of contingent consideration obligations is based on a discounted cash flow model using a probability-weighted income approach. These fair value measurements represent Level 3 measurements as they are based on significant inputs not observable in the market. Significant judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and for each subsequent period. Accordingly, changes in assumptions could have a material impact on the amount of contingent consideration expense we record in any given period. The liability is recorded as contracts payable on the condensed consolidated balance sheet, and changes in the value of the contingent consideration obligations are recorded as other income (expense), net in our Condensed Consolidated Statement of Operations and Comprehensive Income. The following is a reconciliation of contingent consideration value: (in thousands) Value at August 31, 2021 $ 3,217 Contingent consideration payments - cash (2,334) Contingent consideration payments - stock (1,166) Change in value of contingent consideration 283 Value at May 31, 2022 $ — |
Research and Development Costs | Research and Development Costs Research and development costs are charged to expense as incurred until technological feasibility has been established. These costs include salaries, laboratory experiments, and purchased software that was developed by other companies and incorporated into, or used in the development of, our final products. |
Income Taxes | Income Taxes We account for income taxes in accordance with ASC 740-10, “Income Taxes” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each year-end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The provision for income taxes represents the tax payable for the period and the change during the period in deferred tax assets and liabilities. |
Intellectual property | Intellectual property The following table summarizes intellectual property as of May 31, 2022: (in thousands) Amortization Acquisition Accumulated Net Book Royalty Agreement buy out-Enslein Research Straight line 10 years $ 75 $ 75 $ — Termination/nonassertion agreement-TSRL Inc. Straight line 10 years 6,000 4,825 1,175 Developed technologies–DILIsym acquisition Straight line 9 years 2,850 1,583 1,267 Intellectual rights of Entelos Holding Corp. Straight line 10 years 50 19 31 Developed technologies–Lixoft acquisition Straight line 16 years 8,010 1,083 6,927 $ 16,985 $ 7,585 $ 9,400 The following table summarizes intellectual property as of August 31, 2021: (in thousands) Amortization Acquisition Accumulated Net Book Royalty Agreement buy out-Enslein Research Straight line 10 years $ 75 $ — $ 71 $ 4 Termination/nonassertion agreement-TSRL Inc. Straight line 10 years 6,000 — 4,375 1,625 Developed technologies–DILIsym acquisition Straight line 9 years 2,850 — 1,346 1,504 Intellectual rights of Entelos Holding Corp. Straight line 10 years 50 — 15 35 Developed technologies–Lixoft acquisition Straight line 16 years 8,010 — 709 7,301 $ 16,985 $ 6,516 $ 10,469 |
Other intangible assets | Other intangible assets The following table summarizes our other intangible assets as of May 31, 2022: (in thousands) Amortization Acquisition Accumulated Net Book Simulations Plus ERP Straight line 15 years $ 1,702 $ 52 $ 1,650 Cognigen Customer relationships Straight line 8 years 1,100 1,065 35 Trade name None 500 — 500 Covenants not to compete Straight line 5 years 50 50 — DILIsym Customer relationships Straight line 10 years 1,900 951 949 Trade name None 860 — 860 Covenants not to compete Straight line 4 years 80 80 — Lixoft Customer relationships Straight line 14 years 2,550 394 2,156 Trade name None 1,550 — 1,550 Covenants not to compete Straight line 3 years 60 43 17 $ 10,352 $ 2,635 $ 7,717 The following table summarizes our other intangible assets as of August 31, 2021: (in thousands) Amortization Acquisition Accumulated Net Book Cognigen Customer relationships Straight line 8 years $ 1,100 $ 963 $ 137 Trade name None 500 — 500 Covenants not to compete Straight line 5 years 50 50 — DILIsym Customer relationships Straight line 10 years 1,900 807 1,093 Trade name None 860 — 860 Covenants not to compete Straight line 4 years 80 80 — Lixoft Customer relationships Straight line 14 years 2,550 258 2,292 Trade name None 1,550 — 1,550 Covenants not to compete Straight line 3 years 60 28 32 $ 8,650 $ 2,186 $ 6,464 Amortization expense for other intangible assets for the three months ended May 31, 2022 and 2021 was $160 thousand and $137 thousand, respectively, and amortization expense for other intangible assets for the nine months ended May 31, 2022 and 2021 was $449 thousand and $412 thousand, respectively. In addition to normal amortization, these assets are tested for impairment as needed. |
Earnings per Share | Earnings per Share We report earnings per share in accordance with FASB ASC 260-10. Basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding. Diluted earnings per share is computed similarly to basic earnings per share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The components of basic and diluted earnings per share for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended Nine Months Ended 2022 2021 2022 2021 Numerator: Net income attributable to common shareholders $ 4,087 $ 3,787 $ 11,522 $ 9,477 Denominator: Weighted-average number of common shares outstanding during the period 20,212 20,105 20,180 20,014 Dilutive effect of stock options 556 697 551 736 Common stock and common stock equivalents used for diluted earnings per share 20,768 20,802 20,731 20,750 |
Stock-Based Compensation | Stock-Based Compensation Compensation costs related to stock options are determined in accordance with FASB ASC 718-10, “Compensation-Stock Compensation” . Compensation cost is calculated based on the grant-date fair value estimated in accordance with FASB ASC 718-10, amortized on a straight-line basis over the options’ vesting period. Stock-based compensation expense related to stock options, not including shares issued to directors for services, was $679 thousand and $618 thousand for the three months ended May 31, 2022 and 2021, respectively, and $2.0 million and $1.8 million for the nine months ended May 31, 2022 and 2021, respectively. This expense is included in the condensed consolidated statements of operations as selling, general, and administration and research and development expense. |
