SLP - Earnings call transcript Q4 2017

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Renee Bouche

Good afternoon. It is Tuesday, November 14, 2017 and on behalf of Simulations Plus, I welcome you to our Fourth Quarter Fiscal Year 2017 Financial Results Conference Call and Webinar. Presenting this afternoon will be CEO and Chairman, Walt Woltosz; Chief Financial Officer, John Kneisel; and Division President, John DiBella, Ted Grasela and Brett Howell. An opportunity to ask questions will follow today's presentation.

You may send your written question using the questions pane on your control panel or you may use the hand-raising feature on your control panel to ask your question directly. enter call. audio to you displayed sure the join be the PIN unique when Please is recorded call This being www.simulations-plus.com. our website, for playback at

Safe with shall Before presentation, Harbor our begin Statement. we today's read I

but future the Company's with personnel historical information, factors, statements Company's the cause those ability The not growth, contained statements. significantly new the forward-looking fashion, Company's market a are ability actual With the current and of to involve differences contribute sustain exception to in is Exchange finance and the the the discussed or attract to Company annual the ability presentation and products, of that and Securities on the and in skilled information risks to improve productivity. Company's of continuing could continue the from the Further to, produce Factors or retain Company's demand ability timely matters products such filed number in results to Commission. Company's that levels factors are reports a this to uncertainties. quarterly include, limited and differ of could risk Company's for competitive and

Plus. Woltosz, to CEO it’s to Now of Simulations my introduce you and pleasure Walt Chairman

Walt Woltosz

to who's Thank you Renee, and thanks everyone attending today.

give then wrap it I'll the to details the and and presidents will a and just quick overview CFO up So division follow from the our end. at

efforts and in as other for healthcare. the primarily food, tuning also some chemical for software maybe you such first Simulations industry, services those For general provider industries aerospace to and who looking general pharmaceutical and but in the R&D in of support industry Plus time, of in and cosmetics consulting the now is global

supporting program products And existed discovery a computer On side, way then ever right them. or generate very can Into tools then several allow we that losers million preclinical first the all molecules for have R&D the and problem on division never with allow to efforts service. disease for valuable provided communicate our generic world duplication effort very assessment and integration X, them in our we trial that also And data major risk work something X those animal and perhaps trials in and companies XX services. multinational the before. we or our without him Cognigen of earliest or them to get have where with generic to of plus the XX of vitro uses X Phase rid or and to into chemist them draws the a when also and particular molecule way laboratory working to million screen a and make reviewer that Phase safety services into approaches in a the software that's and from in Phase ranging around platform a move in and our are contract other test, obvious clinical them and each and research and life key away software test, selected call having all new first efficiently researchers data to development molecules where using test patent and avoid test we in of test processing now beyond companies to pharmaceutical human to

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including June-July-August quarter fourth our was Services. of first the So DILIsym quarter operations

income $X.X just XX% for up and $XXX,XXX were to was The million. XX.X% about or revenues up about net million $X.XX million. $X.X Our quarter the from

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clients year. $XXX,XXX fiscal about net Our XX just XX% almost were the $X.XX during income to diluted beating up to up the $X.X million, share software earnings or analyst XX% last estimate, added and share per new per

an across various So what again we drug the the the patent bottom services from discovery clinical development collaborations spectrum programs then These in preclinical show to down span divisions. beyond pharmaceutical of give and that boxes through you three to the entire consulting do and idea and of generics. software the

we XX% tissues accuracy, though the that there would corner XXX XXXs library rejected Predictor molecules upper and those are in XX% for can large structure Then XXXXs get would target one just never that predict take unable penetrate word be. out those many it about the not are With molecules. of favorable predicted see even able you you predictions the become to can’t left be maybe of of will absorbed. program They of ballpark where a screen those. molecular through perfectly, too be side, be they you existed. to drug. things those dissolved the as get enough but not hand molecules another it might be the They molecules is then can cells say toxic. to millions If be properties of of it because a nothing those dissolved And get that left to can drawing might can good in discovery into such the ADMET takes Software a of or Typically the it in predictions can’t On a or

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of and the molecules, molecules, in going that the synthesized that, were even would announce approach successful do drug We to that it’s before announced selected show that that. announced to proud we to whether could fact we we’re are works very the that. we we we something design able silico before that certainly we we do So in we were and in

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predictions, XX various mechanistic drug developed cavity in X have prepared. resulted Simulations there different regulatory we trials different for different interaction a from so human correlations. for preclinical vitro Simulations of different done slide administration, effects, for to or X relates from shows and And X pill on, developments here you ways, oral are the dermo, regulatory the oral signals, of X first typical that in X can ways. see for pro food pediatric, far and that that X those consulting routes some X in optimization parent analysis that bioequivalence and of pulmonary, modeling you agencies. types That results development for virtual Plus sallow, ocular our I'm metabolite nice interactions, Drug-drug As product in as these formulation to different XX that the is the vivo

