Cover
Cover - USD ($) | 12 Months Ended | ||
Aug. 31, 2021 | Nov. 25, 2021 | Feb. 26, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Aug. 31, 2021 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2021 | ||
Current Fiscal Year End Date | --08-31 | ||
Entity File Number | 001-32046 | ||
Entity Registrant Name | Simulations Plus, Inc. | ||
Entity Central Index Key | 0001023459 | ||
Entity Tax Identification Number | 95-4595609 | ||
Entity Incorporation, State or Country Code | CA | ||
Entity Address, Address Line One | 42505 Tenth 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 | ||
Title of 12(b) Security | Common Stock, par value $0.001 per share | ||
Trading Symbol | SLP | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 1,110,936,489 | ||
Entity Common Stock, Shares Outstanding | 20,147,714 | ||
ICFR Auditor Attestation Flag | true |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Aug. 31, 2021 | Aug. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 36,984 | $ 49,207 |
Accounts receivable, net of allowance for doubtful accounts of $78 and $50 | 9,851 | 7,422 |
Revenues in excess of billings | 3,150 | 3,093 |
Prepaid income taxes | 1,012 | 970 |
Prepaid expenses and other current assets | 1,696 | 1,596 |
Short-term investments | 86,620 | 66,804 |
Total current assets | 139,313 | 129,092 |
Long-term assets | ||
Capitalized computer software development costs, net of accumulated amortization of $14,438 and $13,582 | 7,646 | 6,087 |
Property and equipment, net | 1,838 | 438 |
Operating lease right of use asset | 1,276 | 927 |
Intellectual property, net of accumulated amortization of $6,516 and $5,087 | 10,469 | 11,898 |
Other intangible assets, net of accumulated amortization of $2,186 and $1,642 | 6,464 | 7,008 |
Goodwill | 12,921 | 12,921 |
Other assets | 51 | 51 |
Total assets | 179,978 | 168,422 |
Current liabilities | ||
Accounts payable | 387 | 351 |
Accrued payroll and other expenses | 5,604 | 2,251 |
Contracts payable - current portion | 4,550 | 2,000 |
Billings in excess of revenues | 117 | 141 |
Operating lease liability - current portion | 382 | 463 |
Deferred revenue | 534 | 300 |
Total current liabilities | 11,574 | 5,506 |
Long-term liabilities | ||
Deferred income taxes, net | 1,726 | 2,354 |
Operating lease liability | 896 | 463 |
Contracts payable – net of current portion | 0 | 4,064 |
Total liabilities | 14,196 | 12,387 |
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, 20,141,521 and 19,923,277 shares issued and outstanding | 133,418 | 128,541 |
Retained earnings | 32,407 | 27,436 |
Accumulated other comprehensive income (loss) | (43) | 58 |
Total shareholders' equity | 165,782 | 156,035 |
Total liabilities and shareholders' equity | $ 179,978 | $ 168,422 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Aug. 31, 2021 | Aug. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | ||
Allowance for doubtful accounts | $ 78 | $ 50 |
Accumulated amortization of computer software development costs | $ 14,438 | $ 13,582 |
Preferred stock par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock par value | $ 0.001 | $ 0.001 |
Common stock shares authorized | 50,000,000 | 50,000,000 |
Common stock shares issued | 20,141,521 | 19,923,277 |
Common stock shares outstanding | 20,141,521 | 19,923,277 |
Intellectual Property [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Accumulated amortization on intangible assets | $ 6,516 | $ 5,087 |
Other Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Accumulated amortization on intangible assets | $ 2,186 | $ 1,642 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Income Statement [Abstract] | |||
Revenues | $ 46,466 | $ 41,589 | $ 33,970 |
Cost of revenues | 10,600 | 10,649 | 9,026 |
Gross profit | 35,866 | 30,940 | 24,944 |
Operating expenses | |||
Research and development | 4,047 | 2,975 | 2,500 |
Selling, general and administrative | 20,566 | 16,360 | 11,796 |
Total operating expenses | 24,613 | 19,335 | 14,296 |
Income from operations | 11,253 | 11,605 | 10,648 |
Other income (expense) | |||
Interest income | 201 | 30 | 34 |
Interest expense | (22) | 0 | 0 |
Change in value of contingent consideration | (486) | (203) | (109) |
Gain (loss) on currency exchange | 139 | (45) | (17) |
Total other income (expense), net | (168) | (218) | (92) |
Income before income taxes | 11,085 | 11,387 | 10,556 |
Provision for income taxes | (1,303) | (2,055) | (1,973) |
Net Income | $ 9,782 | $ 9,332 | $ 8,583 |
Earnings per share | |||
Basic | $ 0.49 | $ 0.52 | $ 0.49 |
Diluted | $ 0.47 | $ 0.50 | $ 0.48 |
Weighted-average common shares outstanding | |||
Basic | 20,045 | 17,819 | 17,492 |
Diluted | 20,743 | 18,538 | 18,057 |
Other comprehensive income (loss), net of tax | |||
Foreign currency translation adjustments | $ (101) | $ 58 | $ 0 |
Comprehensive income | $ 9,681 | $ 9,390 | $ 8,583 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock And Additional Paid In Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Total |
Balance, beginning of period at Aug. 31, 2018 | $ 13,461 | $ 18,461 | ||
Exercise of stock options | 788 | |||
Stock-based compensation | 866 | |||
Shares issued to Directors for services | 212 | |||
Shares issued - Lixoft | ||||
Common stock issued for cash, net | ||||
Cumulative Effect of Changes related to adoption of ASC 606 | (493) | |||
Declaration of dividend | (4,197) | |||
Net income | 8,583 | 8,583 | ||
Other comprehensive income (loss) | ||||
Balance, end of period at Aug. 31, 2019 | 15,327 | 22,354 | $ 37,681 | |
Common dividends declared per common share | $ 0.24 | |||
Exercise of stock options | 630 | |||
Stock-based compensation | 1,287 | |||
Shares issued to Directors for services | 290 | |||
Shares issued - Lixoft | 3,260 | |||
Common stock issued for cash, net | 107,747 | |||
Cumulative Effect of Changes related to adoption of ASC 606 | ||||
Declaration of dividend | (4,250) | |||
Net income | 9,332 | $ 9,332 | ||
Other comprehensive income (loss) | 58 | |||
Balance, end of period at Aug. 31, 2020 | 128,541 | 27,436 | 58 | $ 156,035 |
Common dividends declared per common share | $ 0.24 | |||
Exercise of stock options | 1,461 | |||
Stock-based compensation | 2,405 | |||
Shares issued to Directors for services | 345 | |||
Shares issued - Lixoft | 666 | |||
Common stock issued for cash, net | ||||
Cumulative Effect of Changes related to adoption of ASC 606 | ||||
Declaration of dividend | (4,811) | |||
Net income | 9,782 | $ 9,782 | ||
Other comprehensive income (loss) | (101) | |||
Balance, end of period at Aug. 31, 2021 | $ 133,418 | $ 32,407 | $ (43) | $ 165,782 |
Common dividends declared per common share | $ 0.24 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Cash flows from operating activities | |||
Net income | $ 9,782 | $ 9,332 | $ 8,583 |
Adjustments to reconcile net income to net cash provided by operating activities | |||
Depreciation and amortization | 3,590 | 2,962 | 2,750 |
Change in value of contingent consideration | 486 | 203 | 109 |
Amortization of investment premiums | 2,350 | 0 | 0 |
Stock-based compensation | 2,750 | 1,577 | 1,078 |
Deferred income taxes | (628) | (378) | (299) |
Currency translation adjustments | (101) | 0 | 0 |
Increase (decrease) in | |||
Accounts receivable | (2,429) | (2,018) | 488 |
Revenues in excess of billings | (57) | 140 | (1,248) |
Prepaid income taxes | (42) | (12) | (453) |
Prepaid expenses and other assets | (100) | (399) | (94) |
Accounts payable | 39 | 221 | (148) |
Accrued payroll and other expenses | 3,353 | 23 | 487 |
Billings in excess of revenues | (24) | (658) | 414 |
Deferred revenue | 234 | (81) | (30) |
Net cash provided by operating activities | 19,203 | 10,912 | 11,637 |
Cash flows from investing activities | |||
Purchases of property and equipment | (1,627) | (231) | (138) |
Purchases of intellectual property | 0 | 0 | (50) |
Purchase of short-term investments | (122,395) | (67,249) | 0 |
Proceeds from sale of short-term investments | 100,229 | 0 | 0 |
Cash used to acquire subsidiaries | 0 | (9,471) | 0 |
Cash received in acquisition | 0 | 3,799 | 0 |
Capitalized computer software development costs | (2,949) | (2,353) | (1,768) |
Net cash used in investing activities | (26,742) | (75,505) | (1,956) |
Cash flows from financing activities | |||
Payment of dividends | (4,811) | (4,250) | (4,197) |
Payments on contracts payable | (1,334) | (1,761) | (4,239) |
Proceeds from the exercise of stock options | 1,461 | 630 | 788 |
Proceeds from follow-on public offering, net | 0 | 107,747 | 0 |
Net cash provided by (used in) financing activities | (4,684) | 102,366 | (7,648) |
Net increase (decrease) in cash and cash equivalents | (12,223) | 37,773 | 2,033 |
Cash and cash equivalents, beginning of year | 49,207 | 11,434 | 9,401 |
Cash and cash equivalents, end of period | 36,984 | 49,207 | 11,434 |
Supplemental disclosures of cash flow information | |||
Income taxes paid | 1,857 | 2,353 | 2,673 |
Non-Cash Investing and Financing Activities | |||
Stock issued for acquisition of Lixoft | 666 | 3,261 | 0 |
Creation of contract liabilities for acquisition of subsidiaries | 0 | 4,528 | 0 |
Right of use assets capitalized | $ 905 | $ 1,499 | $ 0 |
ORGANIZATION AND LINES OF BUSIN
ORGANIZATION AND LINES OF BUSINESS | 12 Months Ended |
Aug. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND LINES OF BUSINESS | NOTE 1 – ORGANIZATION AND LINES OF BUSINESS Organization Simulations Plus, Inc. (“The Company”) 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. (Collectively, “Company”, “we”, “us”, “our”). Effective September 1, 2021, the Company merged both Cognigen Corporation and DILIsym, Services, Inc. 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 (the Company’s 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 both artificial intelligence (“AI”) as well as 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, and to regulatory agencies worldwide for use in the conduct of industry-based research. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Aug. 31, 2021 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The consolidated financial statements include the accounts of Simulations Plus and, as of September 2, 2014, its wholly-owned subsidiary, Cognigen, as of June 1, 2017, the accounts of DILIsym, and as of April 1, 2020, Lixoft. All significant intercompany accounts and transactions are eliminated in 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 providing consulting services to the pharmaceutical industry for drug development. The Company determines 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, the Company satisfies a performance obligation 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. Sales commissions for new contracts are deferred and then amortized on a straight-line basis over a period of benefit. We determined the period of benefit by taking into consideration our customer contracts, our technology and other factors. Sales commissions for renewal contracts are deferred and then amortized on a straight-line basis over the related contractual renewal period. Amortization expense is included in sales and marketing expenses on the consolidated statements of operations and comprehensive income as Selling, general, and administrative expense. Practical Expedients and Exemptions The Company has elected the following additional practical expedients in applying Topic 606: · Commission Expense . · Transaction Price Allocated to Future Performance Obligations ASC 606 requires that the Company disclose the aggregate amount of transaction price that is allocated to performance obligations that have not yet been satisfied as of August 31, 2021. ASC 606 provides certain practical expedients that limit the requirement to disclose the aggregate amount of transaction price allocated to unsatisfied performance obligations. The Company applied the practical expedient to not disclose the amount of transaction price allocated to unsatisfied performance obligations when the performance obligation is part of a contract that has an original expected duration of one year or less. Cash and Cash Equivalents For purposes of the statements of cash flows, the Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. Accounts Receivable We analyze the age of customer balances, historical bad-debt experience, customer creditworthiness, and changes in customer payment terms when making estimates of the collectability of the Company’s trade accounts receivable balances. If we determine that the financial conditions of any of our customers have deteriorated, whether due to customer-specific or general economic issues, an increase in the allowance may be made. Accounts receivable are written off when reasonable collection attempts have failed. Investments We 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. The Company accounts for its investment in marketable securities in accordance with 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 reported at amortized cost. Discounts and premiums to par value of the debt securities are amortized to interest income/expense over the term of the security. No gains or losses on investment securities are realized until they are sold or a decline in fair value is determined to be other-than-temporary. 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 with unrealized gains or losses excluded from earnings and reported as a separate component of shareholders’ equity. We classify our investments in marketable debt securities based on the facts and circumstances present at the time of purchase of the securities. During the year ended August 31, 2021, all of our investments were classified as held-to-maturity. Held-to-maturity investments are measured and recorded at amortized cost on the Company’s Consolidated Balance Sheets. Discounts and premiums to par value of the debt securities are amortized to interest income/expense over the term of the security. No gains or losses on investment securities are realized until they are sold or a decline in fair value is determined to be other-than-temporary. Capitalized Computer Software Development Costs Software development costs are capitalized in accordance with ASC 985-20, “Costs of Software to Be Sold, Leased, or Marketed” 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 revenues, estimated economic life, and changes in software and hardware technologies. Capitalized computer software development costs are comprised primarily of salaries and direct payroll-related costs and the purchase of existing software to be used in the Company's software products. Amortization of capitalized computer software development costs is provided 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 $ 1.4 1.2 1.3 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, or fair market value for property and equipment acquired in business combinations, less accumulated depreciation and amortization. Depreciation and amortization are provided using the straight-line method over the estimated useful lives as follows: Property and Equipment estimated useful lives 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 Maintenance and minor replacements are charged to expense as incurred. Gains and losses on disposals are included in the results of operations. 