Impairment of Long-lived Assets | Impairment of Long-lived Assets We account for the impairment and disposition of long-lived assets in accordance with ASC 350, “Intangibles – Goodwill and Other ” and ASC 360, “Property and Equipment” . Long-lived assets to be held and used are reviewed for events or changes in circumstances that indicate that their carrying value may not be recoverable. We measure recoverability by comparing the carrying amount of an asset to the expected future undiscounted net cash flows generated by the asset. If we determine that the asset may not be recoverable, or if the carrying amount of an asset exceeds its estimated future undiscounted cash flows, we recognize an impairment charge to the extent of the difference between the fair value and the asset's carrying amount. No impairment losses were recorded during the nine months ended May 31, 2022 and 2021. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04 , Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). The amendments in ASU 2020-04 provide temporary optional expedients and exceptions for applying GAAP to contract modifications, hedging relationships, and other transactions to ease the potential accounting and financial reporting burden associated with transitioning away from reference rates that are expected to be discontinued, including the London Interbank Offered Rate (“LIBOR”). This ASU is effective as of March 12, 2020, through December 31, 2022. The adoption of the new standard has not had and is not expected to have, a material impact on our consolidated financial statements or related disclosures. In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”). The amendment requires contract assets and contract liabilities acquired in a business combination to be recognized and measured in accordance with ASC 606, Revenue from Contracts with Customers, as if the acquirer had originated the contract. The amendment is intended to improve the accounting for acquired revenue contracts with customers in a business combination, related to the recognition of an acquired contract liability, and to payment terms and their effect on subsequent revenue recognized by the acquirer. The amendment also provides certain practical expedients when applying the guidance. ASU 2021-08 is effective for interim and annual periods beginning after December 15, 2022, on a prospective basis, with early adoption permitted. The Company expects to adopt ASU 2021-08 in the first quarter of fiscal year 2024. The Company is currently evaluating the potential impact of ASU 2021-08 to its consolidated financial statements. In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832), which requires business entities to disclose information about transactions with a government that are accounted for by applying a grant or contribution model by analogy (for example, IFRS guidance in IAS 20 or guidance on contributions for not-for-profit entities in ASC 958-605). For transactions within scope, the new standard requires the disclosure of information about the nature of the transaction, including significant terms and conditions, as well as the amounts and specific financial statement line items affected by the transaction. The new guidance is effective for annual reporting periods beginning after December 15, 2021. The Company does not expect that the adoption of this standard will have a material impact on its condensed consolidated financial statements; however, the Company expects to increase its disclosures with respect to government assistance beginning in the first quarter of fiscal year 2023. |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
May 31, 2022 | |
Accounting Policies [Abstract] | |
Disaggregation of Revenue | The components of disaggregation of revenue for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended Nine Months Ended 2022 2021 2022 2021 Software licenses: Point in time $ 9,380 $ 8,098 $ 25,980 $ 21,570 Over time 267 200 787 703 Consulting services: Over time 5,312 4,479 15,405 14,352 Total revenue $ 14,959 $ 12,777 $ 42,172 $ 36,625 |
Property and Equipment Estimated Useful Lives | Property and equipment are recorded at cost, less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives as follows: Equipment 5 years Computer equipment 3 to 7 years Furniture and fixtures 5 to 7 years Leasehold improvements Shorter of life of asset or lease |
Lease, Cost | Supplemental information related to operating leases was as follows as of May 31, 2022: (in thousands) Right-of-use assets $ 1,533 Lease liabilities, current $ 459 Lease liabilities, long-term $ 1,069 Operating lease costs $ 394 Weighted average remaining lease term 3.30 years Weighted average discount rate 3.41 % |
Schedule of Goodwill | Reconciliation of Goodwill as of May 31, 2022: (in thousands) Cognigen DILIsym Lixoft Total Balance, August 31, 2021 $ 4,789 $ — $ 5,598 $ — $ 2,534 $ 12,921 Addition — — — — — — Impairments — — — — — — Balance, May 31, 2022 $ 4,789 $ 5,598 $ 2,534 $ 12,921 |
Fair Value, Liabilities Measured on Recurring and Nonrecurring Basis | The following table summarizes fair value measurements at May 31, 2022 and August 31, 2021 for assets and liabilities measured at fair value on a recurring basis: May 31, 2022: (in thousands) Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 42,353 $ — $ — $ 42,353 Short-term investments $ 79,801 $ — $ — $ 79,801 Acquisition-related contingent consideration obligations $ — $ — $ — $ — August 31, 2021: (in thousands) Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 36,984 $ — $ — $ 36,984 Short-term investments $ 86,484 $ — $ — $ 86,484 Acquisition-related contingent consideration obligations $ — $ — $ 3,217 $ 3,217 |
Reconciliation of Contingent Consideration | The following is a reconciliation of contingent consideration value: (in thousands) Value at August 31, 2021 $ 3,217 Contingent consideration payments - cash (2,334) Contingent consideration payments - stock (1,166) Change in value of contingent consideration 283 Value at May 31, 2022 $ — |
Schedule of Intellectual Property | The following table summarizes intellectual property as of May 31, 2022: (in thousands) Amortization Acquisition Accumulated Net Book Royalty Agreement buy out-Enslein Research Straight line 10 years $ 75 $ 75 $ — Termination/nonassertion agreement-TSRL Inc. Straight line 10 years 6,000 4,825 1,175 Developed technologies–DILIsym acquisition Straight line 9 years 2,850 1,583 1,267 Intellectual rights of Entelos Holding Corp. Straight line 10 years 50 19 31 Developed technologies–Lixoft acquisition Straight line 16 years 8,010 1,083 6,927 $ 16,985 $ 7,585 $ 9,400 The following table summarizes intellectual property as of August 31, 2021: (in thousands) Amortization Acquisition Accumulated Net Book Royalty Agreement buy out-Enslein Research Straight line 10 years $ 75 $ — $ 71 $ 4 Termination/nonassertion agreement-TSRL Inc. Straight line 10 years 6,000 — 4,375 1,625 Developed technologies–DILIsym acquisition Straight line 9 years 2,850 — 1,346 1,504 Intellectual rights of Entelos Holding Corp. Straight line 10 years 50 — 15 35 Developed technologies–Lixoft acquisition Straight line 16 years 8,010 — 709 7,301 $ 16,985 $ 6,516 $ 10,469 |
Schedule of Other Intangible Assets | The following table summarizes our other intangible assets as of May 31, 2022: (in thousands) Amortization Acquisition Accumulated Net Book Simulations Plus ERP Straight line 15 years $ 1,702 $ 52 $ 1,650 Cognigen Customer relationships Straight line 8 years 1,100 1,065 35 Trade name None 500 — 500 Covenants not to compete Straight line 5 years 50 50 — DILIsym Customer relationships Straight line 10 years 1,900 951 949 Trade name None 860 — 860 Covenants not to compete Straight line 4 years 80 80 — Lixoft Customer relationships Straight line 14 years 2,550 394 2,156 Trade name None 1,550 — 1,550 Covenants not to compete Straight line 3 years 60 43 17 $ 10,352 $ 2,635 $ 7,717 The following table summarizes our other intangible assets as of August 31, 2021: (in thousands) Amortization Acquisition Accumulated Net Book Cognigen Customer relationships Straight line 8 years $ 1,100 $ 963 $ 137 Trade name None 500 — 500 Covenants not to compete Straight line 5 years 50 50 — DILIsym Customer relationships Straight line 10 years 1,900 807 1,093 Trade name None 860 — 860 Covenants not to compete Straight line 4 years 80 80 — Lixoft Customer relationships Straight line 14 years 2,550 258 2,292 Trade name None 1,550 — 1,550 Covenants not to compete Straight line 3 years 60 28 32 $ 8,650 $ 2,186 $ 6,464 |