I'll performance Our top Nasdaq, Simulations all blue I at chart, don't and the in XXX. stock quite I'll regulatory to of I time try need don't two the three year this usually in we'd handily. Kneisel. the industries you. to but to And over now it outperform the microphone see other in this show turn it there then return We I anticipate, do Jones S&P I'll try line time, to if John t Plus say to the

John Kneisel

we'll the the quarter thanks, then. Walt. year-to-date. well Alright go then to can go over Alright, the We first cover we'll slide fourth results

information third isn't And fourth and is quarter. it Buffalo of quarters here, revenues million our who up which down from quarter for and our of As the our $XXX,XXX which our up quarter DILIsym over fourth those shown of was of revenues our ever. ever, quarter good on. prior have were quarter quarterly which quarter they were of fourth coming one for we fourth about you later of revenues is X.XX comparison were advent the was best $XXX,XXX to third X.XX or Walt that in. is In nice lower us Lancaster this for normally one our quarters a for up the fourth really year. at is were Lancaster. $X.X quarter. their best indicated, up $X.XX The quarter second are with XX.X% was follow the look DILIsym XX.X% a first But This will off our million

So we're happy with that.

software up consulting, revenue almost $XXX,XXX quarter, and the or our was up $X our XX.X% For was million.

helped was the or period $X.X in was SG&A this really million. $XXX,XXX Gross XX.X% margin issues and the we're quarter of up the consulting up and increase quarter. ended of with of Lancaster big large with up and DILIsym this for Cognigen were up in DILIsym. up about that expenses profits had X%, for $XXX,XXX $XXX,XXX So us acquisition. piece was up XX.X% a XX.X%, one-time ended this for We for worth the charges period, period. in the for that one M&A acquisition created $XXX,XXX

$X.XX bit selling Overall, the prior that in we of sort were totaled the some in million little of a it up So $XXX,XXX skewed to the down $X.XX the were numbers over period. period. Actually, expenses million period.

last accounted that $XX,XXX reps was drop and for Asian redevelopment $XX,XXX advertising our we website, was down with a incurred of that year. lot

last Our professional the up and cost were of up in stocks that period cost a about do good a in accrued some normally of for And $XXX,XXX December. compensation such non-cash for and in stocks of majority that that stock some we the the for and year accounting bonuses portion are that their was would $XX,XXX, we that such the work salaries first time and fees and quarter. the performed fees were audit

for DILIsym $XXX,XXX part year. of and We accelerated of Also this some about increase. accounted of that expenses the have

talk So little that a on. later we about more will bit

net Moving to quarter. for down income the

X.X than includes $X.XX up a last As of the year from Cognigen contributed are year $XXX,XXX or Walt $XXX,XXX of have XX% said, rounding prior of down $X.XXX quarter EBITDA are and And slightly share, this contributed way for to prior was share, over other but but million like the last X.XX its charge in the that we rounded $X.XX, I quarter actually that so last $X.XXX been the under $XXX,XXX $XXX,XXX are we really works would was $XXX,XXX $X.XX quarter. on $XXX,XXX little per Earnings XX.X% year. up. that the it Lancaster or so rounded that. really the was I a $X and about over up bit DILIsym up to down one-time up just year. -- we it looks they the million

or Lancaster year million fourth And our year-to-date numbers. million the revenues over recorded up million $X $X.XX that XX.X% $XX.X XX.X% or the quarter. Moving increase from DILIsym the revenues on year. revenues New of was Buffalo, prior X.X% are in of increase $X.XX great to generated York the XXXX. increased $X.XX to a again million for Cognigen million about million. Total by or in $XX.X

little licenses shown up were the here, $X of million to to software a $X.XX a while for was Our are rounded Cost for million about $X.X increase consulting million which year. $X.X and labor of a the over year revenues excuse salaries costs were million million of up the me increase they about other for for which increase. the was the year was majority that into the were pretty about accounted the went of that -- some were that $X -- amortization then and and overall

Going increased to Overall, the we've margins or gross which holding XX% bit from came about year down up $X.XX moving just consulting of year. mix a with $XXX,XXX in we and Buffalo $XXX,XXX salary and XX.X% for little XX.X% last acquisition increase that added for the XX% the basically million of cost bit just XX% expect. XX XX.X% work with Buffalo up DILIsym a of is California of there. increase division margins gross margins, the a the increased normally more little cost and margin higher that the our consolidated to margin. the to associated business $XXX,XXX with margins about showed from decreased showed year that work higher the

worth DILIsym which the those them. Again within in Company incur expense of overall about with the incurred and the are selling we period of G&A. $XXX,XXX acquisition Our cost associated