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” The amortization will be classified as Selling, general, and administrative expenses on the consolidated statement of operations and comprehensive income and maintenance and minor upgrades are charged to expense as incurred. Gains and losses on disposals are included in the results of operations. No amortization has been expensed for the project as it is still in progress. Leases We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities (current and long-term) in our consolidated balance sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we generally use our incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Supplemental balance sheet information related to operating leases was as follows as of August 31, 2021: Schedule of lease cost (in thousands) Right of use assets $ 1,276 Lease Liabilities, Current $ 382 Lease Liabilities, Long-term $ 896 Operating lease costs $ 595 Weighted Average remaining lease term 2.50 Weighted Average Discount rate 3.79 Intangible Assets and Goodwill The Company performs valuations of assets acquired and liabilities assumed on each acquisition accounted for as a business combination and recognizes 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 August 31, 2021, the Company determined that it has four reporting units, Simulations Plus, Cognigen Corporation, DILIsym Services, Inc. and Lixoft. When testing goodwill for impairment, the Company first performs 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. The Company is 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 the Company's 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 the Company's 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 August 31, 2021, the entire balance of goodwill was attributed to three of the Company's reporting units, Cognigen Corporation, DILIsym Services, Inc. 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. The Company has no Reconciliation of Goodwill as of August 31, 2021, and 2020: Schedule of reconciliation of goodwill (in thousands) Cognigen DILIsym Lixoft Total Balance, August 31, 2019 $ 4,789 $ 5,598 $ – $ 10,387 Addition – – 2,534 2,534 Impairments – – – – Balance, August 31, 2020 4,789 5,598 2,534 12,921 Addition – – – – Impairments – – – – Balance, August 31, 2021 $ 4,789 $ 5,598 $ 2,534 $ 12,921 Other Intangible Assets The following table summarizes other intangible assets as of August 31, 2021: Schedule of other intangible assets (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 The following table summarizes other intangible assets as of August 31, 2020: (in thousands) Amortization Acquisition Accumulated Net book Cognigen Customer relationships Straight line 8 years $ 1,100 $ 825 $ 275 Trade Name None 500 – 500 Covenants not to compete Straight line 5 years 50 50 – DILIsym Customer relationships Straight line 10 years 1,900 618 1,282 Trade Name None 860 – 860 Covenants not to compete Straight line 4 years 80 65 15 Lixoft Customer relationships Straight line 14 years 2,550 76 2,474 Trade Name None 1,550 – 1,550 Covenants not to compete Straight line 3 years 60 8 52 $ 8,650 $ 1,642 $ 7,008 Total amortization expense for the years ended August 31, 2021, 2020 and 2019 was $ 544 432 358 Future amortization of intangible assets for the next five years is as follows: Schedule of future amortization (in thousands) Year ending August 31, Amount 2022 $ 530 2023 $ 384 2024 $ 372 2025 $ 372 2026 $ 372 Business Acquisitions The Company accounted for the acquisition of Cognigen, DILIsym, and Lixoft using the purchase method of accounting where the assets acquired and liabilities assumed are recognized based on their respective estimated fair values. The excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill. Determining the fair value of certain acquired assets and liabilities is subjective in nature and often involves the use of significant estimates and assumptions, including, but not limited to, the selection of appropriate valuation methodology, projected revenue, expenses and cash flows, weighted average cost of capital, discount rates, estimates of advertiser and publisher turnover rates and estimates of terminal values. Business acquisitions are included in the Company's consolidated financial statements as of the date of the acquisition. Fair Value of Financial Instruments Assets and liabilities recorded at fair value in the 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 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 carrying amounts approximate fair value due to their short-term nature. The following table summarizes fair value measurements as of August 31, 2021, and August 31, 2020, for assets and liabilities measured at fair value on a recurring basis: Summarizes fair value measurements August 31, 2021 (in thousands) Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 36,984 $ – $ – $ 36,984 Short-term investments $ 86,620 $ – $ – $ 86,620 Acquisition-related contingent consideration obligations $ – $ – $ 3,217 $ 3,217 August 31, 2020 (in thousands) Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 49,207 $ – $ – $ 49,207 Short-term investments $ 66,804 $ – $ – $ 66,804 Acquisition-related contingent consideration obligations $ – $ – $ 4,731 $ 4,731 As of August 31, 2021, and 2020, the Company had a liability for contingent consideration related to its acquisition of Lixoft and DILIsym. 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 the Company records in any given period. Changes in the value of the contingent consideration obligations are recorded in the Company’s Consolidated Statement of Operations. The following is a reconciliation of contingent consideration value: Reconciliation of contingent consideration value (in thousands) Value as of August 31, 2020 $ 4,731 Contingent consideration payments (2,000 ) Change in value of contingent consideration 486 Value as of August 31, 2021 $ 3,217 Marketing The Company expenses marketing and advertising costs as incurred. Marketing costs for the years ended August 31, 2021, 2020 and 2019 were approximately $ 60 64 83 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 experiment, and purchased software which was developed by other companies and incorporated into, or used in the development of, our final products. Income Taxes The Company accounts for income taxes in accordance with ASC 740-10, “Income Taxes” 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 On February 28, 2012, we bought out the royalty agreement with Enslein Research. The cost of $ 75 10 years under the straight-line method On May 15, 2014, we entered into a termination and non-assertion agreement with TSRL, Inc., pursuant to which the parties agreed to terminate an exclusive software licensing agreement entered into between the parties in 1997. As a result, the Company obtained a perpetual right to use certain source code and data, and TSRL relinquished any rights and claims to any GastroPlus products and to any claims to royalties or other payments under that 1997 agreement. We agreed to pay TSRL total consideration of $ 6 10 years under the straight-line method On June 1, 2017, as part of the acquisition of DILIsym the Company acquired certain developed technologies associated with the drug induced liver disease (DILI). These technologies were valued at approximately $ 2.9 9 years under the straight-line method In September 2018, we purchased certain intellectual property rights of Entelos Holding Company. The cost of $ 50 10 years under the straight-line method On April 1, 2020, as part of the acquisition of Lixoft, the Company acquired certain developed technologies associated with the Lixoft scientific software. These technologies were valued at approximately $ 8.0 16 years under the straight-line method The following table summarizes intellectual property as of August 31, 2021: Summary of intellectual property (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 Company 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 The following table summarizes intellectual property as of August 31, 2020: (in thousands) Amortization Acquisition Accumulated Net Book Royalty Agreement buy out-Enslein Research Straight line 10 years $ 75 $ 64 $ 11 Termination/nonassertion agreement-TSRL Inc. Straight line 10 years 6,000 3,775 2,225 Developed technologies–DILIsym acquisition Straight line 9 years 2,850 1,029 1,821 Intellectual rights of Entelos Holding Company Straight line 10 years 50 10 40 Developed technologies–Lixoft acquisition Straight line 16 years 8,010 209 7,801 $ 16,985 $ 5,087 $ 11,898 Total amortization expense for intellectual property agreements for the years ended August 31, 2021, 2020 and 2019 was $ 1.4 1.1 929 Future amortization of intellectual property for the next five years is as follows: Schedule of future amortization expenses (in thousands) Year ending August 31, Amount 2022 $ 1,426 2023 $ 1,422 2024 $ 1,247 2025 $ 822 2026 $ 743 Earnings per Share The Company reports earnings per share in accordance with FASB ACS 260-10. Basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of common shares available. 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 years ended August 31, 2021, 2020 and 2019 were as follows: Schedule of earnings per share August 31, (in thousands) 2021 2020 2019 Numerator Net income attributable to common shareholders $ 9,782 $ 9,332 $ 8,583 Denominator Weighted-average number of common shares outstanding during the year 20,045 17,819 17,492 Dilutive effect of stock options 698 719 565 Common stock and common stock equivalents used for diluted earnings per share 20,743 18,538 18,057 Stock-Based Compensation Compensation costs related to stock options are determined in accordance with FASB ASC 718-10, “Compensation-Stock Compensation”, 2.4 1.3 866 Impairment of Long-lived Assets The Company accounts for the impairment and disposition of long-lived assets in accordance with ASC 350, “Intangibles – Goodwill and Other “Property and Equipment” No Recently Issued Accounting Standards In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes existing guidance on accounting for leases in "Leases (Topic 840)" and generally requires all leases to be recognized in the consolidated balance sheet. ASU 2016-02 is effective for annual and interim reporting periods beginning after December 15, 2018. The Company adopted this ASU on September 1, 2019. In December 2019, the FASB issued ASU 2019-12 , Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-04 , Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting |
REVENUE RECOGNITION
REVENUE RECOGNITION | 12 Months Ended |
Aug. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | NOTE 3 – REVENUE RECOGNITION We generate revenue primarily from the sale of software licenses and providing consulting services to the pharmaceutical industry for drug development. The Company determines 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, the Company satisfies a performance obligation Components of Revenue The following is a description of principal activities from which the Company generates revenue. As part of the accounting for these arrangements, the Company must develop assumptions that require judgment to determine the stand-alone selling price for each performance obligation identified in the contract. Stand-alone selling prices are determined based on the prices at which the Company separately sells its services or goods. Revenue Components Typical Payment Terms Software Revenues: Software revenues are generated primarily from sales of software licenses at the time the software is unlocked and the term commences. The license period typically is one year or less. Along with the license a di minimis For certain software arrangements the Company hosts the licenses on servers maintained by the Company, Revenue for those arrangements are accounted as Software as a Service Payments are generally due upon invoicing on a net 30 basis unless other payment terms are negotiated with the customer based on customer history. Typical industry standards apply. Consulting Contracts: Consulting services provided to our customers are generally recognized over time as the contracts are performed and the services are rendered. The company measures its consulting revenue based on time expended compared to total estimated hours to complete a project. The Company believes the methods chosen for its contract revenue best depicts the transfer of benefits to the customer under the contracts. Payment terms vary, depending on the size of the contract, credit history and history with the client and deliverables within the contract. Consortium Member Based Services: The performance obligation is recognized on a time elapsed basis, by month, for which the services are provided, as the Company transfers control evenly over the contractual period. Payment is due at the beginning of the period, generally on a net 30 or 60 basis. Remaining performance obligations that do not fall under the expedients, require the Company to perform various consulting and software development services and consortium memberships of approximately $6.2 million. It is anticipated these revenues will be recognized within the next year. Contract Liabilities During the year ended August 31, 2021, the Company recognized $430 thousand of revenue that was included in contract liabilities as of August 31, 2020. Disaggregation of Revenues The components of disaggregation of revenue for the years ended August 31, 2021, 2020 and 2019 were as follows: Schedule of disaggregation of revenues Year ended August 31, (in thousands) 2021 2020 2019 Software licenses Point in time $ 26,725 $ 20,668 $ 17,425 Over time 945 919 1,054 Consulting services Over time 18,796 20,002 15,491 Total revenue $ 46,466 $ 41,589 $ 33,970 Contracts in Progress Contracts in progress are included in the accompanying balance sheets under the following captions: Schedule of contract in progress Year ended August 31, (in thousands) 2021 2020 2019 Revenues in excess of billings $ 3,150 $ 3,093 $ 3,234 Billings in excess of revenues (117 ) (141 ) (799 ) Revenues over billings on uncompleted contracts $ 3,033 $ 2,952 $ 2,435 Cost, estimated earnings, and billings on uncompleted contracts are summarized as follows as of August 31, 2021, 2020 and 2019: August 31, (in thousands) 2021 2020 2019 Revenues earned to date on uncompleted contracts $ 15,184 $ 20,235 $ 19,255 Billings to date on uncompleted contracts (12,151 ) (17,283 ) (16,820 ) Revenues over billings on uncompleted contracts $ 3,033 $ 2,952 $ 2,435 Balance increases and decreases in these accounts are due to the timing of amounts billed, payments received, and revenue recognized. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Aug. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 4 – PROPERTY AND EQUIPMENT Property and equipment consisted of the following: August 31, (in thousands) 2021 2020 Equipment $ 606 $ 865 Computer equipment 293 548 Furniture and fixtures 36 161 Leasehold improvements 13 114 Construction in progress 1,302 – Subtotal 2,250 1,688 Less accumulated depreciation and amortization (412 ) (1,250 ) Total $ 1,838 $ 438 Depreciation expense was $ 226 166 132 |
INVESTMENTS
INVESTMENTS | 12 Months Ended |
Aug. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENTS | NOTE 5 – INVESTMENTS The Company invests a portion of its excess cash balances in short-term debt securities. Investments at August 31, 2021, consisted of corporate bonds with maturities remaining of less than 12 months. The Company may also invest excess cash balances in certificates of deposits, money market accounts, government-sponsored enterprise securities, corporate bonds and/or commercial paper. The Company accounts for its investments in accordance with FASB ASC 320, Investments – Debt and Equity Securities. As of August 31, 2021, all investments were classified as held-to-maturity securities. The following tables summarize the Company’s short-term investments as of August 31, 2021, and 2020: Schedule of short term investment August 31, 2021 (in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Commercial notes (due within one year) $ 86,620 $ – $ (136 ) $ 86,484 Total $ 86,620 $ – $ (136 ) $ 86,484 August 31, 2020 (in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Commercial notes (due within one year) $ 66,804 $ – $ (61 ) $ 66,743 Total $ 66,804 $ – $ (61 ) $ 66,743 |
CONTRACTS PAYABLE
CONTRACTS PAYABLE | 12 Months Ended |
Aug. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