Schedule of Earnings Per Share, Basic and Diluted | The components of basic and diluted earnings per share for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended Nine Months Ended 2022 2021 2022 2021 Numerator: Net income attributable to common shareholders $ 4,087 $ 3,787 $ 11,522 $ 9,477 Denominator: Weighted-average number of common shares outstanding during the period 20,212 20,105 20,180 20,014 Dilutive effect of stock options 556 697 551 736 Common stock and common stock equivalents used for diluted earnings per share 20,768 20,802 20,731 20,750 |
OTHER INCOME (EXPENSE), NET (Ta
OTHER INCOME (EXPENSE), NET (Tables) | 9 Months Ended |
May 31, 2022 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Nonoperating Income (Expense) | The components of other income (expense), net for the three and nine months ended May 31, 2022 and 2021, were as follows: (in thousands) Three Months Ended Nine Months Ended 2022 2021 2022 2021 Interest income $ 139 $ 37 $ 278 $ 156 Interest expense — — — (22) Change in valuation of contingent consideration (40) (121) (283) (364) Gain on sale of assets — — 1 — Gain (loss) on currency exchange (211) 33 10 61 Total other income (expense), net $ (112) $ (51) $ 6 $ (169) |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 9 Months Ended |
May 31, 2022 | |
Investments, All Other Investments [Abstract] | |
Investments | The following tables summarize our short-term investments as of May 31, 2022 and August 31, 2021: May 31, 2022 (in thousands) Amortized Cost Gross Gross Fair Value Commercial notes (due within one year) $ 75,620 $ — $ (319) $ 75,301 Term deposits (due within one year) $ 4,500 $ — $ — $ 4,500 Total $ 80,120 $ — $ (319) $ 79,801 August 31, 2021 (in thousands) Amortized Cost Gross Gross Fair Value Commercial notes (due within one year) $ 86,620 $ — $ (136) $ 86,484 Total $ 86,620 $ — $ (136) $ 86,484 |
CONTRACTS PAYABLE (Tables)
CONTRACTS PAYABLE (Tables) | 9 Months Ended |
May 31, 2022 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities | As of May 31, 2022 and August 31, 2021, the following liabilities have been recorded: (in thousands) May 31, August 31, Holdback liability $ — $ 1,333 Earnout liability — 3,217 Sub total $ — $ 4,550 Less: current portion — 4,550 Long-term portion $ — $ — |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended |
May 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Lease Payments | The following table presents maturities of operating lease liabilities on an undiscounted basis as of May 31, 2022: (in thousands) Years Ending May 31, 2023 $ 509 2024 438 2025 363 2026 269 2027 50 Total undiscounted liabilities 1,629 Less: imputed interest (101) Total operating lease liabilities (including current portion) $ 1,528 |
SHAREHOLDERS_ EQUITY (Tables)
SHAREHOLDERS’ EQUITY (Tables) | 9 Months Ended |
May 31, 2022 | |
Equity [Abstract] | |
Schedule of Common Stock Outstanding Roll Forward | Shares of common stock outstanding for the three and nine months ended May 31, 2022 and 2021 were as follows: Three Months Ended Nine Months Ended 2022 2021 2022 2021 Common stock outstanding, beginning of the period 20,181,784 20,059,528 20,141,521 19,923,277 Common stock issued during the period 52,870 61,512 93,133 197,763 Common stock outstanding, end of the period 20,234,654 20,121,040 20,234,654 20,121,040 |
Schedule of Dividends Payable | Our Board of Directors declared cash dividends during fiscal years 2022 and 2021. The details of the dividends paid are in the following tables: (in thousands, except dividend per share) Fiscal Year 2022 Record Date Distribution Date Number of Shares Dividend per Total Amount 10/25/2021 11/01/2021 20,148 $ 0.06 1,209 1/31/2022 2/07/2022 20,178 $ 0.06 1,211 4/25/2022 5/02/2022 20,207 $ 0.06 1,212 Total $ 3,632 (in thousands, except dividend per share) Fiscal Year 2021 Record Date Distribution Date Number of Shares Dividend per Total Amount 10/26/2020 11/02/2020 19,924 $ 0.06 $ 1,195 1/25/2021 2/01/2021 20,010 $ 0.06 1,201 4/26/2021 5/03/2021 20,115 $ 0.06 1,207 7/26/2021 8/02/2021 20,139 $ 0.06 1,208 Total $ 4,811 |
Share-based Payment Arrangement, Option, Activity | The following table summarizes information about stock options: (in thousands, except per share and weighted-average amounts) Number of Weighted- Weighted- Transactions during the nine months ended May 31, 2022 Outstanding, August 31, 2021 1,184 $ 25.63 6.47 Granted 232 $ 41.40 Exercised (76) $ 15.93 Cancelled/Forfeited (64) $ 41.04 Outstanding, May 31, 2022 1,276 $ 28.31 6.33 Exercisable, May 31, 2022 722 $ 16.96 4.66 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | The following table summarizes the fair value of the options, including both ISOs and NQSOs, granted during the nine months ended May 31, 2022 and fiscal year 2021: (in thousands except pricing) Nine Months Ended Fiscal Year 2021 Estimated fair value of awards granted $ 4,066 $ — $ 5,092 Unvested forfeiture rate 1 % 0 % Weighted average grant price $ 41.40 $ 57.60 Weighted average market price $ 41.40 $ 57.60 Weighted average volatility 42.71 % 40.49 % Weighted average risk-free rate 1.62 % 0.64 % Weighted average dividend yield 0.59 % 0.42 % Weighted average expected life 6.59 years 6.63 years |
Share-based Payment Arrangement, Option, Exercise Price Range | The exercise prices for the options outstanding at May 31, 2022 ranged from $6.85 to $66.14, and the information relating to these options is as follows: (in thousands except prices) Exercise Price Awards Outstanding Awards Exercisable Low High Quantity Weighted Weighted Quantity Weighted Weighted $ 6.85 $ 9.77 296 3.02 years $ 8.33 296 3.02 years $ 8.33 $ 9.78 $ 18.76 208 4.58 years $ 10.37 207 4.58 years $ 10.35 $ 18.77 $ 33.40 253 6.64 years $ 25.15 129 6.26 years $ 24.11 $ 33.41 $ 47.63 240 8.86 years $ 38.37 34 7.31 years $ 35.75 $ 47.64 $ 66.14 279 8.69 years $ 57.06 56 8.39 years $ 58.93 1,276 6.33 years $ 28.31 722 4.66 years $ 16.96 |
SEGMENT AND GEOGRAPHIC REPORT_2
SEGMENT AND GEOGRAPHIC REPORTING (Tables) | 9 Months Ended |
May 31, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Results for each business unit segment and consolidated results for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended May 31, 2022 Software Services Total Revenue $ 9,647 $ 5,312 $ 14,959 Cost of revenue 730 1,829 2,559 Gross profit $ 8,917 $ 3,483 $ 12,400 Gross margin 92 % 66 % 83 % Our software business and services business represented 64% and 36% of total revenue, respectively, for the three months ended May 31, 2022. (in thousands) Three Months Ended May 31, 2021 Software Services Total Revenue $ 8,298 $ 4,479 $ 12,777 Cost of revenue 800 1,671 2,471 Gross profit $ 7,498 $ 2,808 $ 10,306 Gross margin 90 % 63 % 81 % Our software business and services business represented 65% and 35% of total revenue, respectively, for the three months ended May 31, 2021. (in thousands) Nine Months Ended May 31, 2022 Software Services Total Revenue $ 26,767 $ 15,405 $ 42,172 Cost of revenue 2,245 5,900 8,145 Gross profit $ 24,522 $ 9,505 $ 34,027 Gross margin 92 % 62 % 81 % Our software business and services business represented 63% and 37% of total revenue, respectively, for the nine months ended May 31, 2022. (in thousands) Nine Months Ended May 31, 2021 Software Services Total Revenue $ 22,337 $ 14,288 $ 36,625 Cost of revenue 2,448 5,367 7,815 Gross profit $ 19,889 $ 8,921 $ 28,810 Gross margin 89 % 62 % 79 % Our software business and services business represented 61% and 39% of total revenue, respectively, for the nine months ended May 31, 2021. |