Overall mostly prior we'd $X.XX expensed by can was and incurred year stock and increase as in million bonus of about And overall and Again came of of time I increase compensation we that initiatives the about $XXX,XXX about and little the were dividend website that's million of year, developed the up also amount fiscal of strategic going think the up costs were for research year again up due bit in increases expense making XX% those in by document what and increased $X.XX came $X.X year. or wages to here, year. regular in for of cost, some line $XX,XXX helped were and salary $XX,XXX $XX,XXX right make year incurred and up, expenses decrease the did about charges X.XX year. And during development, which we the total salary and one $XX,XXX $X.X they the DILIsym. related the about in that that's and cost about you see and or million overall go a but of which we million. our up again the development we'd commissions DILI advertising. cost the and from other web $X.XX $XX,XXX for and increased a of So And we $XXX,XXX. DILIsym, $XX,XXX reduced major salaries increase we expensed to prior bottom increases the that $XXX,XXX the accruals for capitalized came to in million about where year. to is where year, so that acquisition two during cost portion incurred a but increase SG&A in in the at also good we've we of another X.X and up some got and those one the and accruals legal review were of SG&A $XX,XXX portion had million SG&A Payroll Insurance expenses a the cost expense DILIsysm. $X.X of that year. we the in most of and August was and medical we're were that taxes health-related from that services Amortization Research about of salary this the about from

income as margins, going that actually the million some tax our for rate result we year. never over that we're XX.X% can’t increased little that benefits year million to or actually a XX.X% to that that X.XX this $X.XX decrease what tax that of our provision always expect at get of year the early but stock-based XX.X% some that’s came level was that created so to bit some benefit and here have guarantee DILIsym. stock is Net income year, decreased $XXX,XXX thing the from people I effective the incurred taxes that to for which for $XXX,XXX that the and year million this for of issues and X.XX some options we during got little and selling about again by of last Our sold for pre-tax their compensation increased was about actually from at fiscal and compensation along so is bit important got people a from And non-cash over acquisition stock with it year cost the increasing, and note $XXX,XXX reduction. was

on. Moving

Here the you repeat are fourth where the here are quarterly the Hopefully things going revenue can can up. we our quarter. in of that growth quarter in year slide. some slides next Again, see

been same we the and the have fourth profit a throughout a slide, each the quarter solid moving EPS performance again quarter with of quarter. and gone; again growth EBITDA, year periods. one for steady been each looks has period. across fourth filled up It’s it’s revenue good the curve solid as just and again Next fairly been thing

agreement change We will changes. a GastroPlus last spent out dividends, about royalty million we that little slide to the $X paid $XX on renegotiated million four around we for a bit. TSRL in Throughout with years We the major our over some three and dividends. little in We million project. done $XX about have

increased cash $X.XX in and I as November excellent see that. Board continue acquired the to DILIsym We balances has dividends about for position out remained you share. think solid and cash pay and an our cash But really can a spent million with have have to acquired dividend on actually we Cognigen the $X.X payment

DILIsym on ratios We acquisition some some bit with little in up acquisition of the took of fourth of continue some cash the current liabilities I quarter it’s and it strong. just position for a liabilities in real I’ll as happy The for solid still. this so the we will liabilities. be next to be ratios that, so of solid. the change assets And am performance. are over turn and to are ratios our the still things is current John. move quarter per where cash to With But with solid some equity share at this those

John DiBella

and software is early you, Okay. of GastroPlus, for of development the work AAPS is hard where enhancements everyone models the clinical hello are Thank use John. of the version products Meeting new a San to really nice product departments I Annual our Walt And pharmaceutical internal our Brett for into very the that attending XXXX regulatory this our and and described sunny models Diego mechanistic to on everyone, has from earlier, team the at pharmacology programs. lot support interactions. population version to and seeing new set deeper flagship The R&D releases really solutions science. a of on including in little and presented bit Lancaster release absorption working next something for Diving

other can this be these us provide really clinical the and GastroPlus. further into consulting released types ADMET support penetrate enhancements month. So expand and hopefully will also X.X with Predictor space help we should of the

a hosted the week webinar over we In fact that drew XXX new on registrants. features some of last