CONTRACTS PAYABLE | NOTE 6 – CONTRACTS PAYABLE DILIsym Acquisition Liabilities: On June 1, 2017, we acquired DILIsym. The agreement provided for a working capital adjustment, an eighteen-month $1.0 million holdback provision against certain representations and warranties, and an earnout agreement of up to an additional $5.0 million in earnout payments based on earnings over three years following acquisition. The earnout liability has been recorded at an estimated fair value. Payments under the earnout liability started in fiscal year 2019. In September 2018, $1.6 million was paid out under the first earnout payment, a second earnout payment was made in August 2019 in the amount of $1.7 million. The final payment of $1.8 million was paid in August 2020. In addition, no claims were made against the holdback and the $1.0 million holdback provision was released eighteen months after June 1, 2017. Lixoft Acquisition Liabilities On April 1, 2020, the Company acquired Lixoft. The agreement provided for a 24-month $2.0 million holdback provision against certain representations and warrantees, comprised of $1.3 million of cash and shares of stock valued at $666 thousand issued at the date of the Agreement. In addition, based on a revenue growth formula for the two years subsequent to April 1, 2020, the agreement calls for earnout payments up to $5.5 million (two thirds cash and one-third newly issued, unregistered shares of the Company’s common stock). The former shareholders can earn up to $2.0 million the first year and $3.5 million in year two. In June 2021, $2.0 million was paid to former Lixoft shareholder under the first earnout payment, which was comprised of $1.3 million of cash and $666 thousand worth of common stock. As of August 31, 2021, and 2020 the following liabilities have been recorded: Schedule of Liabilities (in thousands) August 31, 2021 August 31, 2020 Holdback Liability $ 1,333 $ 1,333 Earnout Liability 3,217 4,731 Subtotal $ 4,550 $ 6,064 Less: Current Portion 4,550 2,000 Long-Term $ – $ 4,064 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Aug. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 7 – COMMITMENTS AND CONTINGENCIES Leases Our corporate headquarters is located in Lancaster, California, where we lease 9,255 square feet of office space. The term of the lease extends to January 31, 2026 and the base rent is approximately $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 12,623 square feet of office space in Buffalo, New York. The initial five-year lease term expired in October 2018; and was renewed for a three-year option, extending it to November 2021 at a base rent of approximately $16 thousand per month. On August 3, 2021, a new lease agreement was signed for a different property for a five-year term at a base rent of approximately $7 thousand per month with an annual 2% increase, and with two, five-year renewal options. Due to ongoing construction, the Company has not yet moved into the new property but anticipates doing so and commencing the lease term no later than November 2021. We lease approximately 2,700 square feet of space in Research Triangle Park, North Carolina. The initial three-year term was due to expire in October 2020. An amendment to the initial lease became effective on April 1, 2020, which added 686 square feet and extended the term of the lease to September 30, 2023. The new base rent is approximately $8 thousand per month with an annual 3% increase. We lease approximately 2,300 square feet of office space in Paris, France. As of April 1, 2020, the lease agreement had minimum payments equaling approximately $288 thousand. The lease is for a 9-year term, with an option to terminate every 3 years, and expires in November of 2024. The base rent is $16 thousand per quarter (approximately $5.3 thousand per month) and can be adjusted each December based on a consumer price index. Rent expense, including common area maintenance fees for the years ended August 31, 2021, 2020 and 2019 was $ 655 644 584 Lease liability maturities as of August 31, 2021, were as follows: Future minimum lease payments (in thousands) Years Ending August 31, Amount 2022 $ 422 2023 375 2024 275 2025 211 2026 83 Total undiscounted liabilities 1,366 Less: imputed interest (88 ) Total future minimum lease payments $ 1,278 Line of Credit On March 31, 2020, the Company entered into a Credit Agreement with Wells Fargo Bank, N.A. The Credit Agreement, has provided the Company with a credit facility of $ 3,500,000 April 15, 2022 no Employment Agreements In the normal course of business, the Company has entered into employment agreements with certain of its key management personnel that may require compensation payments upon termination. License Agreement The Company had a royalty agreement with Dassault Systèmes Americas Corp. for access to their Metabolite Database for developing our Metabolite Module within ADMET Predictor. The module was renamed the Metabolism Module when we released ADMET Predictor version 6 on April 19, 2012. Under this agreement, we paid a royalty of 25% of revenue derived from the sale of the Metabolism/Metabolite module. This agreement was renegotiated, and the Company does not bear any royalty obligations towards Dassault Systèmes Americas Corp. effective June 30, 2019. In addition, the license agreement terminated on September 5, 2020. Under this agreement for the years ended August 31, 2021, 2020 and 2019 we incurred royalty expense (benefit) of $ 0 26 196 Litigation We are not a party to any legal proceedings and are not aware of any pending legal proceedings of any kind. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Aug. 31, 2021 | |
Equity [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 8 – SHAREHOLDERS' EQUITY Shares Outstanding Shares of common stock outstanding for the years ended August 31, 2021, 2020 and 2019 were as follows: August 31, 2021 2020 2019 Common stock outstanding, beginning of year 19,923,277 17,591,834 17,416,445 Common stock issued during the year 218,244 2,331,443 175,389 Common stock outstanding, end of year 20,141,521 19,923,277 17,591,834 Dividends The Company’s Board of Directors declared cash dividends during the years ended August 31, 2021, and 2020. The details of dividends paid are in the following tables: Schedule of dividends declared and paid (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 (in thousands, except dividend per share) Fiscal Year 2020 Record Date Distribution Date Number of Shares Dividend per Total Amount 10/25/2019 11/01/2019 17,606 $ 0.06 $ 1,056 1/27/2020 2/03/2020 17,646 $ 0.06 1,059 4/24/2020 5/01/2020 17,769 $ 0.06 1,066 7/27/2020 8/03/2020 17,820 $ 0.06 1,069 Total $ 4,250 Stock Option Plans On February 23, 2007, the Board of Directors adopted, and the shareholders approved, the 2007 Stock Option Plan under which a total of 1,000,000 On December 23, 2016 the Board of Directors adopted, and on February 23, 2017 the shareholders approved, the 2017 Equity Incentive Plan under which a total of 1,000,000 Effective April 9, 2021, the Board of Directors approved, subject to shareholder approval, the adoption of a new 2021 Equity Incentive Plan (the “2021 Plan”) under which 1.3 As of August 31, 2021, employees and directors held Qualified Incentive Stock Options (ISOs) and Non-Qualified Stock Options (“NQSOs”) to purchase 1.2 million shares of common stock at exercise prices ranging from $6.85 to $66.14 per share. The following tables summarize information about stock options: Schedule of stock option activity (in thousands, except per share and weighted-average amounts) Transactions During Fiscal Year 2021 Number of Weighted-Average Weighted-Average Outstanding, August 31, 2020 1,224 $ 17.76 6.79 Granted 226 57.60 Exercised (204 ) 12.53 Canceled/Forfeited (62 ) 29.83 Outstanding, August 31, 2021 1,184 $ 25.63 6.47 Vested and Exercisable, August 31, 2021 619 $ 13.36 4.95 Vested and Expected to Vest, August 31, 2021 1,173 $ 25.69 6.47 (in thousands, except per share and weighted-average amounts) Transactions During Fiscal Year 2020 Number of Weighted-Average Weighted-Average Outstanding, August 31, 2019 1,163 $ 12.63 7.13 Granted 223 39.23 Exercised (121 ) 9.29 Canceled/Forfeited (41 ) 14.19 Outstanding, August 31, 2020 1,224 $ 17.76 6.79 Vested and Exercisable, August 31, 2020 596 $ 10.69 5.59 Vested and Expected to Vest, August 31, 2020 1,194 $ 17.75 6.77 (in thousands, except per share and weighted-average amounts) Transactions During Fiscal Year 2019 Number of Weighted-Average Weighted-Average Outstanding, August 31, 2018 1,135 $ 9.44 7.31 Granted 264 22.78 Exercised (167 ) 7.15 Canceled/Forfeited (69 ) 12.17 Outstanding, August 31, 2019 1,163 $ 12.63 7.13 Vested and Exercisable, August 31, 2019 515 $ 8.57 6.09 Vested and Expected to Vest, August 31, 2019 1,102 $ 12.39 7.07 The following table summarizes the Intrinsic Value of options outstanding and options exercisable: Intrinsic value of options outstanding and options exercisable (in thousands) Intrinsic Value Intrinsic Intrinsic Fiscal Year 2019 $ 27,313 $ 14,195 $ 3,224 Fiscal Year 2020 $ 51,273 $ 29,151 $ 4,086 Fiscal Year 2021 $ 25,705 $ 19,373 $ 11,554 The weighted-average remaining contractual life of options outstanding issued under the Plans, for both ISOs and NQSOs, was 6.47 6.3 3.43 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 current fiscal year 2021 and fiscal year 2020: Schedule of fair value of options (in thousands, except prices) Fiscal Year 2021 Fiscal Year 2020 Estimated fair value of awards granted $ 5,092 $ 2,997 Unvested Forfeiture Rate 0 0 Weighted average grant price $ 57.60 $ 39.23 Weighted average market price $ 57.60 $ 39.23 Weighted average volatility 40.49 33.56 Weighted average risk-free rate 0.64 1.39 Weighted average dividend yield 0.42 0.65 Weighted average expected life 6.63 6.67 The exercise prices for the options outstanding at August 31, 2021, ranged from $6.85 to $66.14, and the information relating to these options is as follows: (in thousands except prices) Schedule of options by exercise price range Exercise Price Awards Outstanding Awards Exercisable Low High Quantity Weighted Weighted Quantity Weighted Weighted $ 6.85 $ 8.28 144 3.00 $ 6.85 144 3.00 $ 6.85 $ 8.29 $ 10.03 183 4.52 $ 9.72 183 4.52 $ 9.72 $ 10.04 $ 12.20 221 5.48 $ 10.05 162 5.48 $ 10.05 $ 12.21 $ 28.16 184 6.66 $ 20.37 66 5.88 $ 20.25 $ 28.17 $ 57.04 230 8.40 $ 37.22 51 8.08 $ 34.19 $ 57.05 $ 66.14 222 9.17 $ 58.77 13 8.88 $ 61.84 1,184 6.47 $ 25.63 619 4.95 $ 13.36 During the fiscal years ended August 31, 2021, 2020, and 2019, we issued 5,620, 7,205 8,686 345 290 212 The balance of our par value common stock and additional paid-in capital as of August 31, 2021, was $ 10 133.4 10 128.5 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Aug. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 9 – INCOME TAXES We utilize FASB ASC 740-10, “Income Taxes” 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. The components of the income tax provision for the years ended August 31, 2021, 2020 and 2019 were as follows: Components of the income tax provision (in thousands) 2021 2020 2019 Current Federal $ 1,315 $ 2,098 $ 1,795 State 450 478 426 Foreign 166 39 51 Total current tax expense 1,931 2,615 2,272 Deferred Federal (379 ) (428 ) (141 ) State (249 ) (132 ) (158 ) Total deferred federal and state (628 ) (560 ) (299 ) Total $ 1,303 $ 2,055 $ 1,973 A reconciliation of the expected income tax computed using the federal statutory income tax rate to the Company's effective income tax rate is as follows for the years ended August 31, 2021, 2020 and 2019: Effective income tax rate 2021 2020 2019 Income tax computed at federal statutory tax rate 21.0 % 21.0 % 21.0 % State taxes, net of federal benefit 2.0 4.1 4.1 Meals & entertainment – 0.1 0.1 Stock based compensation (6.8 ) (1.2 ) (2.6 ) Other permanent differences (0.3 ) (0.3 ) (0.7 ) Research and development credit (1.6 ) (2.8 ) (2.3 ) Foreign tax related differences (2.6 ) (1.4 ) – Research & credit adjustments to expense 0.2 0.3 – Change in prior year estimated taxes (0.1 ) (1.8 ) (0.9 ) Total 11.8 % 18.0 % 18.7 % Significant components of the Company's deferred tax assets and liabilities for income taxes for the years ended August 31, 2021, and 2020 are as follows: Components of company deferred tax assets and liabilities (in thousands) 2021 2020 Deferred tax assets: Accrued payroll and other expenses $ 586 $ 402 Deferred revenue 102 7 Capitalized merger costs 703 742 Intellectual property 7 8 Research and development credits 66 – State taxes 72 100 Allowance for doubtful accounts 20 13 State tax deferred 80 125 Total deferred tax assets 1,636 1,397 Less: Valuation allowance – – Deferred tax asset 1,636 1,397 Deferred tax liabilities: Property and equipment (83 ) (82 ) State tax deferred (26 ) (19 ) Intellectual property (1,456 ) (1,876 ) Capitalized computer software development costs (1,797 ) (1,774 ) Total deferred tax liabilities (3,362 ) (3,751 ) Net deferred tax liabilities $ (1,726 ) $ (2,354 ) 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. Interest and penalties were immaterial for fiscal years 2021, 2020, and 2019, respectively. 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 year 2018 thru 2020 are open for audit, and our state tax returns for fiscal year 2017 through 2020 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. |
CONCENTRATIONS AND UNCERTAINTIE
CONCENTRATIONS AND UNCERTAINTIES | 12 Months Ended |
Aug. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS AND UNCERTAINTIES | NOTE 10 – CONCENTRATIONS AND UNCERTAINTIES Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash, cash equivalents, trade accounts receivable and short-term investments. The Company holds cash and cash equivalents at banks located in California, with balances that often exceed FDIC insured limits. In addition, we hold cash at a bank in France that is not FDIC-insured. Historically, the Company has not experienced any losses in such accounts. However, we are investigating alternative way to minimize our exposure to such risk. While the Company may be exposed to credit losses due to the nonperformance of its counterparties, the Company does not expect the settlement of these transactions to have a material effect on its results of operations, cash flows or financial condition. The Company maintains cash at financial institutions that may, at times, exceed federally insured limits. Revenue concentration shows that international sales accounted for 31 29 34 11 4 3 9 7 7 8 8 7 Accounts receivable concentrations show that three customers each comprised between 5 16 13 10 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 impacts 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 |
SEGMENT AND GEOGRAPHIC REPORTIN
SEGMENT AND GEOGRAPHIC REPORTING | 12 Months Ended |
Aug. 31, 2021 | |
Segment Reporting [Abstract] | |