Schedule of Revenue by Product | Revenue by product and consolidated revenue for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended May 31, 2022 2021 Software revenue GastroPlus $ 6,434 67 % $ 5,426 65 % MonolixSuite 1,025 11 % 948 11 % ADMET Predictor 1,593 17 % 1,488 18 % Other 595 6 % 436 5 % Total software revenue $ 9,647 100 % $ 8,298 100 % Services revenue PKPD $ 2,482 47 % $ 1,925 43 % QSP/QST 1,197 23 % 1,180 26 % PBPK 1,351 25 % 739 17 % Other 282 5 % 635 14 % Total services revenue $ 5,312 100 % $ 4,479 100 % Total consolidated revenue $ 14,959 $ 12,777 (in thousands) Nine Months Ended May 31, 2022 2021 Software revenue GastroPlus $ 15,869 59 % $ 13,245 59 % MonolixSuite 4,817 18 % 3,664 16 % ADMET Predictor 4,419 17 % 3,872 17 % Other 1,662 6 % 1,556 7 % Total software revenue $ 26,767 100 % $ 22,337 100 % Services revenue PKPD $ 7,030 46 % $ 6,755 47 % QSP/QST 4,190 27 % 4,047 28 % PBPK 3,158 20 % 2,312 16 % Other 1,027 7 % 1,174 8 % Total services revenue $ 15,405 100 % $ 14,288 100 % Total consolidated revenue $ 42,172 $ 36,625 |
Schedule of Revenue by Division | Revenue by division and consolidated revenue for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended May 31, 2022 2021 Simulations Plus $ 9,412 63 % $ 7,916 62 % Cognigen 2,745 18 % 2,536 20 % DILIsym 1,723 12 % 1,331 10 % Lixoft 1,079 7 % 994 8 % Total $ 14,959 100 % $ 12,777 100 % (in thousands) Nine Months Ended May 31, 2022 2021 Simulations Plus $ 23,916 57 % $ 19,994 55 % Cognigen 7,685 18 % 7,987 22 % DILIsym 5,542 13 % 4,817 13 % Lixoft 5,029 12 % 3,827 10 % Total $ 42,172 100 % $ 36,625 100 % |
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area | In addition, we allocate revenue to geographic areas based on the locations of our customers. Revenue for each geographical area and consolidated revenue for the three and nine months ended May 31, 2022 and 2021 were as follows: (in thousands) Three Months Ended May 31, 2022 2021 Americas $ 11,163 75 % $ 9,651 76 % EMEA 1,925 13 % 1,462 11 % Asia Pacific 1,871 13 % 1,664 13 % Total $ 14,959 100 % $ 12,777 100 % (in thousands) Nine Months Ended May 31, 2022 2021 Americas $ 29,318 70 % $ 25,436 69 % EMEA 8,656 21 % 7,022 19 % Asia Pacific 4,198 10 % 4,167 11 % Total $ 42,172 100 % $ 36,625 100 % |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES - Disaggregation of Revenue (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | Aug. 31, 2021 | |
Product Information [Line Items] | |||||
Revenue | $ 14,959 | $ 12,777 | $ 42,172 | $ 36,625 | |
Revenue, remaining performance obligation, amount | 13,200 | 13,200 | |||
Contract asset balance | 1,800 | 1,800 | $ 3,200 | ||
Contract with customer, liability, revenue recognized | $ 68 | 30 | $ 608 | 430 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-06-01 | |||||
Product Information [Line Items] | |||||
Revenue, remaining performance obligation, percent | 89% | 89% | |||
Revenue, remaining performance obligation, period | 12 months | 12 months | |||
Software licenses: | Point in time | |||||
Product Information [Line Items] | |||||
Revenue | $ 9,380 | 8,098 | $ 25,980 | 21,570 | |
Software licenses: | Over time | |||||
Product Information [Line Items] | |||||
Revenue | 267 | 200 | 787 | 703 | |
Consulting services: | Over time | |||||
Product Information [Line Items] | |||||
Revenue | $ 5,312 | $ 4,479 | $ 15,405 | $ 14,352 |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES - Capitalized Computer Software Development Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Accounting Policies [Abstract] | ||||
Capitalized computer software, amortization | $ 314 | $ 344 | $ 938 | $ 1,000 |
SIGNIFICANT ACCOUNTING POLICI_6
SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment (Detail) | 9 Months Ended |
May 31, 2022 | |
Equipment | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful lives | 5 years |
Computer equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful lives | 3 years |
Computer equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful lives | 7 years |
Furniture and fixtures | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful lives | 5 years |
Furniture and fixtures | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful lives | 7 years |
SIGNIFICANT ACCOUNTING POLICI_7
SIGNIFICANT ACCOUNTING POLICIES - Leases (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
May 31, 2022 | Aug. 31, 2021 | |
Accounting Policies [Abstract] | ||
Right-of-use assets | $ 1,533 | $ 1,276 |
Lease liabilities, current | 459 | 382 |
Lease liabilities, long-term | 1,069 | $ 896 |
Operating lease costs | $ 394 | |
Weighted average remaining lease term | 3 years 3 months 18 days | |
Weighted average discount rate | 3.41% |
SIGNIFICANT ACCOUNTING POLICI_8
SIGNIFICANT ACCOUNTING POLICIES - Goodwill (Detail) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 USD ($) | May 31, 2021 USD ($) | May 31, 2022 USD ($) reportingUnit | May 31, 2021 USD ($) | |
Accounting Policies [Abstract] | ||||
Number of reporting units | reportingUnit | 4 | |||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | $ 12,921 | |||
Addition | 0 | |||
Impairments | $ 0 | $ 0 | 0 | $ 0 |
Goodwill, ending balance | 12,921 | 12,921 | ||
Cognigen | ||||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | 4,789 | |||
Addition | 0 | |||
Impairments | 0 | |||
Goodwill, ending balance | 4,789 | 4,789 | ||
Developed technologies–DILIsym acquisition | ||||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | 5,598 | |||
Addition | 0 | |||
Impairments | 0 | |||
Goodwill, ending balance | 5,598 | 5,598 | ||
Developed technologies–Lixoft acquisition | ||||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | 2,534 | |||
Addition | 0 | |||
Impairments | 0 | |||
Goodwill, ending balance | $ 2,534 | $ 2,534 |
SIGNIFICANT ACCOUNTING POLICI_9
SIGNIFICANT ACCOUNTING POLICIES - Fair Value of Financial Instruments (Detail) - Fair Value, Recurring - USD ($) $ in Thousands | May 31, 2022 | Aug. 31, 2021 |
Defined Benefit Plan Disclosure [Line Items] | ||
Acquisition-related contingent consideration obligations | $ 0 | $ 3,217 |
Level 1 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Acquisition-related contingent consideration obligations | 0 | 0 |
Level 2 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Acquisition-related contingent consideration obligations | 0 | 0 |
Level 3 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Acquisition-related contingent consideration obligations | 0 | 3,217 |
Cash and cash equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Assets, fair value disclosure | 42,353 | 36,984 |
Cash and cash equivalents | Level 1 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Assets, fair value disclosure | 42,353 | 36,984 |
Cash and cash equivalents | Level 2 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Assets, fair value disclosure | 0 | 0 |
Cash and cash equivalents | Level 3 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Assets, fair value disclosure | 0 | 0 |
Short-term investments | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Assets, fair value disclosure | 79,801 | 86,484 |
Short-term investments | Level 1 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Assets, fair value disclosure | 79,801 | 86,484 |
Short-term investments | Level 2 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Assets, fair value disclosure | 0 | 0 |
Short-term investments | Level 3 | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Assets, fair value disclosure | $ 0 | $ 0 |
SIGNIFICANT ACCOUNTING POLIC_10