modeling chemist is help DDDPlus the the next help Walt Version so finally select early spring PKPlus push continued and chemistry to efficiently in for MedChem early released full a in we then of to We've the been optimizations. needed really expect Predictor and We The GastroPlus release MembranePlus the Getting inputs features have incorporated models These lead XXXX. hands really of their And within from with as to more or PBPK we've bring platform to also discovery. capabilities X few get hands molecules release now in lead GastroPlus additional PBPK ADMET the models PBPK extra and scientists activities. weeks. tools into few Discovery user expect new lead We've looking into Version growth mentioned integrated and simulation got feedback into vitro earlier ADMET support new items items, added. into sales. X approaches and expected also really some implemented complete Studio just the X additional directly come excited September Predictor to Version functionality new in we're PBPK PKPlus to this to into in of inform a to

please. already John Company's has overall slide the Next performance discussed strong QX. in

like highlights I'd the X% for saw demand to remains describe by division. we've meet very to our was Here We The consulting full services. for PBPK these successfully Lancaster up few the our which increased staff pipeline a over quarter strong for driven growth and also demands. scaled

solid not not little growth the growth was by really new company's we a of terms Software or in had customers. news. platforms revenue of to not still software bit license couple deemed a renewing But due budgetary issues due switching to

our chemicals bar XX the clients good right, see in that XX so we for pharmaceutical chart can continue so core sold space outside an number commercial added the companies X% new software quarter. on consumers penetrate to we've of including you upper were As with software license realized several in forth. units the increase the and We

sites. new for or reminder that a a group before, us is a research new is client As existing or departments in organization company defined added licenses an brand never new or which licensed

and we quarter remaining making XX% training about XX%. revenue lower XX% with in coming right, new of the consulting in up see renewal, For over services the license software revenue license the was can the total software

slide please. Next

year, regulatory U.S. new licenses training of and XX at added China. software strong the including was services. growth division For the over the in all new clients We agencies very gain for Lancaster X% consulting the and revenue seen both in the year major

and revenue at X%. we renewal the making revenue in lower coming XX% total remaining license XX% right training new about with services consulting software the of the license Software and see was up as in

Next slide.

add that growth XXXX. which in and to digit services preceding marketing time one from all more of is sales the website hard activities, location And and website to the nice We seen we understand marketing continue really and companies over to Asia. as We India the years distribution coming nice to the in in that organizing Europe to in couple of nice the Korea in months them visitors spent of be those versus really content done and the and head job a America, finally XX% on more terms distributors domestic a pushing doing group team up lot the we traffic DILIsym now content distributors appreciate for they see for also job revenue see where a Cognigen us we've And creating more can growth place sales those territories. new the continue in expect a North markets are from for of had as And in there signed we able globally Japan in is working into newest really XX% workshops to the XX% drive growing nice months past a software video then license have six ago have and really solutions licenses about China, migrating quarter. provide. of double that in

solutions, hundred educating all be very around on in the seminars were of modeling year. and workshops maintained hosted us promotional for we year. registered eight engagement on has people scientists for this seen various that help applications user heading as technology expansion focus busy PBPK territories media successful our webinars onsite XXXX a and we Additionally, base. weeks several significant modeling major and training our will over to the social with had for more training the in past each one into should help on POPPK finally the globe very for And we strategic hosting the a workshop year continue activities, a the increase and with to presence robust with

And so I happy Ted am with that, give invite update the Ted? Cognigen an operations. to on to

Ted Grasela

initiatives year. growth explain the little I seen you, are going what’s past in take this have the time over John. of about Thank like some would that and this revenue in bit Cognigen we to to a that behind

on have are that and are as some hiring going platform younger senior to with going lot year able So And grow who out new on younger and effort work to be to also and we be board an the successfully scientists. modeling well in software to as KIWI boarding been scientists both successful but necessary of scientists. awful the build scientists the gone bringing engineers communication into in recruiting was past

on three have cover that sponsor fiscal drugs that fiscal we our had the that we’ve all scope safety number projects. have and from pan work forward were being of become on outstanding between because efficacy XX a them work and additional in looking the a In 'XX. anticipated. frequently they and previously, that in a in not DILIsym. to projects with of relationships scope that be out that the in had continues clients the XX happened profile companies business accelerate questions we and will cross-selling part Cognigen. same models were between proposals expand working increasing we And of divisions, colleagues companies deployment. mentioned the about different Lancaster XXXX and do we new And able reduced initiatives synergies new There development and working new being KIWI at I do the small to with companies. aware different year drugs worked at projects were of to of really different didn’t its projects. important with for as this nine got XX on and issues a as time to the total a XX in not XX to thing number And we’re had are an projects, happens, as of involved 'XX in And marketing as and carryover moment. particular of I XX We working And value the present number explain out the sales into that of and year XX we There