SEGMENT AND GEOGRAPHIC REPORTING | NOTE 11 – SEGMENT AND GEOGRAPHIC REPORTING We account for segments and geographic revenues in accordance with guidance issued by the FASB. Our reportable segments are strategic business units that offer different products and services. Results for each divisional segment and consolidated results are as follows for the years ended August 31, 2021, 2020 and 2019: (in thousands) Year ended August 31, 2021 Simulations Plus Cognigen DILIsym Lixoft Eliminations Total Revenues $ 25,142 $ 10,546 $ 6,115 $ 4,663 $ – $ 46,466 Income (loss) from operations $ 9,286 $ 376 $ (112 ) $ 1,703 $ – $ 11,253 Total assets $ 168,923 $ 13,121 $ 14,884 $ 19,344 $ (36,294 ) $ 179,978 Goodwill $ – $ 4,789 $ 5,598 $ 2,534 $ – $ 12,921 Capital expenditures $ 1,212 $ 279 $ 18 $ 118 $ – $ 1,627 Capitalized software costs $ 2,289 $ 12 $ 170 $ 478 $ – $ 2,949 Depreciation and amortization $ 1,885 $ 347 $ 590 $ 768 $ – $ 3,590 (in thousands) Year ended August 31, 2020 Simulations Plus Cognigen DILIsym Lixoft* Eliminations Total Revenues $ 21,961 $ 11,105 $ 6,948 $ 1,575 $ – $ 41,589 Income from operations $ 7,374 $ 1,770 $ 1,744 $ 717 $ – $ 11,605 Total assets $ 162,807 $ 11,654 $ 14,084 $ 19,972 $ (40,095 ) $ 168,422 Goodwill $ – $ 4,789 $ 5,598 $ 2,534 $ – $ 12,921 Capital expenditures $ 111 $ 87 $ 31 $ 2 $ – $ 231 Capitalized software costs $ 2,029 $ 40 $ 124 $ 160 $ – $ 2,353 Depreciation and amortization $ 1,713 $ 349 $ 600 $ 300 $ – $ 2,962 * As Lixoft was purchased on April 1, 2020, five months of activity is reflected for fiscal year 2020. (in thousands) Year ended August 31, 2019 Simulations Plus Cognigen DILIsym Eliminations Total Revenues $ 19,584 $ 9,321 $ 5,065 $ – $ 33,970 Income from operations $ 7,751 $ 1,481 $ 1,416 $ – $ 10,648 Total assets $ 38,535 $ 11,196 $ 13,168 $ (17,702 ) $ 45,197 Goodwill $ – $ 4,789 $ 5,598 $ – $ 10,387 Capital expenditures $ 39 $ 79 $ 20 $ – $ 138 Capitalized software costs $ 1,482 $ 114 $ 172 $ – $ 1,768 Depreciation and amortization $ 1,806 $ 364 $ 580 $ – $ 2,750 Results for each business unit segment and consolidated results for the years ended August 31, 2021, 2020 and 2019 were as follows: (in thousands) Year ended August 31, 2021 Software Services Total Revenues $ 27,670 $ 18,796 $ 46,466 Cost of revenues 3,235 7,365 10,600 Gross profit $ 24,435 $ 11,431 $ 35,866 Gross margin 88 61 77 Our software business and services business represented 60% and 40% of total revenue, respectively, for the year ended August 31, 2021. (in thousands) Year ended August 31, 2020 Software Services Total Revenues $ 21,587 $ 20,002 $ 41,589 Cost of revenues 2,883 7,766 10,649 Gross profit $ 18,704 $ 12,236 $ 30,940 Gross margin 87 61 74 Our software business and services business represented 52% and 48% of total revenue, respectively, for the 2020 fiscal year. (in thousands) Year ended August 31, 2019 Software Services Total Revenues $ 18,479 $ 15,491 $ 33,970 Cost of revenues 2,957 6,069 9,026 Gross profit $ 15,522 $ 9,422 $ 24,944 Gross margin 84 61 73 Our software business and services business represented 54% and 46% of total revenue, respectively, for the 2019 fiscal year. In addition, the Company allocates revenues to geographic areas based on the locations of its customers. Geographical revenues for the years ended August 31, 2021, 2020 and 2019 were as follows: (in thousands) Year ended August 31, 2021 2020 2019 $ % of total $ % of total $ % of total Americas $ 32,549 70 % $ 29,674 71 % $ 22,576 67 % EMEA 7,906 17 5,827 14 5,829 17 Asia Pacific 6,011 13 6,088 15 5,565 16 Total $ 46,466 100 % $ 41,589 100 % $ 33,970 100 % |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Aug. 31, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 12 – RELATED PARTY TRANSACTIONS On April 1, 2020, the Company acquired Lixoft. As part of that agreement the Company paid $ 6.7 2.6 947 2.0 |
EMPLOYEE BENEFIT PLAN
EMPLOYEE BENEFIT PLAN | 12 Months Ended |
Aug. 31, 2021 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLAN | NOTE 13 – EMPLOYEE BENEFIT PLAN We maintain a 401(k) Plan for eligible employees. We make matching contributions equal to 100% of the employee’s elective deferral, not to exceed 4% of the total employee compensation. We can also elect to make a profit-sharing contribution. We contributed $ 535 456 405 |
ACQUISITION
ACQUISITION | 12 Months Ended |
Aug. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITION | NOTE 14 – ACQUISITION On March 31, 2020, the Company entered into a Stock Purchase and Contribution Agreement (the “Agreement”) with Lixoft, a French société par actions simplifiée (“Lixoft”). On April 1, 2020, the Company consummated the acquisition of all outstanding equity interests of Lixoft pursuant to the terms of the Agreement, with Lixoft becoming a wholly-owned subsidiary of the Company. We believe the combination of Simulations Plus and Lixoft provides substantial future potential based on the complementary strengths of each of the companies. Under the terms of the Agreement, as described below, the Company will pay the former shareholders of Lixoft total consideration of up to $16.5 million, consisting of two-thirds cash and one-third newly issued, unregistered shares of the Company’s common stock. In addition, the Company will pay $3,456,029 of excess working capital based on the March 31, 2020 financial statements of Lixoft. On April 1, 2020, the Company paid the former shareholders of Lixoft a total of $10.8 million, comprised of cash in the amount of $9.5 million and the issuance of 111,682 shares of the Company’s common stock valued at $3.7 million, net of adjustments and a holdback for representations and warranties (under the terms of the Agreement a price of approximately $32.15 dollars per share was used based upon the volume-weighted average closing price of the Company’s shares of common stock for the 30-consecutive-trading-day period ending two trading days prior to April 1, 2020). 9,669 shares are held in an escrow for offset for representations and warrantees. Within three business days following the two-year anniversary of March 31, 2020 (the date of the Agreement) and subject to any offsets for representations and warrantees, the Company will pay the former shareholders of Lixoft a total of $2.0 million, comprised of $1.3 million of cash and the release from an escrow shares of stock valued at $666 thousand issued at the date of the Agreement. The Agreement provides for a two-year market standoff period in which the newly issued shares may not be sold by the recipients thereof. In addition, the agreement calls for earnout payments up to an additional $5.5 million, two-thirds cash and one-third newly issued, unregistered shares of the Company’s common stock based on a revenue growth formula each year for the two years subsequent to April 1, 2020. The former shareholders can earn up to $2.0 million the first year and $3.5 million in year two. The earnout liability has been recorded at fair value. Under the acquisition method of accounting, the total purchase price reflects Lixoft’s tangible and intangible assets and liabilities based on their estimated fair values at the date of the completion of the acquisition (April 1, 2020). The following table summarizes the preliminary allocation of the purchase price for Lixoft: Allocation of purchase price (in thousands) Assets acquired, including cash of $3,799 and accounts receivable of $629 $ 5,007 Developed technologies acquired 8,010 Estimated value of intangible assets acquired (customer lists, trade name etc.) 4,160 Estimated goodwill acquired 2,534 Liabilities assumed (1,118 ) Total consideration $ 18,593 Goodwill has been provided in the transaction based on estimates of future earnings of this subsidiary including anticipated synergies associated with the positioning of the combined company as a leader in model-based drug development. Consolidated Supplemental Pro Forma Information The following unaudited consolidated supplemental pro forma information assumes that the acquisition of Lixoft took place on September 1, 2017 for the income statement years ended August 31, 2020. These amounts have been calculated after applying the Company’s accounting policies and adjusting the results of Lixoft to reflect the same expenses in the years ended August 31, 2019 and 2018. The adjustments include costs of acquisition, and amortization of intangibles and other technologies acquired during the merger, assuming the fair-value adjustments applied on September 1, 2017, together with consequential tax effects. Schedule of statement of income (Actual) (Pro forma) (Pro forma) 2021 2020* 2019 (in thousands) (Audited) (unaudited) (unaudited) Revenue $ 46,466 $ 43,970 $ 36,918 Net Income $ 9,782 $ 10,630 $ 9,250 * Balances include five months actual results for Lixoft. |
UNAUDITED QUARTERLY FINANCIAL D
UNAUDITED QUARTERLY FINANCIAL DATA | 12 Months Ended |
Aug. 31, 2021 | |
Quarterly Financial Information Disclosure [Abstract] | |
UNAUDITED QUARTERLY FINANCIAL DATA | NOTE 15 – UNAUDITED QUARTERLY FINANCIAL DATA The following table presents selected unaudited quarterly financial data for each full quarterly period for the years ended August 31, 2021, and 2020: (in thousands) Year ended August 31, 2021 First Second Third Fourth Quarter Quarter Quarter Quarter Revenues $ 10,701 $ 13,147 $ 12,777 $ 9,841 Gross profit $ 8,268 $ 10,236 $ 10,306 $ 7,056 Net income $ 2,479 $ 3,211 $ 3,787 $ 305 Earnings per share, basic $ 0.12 $ 0.16 $ 0.19 $ 0.02 Earnings per share, diluted $ 0.12 $ 0.15 $ 0.18 $ 0.01 (in thousands) Year ended August 31, 2020 First Second Third Fourth Quarter Quarter Quarter Quarter Revenues $ 9,401 $ 10,350 $ 12,298 $ 9,540 Gross profit $ 6,759 $ 7,683 $ 9,633 $ 6,865 Net income $ 2,058 $ 2,150 $ 2,936 $ 2,188 Earnings per share, basic $ 0.12 $ 0.12 $ 0.17 $ 0.12 Earnings per share, diluted $ 0.11 $ 0.12 $ 0.16 $ 0.11 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Aug. 31, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 16 - SUBSEQUENT EVENTS Dividend Declared On Wednesday, October 13, 2021, our Board of Directors declared a quarterly cash dividend of $0.06 per share to our shareholders. The dividend in the amount of $1.2 million will be distributed on Monday, November 1, 2021, for shareholders of record as of Monday, October 25, 2021. Effective September 1, 2021, the Company merged both Cognigen Corporation and DILIsym, Services, Inc. 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 (the Company’s 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. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Aug. 31, 2021 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Simulations Plus and, as of September 2, 2014, its wholly-owned subsidiary, Cognigen, as of June 1, 2017, the accounts of DILIsym, and as of April 1, 2020, Lixoft. All significant intercompany accounts and transactions are eliminated in 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 providing consulting services to the pharmaceutical industry for drug development. The Company determines 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, the Company satisfies a performance obligation 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. Sales commissions for new contracts are deferred and then amortized on a straight-line basis over a period of benefit. We determined the period of benefit by taking into consideration our customer contracts, our technology and other factors. Sales commissions for renewal contracts are deferred and then amortized on a straight-line basis over the related contractual renewal period. Amortization expense is included in sales and marketing expenses on the consolidated statements of operations and comprehensive income as Selling, general, and administrative expense. Practical Expedients and Exemptions The Company has elected the following additional practical expedients in applying Topic 606: · Commission Expense . · Transaction Price Allocated to Future Performance Obligations ASC 606 requires that the Company disclose the aggregate amount of transaction price that is allocated to performance obligations that have not yet been satisfied as of August 31, 2021. ASC 606 provides certain practical expedients that limit the requirement to disclose the aggregate amount of transaction price allocated to unsatisfied performance obligations. The Company applied the practical expedient to not disclose the amount of transaction price allocated to unsatisfied performance obligations when the performance obligation is part of a contract that has an original expected duration of one year or less. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of the statements of cash flows, the Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. |
Accounts Receivable | Accounts Receivable We analyze the age of customer balances, historical bad-debt experience, customer creditworthiness, and changes in customer payment terms when making estimates of the collectability of the Company’s trade accounts receivable balances. If we determine that the financial conditions of any of our customers have deteriorated, whether due to customer-specific or general economic issues, an increase in the allowance may be made. Accounts receivable are written off when reasonable collection attempts have failed. |
Investments | Investments We 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. The Company accounts for its investment in marketable securities in accordance with 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 reported at amortized cost. Discounts and premiums to par value of the debt securities are amortized to interest income/expense over the term of the security. No gains or losses on investment securities are realized until they are sold or a decline in fair value is determined to be other-than-temporary. 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 with unrealized gains or losses excluded from earnings and reported as a separate component of shareholders’ equity. We classify our investments in marketable debt securities based on the facts and circumstances present at the time of purchase of the securities. During the year ended August 31, 2021, all of our investments were classified as held-to-maturity. Held-to-maturity investments are measured and recorded at amortized cost on the Company’s Consolidated Balance Sheets. Discounts and premiums to par value of the debt securities are amortized to interest income/expense over the term of the security. No gains or losses on investment securities are realized until they are sold or a decline in fair value is determined to be other-than-temporary. |
Capitalized Computer Software Development Costs | Capitalized Computer Software Development Costs Software development costs are capitalized in accordance with ASC 985-20, “Costs of Software to Be Sold, Leased, or Marketed” 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 revenues, estimated economic life, and changes in software and hardware technologies. Capitalized computer software development costs are comprised primarily of salaries and direct payroll-related costs and the purchase of existing software to be used in the Company's software products. Amortization of capitalized computer software development costs is provided 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 $ 1.4 1.2 1.3 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, or fair market value for property and equipment acquired in business combinations, less accumulated depreciation and amortization. Depreciation and amortization are provided using the straight-line method over the estimated useful lives as follows: Property and Equipment estimated useful lives 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 Maintenance and minor replacements are charged to expense as incurred. Gains and losses on disposals are included in the results of operations. |
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” The amortization will be classified as Selling, general, and administrative expenses on the consolidated statement of operations and comprehensive income and maintenance and minor upgrades are charged to expense as incurred. Gains and losses on disposals are included in the results of operations. No amortization has been expensed for the project as it is still in progress. |
Leases | Leases We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities (current and long-term) in our consolidated balance sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we generally use our incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Supplemental balance sheet information related to operating leases was as follows as of August 31, 2021: Schedule of lease cost (in thousands) Right of use assets $ 1,276 Lease Liabilities, Current $ 382 Lease Liabilities, Long-term $ 896 Operating lease costs $ 595 Weighted Average remaining lease term 2.50 Weighted Average Discount rate 3.79 |
Intangible Assets and Goodwill | Intangible Assets and Goodwill The Company performs valuations of assets acquired and liabilities assumed on each acquisition accounted for as a business combination and recognizes 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 August 31, 2021, the Company determined that it has four reporting units, Simulations Plus, Cognigen Corporation, DILIsym Services, Inc. and Lixoft. When testing goodwill for impairment, the Company first performs 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. The Company is 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 the Company's 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 the Company's 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 August 31, 2021, the entire balance of goodwill was attributed to three of the Company's reporting units, Cognigen Corporation, DILIsym Services, Inc. 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. The Company has no Reconciliation of Goodwill as of August 31, 2021, and 2020: Schedule of reconciliation of goodwill (in thousands) Cognigen DILIsym Lixoft Total Balance, August 31, 2019 $ 4,789 $ 5,598 $ – $ 10,387 Addition – – 2,534 2,534 Impairments – – – – Balance, August 31, 2020 4,789 5,598 2,534 12,921 Addition – – – – Impairments – – – – Balance, August 31, 2021 $ 4,789 $ 5,598 $ 2,534 $ 12,921 |