SIGNIFICANT ACCOUNTING POLICIES - Reconciliation of Contingent Consideration (Detail) $ in Thousands | 9 Months Ended |
May 31, 2022 USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Contingent consideration, beginning balance | $ 3,217 |
Contingent consideration payments - cash | (2,334) |
Contingent consideration payments - stock | (1,166) |
Change in value of contingent consideration | 283 |
Contingent consideration, ending balance | $ 0 |
SIGNIFICANT ACCOUNTING POLIC_11
SIGNIFICANT ACCOUNTING POLICIES - Intellectual Property (Detail) - Intellectual property - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | Aug. 31, 2021 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Acquisition Value | $ 16,985 | $ 16,985 | $ 16,985 | ||
Accumulated Amortization | 7,585 | 7,585 | 6,516 | ||
Net Book Value | 9,400 | 9,400 | $ 10,469 | ||
Amortization of intangible assets | 354 | $ 358 | $ 1,100 | $ 1,100 | |
Royalty Agreement buy out-Enslein Research | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Amortization Period | 10 years | 10 years | |||
Acquisition Value | 75 | $ 75 | $ 75 | ||
Accumulated Amortization | 75 | 75 | 71 | ||
Net Book Value | 0 | $ 0 | $ 4 | ||
Termination/nonassertion agreement-TSRL Inc. | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Amortization Period | 10 years | 10 years | |||
Acquisition Value | 6,000 | $ 6,000 | $ 6,000 | ||
Accumulated Amortization | 4,825 | 4,825 | 4,375 | ||
Net Book Value | 1,175 | $ 1,175 | $ 1,625 | ||
Developed technologies–DILIsym acquisition | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Amortization Period | 9 years | 9 years | |||
Acquisition Value | 2,850 | $ 2,850 | $ 2,850 | ||
Accumulated Amortization | 1,583 | 1,583 | 1,346 | ||
Net Book Value | 1,267 | $ 1,267 | $ 1,504 | ||
Intellectual rights of Entelos Holding Corp. | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Amortization Period | 10 years | 10 years | |||
Acquisition Value | 50 | $ 50 | $ 50 | ||
Accumulated Amortization | 19 | 19 | 15 | ||
Net Book Value | 31 | $ 31 | $ 35 | ||
Developed technologies–Lixoft acquisition | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Amortization Period | 16 years | 16 years | |||
Acquisition Value | 8,010 | $ 8,010 | $ 8,010 | ||
Accumulated Amortization | 1,083 | 1,083 | 709 | ||
Net Book Value | $ 6,927 | $ 6,927 | $ 7,301 |
SIGNIFICANT ACCOUNTING POLIC_12
SIGNIFICANT ACCOUNTING POLICIES - Schedule of Other Intangible Assets (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | Aug. 31, 2021 | |
Other intangible assets | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Acquisition Value | $ 10,352 | $ 10,352 | $ 8,650 | ||
Accumulated Amortization | 2,635 | 2,635 | 2,186 | ||
Net Book Value | 7,717 | 7,717 | $ 6,464 | ||
Amortization of intangible assets | 160 | $ 137 | $ 449 | $ 412 | |
Simulations Plus | ERP | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Amortization Period | 15 years | ||||
Acquisition Value | 1,702 | $ 1,702 | |||
Accumulated Amortization | 52 | 52 | |||
Net Book Value | 1,650 | $ 1,650 | |||
Cognigen | Customer relationships | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Amortization Period | 8 years | 8 years | |||
Acquisition Value | 1,100 | $ 1,100 | $ 1,100 | ||
Accumulated Amortization | 1,065 | 1,065 | 963 | ||
Net Book Value | 35 | 35 | 137 | ||
Cognigen | Trade name | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Acquisition Value | 500 | 500 | 500 | ||
Accumulated Amortization | 0 | 0 | 0 | ||
Net Book Value | 500 | $ 500 | $ 500 | ||
Cognigen | Covenants not to compete | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Amortization Period | 5 years | 5 years | |||
Acquisition Value | 50 | $ 50 | $ 50 | ||
Accumulated Amortization | 50 | 50 | 50 | ||
Net Book Value | 0 | $ 0 | $ 0 | ||
Developed technologies–DILIsym acquisition | Customer relationships | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Amortization Period | 10 years | 10 years | |||
Acquisition Value | 1,900 | $ 1,900 | $ 1,900 | ||
Accumulated Amortization | 951 | 951 | 807 | ||
Net Book Value | 949 | 949 | 1,093 | ||
Developed technologies–DILIsym acquisition | Trade name | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Acquisition Value | 860 | 860 | 860 | ||
Accumulated Amortization | 0 | 0 | 0 | ||
Net Book Value | 860 | $ 860 | $ 860 | ||
Developed technologies–DILIsym acquisition | Covenants not to compete | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Amortization Period | 4 years | 4 years | |||
Acquisition Value | 80 | $ 80 | $ 80 | ||
Accumulated Amortization | 80 | 80 | 80 | ||
Net Book Value | 0 | $ 0 | $ 0 | ||
Developed technologies–Lixoft acquisition | Customer relationships | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Amortization Period | 14 years | 14 years | |||
Acquisition Value | 2,550 | $ 2,550 | $ 2,550 | ||
Accumulated Amortization | 394 | 394 | 258 | ||
Net Book Value | 2,156 | 2,156 | 2,292 | ||
Developed technologies–Lixoft acquisition | Trade name | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Acquisition Value | 1,550 | 1,550 | 1,550 | ||
Accumulated Amortization | 0 | 0 | 0 | ||
Net Book Value | 1,550 | $ 1,550 | $ 1,550 | ||
Developed technologies–Lixoft acquisition | Covenants not to compete | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Amortization Period | 3 years | 3 years | |||
Acquisition Value | 60 | $ 60 | $ 60 | ||
Accumulated Amortization | 43 | 43 | 28 | ||
Net Book Value | $ 17 | $ 17 | $ 32 |
SIGNIFICANT ACCOUNTING POLIC_13
SIGNIFICANT ACCOUNTING POLICIES - Schedule of Earnings Per Share (Detail) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Numerator: | ||||
Net income attributable to common shareholders | $ 4,087 | $ 3,787 | $ 11,522 | $ 9,477 |
Denominator: | ||||
Weighted average number of common shares outstanding during the period (in shares) | 20,212 | 20,105 | 20,180 | 20,014 |
Dilutive effect of stock options (in shares) | 556 | 697 | 551 | 736 |
Common stock and common stock equivalents used for diluted earnings per share (in shares) | 20,768 | 20,802 | 20,731 | 20,750 |
SIGNIFICANT ACCOUNTING POLIC_14
SIGNIFICANT ACCOUNTING POLICIES - Share-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Accounting Policies [Abstract] | ||||
Stock-based compensation | $ 679 | $ 618 | $ 2,000 | $ 1,800 |
OTHER INCOME (EXPENSE), NET (De
OTHER INCOME (EXPENSE), NET (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Other Income and Expenses [Abstract] | ||||
Interest income | $ 139 | $ 37 | $ 278 | $ 156 |
Interest expense | 0 | 0 | 0 | (22) |
Change in valuation of contingent consideration | (40) | (121) | (283) | (364) |
Gain on sale of assets | 0 | 0 | 1 | 0 |
Gain (loss) on currency exchange | (211) | 33 | 10 | 61 |
Total other income (expense), net | $ (112) | $ (51) | $ 6 | $ (169) |
Entity Small Business | false | |||
Entity Emerging Growth Company | false |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ in Thousands | May 31, 2022 | Aug. 31, 2021 |
Net Investment Income [Line Items] | ||
Amortized Cost | $ 80,120 | $ 86,620 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (319) | (136) |
Fair Value | 79,801 | 86,484 |
Commercial notes (due within one year) | ||
Net Investment Income [Line Items] | ||
Amortized Cost | 75,620 | 86,620 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (319) | (136) |
Fair Value | 75,301 | $ 86,484 |
Term deposits (due within one year) | ||
Net Investment Income [Line Items] | ||
Amortized Cost | 4,500 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Fair Value | $ 4,500 |