perspective, publications. reach resulted number working this or bridging like a commercialization additional endocrinology that different projects neurology, clients. done our as been The very to regulatory the most value the reviewed been development pharmacometric three to projects on and we complicated are stages aspects medicines. So PK in to based of as presented of oncology problems. that’s studies that of all well the four We A as new projects modeling but And new by helping all to have different came scientific on embed of are regions of to human and development get And simulation in available abstracts, other Predictor, work idea working countries of earlier and marked well and fiscal that in modeling at on healthy we year hoping marketing physiologically software we're invited even nine therapeutic of agencies illustrating now we in that And consulting scientific is part data we of our meetings. that peer were present half common currently able a that can disease. past we early health the to of applications infectious we under an projects at we services the XXXX and have publications, of have different bear initiatives of area so is an book regulatory and regulatory interactions. with things directly expansion And to presentation as consulting performed the is five to And us of been in published. of meetings have drug our a walk we of world. expansion research that be been was posters and in our in have out the the number with using conference types working a doing extend first From R&D. as global big There at publications that submissions pipeline working as we that between a projects. one different we had followed to across work well XX XXXX, support little to ADMET chapter in has from

due early. the fact of And get that we that to is some project started working on the

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and additional centralized their Version sharing. all able in the and tropical a readily Platform and communication. the of there malaria. that working interdisciplinary strategy demonstrations of course of be to Health way KIWI number a it XXXX. to in are a centric we've students work. interest use hopefully including actively meetings establishing in that be modeling to that And establishing very they'll partnerships program important attended. as can different We need they simulation been collaboration early KIWI to all data And academic accessible we repository the continuing place their part of activities this modeling to KIWI and we're an one in at working a to within scientific do modeling stop get Initiative performing do the ongoing KIWI as all we're introduce November so includes on is X working existing projects going with used pharmecometric to they And the jobs. knowledge data bridge simulation a that International tools it we've becomes visualization around that number of deploying working to on finding with in with visualization accelerate that also interorganizational platform the the the We're diseases exactly as platform this KIWI been that. and that We're the We've of take perform scientists bring to the an And it's so building on that's working of bring data model the simulation of and of and organize diagnostic together repository working to design improvements are to that and that associated that to so do

in So activities. an we're increase seeing marketing sales and

I'll to that continue about to before. Initiative expand further organizations of the and even had Global look And and I a of expect we that's faster even been and to the and we working have our expanding we our forward services of broader accelerate get we we're business to clients of projects trained it on we Our colleagues the as the and to relationships selling ourselves on new with pick opportunity able KIWI over have lifecycle into projects the good up continuing you. produce turn including Plus be We've And past. that, to spectrum in with and Brett. scientific work Simulations synergies than client to so the pipeline Health with research our with Thank have companies. KIWI and to working even at hired complement deployment talked working projects team across And an and platform create to and now healthy I've work DILIsym cross development. a

Brett Howell

Well, Ted. DILIsym family. obviously, the Simulations to Services you the thank Okay, are new Plus

do one at call is slides on the introduction have that So what that some and where things slide with current the who I we present today today we're of give just we the initiatives. are beginning our headed then couple general can worth of some what of I at of of a and do the if mention ongoing

well respect with development It's places made is assessing drugs be or is molecules the from software handful pipeline. of flagship their It or been which safety development they to should taking versus the our DILIsym their they deliver. large next a like decisions should particular molecule of forward of in. compared they're a clinical really drug applied that different the other as said on decisions have invest product. that investing competitors' advance to does molecule make So money the a should to considering a how a they applied use various number and And important of throughout focused decisions. can It the at the to companies companies pick molecule drug amount molecule molecule stage,

with different seven XX been these software globe. this potential being years. liver -- been we've to It's to drug. used respect regulatory of in submissions And developing the the All now or used or the over last eight the is around agencies been regulatory different it has with planned safety used of XX

solithromycin those that highlight products more get safety and liver here the joining really and software meeting, bullet efficiently, many Committee software part is relate DILIsym work DILIsym and on that Simulations Plus And about company of nice to GastroPlus just It’s how wanted Simulations drug quickly. on to pharma allow the the the is various address small antimicrobials side issues. Drug approved. really I with One it meeting committee DILIsym the for And and X to ADMET more tools Predictor feature the the complementarity offers, Advisory Food was mid large, focused of Administration ones used to on and including things advisory and XXXX of and that the of with try by one in works Plus drugs one to advance currently

between So different there on really is the groups. side some product nice the synergy

So next slide please.