Other Intangible Assets | Other Intangible Assets The following table summarizes other intangible assets as of August 31, 2021: Schedule of other intangible assets (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 The following table summarizes other intangible assets as of August 31, 2020: (in thousands) Amortization Acquisition Accumulated Net book Cognigen Customer relationships Straight line 8 years $ 1,100 $ 825 $ 275 Trade Name None 500 – 500 Covenants not to compete Straight line 5 years 50 50 – DILIsym Customer relationships Straight line 10 years 1,900 618 1,282 Trade Name None 860 – 860 Covenants not to compete Straight line 4 years 80 65 15 Lixoft Customer relationships Straight line 14 years 2,550 76 2,474 Trade Name None 1,550 – 1,550 Covenants not to compete Straight line 3 years 60 8 52 $ 8,650 $ 1,642 $ 7,008 Total amortization expense for the years ended August 31, 2021, 2020 and 2019 was $ 544 432 358 Future amortization of intangible assets for the next five years is as follows: Schedule of future amortization (in thousands) Year ending August 31, Amount 2022 $ 530 2023 $ 384 2024 $ 372 2025 $ 372 2026 $ 372 |
Business Acquisitions | Business Acquisitions The Company accounted for the acquisition of Cognigen, DILIsym, and Lixoft using the purchase method of accounting where the assets acquired and liabilities assumed are recognized based on their respective estimated fair values. The excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill. Determining the fair value of certain acquired assets and liabilities is subjective in nature and often involves the use of significant estimates and assumptions, including, but not limited to, the selection of appropriate valuation methodology, projected revenue, expenses and cash flows, weighted average cost of capital, discount rates, estimates of advertiser and publisher turnover rates and estimates of terminal values. Business acquisitions are included in the Company's consolidated financial statements as of the date of the acquisition. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Assets and liabilities recorded at fair value in the 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 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 carrying amounts approximate fair value due to their short-term nature. The following table summarizes fair value measurements as of August 31, 2021, and August 31, 2020, for assets and liabilities measured at fair value on a recurring basis: Summarizes fair value measurements August 31, 2021 (in thousands) Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 36,984 $ – $ – $ 36,984 Short-term investments $ 86,620 $ – $ – $ 86,620 Acquisition-related contingent consideration obligations $ – $ – $ 3,217 $ 3,217 August 31, 2020 (in thousands) Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 49,207 $ – $ – $ 49,207 Short-term investments $ 66,804 $ – $ – $ 66,804 Acquisition-related contingent consideration obligations $ – $ – $ 4,731 $ 4,731 As of August 31, 2021, and 2020, the Company had a liability for contingent consideration related to its acquisition of Lixoft and DILIsym. 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 the Company records in any given period. Changes in the value of the contingent consideration obligations are recorded in the Company’s Consolidated Statement of Operations. The following is a reconciliation of contingent consideration value: Reconciliation of contingent consideration value (in thousands) Value as of August 31, 2020 $ 4,731 Contingent consideration payments (2,000 ) Change in value of contingent consideration 486 Value as of August 31, 2021 $ 3,217 |
Marketing | Marketing The Company expenses marketing and advertising costs as incurred. Marketing costs for the years ended August 31, 2021, 2020 and 2019 were approximately $ 60 64 83 |
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 experiment, and purchased software which was developed by other companies and incorporated into, or used in the development of, our final products. |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with ASC 740-10, “Income Taxes” 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 On February 28, 2012, we bought out the royalty agreement with Enslein Research. The cost of $ 75 10 years under the straight-line method On May 15, 2014, we entered into a termination and non-assertion agreement with TSRL, Inc., pursuant to which the parties agreed to terminate an exclusive software licensing agreement entered into between the parties in 1997. As a result, the Company obtained a perpetual right to use certain source code and data, and TSRL relinquished any rights and claims to any GastroPlus products and to any claims to royalties or other payments under that 1997 agreement. We agreed to pay TSRL total consideration of $ 6 10 years under the straight-line method On June 1, 2017, as part of the acquisition of DILIsym the Company acquired certain developed technologies associated with the drug induced liver disease (DILI). These technologies were valued at approximately $ 2.9 9 years under the straight-line method In September 2018, we purchased certain intellectual property rights of Entelos Holding Company. The cost of $ 50 10 years under the straight-line method On April 1, 2020, as part of the acquisition of Lixoft, the Company acquired certain developed technologies associated with the Lixoft scientific software. These technologies were valued at approximately $ 8.0 16 years under the straight-line method The following table summarizes intellectual property as of August 31, 2021: Summary of intellectual property (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 Company 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 The following table summarizes intellectual property as of August 31, 2020: (in thousands) Amortization Acquisition Accumulated Net Book Royalty Agreement buy out-Enslein Research Straight line 10 years $ 75 $ 64 $ 11 Termination/nonassertion agreement-TSRL Inc. Straight line 10 years 6,000 3,775 2,225 Developed technologies–DILIsym acquisition Straight line 9 years 2,850 1,029 1,821 Intellectual rights of Entelos Holding Company Straight line 10 years 50 10 40 Developed technologies–Lixoft acquisition Straight line 16 years 8,010 209 7,801 $ 16,985 $ 5,087 $ 11,898 Total amortization expense for intellectual property agreements for the years ended August 31, 2021, 2020 and 2019 was $ 1.4 1.1 929 Future amortization of intellectual property for the next five years is as follows: Schedule of future amortization expenses (in thousands) Year ending August 31, Amount 2022 $ 1,426 2023 $ 1,422 2024 $ 1,247 2025 $ 822 2026 $ 743 |
Earnings per Share | Earnings per Share The Company reports earnings per share in accordance with FASB ACS 260-10. Basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of common shares available. 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 years ended August 31, 2021, 2020 and 2019 were as follows: Schedule of earnings per share August 31, (in thousands) 2021 2020 2019 Numerator Net income attributable to common shareholders $ 9,782 $ 9,332 $ 8,583 Denominator Weighted-average number of common shares outstanding during the year 20,045 17,819 17,492 Dilutive effect of stock options 698 719 565 Common stock and common stock equivalents used for diluted earnings per share 20,743 18,538 18,057 |
Stock-Based Compensation | Stock-Based Compensation Compensation costs related to stock options are determined in accordance with FASB ASC 718-10, “Compensation-Stock Compensation”, 2.4 1.3 866 |
Impairment of Long-lived Assets | Impairment of Long-lived Assets The Company accounts for the impairment and disposition of long-lived assets in accordance with ASC 350, “Intangibles – Goodwill and Other “Property and Equipment” No |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes existing guidance on accounting for leases in "Leases (Topic 840)" and generally requires all leases to be recognized in the consolidated balance sheet. ASU 2016-02 is effective for annual and interim reporting periods beginning after December 15, 2018. The Company adopted this ASU on September 1, 2019. In December 2019, the FASB issued ASU 2019-12 , Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-04 , Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Aug. 31, 2021 | |
Accounting Policies [Abstract] | |
Property and Equipment estimated useful lives | Property and Equipment estimated useful lives 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 |
Schedule of lease cost | Schedule of lease cost (in thousands) Right of use assets $ 1,276 Lease Liabilities, Current $ 382 Lease Liabilities, Long-term $ 896 Operating lease costs $ 595 Weighted Average remaining lease term 2.50 Weighted Average Discount rate 3.79 |
Schedule of reconciliation of goodwill | Schedule of reconciliation of goodwill (in thousands) Cognigen DILIsym Lixoft Total Balance, August 31, 2019 $ 4,789 $ 5,598 $ – $ 10,387 Addition – – 2,534 2,534 Impairments – – – – Balance, August 31, 2020 4,789 5,598 2,534 12,921 Addition – – – – Impairments – – – – Balance, August 31, 2021 $ 4,789 $ 5,598 $ 2,534 $ 12,921 |
Schedule of other intangible assets | Schedule of other intangible assets (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 The following table summarizes other intangible assets as of August 31, 2020: (in thousands) Amortization Acquisition Accumulated Net book Cognigen Customer relationships Straight line 8 years $ 1,100 $ 825 $ 275 Trade Name None 500 – 500 Covenants not to compete Straight line 5 years 50 50 – DILIsym Customer relationships Straight line 10 years 1,900 618 1,282 Trade Name None 860 – 860 Covenants not to compete Straight line 4 years 80 65 15 Lixoft Customer relationships Straight line 14 years 2,550 76 2,474 Trade Name None 1,550 – 1,550 Covenants not to compete Straight line 3 years 60 8 52 $ 8,650 $ 1,642 $ 7,008 |
Schedule of future amortization | Schedule of future amortization (in thousands) Year ending August 31, Amount 2022 $ 530 2023 $ 384 2024 $ 372 2025 $ 372 2026 $ 372 |
Summarizes fair value measurements | Summarizes fair value measurements August 31, 2021 (in thousands) Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 36,984 $ – $ – $ 36,984 Short-term investments $ 86,620 $ – $ – $ 86,620 Acquisition-related contingent consideration obligations $ – $ – $ 3,217 $ 3,217 August 31, 2020 (in thousands) Level 1 Level 2 Level 3 Total Cash and cash equivalents $ 49,207 $ – $ – $ 49,207 Short-term investments $ 66,804 $ – $ – $ 66,804 Acquisition-related contingent consideration obligations $ – $ – $ 4,731 $ 4,731 |
Reconciliation of contingent consideration value | Reconciliation of contingent consideration value (in thousands) Value as of August 31, 2020 $ 4,731 Contingent consideration payments (2,000 ) Change in value of contingent consideration 486 Value as of August 31, 2021 $ 3,217 |
Summary of intellectual property | Summary of intellectual property (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 Company 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 The following table summarizes intellectual property as of August 31, 2020: (in thousands) Amortization Acquisition Accumulated Net Book Royalty Agreement buy out-Enslein Research Straight line 10 years $ 75 $ 64 $ 11 Termination/nonassertion agreement-TSRL Inc. Straight line 10 years 6,000 3,775 2,225 Developed technologies–DILIsym acquisition Straight line 9 years 2,850 1,029 1,821 Intellectual rights of Entelos Holding Company Straight line 10 years 50 10 40 Developed technologies–Lixoft acquisition Straight line 16 years 8,010 209 7,801 $ 16,985 $ 5,087 $ 11,898 |
Schedule of future amortization expenses | Schedule of future amortization expenses (in thousands) Year ending August 31, Amount 2022 $ 1,426 2023 $ 1,422 2024 $ 1,247 2025 $ 822 2026 $ 743 |
Schedule of earnings per share | Schedule of earnings per share August 31, (in thousands) 2021 2020 2019 Numerator Net income attributable to common shareholders $ 9,782 $ 9,332 $ 8,583 Denominator Weighted-average number of common shares outstanding during the year 20,045 17,819 17,492 Dilutive effect of stock options 698 719 565 Common stock and common stock equivalents used for diluted earnings per share 20,743 18,538 18,057 |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 12 Months Ended |
Aug. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of disaggregation of revenues | Schedule of disaggregation of revenues Year ended August 31, (in thousands) 2021 2020 2019 Software licenses Point in time $ 26,725 $ 20,668 $ 17,425 Over time 945 919 1,054 Consulting services Over time 18,796 20,002 15,491 Total revenue $ 46,466 $ 41,589 $ 33,970 |
Schedule of contract in progress | Schedule of contract in progress Year ended August 31, (in thousands) 2021 2020 2019 Revenues in excess of billings $ 3,150 $ 3,093 $ 3,234 Billings in excess of revenues (117 ) (141 ) (799 ) Revenues over billings on uncompleted contracts $ 3,033 $ 2,952 $ 2,435 Cost, estimated earnings, and billings on uncompleted contracts are summarized as follows as of August 31, 2021, 2020 and 2019: August 31, (in thousands) 2021 2020 2019 Revenues earned to date on uncompleted contracts $ 15,184 $ 20,235 $ 19,255 Billings to date on uncompleted contracts (12,151 ) (17,283 ) (16,820 ) Revenues over billings on uncompleted contracts $ 3,033 $ 2,952 $ 2,435 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Aug. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | August 31, (in thousands) 2021 2020 Equipment $ 606 $ 865 Computer equipment 293 548 Furniture and fixtures 36 161 Leasehold improvements 13 114 Construction in progress 1,302 – Subtotal 2,250 1,688 Less accumulated depreciation and amortization (412 ) (1,250 ) Total $ 1,838 $ 438 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 12 Months Ended |
Aug. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of short term investment | Schedule of short term investment August 31, 2021 (in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Commercial notes (due within one year) $ 86,620 $ – $ (136 ) $ 86,484 Total $ 86,620 $ – $ (136 ) $ 86,484 August 31, 2020 (in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Commercial notes (due within one year) $ 66,804 $ – $ (61 ) $ 66,743 Total $ 66,804 $ – $ (61 ) $ 66,743 |
CONTRACTS PAYABLE (Tables)
CONTRACTS PAYABLE (Tables) | 12 Months Ended |
Aug. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Liabilities | Schedule of Liabilities (in thousands) August 31, 2021 August 31, 2020 Holdback Liability $ 1,333 $ 1,333 Earnout Liability 3,217 4,731 Subtotal $ 4,550 $ 6,064 Less: Current Portion 4,550 2,000 Long-Term $ – $ 4,064 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Aug. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future minimum lease payments | Future minimum lease payments (in thousands) Years Ending August 31, Amount 2022 $ 422 2023 375 2024 275 2025 211 2026 83 Total undiscounted liabilities 1,366 Less: imputed interest (88 ) Total future minimum lease payments $ 1,278 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Aug. 31, 2021 | |
Equity [Abstract] | |
Schedule of Capital Units [Table Text Block] | August 31, 2021 2020 2019 Common stock outstanding, beginning of year 19,923,277 17,591,834 17,416,445 Common stock issued during the year 218,244 2,331,443 175,389 Common stock outstanding, end of year 20,141,521 19,923,277 17,591,834 |