CONTRACTS PAYABLE - Schedule of
CONTRACTS PAYABLE - Schedule of Contracts Payable (Details) - USD ($) $ in Thousands | May 31, 2022 | Aug. 31, 2021 | Apr. 01, 2020 |
Business Acquisition, Contingent Consideration [Line Items] | |||
Contracts payable | $ 0 | $ 4,550 | |
Less: current portion | 0 | 4,550 | |
Long-term portion | 0 | 0 | |
Lixoft | Holdback liability | |||
Business Acquisition, Contingent Consideration [Line Items] | |||
Contracts payable | 0 | 1,333 | $ 2,000 |
Lixoft | Earnout liability | |||
Business Acquisition, Contingent Consideration [Line Items] | |||
Contracts payable | $ 0 | $ 3,217 | $ 5,500 |
CONTRACTS PAYABLE - Narrative (
CONTRACTS PAYABLE - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 9 Months Ended | |||||
Apr. 01, 2020 | May 31, 2022 | Apr. 30, 2022 | Jun. 30, 2021 | May 31, 2022 | May 31, 2021 | Aug. 31, 2021 | |
Business Acquisition, Contingent Consideration [Line Items] | |||||||
Contracts payable | $ 0 | $ 0 | $ 4,550 | ||||
Payment for contracts payable | 3,667 | $ 0 | |||||
Lixoft | Holdback liability | |||||||
Business Acquisition, Contingent Consideration [Line Items] | |||||||
Contract payable term | 24 months | ||||||
Contracts payable | $ 2,000 | 0 | 0 | 1,333 | |||
Payment for contracts payable | $ 1,300 | ||||||
Lixoft | Holdback Liability - Cash | |||||||
Business Acquisition, Contingent Consideration [Line Items] | |||||||
Contracts payable | 1,300 | ||||||
Lixoft | Holdback Liability - Stock | |||||||
Business Acquisition, Contingent Consideration [Line Items] | |||||||
Contracts payable | $ 700 | ||||||
Lixoft | Earnout liability | |||||||
Business Acquisition, Contingent Consideration [Line Items] | |||||||
Contract payable term | 2 years | ||||||
Contracts payable | $ 5,500 | 0 | $ 0 | $ 3,217 | |||
Obligation to be paid year one | 2,000 | ||||||
Obligation to be paid year two | $ 3,500 | ||||||
Payment for contracts payable | 3,500 | $ 2,000 | |||||
Lixoft | Earnout Liability - Cash | |||||||
Business Acquisition, Contingent Consideration [Line Items] | |||||||
Payment for contracts payable | 2,300 | 1,300 | |||||
Lixoft | Earnout Liability - Stock | |||||||
Business Acquisition, Contingent Consideration [Line Items] | |||||||
Payment for contracts payable | $ 1,200 | $ 700 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Future minimum lease payments (Details) $ in Thousands | May 31, 2022 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2023 | $ 509 |
2024 | 438 |
2025 | 363 |
2026 | 269 |
2027 | 50 |
Total undiscounted liabilities | 1,629 |
Less: imputed interest | (101) |
Total operating lease liabilities (including current portion) | $ 1,528 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
May 31, 2022 USD ($) ft² server | May 31, 2021 USD ($) | May 31, 2022 USD ($) ft² server | May 31, 2021 USD ($) | Aug. 31, 2021 USD ($) ft² | Apr. 15, 2022 USD ($) | Mar. 31, 2020 USD ($) | |
Line of Credit Facility [Line Items] | |||||||
Operating lease, expense | $ 138 | $ 167 | $ 414 | $ 499 | |||
Wells Fargo | |||||||
Line of Credit Facility [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | $ 3,500 | ||||||
Long-term line of credit | $ 0 | ||||||
Server Cabinets | |||||||
Line of Credit Facility [Line Items] | |||||||
Server cabinets | server | 3 | 3 | |||||
Lancaster, California | |||||||
Line of Credit Facility [Line Items] | |||||||
Area of land | ft² | 9,255 | 9,255 | |||||
Operating lease, expense | $ 17 | ||||||
Buffalo, New York | |||||||
Line of Credit Facility [Line Items] | |||||||
Area of land | ft² | 4,317 | 4,317 | 12,623 | ||||
Operating lease, expense | $ 7 | $ 16 | |||||
Annual rent increase | 0.02 | 0.02 | |||||
Buffalo, New York | Server Cabinets | |||||||
Line of Credit Facility [Line Items] | |||||||
Area of land | ft² | 64 | 64 | |||||
Operating lease, expense | $ 4 | ||||||
Annual rent increase | 0.03 | 0.03 | |||||
Durham, North Carolina | |||||||
Line of Credit Facility [Line Items] | |||||||
Area of land | ft² | 3,386 | 3,386 | |||||
Operating lease, expense | $ 8 | ||||||
Annual rent increase | 0.03 | 0.03 | |||||
Paris, France | |||||||
Line of Credit Facility [Line Items] | |||||||
Area of land | ft² | 2,300 | 2,300 | |||||
Operating lease, expense | $ 5 |
SHAREHOLDERS EQUITY - Shares Ou
SHAREHOLDERS EQUITY - Shares Outstanding (Details) - shares | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Equity [Abstract] | ||||
Common stock outstanding, beginning of year (in shares) | 20,181,784 | 20,059,528 | 20,141,521 | 19,923,277 |
Common stock issued during the period (in shares) | 52,870 | 61,512 | 93,133 | 197,763 |
Common stock outstanding, end of year (in shares) | 20,234,654 | 20,121,040 | 20,234,654 | 20,121,040 |
SHAREHOLDERS EQUITY - Dividends
SHAREHOLDERS EQUITY - Dividends (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
May 31, 2022 | Feb. 28, 2022 | Nov. 30, 2021 | Aug. 31, 2021 | May 31, 2021 | Feb. 28, 2021 | Nov. 30, 2020 | May 31, 2022 | Aug. 31, 2021 | |
Equity [Abstract] | |||||||||
Number of Shares Outstanding on Record Date (in share) | 20,207 | 20,178 | 20,148 | 20,139 | 20,115 | 20,010 | 19,924 | ||
Dividend per Share (in usd per share) | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | ||
Payments of dividends | $ 1,212 | $ 1,211 | $ 1,209 | $ 1,208 | $ 1,207 | $ 1,201 | $ 1,195 | $ 3,632 | $ 4,811 |
SHAREHOLDERS EQUITY - Option ac
SHAREHOLDERS EQUITY - Option activity (Details) - $ / shares shares in Thousands | 9 Months Ended | 12 Months Ended |
May 31, 2022 | Aug. 31, 2021 | |
Number of Options | ||
Outstanding, beginning balance (in shares) | 1,184 | |
Granted (in shares) | 232 | |
Exercised (in shares) | (76) | |
Canceled/forfeited (in shares) | (64) | |
Outstanding, ending balance (in shares) | 1,276 | 1,184 |
Weighted- Average Exercise Price Per Share | ||
Beginning balance (in usd per share) | $ 25.63 | |
Granted (in usd per share) | 41.40 | $ 57.60 |
Exercised (in usd per share) | 15.93 | |
Cancelled/forfeited (in usd per share) | 41.04 | |
Ending balance (in usd per share) | $ 28.31 | $ 25.63 |
Exercisable (in shares) | 722 | |
Exercisable (in usd per share) | $ 16.96 | |
Weighted-average remaining contractual life | 6 years 3 months 29 days | 6 years 5 months 19 days |
Exercisable, weighted-average remaining contractual life | 4 years 7 months 28 days |
SHAREHOLDERS EQUITY - Fair valu
SHAREHOLDERS EQUITY - Fair value of options (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
May 31, 2022 | Aug. 31, 2021 | |
Equity [Abstract] | ||
Estimated fair value of awards granted | $ 4,066 | $ 5,092 |
Unvested forfeiture rate | 1% | 0% |
Weighted average grant price (in usd per share) | $ 41.40 | $ 57.60 |
Weighted average market price (in usd per share) | $ 41.40 | $ 57.60 |
Weighted average volatility | 42.71% | 40.49% |
Weighted average risk-free rate | 1.62% | 0.64% |
Weighted average dividend yield | 0.59% | 0.42% |
Weighted average expected life | 6 years 7 months 2 days | 6 years 7 months 17 days |
SHAREHOLDERS EQUITY - Options o
SHAREHOLDERS EQUITY - Options outstanding and exercisable (Details) - $ / shares shares in Thousands | 9 Months Ended | 12 Months Ended |
May 31, 2022 | Aug. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based payment arrangement, option, exercise price range, lower range limit (in usd per share) | $ 6.85 | |
Share-based payment arrangement, option, exercise price range, upper range limit (in usd per share) | $ 66.14 | |
Options, outstanding, number (in shares) | 1,276 | 1,184 |