a with monetarily companies the So DILIsym software ideas the in world consortium would pharmaceutical been that the and seven, also and slide to voice of the context companies see the at the had DILIsym like help years. things And the slide of that’s to Initiative DILIsym has major of the this. currently of called both we’ve we XX can here. to XXXX clarification taken the but last the “I” consortium. what’s of for the that pharmaceutical development you and see soon mostly software, to with large us the developed year the top And have the in XX pharmaceutical see contributed this in scientifically as of have is an eight The of have their you companies priorities, XX be over they in that on just companies

DILIsym on us this going most questions to allowed understand going what’s needs do what’s and while so to that the And to address. is important has be really a for been to

also for consulting, the is received companies at projects large a for of the currently and members. has non-consortium pharma with and one it we So partly fairly these is each we for of have our term DILIsym consulting licensing which services, that a our the portion partly software things revenue software use our partners that is DILIsym during membership do of the done

here. software and of that the also to several You see our by highlighting scientific bottom this supporting a the over evaluation Group developing at years. but through provided FDA, the screen they’ve the both contributor researchers I They last insight monetarily in am have been

Next slide.

to moving XXXX. on XXXX X DILIsym now things is which a into several through comment that just stage within happening DILIsym, of down the Initiative the covers So period are

are adaptive integration populations We on our science with on advancing new diseases additional that includes and the and simulated GastroPlus. focused new immunology, adding to software also focus states which then disease

more complementary and So those make be users. software even even can the products use efficient more for

we three contracts So next are years. for renewing our those currently

members annual have Some contracts. of the consortium

Some of multi-year them have contracts.

to a drugs been we questions in a but them In with of focused address they also seen increasingly to have long take to addition understand as the and we the as have to future happen companies may we on where preclinical now differentiation DILIsym competitors. we to develop said and consult number time clinic projects DILIsym for what move using we clinically from related forward continue want companies stage are seeing

yet and of are liver steatohepatitis, necessary, help a a And this use they drug contract. spoken aspects to currently non-alcoholic of issue large So information software NASH, right that of greatly to software certain software that all pharma safety. additional we disease. we that to haven’t to includes cover determine disease but and on competitor’s company or enhancing that it with the I where about fatty components sit of them the they aspects much is NAFLDsym, to two respect adding are this now are account fibrosis

that have drug-induced number with it have like pipeline on forward software products of the And in for their molecules. we we very us additional particular to other moving the a one used we would developing, are contracts who do soon. already efficacy use thinking of finally, be of to three have questions nice we and companies we consulting So injury focused a of address that kidney will

we will and whole Plus. additional a So be software have in that that products to that others we offer complement also the we coming as out complementary the the future anticipate Simulations at

Walt Woltosz

Ted John. you and and John Brett and Thank Okay.

income quarter up Just net revenues so it now summarize, up about XX%. fourth to XX%, wrap up by

about synergies will for very the extremely revenues three and year, and and last California the fiscal be expect all Carolina year there. XX% well. All and beginning Buffalo, between few That's be the performing whole share Carolina They're years operations Buffalo now to up we net XX%, months work Carolina and and just between very California, synergies nice earnings and income and per North able see that Buffalo XX% about divisions we'll the up we've now of been California realizing divisions are well, diluted also three together. so North realize North synergies in For where at us. up working about to for

and addressing the research. in focus model of planned the regulatory agency We PBPK are safety pharmacology the clinical in

our So both done research to have GastroPlus done capability and safety for Buffalo clinical the pharmacology for in relates in part. work and clinical the PBPK research

towards continues trend that the that FDA and We greater the the and cells. exciting something Plus is happened detailed is simulation an systems coming We'd becoming and and drive and five and again by documents our lead fond potential with area. the also that in believe of modeling to it's research renovation. at an new a we're area very with a now deal New guidance it and offerings very of contract commissioner well offers And on are other helping $X.X toxicology FDA interest, our the major expanded organizations. DILIsym similar in up with contracts year the acquisition interactions encouraging. inside and That new will Cognigen be of Services European the development Simulation Medical additional contract to FDA for executing Agency this use this million research to

some folks so And summary We'd works may ask questions. but links here want that that I find because sale stay we to have I for ahead. to slide on better that the want is that smooth believe

Now, I'll Renee any moderate to turn it to back questions.