Schedule of dividends declared and paid | Schedule of dividends declared and paid (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 (in thousands, except dividend per share) Fiscal Year 2020 Record Date Distribution Date Number of Shares Dividend per Total Amount 10/25/2019 11/01/2019 17,606 $ 0.06 $ 1,056 1/27/2020 2/03/2020 17,646 $ 0.06 1,059 4/24/2020 5/01/2020 17,769 $ 0.06 1,066 7/27/2020 8/03/2020 17,820 $ 0.06 1,069 Total $ 4,250 |
Schedule of stock option activity | Schedule of stock option activity (in thousands, except per share and weighted-average amounts) Transactions During Fiscal Year 2021 Number of Weighted-Average Weighted-Average Outstanding, August 31, 2020 1,224 $ 17.76 6.79 Granted 226 57.60 Exercised (204 ) 12.53 Canceled/Forfeited (62 ) 29.83 Outstanding, August 31, 2021 1,184 $ 25.63 6.47 Vested and Exercisable, August 31, 2021 619 $ 13.36 4.95 Vested and Expected to Vest, August 31, 2021 1,173 $ 25.69 6.47 (in thousands, except per share and weighted-average amounts) Transactions During Fiscal Year 2020 Number of Weighted-Average Weighted-Average Outstanding, August 31, 2019 1,163 $ 12.63 7.13 Granted 223 39.23 Exercised (121 ) 9.29 Canceled/Forfeited (41 ) 14.19 Outstanding, August 31, 2020 1,224 $ 17.76 6.79 Vested and Exercisable, August 31, 2020 596 $ 10.69 5.59 Vested and Expected to Vest, August 31, 2020 1,194 $ 17.75 6.77 (in thousands, except per share and weighted-average amounts) Transactions During Fiscal Year 2019 Number of Weighted-Average Weighted-Average Outstanding, August 31, 2018 1,135 $ 9.44 7.31 Granted 264 22.78 Exercised (167 ) 7.15 Canceled/Forfeited (69 ) 12.17 Outstanding, August 31, 2019 1,163 $ 12.63 7.13 Vested and Exercisable, August 31, 2019 515 $ 8.57 6.09 Vested and Expected to Vest, August 31, 2019 1,102 $ 12.39 7.07 |
Intrinsic value of options outstanding and options exercisable | Intrinsic value of options outstanding and options exercisable (in thousands) Intrinsic Value Intrinsic Intrinsic Fiscal Year 2019 $ 27,313 $ 14,195 $ 3,224 Fiscal Year 2020 $ 51,273 $ 29,151 $ 4,086 Fiscal Year 2021 $ 25,705 $ 19,373 $ 11,554 |
Schedule of fair value of options | Schedule of fair value of options (in thousands, except prices) Fiscal Year 2021 Fiscal Year 2020 Estimated fair value of awards granted $ 5,092 $ 2,997 Unvested Forfeiture Rate 0 0 Weighted average grant price $ 57.60 $ 39.23 Weighted average market price $ 57.60 $ 39.23 Weighted average volatility 40.49 33.56 Weighted average risk-free rate 0.64 1.39 Weighted average dividend yield 0.42 0.65 Weighted average expected life 6.63 6.67 |
Schedule of options by exercise price range | Schedule of options by exercise price range Exercise Price Awards Outstanding Awards Exercisable Low High Quantity Weighted Weighted Quantity Weighted Weighted $ 6.85 $ 8.28 144 3.00 $ 6.85 144 3.00 $ 6.85 $ 8.29 $ 10.03 183 4.52 $ 9.72 183 4.52 $ 9.72 $ 10.04 $ 12.20 221 5.48 $ 10.05 162 5.48 $ 10.05 $ 12.21 $ 28.16 184 6.66 $ 20.37 66 5.88 $ 20.25 $ 28.17 $ 57.04 230 8.40 $ 37.22 51 8.08 $ 34.19 $ 57.05 $ 66.14 222 9.17 $ 58.77 13 8.88 $ 61.84 1,184 6.47 $ 25.63 619 4.95 $ 13.36 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Aug. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Components of the income tax provision | Components of the income tax provision (in thousands) 2021 2020 2019 Current Federal $ 1,315 $ 2,098 $ 1,795 State 450 478 426 Foreign 166 39 51 Total current tax expense 1,931 2,615 2,272 Deferred Federal (379 ) (428 ) (141 ) State (249 ) (132 ) (158 ) Total deferred federal and state (628 ) (560 ) (299 ) Total $ 1,303 $ 2,055 $ 1,973 |
Effective income tax rate | Effective income tax rate 2021 2020 2019 Income tax computed at federal statutory tax rate 21.0 % 21.0 % 21.0 % State taxes, net of federal benefit 2.0 4.1 4.1 Meals & entertainment – 0.1 0.1 Stock based compensation (6.8 ) (1.2 ) (2.6 ) Other permanent differences (0.3 ) (0.3 ) (0.7 ) Research and development credit (1.6 ) (2.8 ) (2.3 ) Foreign tax related differences (2.6 ) (1.4 ) – Research & credit adjustments to expense 0.2 0.3 – Change in prior year estimated taxes (0.1 ) (1.8 ) (0.9 ) Total 11.8 % 18.0 % 18.7 % |
Components of company deferred tax assets and liabilities | Components of company deferred tax assets and liabilities (in thousands) 2021 2020 Deferred tax assets: Accrued payroll and other expenses $ 586 $ 402 Deferred revenue 102 7 Capitalized merger costs 703 742 Intellectual property 7 8 Research and development credits 66 – State taxes 72 100 Allowance for doubtful accounts 20 13 State tax deferred 80 125 Total deferred tax assets 1,636 1,397 Less: Valuation allowance – – Deferred tax asset 1,636 1,397 Deferred tax liabilities: Property and equipment (83 ) (82 ) State tax deferred (26 ) (19 ) Intellectual property (1,456 ) (1,876 ) Capitalized computer software development costs (1,797 ) (1,774 ) Total deferred tax liabilities (3,362 ) (3,751 ) Net deferred tax liabilities $ (1,726 ) $ (2,354 ) |
SEGMENT AND GEOGRAPHIC REPORT_2
SEGMENT AND GEOGRAPHIC REPORTING (Tables) | 12 Months Ended |
Aug. 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | (in thousands) Year ended August 31, 2021 Simulations Plus Cognigen DILIsym Lixoft Eliminations Total Revenues $ 25,142 $ 10,546 $ 6,115 $ 4,663 $ – $ 46,466 Income (loss) from operations $ 9,286 $ 376 $ (112 ) $ 1,703 $ – $ 11,253 Total assets $ 168,923 $ 13,121 $ 14,884 $ 19,344 $ (36,294 ) $ 179,978 Goodwill $ – $ 4,789 $ 5,598 $ 2,534 $ – $ 12,921 Capital expenditures $ 1,212 $ 279 $ 18 $ 118 $ – $ 1,627 Capitalized software costs $ 2,289 $ 12 $ 170 $ 478 $ – $ 2,949 Depreciation and amortization $ 1,885 $ 347 $ 590 $ 768 $ – $ 3,590 (in thousands) Year ended August 31, 2020 Simulations Plus Cognigen DILIsym Lixoft* Eliminations Total Revenues $ 21,961 $ 11,105 $ 6,948 $ 1,575 $ – $ 41,589 Income from operations $ 7,374 $ 1,770 $ 1,744 $ 717 $ – $ 11,605 Total assets $ 162,807 $ 11,654 $ 14,084 $ 19,972 $ (40,095 ) $ 168,422 Goodwill $ – $ 4,789 $ 5,598 $ 2,534 $ – $ 12,921 Capital expenditures $ 111 $ 87 $ 31 $ 2 $ – $ 231 Capitalized software costs $ 2,029 $ 40 $ 124 $ 160 $ – $ 2,353 Depreciation and amortization $ 1,713 $ 349 $ 600 $ 300 $ – $ 2,962 * As Lixoft was purchased on April 1, 2020, five months of activity is reflected for fiscal year 2020. (in thousands) Year ended August 31, 2019 Simulations Plus Cognigen DILIsym Eliminations Total Revenues $ 19,584 $ 9,321 $ 5,065 $ – $ 33,970 Income from operations $ 7,751 $ 1,481 $ 1,416 $ – $ 10,648 Total assets $ 38,535 $ 11,196 $ 13,168 $ (17,702 ) $ 45,197 Goodwill $ – $ 4,789 $ 5,598 $ – $ 10,387 Capital expenditures $ 39 $ 79 $ 20 $ – $ 138 Capitalized software costs $ 1,482 $ 114 $ 172 $ – $ 1,768 Depreciation and amortization $ 1,806 $ 364 $ 580 $ – $ 2,750 |
Schedule of Revenue by Major Customers by Reporting Segments [Table Text Block] | (in thousands) Year ended August 31, 2021 Software Services Total Revenues $ 27,670 $ 18,796 $ 46,466 Cost of revenues 3,235 7,365 10,600 Gross profit $ 24,435 $ 11,431 $ 35,866 Gross margin 88 61 77 Our software business and services business represented 60% and 40% of total revenue, respectively, for the year ended August 31, 2021. (in thousands) Year ended August 31, 2020 Software Services Total Revenues $ 21,587 $ 20,002 $ 41,589 Cost of revenues 2,883 7,766 10,649 Gross profit $ 18,704 $ 12,236 $ 30,940 Gross margin 87 61 74 Our software business and services business represented 52% and 48% of total revenue, respectively, for the 2020 fiscal year. (in thousands) Year ended August 31, 2019 Software Services Total Revenues $ 18,479 $ 15,491 $ 33,970 Cost of revenues 2,957 6,069 9,026 Gross profit $ 15,522 $ 9,422 $ 24,944 Gross margin 84 61 73 |
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area [Table Text Block] | (in thousands) Year ended August 31, 2021 2020 2019 $ % of total $ % of total $ % of total Americas $ 32,549 70 % $ 29,674 71 % $ 22,576 67 % EMEA 7,906 17 5,827 14 5,829 17 Asia Pacific 6,011 13 6,088 15 5,565 16 Total $ 46,466 100 % $ 41,589 100 % $ 33,970 100 % |
ACQUISITION (Tables)
ACQUISITION (Tables) | 12 Months Ended |
Aug. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Allocation of purchase price | Allocation of purchase price (in thousands) Assets acquired, including cash of $3,799 and accounts receivable of $629 $ 5,007 Developed technologies acquired 8,010 Estimated value of intangible assets acquired (customer lists, trade name etc.) 4,160 Estimated goodwill acquired 2,534 Liabilities assumed (1,118 ) Total consideration $ 18,593 |
Schedule of statement of income | Schedule of statement of income (Actual) (Pro forma) (Pro forma) 2021 2020* 2019 (in thousands) (Audited) (unaudited) (unaudited) Revenue $ 46,466 $ 43,970 $ 36,918 Net Income $ 9,782 $ 10,630 $ 9,250 * Balances include five months actual results for Lixoft. |
UNAUDITED QUARTERLY FINANCIAL_2
UNAUDITED QUARTERLY FINANCIAL DATA (Tables) | 12 Months Ended |
Aug. 31, 2021 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information [Table Text Block] | (in thousands) Year ended August 31, 2021 First Second Third Fourth Quarter Quarter Quarter Quarter Revenues $ 10,701 $ 13,147 $ 12,777 $ 9,841 Gross profit $ 8,268 $ 10,236 $ 10,306 $ 7,056 Net income $ 2,479 $ 3,211 $ 3,787 $ 305 Earnings per share, basic $ 0.12 $ 0.16 $ 0.19 $ 0.02 Earnings per share, diluted $ 0.12 $ 0.15 $ 0.18 $ 0.01 (in thousands) Year ended August 31, 2020 First Second Third Fourth Quarter Quarter Quarter Quarter Revenues $ 9,401 $ 10,350 $ 12,298 $ 9,540 Gross profit $ 6,759 $ 7,683 $ 9,633 $ 6,865 Net income $ 2,058 $ 2,150 $ 2,936 $ 2,188 Earnings per share, basic $ 0.12 $ 0.12 $ 0.17 $ 0.12 Earnings per share, diluted $ 0.11 $ 0.12 $ 0.16 $ 0.11 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details - Useful lives) | 12 Months Ended |
Aug. 31, 2021 | |
Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Lives | 5 years |
Computer Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Lives | 3 to 7 years |
Furniture and Fixtures [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Lives | 5 to 7 years |
Leasehold Improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Lives | Shorter of life of asset or lease |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details - Lease cost) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2021 | Aug. 31, 2020 | |
Accounting Policies [Abstract] | ||
Right of use assets | $ 1,276 | $ 927 |
Lease Liabilities, Current | 382 | 463 |
Lease Liabilities, Long-term | 896 | $ 463 |
Operating lease costs | $ 595 | |
Weighted average remaining lease term | 2 years 6 months | |
Weighted average discount rate | 3.79% |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details - Goodwill) - USD ($) $ in Thousands | 7 Months Ended | 12 Months Ended | |
Apr. 02, 2020 | Aug. 31, 2021 | Aug. 31, 2020 | |
Goodwill [Line Items] | |||
Goodwill, beginning balance | $ 10,387 | $ 12,921 | $ 10,387 |
Addition | 0 | 2,534 | |
Impairments | 0 | 0 | |
Goodwill, ending balance | 12,921 | 12,921 | |
Cognigen [Member] | |||
Goodwill [Line Items] | |||
Goodwill, beginning balance | 4,789 | 4,789 | 4,789 |
Addition | 0 | 0 | |
Impairments | 0 | 0 | |
Goodwill, ending balance | 4,789 | 4,789 | |
D I L Isym [Member] | |||
Goodwill [Line Items] | |||
Goodwill, beginning balance | 5,598 | 5,598 | 5,598 |
Addition | 0 | 0 | |
Impairments | 0 | 0 | |
Goodwill, ending balance | 5,598 | 5,598 | |
Lixoft [Member] | |||
Goodwill [Line Items] | |||
Goodwill, beginning balance | 0 | 2,534 | 0 |
Addition | $ 2,534 | 0 | 2,534 |
Impairments | 0 | 0 | |
Goodwill, ending balance | $ 2,534 | $ 2,534 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details - Other Intangible Assets) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2021 | Aug. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | ||
Net book value | $ 6,464 | $ 7,008 |
Customer Relationships [Member] | Cognigen [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | Straight line 8 years | Straight line 8 years |
Acquisition value | $ 1,100 | $ 1,100 |
Accumulated amortization | 963 | 825 |
Net book value | $ 137 | $ 275 |
Customer Relationships [Member] | D I L Isym [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | Straight line 10 years | Straight line 10 years |
Acquisition value | $ 1,900 | $ 1,900 |
Accumulated amortization | 807 | 618 |
Net book value | $ 1,093 | $ 1,282 |
Customer Relationships [Member] | Lixoft [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | Straight line 14 years | Straight line 14 years |
Acquisition value | $ 2,550 | $ 2,550 |
Accumulated amortization | 258 | 76 |
Net book value | $ 2,292 | $ 2,474 |
Trade Names [Member] | Cognigen [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | None | None |
Acquisition value | $ 500 | $ 500 |
Accumulated amortization | 0 | 0 |
Net book value | $ 500 | $ 500 |
Trade Names [Member] | D I L Isym [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | None | None |
Acquisition value | $ 860 | $ 860 |
Accumulated amortization | 0 | 0 |
Net book value | $ 860 | $ 860 |
Trade Names [Member] | Lixoft [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | None | None |
Acquisition value | $ 1,550 | $ 1,550 |
Accumulated amortization | 0 | |
Net book value | $ 1,550 | $ 1,550 |
Noncompete Agreements [Member] | Cognigen [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | Straight line 5 years | Straight line 5 years |
Acquisition value | $ 50 | $ 50 |
Accumulated amortization | 50 | 50 |
Net book value | $ 0 | $ 0 |
Noncompete Agreements [Member] | D I L Isym [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | Straight line 4 years | Straight line 4 years |
Acquisition value | $ 80 | $ 80 |
Accumulated amortization | 80 | 65 |
Net book value | $ 0 | $ 15 |
Noncompete Agreements [Member] | Lixoft [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | Straight line 3 years | Straight line 3 years |
Acquisition value | $ 60 | $ 60 |
Accumulated amortization | 28 | 8 |
Net book value | 32 | 52 |
Other Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Acquisition value | 8,650 | 8,650 |
Accumulated amortization | 2,186 | 1,642 |
Net book value | $ 6,464 | $ 7,008 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details - Amortization schedule) - Other Intangible Assets [Member] $ in Thousands | Aug. 31, 2021USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
2022 | $ 530 |
2023 | 384 |
2024 | 372 |
2025 | 372 |
2026 | $ 372 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details - Fair value measurements) - Fair Value, Recurring [Member] - USD ($) $ in Thousands | Aug. 31, 2021 | Aug. 31, 2020 |
Cash and Cash Equivalents [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value assets | $ 36,984 | $ 49,207 |
Short-term Investments [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value assets | 86,620 | 66,804 |
Aquisition Related Contingent Consideration Obligations [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value liabilities | 3,217 | 4,731 |
Fair Value, Inputs, Level 1 [Member] | Cash and Cash Equivalents [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value assets | 36,984 | 49,207 |
Fair Value, Inputs, Level 1 [Member] | Short-term Investments [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value assets | 86,620 | 66,804 |
Fair Value, Inputs, Level 1 [Member] | Aquisition Related Contingent Consideration Obligations [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value liabilities | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | Cash and Cash Equivalents [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value assets | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | Short-term Investments [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value assets | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | Aquisition Related Contingent Consideration Obligations [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value liabilities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Cash and Cash Equivalents [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value assets | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Short-term Investments [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value assets | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Aquisition Related Contingent Consideration Obligations [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value liabilities | $ 3,217 | $ 4,731 |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details - Reconciliation of contingent consideration) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Accounting Policies [Abstract] | |||