Awards outstanding weighted average remaining contractual life | 6 years 3 months 29 days | 6 years 5 months 19 days |
Options, outstanding, weighted average exercise price (in usd per share) | $ 28.31 | $ 25.63 |
Awards exercisable (in shares) | 722 | |
Awards exercisable weighted average remaining contractual life | 4 years 7 months 28 days | |
Share-based compensation arrangement by share-based payment award, options, exercisable, weighted average exercise price (in usd per share) | $ 16.96 | |
$6.85 to $9.77 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based payment arrangement, option, exercise price range, lower range limit (in usd per share) | 6.85 | |
Share-based payment arrangement, option, exercise price range, upper range limit (in usd per share) | $ 9.77 | |
Options, outstanding, number (in shares) | 296 | |
Awards outstanding weighted average remaining contractual life | 3 years 7 days | |
Options, outstanding, weighted average exercise price (in usd per share) | $ 8.33 | |
Awards exercisable (in shares) | 296 | |
Awards exercisable weighted average remaining contractual life | 3 years 7 days | |
Share-based compensation arrangement by share-based payment award, options, exercisable, weighted average exercise price (in usd per share) | $ 8.33 | |
$9.78 to $18.76 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based payment arrangement, option, exercise price range, lower range limit (in usd per share) | 9.78 | |
Share-based payment arrangement, option, exercise price range, upper range limit (in usd per share) | $ 18.76 | |
Options, outstanding, number (in shares) | 208 | |
Awards outstanding weighted average remaining contractual life | 4 years 6 months 29 days | |
Options, outstanding, weighted average exercise price (in usd per share) | $ 10.37 | |
Awards exercisable (in shares) | 207 | |
Awards exercisable weighted average remaining contractual life | 4 years 6 months 29 days | |
Share-based compensation arrangement by share-based payment award, options, exercisable, weighted average exercise price (in usd per share) | $ 10.35 | |
$18.77 to $33.40 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based payment arrangement, option, exercise price range, lower range limit (in usd per share) | 18.77 | |
Share-based payment arrangement, option, exercise price range, upper range limit (in usd per share) | $ 33.40 | |
Options, outstanding, number (in shares) | 253 | |
Awards outstanding weighted average remaining contractual life | 6 years 7 months 20 days | |
Options, outstanding, weighted average exercise price (in usd per share) | $ 25.15 | |
Awards exercisable (in shares) | 129 | |
Awards exercisable weighted average remaining contractual life | 6 years 3 months 3 days | |
Share-based compensation arrangement by share-based payment award, options, exercisable, weighted average exercise price (in usd per share) | $ 24.11 | |
$33.41 to $47.63 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based payment arrangement, option, exercise price range, lower range limit (in usd per share) | 33.41 | |
Share-based payment arrangement, option, exercise price range, upper range limit (in usd per share) | $ 47.63 | |
Options, outstanding, number (in shares) | 240 | |
Awards outstanding weighted average remaining contractual life | 8 years 10 months 9 days | |
Options, outstanding, weighted average exercise price (in usd per share) | $ 38.37 | |
Awards exercisable (in shares) | 34 | |
Awards exercisable weighted average remaining contractual life | 7 years 3 months 21 days | |
Share-based compensation arrangement by share-based payment award, options, exercisable, weighted average exercise price (in usd per share) | $ 35.75 | |
$47.64 to $66.14 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based payment arrangement, option, exercise price range, lower range limit (in usd per share) | 47.64 | |
Share-based payment arrangement, option, exercise price range, upper range limit (in usd per share) | $ 66.14 | |
Options, outstanding, number (in shares) | 279 | |
Awards outstanding weighted average remaining contractual life | 8 years 8 months 8 days | |
Options, outstanding, weighted average exercise price (in usd per share) | $ 57.06 | |
Awards exercisable (in shares) | 56 | |
Awards exercisable weighted average remaining contractual life | 8 years 4 months 20 days | |
Share-based compensation arrangement by share-based payment award, options, exercisable, weighted average exercise price (in usd per share) | $ 58.93 |
SHAREHOLDERS_ EQUITY - Narrativ
SHAREHOLDERS’ EQUITY - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
May 31, 2022 | May 31, 2022 | Aug. 31, 2021 | Apr. 09, 2021 | Dec. 23, 2016 | Feb. 25, 2014 | Feb. 23, 2007 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Common stock, capital shares reserved for future issuance (in shares) | 1,300,000 | ||||||
Share-based compensation, term of agreements | 10 years | ||||||
Options, outstanding, number (in shares) | 1,276,000 | 1,276,000 | 1,184,000 | ||||
Share-based payment arrangement, option, exercise price range, lower range limit (in usd per share) | $ 6.85 | ||||||
Share-based payment arrangement, option, exercise price range, upper range limit (in usd per share) | $ 66.14 | ||||||
Stock issued during period, shares, issued for services (in shares) | 1,875 | 5,326 | |||||
Stock issued during period, value, issued for services | $ 87 | $ 263 | |||||
Par value common stock | 11 | 11 | |||||
Additional paid in capital, common stock | 137,500 | 137,500 | |||||
Stock Options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Fair value of nonvested stock options | $ 7,500 | $ 7,500 | |||||
Fair value of nonvested stock options, period for recognition | 3 years 3 months 29 days | ||||||
2007 Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Common stock, capital shares reserved for future issuance (in shares) | 2,000,000 | 2,000,000 | 1,000,000 | 1,000,000 | |||
2017 Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Common stock, capital shares reserved for future issuance (in shares) | 1,000,000 |
CONCENTRATIONS AND UNCERTAINT_2
CONCENTRATIONS AND UNCERTAINTIES (Details) | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Geographic concentration risk | Revenue benchmark | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 100% | 100% | 100% | 100% |
Geographic concentration risk | Revenue benchmark | International | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 30% | 31% | ||
Customer concentration risk | Revenue benchmark | Customer 1 | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 5% | 12% | ||
Customer concentration risk | Revenue benchmark | Customer 2 | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 4% | |||
Customer concentration risk | Revenue benchmark | Customer 3 | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 3% | 4% | ||
Customer concentration risk | Revenue benchmark | Customer 4 | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 3% | |||
Customer concentration risk | Accounts receivable | Customer 1 | Maximum | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 6% | 10% | ||
Customer concentration risk | Accounts receivable | Customer 1 | Minimum | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 5% | 7% | ||
Customer concentration risk | Accounts receivable | Customer 2 | Maximum | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 6% | 10% | ||
Customer concentration risk | Accounts receivable | Customer 2 | Minimum | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 5% | 7% | ||