Renee Bouche

Walt. you, Thank

Cognigen? growth at concerns is What first can the question Cognigen, revenue the driving is. Our forward? at And going question sustained growth it the revenue be

Ted Grasela

that, take you. I'll so thank

consulting bring is Cognigen take always revenue contracts additional been I several things that's thing. so scientists to yes for Sorry, which additional is one the guess on of we've growth one source major are been to revenue driving on able

trying of up very picked the third some a number the space part global And there value this sorry make we health KIWI simulation communication to how projects kept that's modeling Second with a illustrate we've and consulting is sure which in platform. busy. can the do out area of us new and represents of that figure an to us for that echo, the to has as

to don't predictions future new also about So the of consulting while to we're as an and put continuing make effort we into securing additional push source continuing revenue. then KIWI projects

Renee Bouche

Ted. you, Thank

will think I for the the Version for about X question released? offering does customers potential next be DiBella. purchasing tell new PKPlus John feedback What the you once Our

John DiBella

to good point a people But really feedback easy us a the like first workflow, question. really that's it's limited. click from the functionality positive that's Version Okay, told a The bit streamlined perspective X and that use. was that

program speak. to data using the Scientists established been to certain I the activities so so reuse doing X, time preferred for for able also running we've datasets address also adding templates PKPlus easier to Version by mapping save that this they've make to and programs. think think I do it that features more certain so to some of the users to And stickier their already complement program they going be generating make able which we're some reports to datasets the analysis with that of were now prediction through would

do stages both non-validated and both from and now environment. fitting So overall in prediction, I in more preclinical validated also model think the can scientists development a

have use of toxicology preclinical sales reports into X quickly. really managers that into we ease more can to need I and help PK the now So push coupled version study functionality us stages with to generate the that additional think bought

Renee Bouche

SG&A we be question forward? going Kneisel. Thank of what anticipate will XXXX of DILIsym think representative I approximately and expense you, John. for The for John Is the next $XXX,XXX of can

John Kneisel

a unit Obviously representation there it’s cost cost is unit. that fairly labor some think as the will is is fixed growth. there I there. change But fair

So it’s a fair I think representation.

Renee Bouche

have is think out the well. you one segment go will have I the broken your But Don’t for information yet. future this in Okay. K section as not DILIsym’s and next XX-Qs? separately I seen XX-K away,

John Kneisel

DILIsym the -- Q. segment is reporting the for in there K Yes, in

Renee Bouche

facilitate And are of you synergies to the Okay. the question some growth additional at DILIsym? see next is. What

Brett Howell

I growth are several will to So synergies lead that we the and help that think point grow there overall. could us

of more GastroPlus One as tight that is the between some such this integration of them existing referenced Predictor ADMET products and DILIsym. I with

Predictor to run exposure for to of and you in part is drugs of basic very have the do So models of what do to ADMET do with rudimentary work technical predict that drugs, information. DILIsym simulation to GastroPlus and build the a well exposure and

And so I in earlier will the the DILIsym enhance think really ability into discovery space that to development. move

well as process in involved terms Cognigen the marketing do. knowing So that’s working that smaller can they other one of of seeing marketing products on initiatives synergies you that some and help from doing of some is nice benefit with we growth. company things number odds actively the the drive can There’s DILIsym of as a in know and being what as will are as obviously

NAFLDsym many, the is new terms with can many probably mentioned disease are as that to overall consulting target being now in enhanced benefit development of other Simulations with in is size drugs a a additional that think lot to products now new The for I really that right many, the NAFLD allow also its NAFLDsym one billions market from companies. of And the within area. umbrella. to I Plus of number are part in of lot right important of drugs DILIsym, expand for also some the NASH features

to NAFLDsym for we months. believe we already we dollars the and the what XX we complete over using really support with is project information big do have can in market fibrosis once there do next it to XX that have and So coming steatosis

others there So well that? growth I to there add organs, have new some too. that Walt, as for areas Is mentioned anything some as is products well other other, producing as as or

Walt Woltosz

inputs GastroPlus was said DILIsym -- inputs it for Yes, exclusive. but make for NAFLDsym. outputs what for are just it more part Brett -- in and I would implied of just the The to of

and a That’s then of into on used right in in the without So far two. or we a got export GastroPlus be will release work we’ve loaded next we the already already here have GastroPlus month very be extra file DILIsym very, to something required. lot to be along next that cleanly of that can

periods work different liver over important in of long is that simulations. that populations one. So other and goes synergy to a then injury to types the and PBPK the time going the concentrations really the NAFLDsym which with and and into come the do generates other very the simulation the It for streamlines directly inputs process from from dose discovery places lab drug

Renee Bouche

as next question. you Can the Walt. John? you, some is growth Thank The provide in steady your color to consulting having Lancaster, additional services

Walt Woltosz

green. say I'd

John DiBella

Okay.

there reference more very add development on mentioned form beyond documents for in there In bit total and use I summary to it slide that modeling that So regulatory guidance agencies XX the the documents some simulation XXXX. it's a European the of we're color drug over activities. PBPK the Walt think that. support little of modeling on are focused U.S. released that I'll listed and different and first guidance now