Contingent consideration, beginning balance | $ 4,731 | ||
Contingent consideration payments | (2,000) | ||
Change in value of contingent consideration | 486 | $ 203 | $ 109 |
Contingent consideration, ending balance | $ 3,217 | $ 4,731 |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES (Details - Intellectual property) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2021 | Aug. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | ||
Net book value | $ 6,464 | $ 7,008 |
Intellectual Property [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Acquisition value | 16,985 | 16,985 |
Accumulated amortization | 6,516 | 5,087 |
Net book value | $ 10,469 | $ 11,898 |
Intellectual Property [Member] | Enslien [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | Straight line 10 years | Straight line 10 years |
Acquisition value | $ 75 | $ 75 |
Accumulated amortization | 71 | 64 |
Net book value | $ 4 | $ 11 |
Intellectual Property [Member] | T S R L [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | Straight line 10 years | Straight line 10 years |
Acquisition value | $ 6,000 | $ 6,000 |
Accumulated amortization | 4,375 | 3,775 |
Net book value | $ 1,625 | $ 2,225 |
Intellectual Property [Member] | D I L I [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | Straight line 9 years | Straight line 9 years |
Acquisition value | $ 2,850 | $ 2,850 |
Accumulated amortization | 1,346 | 1,029 |
Net book value | $ 1,504 | $ 1,821 |
Intellectual Property [Member] | Entelos [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | Straight line 10 years | Straight line 10 years |
Acquisition value | $ 50 | $ 50 |
Accumulated amortization | 15 | 10 |
Net book value | $ 35 | $ 40 |
Intellectual Property [Member] | Lixoft [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | Straight line 16 years | Straight line 16 years |
Acquisition value | $ 8,010 | $ 8,010 |
Accumulated amortization | 709 | 209 |
Net book value | $ 7,301 | $ 7,801 |
SUMMARY OF SIGNIFICANT ACCOU_11
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details - Amortization expenses) - Intellectual Property [Member] $ in Thousands | Aug. 31, 2021USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
2022 | $ 1,426 |
2023 | 1,422 |
2024 | 1,247 |
2025 | 822 |
2026 | $ 743 |
SUMMARY OF SIGNIFICANT ACCOU_12
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details - Earnings per share) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Aug. 31, 2021 | May 31, 2021 | Feb. 28, 2021 | Nov. 30, 2020 | Aug. 31, 2020 | May 31, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Numerator | |||||||||||
Net income attributable to common shareholders | $ 305 | $ 3,787 | $ 3,211 | $ 2,479 | $ 2,188 | $ 2,936 | $ 2,150 | $ 2,058 | $ 9,782 | $ 9,332 | $ 8,583 |
Denominator | |||||||||||
Weighted-average number of common shares outstanding during the year | 20,045 | 17,819 | 17,492 | ||||||||
Dilutive effect of stock options | 698 | 719 | 565 | ||||||||
Common stock and common stock equivalents used for diluted earnings per share | 20,743 | 18,538 | 18,057 |
SUMMARY OF SIGNIFICANT ACCOU_13
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | 7 Months Ended | 8 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018 | Feb. 28, 2012 | Apr. 02, 2020 | May 15, 2014 | Jun. 02, 2017 | Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||||||||
Amortization of software development | $ 1,400 | $ 1,200 | $ 1,300 | |||||
Advertising costs | 60 | 64 | 83 | |||||
Stock-based compensation | 2,400 | 1,300 | 866 | |||||
Impairment losses | 0 | 0 | 0 | |||||
Goodwill [Member] | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Impairment of long-lived assets | 0 | 0 | 0 | |||||
Other Intangible Assets [Member] | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Amortization of intangible assets | 544 | 432 | 358 | |||||
Intangible asset acquisition value | 8,650 | 8,650 | ||||||
Accumulated amortization of intellectual property | 2,186 | 1,642 | ||||||
Royalty Agreements [Member] | Enslien [Member] | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Intangible asset acquisition value | $ 75 | |||||||
Amortization period | 10 years under the straight-line method | |||||||
Term And Nonassertion Agr [Member] | T S R L [Member] | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Intangible asset acquisition value | $ 6,000 | |||||||
Amortization period | 10 years under the straight-line method | |||||||
Certain Developed Technologies [Member] | D I L Isym [Member] | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Intangible asset acquisition value | $ 2,900 | |||||||
Amortization period | 9 years under the straight-line method | |||||||
Certain Developed Technologies [Member] | Lixoft [Member] | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Intangible asset acquisition value | $ 8,000 | |||||||
Amortization period | 16 years under the straight-line method | |||||||
Certain Intellectual Property Rights [Member] | Entelos Holding Co [Member] | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Intangible asset acquisition value | $ 50 | |||||||
Amortization period | 10 years under the straight-line method | |||||||
Intellectual Propertys [Member] | ||||||||
Finite-Lived Intangible Assets [Line Items] | ||||||||
Accumulated amortization of intellectual property | $ 1,400 | $ 1,100 | $ 929 |
REVENUE RECOGNITION (Details -
REVENUE RECOGNITION (Details - Disaggregation) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Aug. 31, 2021 | May 31, 2021 | Feb. 28, 2021 | Nov. 30, 2020 | Aug. 31, 2020 | May 31, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ 9,841 | $ 12,777 | $ 13,147 | $ 10,701 | $ 9,540 | $ 12,298 | $ 10,350 | $ 9,401 | $ 46,466 | $ 41,589 | $ 33,970 |
Software Licenses [Member] | Transferred at Point in Time [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 26,725 | 20,668 | 17,425 | ||||||||
Software Licenses [Member] | Transferred over Time [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 945 | 919 | 1,054 | ||||||||
Consulting Services [Member] | Transferred over Time [Member] | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ 18,796 | $ 20,002 | $ 15,491 |
REVENUE RECOGNITION (Details _2
REVENUE RECOGNITION (Details - Contracts in Progess) - USD ($) $ in Thousands | Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 |
Revenue from Contract with Customer [Abstract] | |||
Revenues in excess of billings | $ 3,150 | $ 3,093 | $ 3,234 |
Billings in excess of revenues | (117) | (141) | (799) |
Revenues over billings on uncompleted contracts | 3,033 | 2,952 | 2,435 |
Revenues earned to date on uncompleted contracts | 15,184 | 20,235 | 19,255 |
Billings to date on uncompleted contracts | $ (12,151) | $ (17,283) | $ (16,820) |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands | Aug. 31, 2021 | Aug. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 2,250 | $ 1,688 |
Less accumulated depreciation and amortization | (412) | (1,250) |
Net Book Value | 1,838 | 438 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 606 | 865 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 293 | 548 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 36 | 161 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 13 | 114 |
Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 1,302 | $ 0 |
PROPERTY AND EQUIPMENT (Detai_2
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation | $ 226 | $ 166 | $ 132 |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2021 | Aug. 31, 2020 | |
Net Investment Income [Line Items] | ||
Short term investment, amortized cost | $ 86,620 | $ 66,804 |
Gross unrealized gains | 0 | |
Gross unrealized loss | (136) | (61) |
Short term investment, fair value | 86,484 | 66,743 |
Commercial Paper [Member] | ||
Net Investment Income [Line Items] | ||
Short term investment, amortized cost | 86,620 | 66,804 |
Gross unrealized gains | 0 | 0 |
Gross unrealized loss | (136) | (61) |
Short term investment, fair value | $ 86,484 | $ 66,743 |
CONTRACTS PAYABLE (Details)
CONTRACTS PAYABLE (Details) - USD ($) $ in Thousands | Aug. 31, 2021 | Aug. 31, 2020 |
ContractsPayableLineItems [Line Items] | ||
Total contract with customer | $ 4,550 | $ 6,064 |
Less: Current Portion | 4,550 | 2,000 |
Long-Term | 0 | 4,064 |
Holdback Liability Lixoft [Member] | ||
ContractsPayableLineItems [Line Items] | ||
Total contract with customer | 1,333 | 1,333 |
Earnout Liability Lixoft [Member] | ||
ContractsPayableLineItems [Line Items] | ||
Total contract with customer | $ 3,217 | $ 4,731 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands | Aug. 31, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2022 | $ 422 |
2023 | 375 |
2024 | 275 |
2025 | 211 |
2026 | 83 |
Total undiscounted liabilities | 1,366 |
Less: imputed interest | (88) |
Total future minimum lease payments | $ 1,278 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) $ in Thousands | 7 Months Ended | 12 Months Ended | ||
Mar. 31, 2020 | Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Line of Credit Facility [Line Items] | ||||
Rent expense | $ 655 | $ 644 | $ 584 | |
Royalty expense benefit | 0 | 26 | (196) | |
Royalty expense benefit | 0 | $ (26) | $ 196 | |
Wells Fargo [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit maximum amount | $ 3,500 | |||
Line of credit expiration date | Apr. 15, 2022 | |||
Line of credit amount outstanding | $ 0 |
SHAREHOLDERS' EQUITY (Details -
SHAREHOLDERS' EQUITY (Details - Shares Outstanding) - shares shares in Thousands | 12 Months Ended | ||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Equity [Abstract] | |||
Common stock outstanding, beginning of year | 19,923,277 | 17,591,834 | 17,416,445 |
Common stock issued during the year | 218,244 | 2,331,443 | 175,389 |
Common stock outstanding, end of year | 20,141,521 | 19,923,277 | 17,591,834 |
SHAREHOLDERS EQUITY (Details -
SHAREHOLDERS EQUITY (Details - Dividends) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Aug. 31, 2021 | Aug. 31, 2020 | |
Dividends Payable [Line Items] | ||
Total Amount | $ 4,811 | $ 4,250 |
FY 2021 1st Qtr [Member] | ||
Dividends Payable [Line Items] | ||
Record Date | Oct. 26, 2020 | |
Distribution Date | Nov. 2, 2020 | |
Number of Shares Outstanding on Record Date | 19,924 | |
Dividend per Share | $ 0.06 | |
Total Amount | $ 1,195 | |
FY 2021 2nd Qtr [Member] | ||
Dividends Payable [Line Items] | ||
Record Date | Jan. 25, 2021 | |
Distribution Date | Feb. 1, 2021 | |
Number of Shares Outstanding on Record Date | 20,010 | |
Dividend per Share | $ 0.06 | |
Total Amount | $ 1,201 | |
FY 2021 3rd Qtr [Member] | ||
Dividends Payable [Line Items] | ||
Record Date | Apr. 26, 2021 | |
Distribution Date | May 3, 2021 | |
Number of Shares Outstanding on Record Date | 20,115 | |
Dividend per Share | $ 0.06 | |
Total Amount | $ 1,207 | |
FY 2021 4th Qtr [Member] | ||
Dividends Payable [Line Items] | ||
Record Date | Jul. 26, 2021 | |
Distribution Date | Aug. 2, 2021 | |
Number of Shares Outstanding on Record Date | 20,139 | |
Dividend per Share | $ 0.06 | |
Total Amount | $ 1,208 | |
FY 2020 1st Qtr [Member] | ||
Dividends Payable [Line Items] | ||
Record Date | Oct. 25, 2019 | |
Distribution Date | Nov. 1, 2019 | |
Number of Shares Outstanding on Record Date | 17,606 | |
Dividend per Share | $ 0.06 | |
Total Amount | $ 1,056 | |
FY 2020 2nd Qtr [Member] | ||
Dividends Payable [Line Items] | ||
Record Date | Jan. 27, 2020 | |
Distribution Date | Feb. 3, 2020 | |
Number of Shares Outstanding on Record Date | 17,646 | |
Dividend per Share | $ 0.06 | |
Total Amount | $ 1,059 | |
FY 2020 3rd Qtr [Member] | ||
Dividends Payable [Line Items] | ||
Record Date | Apr. 24, 2020 | |
Distribution Date | May 1, 2020 | |
Number of Shares Outstanding on Record Date | 17,769 | |
Dividend per Share | $ 0.06 | |
Total Amount | $ 1,066 | |
FY 2020 4th Qtr [Member] | ||
Dividends Payable [Line Items] | ||
Record Date | Jul. 27, 2020 | |
Distribution Date | Aug. 3, 2020 | |
Number of Shares Outstanding on Record Date | 17,820 | |
Dividend per Share | $ 0.06 | |
Total Amount | $ 1,069 |
SHAREHOLDERS EQUITY (Details _2
SHAREHOLDERS EQUITY (Details - Option activity) - $ / shares shares in Thousands | 12 Months Ended | |||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted | $ 57.60 | $ 39.23 | ||
Equity Option [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Option outstanding, beginning balance | 1,224 | 1,163 | 1,135 | |
Outstanding | $ 17.76 | $ 12.63 | $ 9.44 | |
Weighted-Average Remaining Contractual Life | 6 years 5 months 19 days | 6 years 9 months 14 days | 7 years 1 month 17 days | 7 years 3 months 21 days |
Granted | 226 | 223 | 264 | |
Granted | $ 57.60 | $ 39.23 | $ 22.78 | |
Exercised | (204) | (121) | (167) | |
Exercised | $ 12.53 | $ 9.29 | $ 7.15 | |
Canceled/Forfeited | (62) | (41) | (69) | |
Canceled/Forfeited | $ 29.83 | $ 14.19 | $ 12.17 | |
Awards Outstanding, ending balance | 1,184 | 1,224 | 1,163 | 1,135 |
Outstanding | $ 25.63 | $ 17.76 | $ 12.63 | $ 9.44 |
Vested and Exercisable, end of period | 619 | 596 | 515 | |
Vested and Exercisable, end of period | $ 13.36 | $ 10.69 | $ 8.57 | |
Weighted-Average Remaining Contractual Life Vested and Exercisable | 4 years 11 months 12 days | 5 years 7 months 2 days | 6 years 1 month 2 days | |
Vested and Expected to Vest, end of period | 1,173 | 1,194 | 1,102 | |
Vested and Expected to Vest, end of period | $ 25.69 | $ 17.75 | $ 12.39 | |
Weighted-Average Remaining Contractual Life Vested and Expected to Vest | 6 years 5 months 19 days | 6 years 9 months 7 days | 7 years 25 days | |
Weighted-Average Remaining Contractual Life | 7 years 1 month 17 days |
SHAREHOLDERS EQUITY (Details _3
SHAREHOLDERS EQUITY (Details - Intrinsic Value) - Equity Option [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Intrinsic Value of Options Outstanding | $ 25,705 | $ 51,273 | $ 27,313 |
Intrinsic Value of Options Exercisable | 19,373 | 29,151 | 14,195 |
Intrinsic Value of Options Exercised | $ 11,554 | $ 4,086 | $ 3,224 |
SHAREHOLDERS EQUITY (Details _4
SHAREHOLDERS EQUITY (Details - Fair value of options) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Aug. 31, 2021 | Aug. 31, 2020 | |
Equity [Abstract] | ||
Estimated fair value of awards granted | $ 5,092 | $ 2,997 |
Unvested Forfeiture Rate | 0.00% | 0.00% |
Weighted average grant price | $ 57.60 | $ 39.23 |
Weighted average market price | $ 57.60 | $ 39.23 |
Weighted average volatility | 40.49% | 33.56% |
Weighted average risk-free rate | 0.64% | 1.39% |
Weighted average dividend yield | 0.42% | 0.65% |
Weighted average expected life | 6 years 7 months 17 days | 6 years 8 months 1 day |
SHAREHOLDERS EQUITY (Details _5
SHAREHOLDERS EQUITY (Details - Options outstanding and exercisable) - Equity Option [Member] - $ / shares shares in Thousands | 12 Months Ended | |||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Awards outstanding | 1,184 | 1,224 | 1,163 | 1,135 |
Awards outstanding weighted average remaining contractual life | 6 years 5 months 19 days | |||
Awards outstanding weighted average exercise price | $ 25.63 | $ 17.76 | $ 12.63 | $ 9.44 |
Awards exercisable | 619 | 596 | 515 | |
Awards exercisable weighted average remaining contractual life | 4 years 11 months 12 days | |||
Awards exercisable weighted average exercise price | $ 13.36 | $ 10.69 | $ 8.57 | |
$6.85 to $8.28 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Exercise price low | 6.85 | |||
Exercise price high | $ 8.28 | |||
Awards outstanding | 144 | |||
Awards outstanding weighted average remaining contractual life | 3 years | |||
Awards outstanding weighted average exercise price | $ 6.85 | |||
Awards exercisable | 144 | |||
Awards exercisable weighted average remaining contractual life | 3 years | |||
Awards exercisable weighted average exercise price | $ 6.85 | |||
$8.29 to $10.03 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Exercise price low | 8.29 | |||