Customer concentration risk | Accounts receivable | Customer 3 | Maximum | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 6% | 10% | ||
Customer concentration risk | Accounts receivable | Customer 3 | Minimum | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 5% | 7% | ||
Customer concentration risk | Accounts receivable | Customer 4 | Maximum | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 6% | 10% | ||
Customer concentration risk | Accounts receivable | Customer 4 | Minimum | ||||
Concentration Risk [Line Items] | ||||
Concentration percentage | 5% | 7% |
SEGMENT AND GEOGRAPHIC REPORT_3
SEGMENT AND GEOGRAPHIC REPORTING - Segment Reporting (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 14,959 | $ 12,777 | $ 42,172 | $ 36,625 |
Cost of revenue | 2,559 | 2,471 | 8,145 | 7,815 |
Gross profit | $ 12,400 | $ 10,306 | $ 34,027 | $ 28,810 |
Gross margin | 83% | 81% | 81% | 79% |
Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 100% | 100% | 100% | 100% |
Software | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 9,647 | $ 8,298 | $ 26,767 | $ 22,337 |
Cost of revenue | 730 | 800 | 2,245 | 2,448 |
Gross profit | $ 8,917 | $ 7,498 | $ 24,522 | $ 19,889 |
Gross margin | 92% | 90% | 92% | 89% |
Software | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 64% | 65% | 63% | 61% |
Services | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 5,312 | $ 4,479 | $ 15,405 | $ 14,288 |
Cost of revenue | 1,829 | 1,671 | 5,900 | 5,367 |
Gross profit | $ 3,483 | $ 2,808 | $ 9,505 | $ 8,921 |
Gross margin | 66% | 63% | 62% | 62% |
Services | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 36% | 35% | 37% | 39% |
SEGMENT AND GEOGRAPHIC REPORT_4
SEGMENT AND GEOGRAPHIC REPORTING - Revenue by Product and Service (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 14,959 | $ 12,777 | $ 42,172 | $ 36,625 |
Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 100% | 100% | 100% | 100% |
Services | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 5,312 | $ 4,479 | $ 15,405 | $ 14,288 |
Services | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 36% | 35% | 37% | 39% |
Services | Other | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 282 | $ 635 | $ 1,027 | $ 1,174 |
Services | Other | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 5% | 14% | 7% | 8% |
Services | PKPD | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 2,482 | $ 1,925 | $ 7,030 | $ 6,755 |
Services | PKPD | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 47% | 43% | 46% | 47% |
Services | QSP/QST | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 1,197 | $ 1,180 | $ 4,190 | $ 4,047 |
Services | QSP/QST | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 23% | 26% | 27% | 28% |
Services | PBPK | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 1,351 | $ 739 | $ 3,158 | $ 2,312 |
Services | PBPK | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 25% | 17% | 20% | 16% |
Services | Service | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 5,312 | $ 4,479 | $ 15,405 | $ 14,288 |
Services | Service | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 100% | 100% | 100% | 100% |
Software | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 9,647 | $ 8,298 | $ 26,767 | $ 22,337 |
Software | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 64% | 65% | 63% | 61% |
Software | GastroPlus | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 6,434 | $ 5,426 | $ 15,869 | $ 13,245 |
Software | GastroPlus | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 67% | 65% | 59% | 59% |
Software | MonolixSuite | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 1,025 | $ 948 | $ 4,817 | $ 3,664 |
Software | MonolixSuite | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 11% | 11% | 18% | 16% |
Software | ADMET Predictor | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 1,593 | $ 1,488 | $ 4,419 | $ 3,872 |
Software | ADMET Predictor | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 17% | 18% | 17% | 17% |
Software | Other | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 595 | $ 436 | $ 1,662 | $ 1,556 |
Software | Other | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 6% | 5% | 6% | 7% |
Software | Product | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 9,647 | $ 8,298 | $ 26,767 | $ 22,337 |
Software | Product | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 100% | 100% | 100% | 100% |
SEGMENT AND GEOGRAPHIC REPORT_5
SEGMENT AND GEOGRAPHIC REPORTING - Schedule of Revenue by Division (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 14,959 | $ 12,777 | $ 42,172 | $ 36,625 |
Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 100% | 100% | 100% | 100% |
Simulations Plus | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 9,412 | $ 7,916 | $ 23,916 | $ 19,994 |
Simulations Plus | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 63% | 62% | 57% | 55% |
Cognigen | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 2,745 | $ 2,536 | $ 7,685 | $ 7,987 |
Cognigen | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 18% | 20% | 18% | 22% |
Developed technologies–DILIsym acquisition | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 1,723 | $ 1,331 | $ 5,542 | $ 4,817 |
Developed technologies–DILIsym acquisition | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 12% | 10% | 13% | 13% |
Developed technologies–Lixoft acquisition | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 1,079 | $ 994 | $ 5,029 | $ 3,827 |
Developed technologies–Lixoft acquisition | Revenue benchmark | Product concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 7% | 8% | 12% | 10% |
SEGMENT AND GEOGRAPHIC REPORT_6
SEGMENT AND GEOGRAPHIC REPORTING - Schedule of Revenue by Geographic Areas (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 14,959 | $ 12,777 | $ 42,172 | $ 36,625 |
Revenue benchmark | Geographic concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 100% | 100% | 100% | 100% |
Americas | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 11,163 | $ 9,651 | $ 29,318 | $ 25,436 |
Americas | Revenue benchmark | Geographic concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 75% | 76% | 70% | 69% |
EMEA | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 1,925 | $ 1,462 | $ 8,656 | $ 7,022 |
EMEA | Revenue benchmark | Geographic concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 13% | 11% | 21% | 19% |
Asia Pacific | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 1,871 | $ 1,664 | $ 4,198 | $ 4,167 |
Asia Pacific | Revenue benchmark | Geographic concentration risk | ||||
Segment Reporting Information [Line Items] | ||||
Concentration percentage | 13% | 13% | 10% | 11% |
EMPLOYEE BENEFIT PLAN (Details)
EMPLOYEE BENEFIT PLAN (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
May 31, 2022 | May 31, 2021 | May 31, 2022 | May 31, 2021 | |
Retirement Benefits [Abstract] | ||||
Defined benefit plan, plan assets, contributions by employer | $ 134 | $ 151 | $ 442 | $ 403 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |||||||
Jul. 06, 2022 | May 31, 2022 | Feb. 28, 2022 | Nov. 30, 2021 | Aug. 31, 2021 | May 31, 2021 | Feb. 28, 2021 | Nov. 30, 2020 | |
Subsequent Event [Line Items] | ||||||||
Common stock, dividends, per share, declared (in usd per share) | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | $ 0.06 | |
Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Common stock, dividends, per share, declared (in usd per share) | $ 0.06 | |||||||
Dividends, common stock, cash | $ 1.2 |