Exercise price high | $ 10.03 | |||
Awards outstanding | 183 | |||
Awards outstanding weighted average remaining contractual life | 4 years 6 months 7 days | |||
Awards outstanding weighted average exercise price | $ 9.72 | |||
Awards exercisable | 183 | |||
Awards exercisable weighted average remaining contractual life | 4 years 6 months 7 days | |||
Awards exercisable weighted average exercise price | $ 9.72 | |||
$10.04 to $12.20 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Exercise price low | 10.04 | |||
Exercise price high | $ 12.20 | |||
Awards outstanding | 221 | |||
Awards outstanding weighted average remaining contractual life | 5 years 5 months 23 days | |||
Awards outstanding weighted average exercise price | $ 10.05 | |||
Awards exercisable | 162 | |||
Awards exercisable weighted average remaining contractual life | 5 years 5 months 23 days | |||
Awards exercisable weighted average exercise price | $ 10.05 | |||
$12.21 to $28.16 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Exercise price low | 12.21 | |||
Exercise price high | $ 28.16 | |||
Awards outstanding | 184 | |||
Awards outstanding weighted average remaining contractual life | 6 years 7 months 28 days | |||
Awards outstanding weighted average exercise price | $ 20.37 | |||
Awards exercisable | 66 | |||
Awards exercisable weighted average remaining contractual life | 5 years 10 months 17 days | |||
Awards exercisable weighted average exercise price | $ 20.25 | |||
$28.17 to $57.04 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Exercise price low | 28.17 | |||
Exercise price high | $ 57.04 | |||
Awards outstanding | 230 | |||
Awards outstanding weighted average remaining contractual life | 8 years 4 months 24 days | |||
Awards outstanding weighted average exercise price | $ 37.22 | |||
Awards exercisable | 51 | |||
Awards exercisable weighted average remaining contractual life | 8 years 29 days | |||
Awards exercisable weighted average exercise price | $ 34.19 | |||
$57.05 to $66.14 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Exercise price low | 57.05 | |||
Exercise price high | $ 66.14 | |||
Awards outstanding | 222 | |||
Awards outstanding weighted average remaining contractual life | 9 years 2 months 1 day | |||
Awards outstanding weighted average exercise price | $ 58.77 | |||
Awards exercisable | 13 | |||
Awards exercisable weighted average remaining contractual life | 8 years 10 months 17 days | |||
Awards exercisable weighted average exercise price | $ 61.84 |
SHAREHOLDERS' EQUITY (Details N
SHAREHOLDERS' EQUITY (Details Narrative) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common Stock, Value, Issued | $ 10 | $ 10 | |
Common Stock and Additional Paid in Capital | $ 133,400 | $ 128,500 | |
Non Management Directors [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares Issued, Shares, Share-based Payment Arrangement, after Forfeiture | 5,620 | 7,205 | 8,686 |
Shares Issued, Value, Share-based Payment Arrangement, after Forfeiture | $ 345 | $ 290 | $ 212 |
Equity Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average remaining contractual life | 6 years 5 months 19 days | ||
Fair value of non-vested options | $ 6,300 | ||
Fair value amortization period | 3 years 5 months 4 days | ||
Equity 2007 Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock reserved for issuance under the plan | 1,000 | ||
Equity 2017 Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock reserved for issuance under the plan | 1,000 | ||
Equity 2021 Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock reserved for issuance under the plan | 1,300 |
INCOME TAXES (Details - Income
INCOME TAXES (Details - Income tax provision) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Current | |||
Federal | $ 1,315 | $ 2,098 | $ 1,795 |
State | 450 | 478 | 426 |
Foreign | 166 | 39 | 51 |
Total current tax expense | 1,931 | 2,615 | 2,272 |
Deferred | |||
Federal | (379) | (428) | (141) |
State | (249) | (132) | (158) |
Total deferred federal and state | (628) | (560) | (299) |
Total | $ 1,303 | $ 2,055 | $ 1,973 |
INCOME TAXES (Details - Reconci
INCOME TAXES (Details - Reconciliation) | 12 Months Ended | ||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Income tax computed at federal statutory tax rate | 21.00% | 21.00% | 21.00% |
State taxes, net of federal benefit | 2.00% | 4.10% | 4.10% |
Meals & entertainment | 0.00% | 0.10% | 0.10% |
Stock based compensation | (6.80%) | (1.20%) | (2.60%) |
Other permanent differences | (0.30%) | (0.30%) | (0.70%) |
Research and development credit | (1.60%) | (2.80%) | (2.30%) |
Foreign tax related differences | (2.60%) | (1.40%) | 0.00% |
Research & credit adjustments to expense | 0.20% | 0.30% | 0.00% |
Change in prior year estimated taxes | (0.10%) | (1.80%) | (0.90%) |
Total | 11.80% | 18.00% | 18.70% |
INCOME TAXES (Details - Deferre
INCOME TAXES (Details - Deferred taxes) - USD ($) $ in Thousands | Aug. 31, 2021 | Aug. 31, 2020 |
Deferred tax assets: | ||
Accrued payroll and other expenses | $ 586 | $ 402 |
Deferred revenue | 102 | 7 |
Capitalized merger costs | 703 | 742 |
Intellectual property | 7 | 8 |
Research and development credits | 66 | |
State taxes | 72 | 100 |
Allowance for doubtful accounts | 20 | 13 |
State tax deferred | 80 | 125 |
Total deferred tax assets | 1,636 | 1,397 |
Less: Valuation allowance | ||
Deferred tax asset | 1,636 | 1,397 |
Deferred tax liabilities: | ||
Property and equipment | (83) | (82) |
State tax deferred | (26) | (19) |
Intellectual property | (1,456) | (1,876) |
Capitalized computer software development costs | (1,797) | (1,774) |
Total deferred tax liabilities | (3,362) | (3,751) |
Net deferred tax liabilities | $ (1,726) | $ (2,354) |
CONCENTRATIONS AND UNCERTAINT_2
CONCENTRATIONS AND UNCERTAINTIES (Details Narrative) | 12 Months Ended | ||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Concentration Risk [Line Items] | |||
Net sales concentration percentage | 100.00% | 100.00% | 100.00% |
Sales [Member] | International Sales [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Net sales concentration percentage | 31.00% | 29.00% | 34.00% |
Sales [Member] | Customer 1 [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Net sales concentration percentage | 11.00% | 9.00% | 8.00% |
Sales [Member] | Another Customer [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Net sales concentration percentage | 4.00% | 7.00% | 8.00% |
Sales [Member] | Another Customer 3 [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Net sales concentration percentage | 3.00% | ||
Sales [Member] | Another Customer 2 [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Net sales concentration percentage | 7.00% | 7.00% | |
Accounts Receivable [Member] | Another Customer [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Net sales concentration percentage | 16.00% | 10.00% | |
Accounts Receivable [Member] | One Customer [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Net sales concentration percentage | 5.00% | 13.00% |
SEGMENT AND GEOGRAPHIC REPORT_3
SEGMENT AND GEOGRAPHIC REPORTING (Details - Segment reporting) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||
Aug. 31, 2021 | May 31, 2021 | Feb. 28, 2021 | Nov. 30, 2020 | Aug. 31, 2020 | May 31, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |||
Segment Reporting Information [Line Items] | |||||||||||||
Net Revenues | $ 9,841 | $ 12,777 | $ 13,147 | $ 10,701 | $ 9,540 | $ 12,298 | $ 10,350 | $ 9,401 | $ 46,466 | $ 41,589 | $ 33,970 | ||
Income (loss) from operations before income taxes | 11,253 | 11,605 | 10,648 | ||||||||||
Total assets | 179,978 | 168,422 | 179,978 | 168,422 | |||||||||
Goodwill | 12,921 | 12,921 | 12,921 | 12,921 | 10,387 | ||||||||
Consolidation, Eliminations [Member] | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net Revenues | 0 | 0 | 0 | ||||||||||
Income (loss) from operations before income taxes | 0 | 0 | 0 | ||||||||||
Total assets | (36,294) | (40,095) | (36,294) | (40,095) | (17,702) | ||||||||
Goodwill | 0 | 0 | 0 | 0 | 0 | ||||||||
Capital expenditures | 0 | 0 | 0 | ||||||||||
Capitalized software costs | 0 | 0 | 0 | 0 | 0 | ||||||||
Depreciation and Amortization | 0 | 0 | 0 | ||||||||||
Simulations [Member] | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net Revenues | 25,142 | 21,961 | 19,584 | ||||||||||
Income (loss) from operations before income taxes | 9,286 | 7,374 | 7,751 | ||||||||||
Total assets | 168,923 | 162,807 | 168,923 | 162,807 | 38,535 | ||||||||
Goodwill | 0 | 0 | 0 | 0 | 0 | ||||||||
Capital expenditures | 1,212 | 111 | 39 | ||||||||||
Capitalized software costs | 2,289 | 2,029 | 2,289 | 2,029 | 1,482 | ||||||||
Depreciation and Amortization | 1,885 | 1,713 | 1,806 | ||||||||||
Cognigen [Member] | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net Revenues | 10,546 | 11,105 | 9,321 | ||||||||||
Income (loss) from operations before income taxes | 376 | 1,770 | 1,481 | ||||||||||
Total assets | 13,121 | 11,654 | 13,121 | 11,654 | 11,196 | ||||||||
Goodwill | 4,789 | 4,789 | 4,789 | 4,789 | 4,789 | ||||||||
Capital expenditures | 279 | 87 | 79 | ||||||||||
Capitalized software costs | 12 | 40 | 12 | 40 | 114 | ||||||||
Depreciation and Amortization | 347 | 349 | 364 | ||||||||||
D I L Isym [Member] | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net Revenues | 6,115 | 6,948 | 5,065 | ||||||||||
Income (loss) from operations before income taxes | (112) | 1,744 | 1,416 | ||||||||||
Total assets | 14,884 | 14,084 | 14,884 | 14,084 | 13,168 | ||||||||
Goodwill | 5,598 | 5,598 | 5,598 | 5,598 | 5,598 | ||||||||
Capital expenditures | 18 | 31 | 20 | ||||||||||
Capitalized software costs | 170 | 124 | 170 | 124 | 172 | ||||||||
Depreciation and Amortization | 590 | 600 | 580 | ||||||||||
Lixoft [Member] | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net Revenues | 4,663 | 1,575 | [1] | ||||||||||
Income (loss) from operations before income taxes | 1,703 | 717 | [1] | ||||||||||
Total assets | 19,344 | 19,972 | [1] | 19,344 | 19,972 | [1] | |||||||
Goodwill | 2,534 | 2,534 | [1] | 2,534 | 2,534 | [1] | |||||||
Capital expenditures | 118 | 2 | [1] | ||||||||||
Capitalized software costs | 478 | 160 | [1] | 478 | 160 | [1] | |||||||
Depreciation and Amortization | 768 | 300 | [1] | ||||||||||
Operating Segments [Member] | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net Revenues | 46,466 | 41,589 | 33,970 | ||||||||||
Income (loss) from operations before income taxes | 11,253 | 11,605 | 10,648 | ||||||||||
Total assets | 179,978 | 168,422 | 179,978 | 168,422 | 45,197 | ||||||||
Goodwill | 12,921 | 12,921 | 12,921 | 12,921 | 10,387 | ||||||||
Capital expenditures | 1,627 | 231 | 138 | ||||||||||
Capitalized software costs | $ 2,949 | $ 2,353 | 2,949 | 2,353 | 1,768 | ||||||||
Depreciation and Amortization | $ 3,590 | $ 2,962 | $ 2,750 | ||||||||||
[1] | As Lixoft was purchased on April 1, 2020, five months of activity is reflected for fiscal year 2020. |
SEGMENT AND GEOGRAPHIC REPORT_4
SEGMENT AND GEOGRAPHIC REPORTING (Details - Business unit segment and consolidated results) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Aug. 31, 2021 | May 31, 2021 | Feb. 28, 2021 | Nov. 30, 2020 | Aug. 31, 2020 | May 31, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Revenue from External Customer [Line Items] | |||||||||||
Revenues | $ 9,841 | $ 12,777 | $ 13,147 | $ 10,701 | $ 9,540 | $ 12,298 | $ 10,350 | $ 9,401 | $ 46,466 | $ 41,589 | $ 33,970 |
Cost of revenues | 10,600 | 10,649 | 9,026 | ||||||||
Gross profit | $ 7,056 | $ 10,306 | $ 10,236 | $ 8,268 | $ 6,865 | $ 9,633 | $ 7,683 | $ 6,759 | $ 35,866 | $ 30,940 | $ 24,944 |
Gross margin percentage | 77.00% | 74.00% | 73.00% | ||||||||
Software [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Revenues | $ 27,670 | $ 21,587 | $ 18,479 | ||||||||
Cost of revenues | 3,235 | 2,883 | 2,957 | ||||||||
Gross profit | $ 24,435 | $ 18,704 | $ 15,522 | ||||||||
Gross margin percentage | 88.00% | 87.00% | 84.00% | ||||||||
Service [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Revenues | $ 18,796 | $ 20,002 | $ 15,491 | ||||||||
Cost of revenues | 7,365 | 7,766 | 6,069 | ||||||||
Gross profit | $ 11,431 | $ 12,236 | $ 9,422 | ||||||||
Gross margin percentage | 61.00% | 61.00% | 61.00% |
SEGMENT AND GEOGRAPHIC REPORT_5
SEGMENT AND GEOGRAPHIC REPORTING (Details - Geographical revenues) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Aug. 31, 2021 | May 31, 2021 | Feb. 28, 2021 | Nov. 30, 2020 | Aug. 31, 2020 | May 31, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenues | $ 9,841 | $ 12,777 | $ 13,147 | $ 10,701 | $ 9,540 | $ 12,298 | $ 10,350 | $ 9,401 | $ 46,466 | $ 41,589 | $ 33,970 |
Concentration percentage | 100.00% | 100.00% | 100.00% | ||||||||
North And South America [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenues | $ 32,549 | $ 29,674 | $ 22,576 | ||||||||
Concentration percentage | 70.00% | 71.00% | 67.00% | ||||||||
EMEA [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenues | $ 7,906 | $ 5,827 | $ 5,829 | ||||||||
Concentration percentage | 17.00% | 14.00% | 17.00% | ||||||||
Asia [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenues | $ 6,011 | $ 6,088 | $ 5,565 | ||||||||
Concentration percentage | 13.00% | 15.00% | 16.00% |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2021 | Apr. 02, 2020 | |
Lixoft [Member] | ||
Related Party Transaction [Line Items] | ||
Payment to related party | $ 2,000 | |
Lixoft [Member] | ||
Related Party Transaction [Line Items] | ||
Acquisition liabilities owed | $ 1,118 | |
Lixoft [Member] | Former Shareholders [Member] | ||
Related Party Transaction [Line Items] | ||
Payment for acquisition | 6,700 | |
Acquisition liabilities owed | 947 | |
D I L Isym [Member] | Former Shareholders [Member] | ||
Related Party Transaction [Line Items] | ||
Acquisition liabilities owed | $ 2,600 |
EMPLOYEE BENEFIT PLAN (Details
EMPLOYEE BENEFIT PLAN (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Retirement Benefits [Abstract] | |||
Contribution by employer in benefit plan | $ 535 | $ 456 | $ 405 |
ACQUISITION (Details - purchase
ACQUISITION (Details - purchase price allocation) - USD ($) $ in Thousands | 7 Months Ended | 12 Months Ended | |
Apr. 02, 2020 | Aug. 31, 2021 | Aug. 31, 2020 | |
Business Acquisition [Line Items] | |||
Estimated Goodwill acquired | $ 0 | $ 2,534 | |
Lixoft [Member] | |||
Business Acquisition [Line Items] | |||
Assets acquired, Including cash of $3,799,134 and accounts receivable of $629,481 | $ 5,007 | ||
Developed Technologies Acquired | 8,010 | ||
Estimated value of Intangibles assets acquired (Customer Lists, trade name etc.) | 4,160 | ||
Estimated Goodwill acquired | 2,534 | $ 0 | $ 2,534 |
Liabilities Assumed | (1,118) | ||
Total Consideration | $ 18,593 |
ACQUISITION (Details - Proforma
ACQUISITION (Details - Proforma Information) - USD ($) $ in Thousands | 12 Months Ended | |||
Aug. 31, 2021 | Aug. 31, 2020 | [1] | Aug. 31, 2019 | |
Business Combination and Asset Acquisition [Abstract] | ||||
Revenue | $ 46,466 | $ 43,970 | $ 36,918 | |
Net Income | $ 9,782 | $ 10,630 | $ 9,250 | |
[1] | Balances include five months actual results for Lixoft. |
UNAUDTED QUARTERLY FINANCIAL DA
UNAUDTED QUARTERLY FINANCIAL DATA (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Aug. 31, 2021 | May 31, 2021 | Feb. 28, 2021 | Nov. 30, 2020 | Aug. 31, 2020 | May 31, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2021 | Aug. 31, 2020 | Aug. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenues | $ 9,841 | $ 12,777 | $ 13,147 | $ 10,701 | $ 9,540 | $ 12,298 | $ 10,350 | $ 9,401 | $ 46,466 | $ 41,589 | $ 33,970 |
Gross Profit | 7,056 | 10,306 | 10,236 | 8,268 | 6,865 | 9,633 | 7,683 | 6,759 | 35,866 | 30,940 | 24,944 |
Net Income | $ 305 | $ 3,787 | $ 3,211 | $ 2,479 | $ 2,188 | $ 2,936 | $ 2,150 | $ 2,058 | $ 9,782 | $ 9,332 | $ 8,583 |
Earnings per share, Basic | $ 0.02 | $ 0.19 | $ 0.16 | $ 0.12 | $ 0.12 | $ 0.17 | $ 0.12 | $ 0.12 | $ 0.49 | $ 0.52 | $ 0.49 |
Earnings per share, Diluted | $ 0.01 | $ 0.18 | $ 0.15 | $ 0.12 | $ 0.11 | $ 0.16 | $ 0.12 | $ 0.11 | $ 0.47 | $ 0.50 | $ 0.48 |