And this, on to variety provides this as both of counter different a to to have of of to consulting modeling of management wide support presentation a companies that of properly studies the at of is showed of more and that teams is simulation in strengthen stages to again trained the lieu or simulation of application of clinical opportunities outsourced being cover made the still to and in-house lack is so see ways company and interactions. large includes is Walt real of regulatory able this groups research potentially regulatory from at are engage real small. company all it in scientists application. now certainly issue has it there sponsor be some case and simulation the the available the And that our push utilized mechanistic identify the these so in big at which side, a in a utilize could with does regulatory experts. certain there been and least And realized beginning value importance being really that modeling at The modeling

Renee Bouche

Okay.

cash times an to get trading more with opportunistic at than is question next now stock revenues. flexibility? Company XX M&A raise trailing considered your Our the Board raising Has the equity through

Walt Woltosz

guess no. I one, that I number should the is

been years then. or raise have what We not actually told to was an $XX several needed with that that additional And we be for we've before if up loan cash $XX million a issue. to the are had success that getting since we've had ago million

from that the can it with of were out $X diluting before current to get We cash the So see chart interest we and going we take acquisition cash. you on back the approach where million There stock. cash we some don't our needed the DILIsym even raising was did really no we want When or quarter paid to shareholders all we of is there treasury out. it the acquired we paying the and $X loans. million

answer no. the is So

Renee Bouche

Thank what of John? are annual license expectations And next PKPlus? sales an the Okay, year, number The within what you. cost is question your unit for for next Walt.

John DiBella

like offering potentially cost are for License program in a in fiscal volume to solid hope the for the product a of some single year over the project rate we as And seen are XXXX release. our DDDPlus the what see been have would of thousands. always today. high what extent new growth That's we I other us. fees I programs years low think with versions It's similar digit to

Renee Bouche

next Thank question you, The projects. the concerns and John. anti-inflammatory malaria

the there is and plans status to any monetize? what Asking are

John DiBella

a many to development lead that were take the good molecules be the that properties we all Okay, all had those of able through not would like be so They chemical that do. lead development molecule would two that what molecule. of way And again drug Those any new molecules. plan We our company is take projects. to to size are to those to afford those our preclinical have the a their clinical investment The a beyond further. got all way major hit is don't were final and entity targets. go

don't next be those talking millions additional molecules. done dollars lot we've of under new We're jump anyone would those it and of I combined. that license lot products to of of We on of stage. be many take as spent testing, would the a try onto a to So would synthesis that need across many, iteration think both total And there a of leads. to $XXX,XXX

That’s the we and data the We can access have successful access public see that internal if which to are is have they our not results structure have tools very pretty molecular we license publishing to including that only are did at domain we the And people that and to, lengthy. work data so use were yet not in drug they But companies public put significant right step domain. what could projects. the design that They going in both do. that off the we to basis there we use the and have did approach out data our their are the they internal molecules. their bed -- got in really sooner servers to take best it's

to and tools really company. We are the not providing a trying be drug

Renee Bouche

you. Okay, well. Thank

below last just their members one general, trading in question for this what well? sell, know if am have question to management I is Should at. anything large portion and is that We don’t interpret But the stock this, not shareholders shares if can address to from of you make I specific. going

John DiBella

which XXbX-X those or gives shares Well, on sells is, no XXbX-X over times no certain sell number control over sales I I that. program have a the of day, a have month. the decides certain whatsoever program every of whatever neither me influence to days certain broker price

going any I see don’t surprise would expect and that one And happen. not happen have that any. really had -- we’d me. seen market. it times never So we so They that and to times, so times, are if sales. XXbX-X no happen those we I there the on that haven’t work bad anything are good shares far program know would bad I luckily selling effect have below has I

Renee Bouche

Okay.

last I think that’s the written of question. our

a don’t anybody questions. is if see see hand. any me I Let raising further

I addresses all the think today. that questions

Walt Woltosz

you Why Thanks it up wrap everybody. don’t Renee? Okay.

Renee Bouche

point this Alright. Well great Thank presentations. you John, and Ted Brett Walt. at a for thank you John,

would about. we like that have to December to want in Before up you conferences we investor tell we today, two go coming

is XXth will be Main some that we might the Hotel Microcap We and Annual Event us in and LD Boulevard of at Discovery there. hope meet December Wednesday Luxe and to XXth our be presenting Chicago presentation you Micro’s also we will Thursday able December on conference Xth Benchmark Sunset on at at one-on-one

So conference and webinar. this concludes today’s

If you’ve www.simulations-plus.com. presentation, the you and in website we of wish a Thank all our the be of joining replay missed today all us today’s holiday for will any best at coming you available part very season.

Simulations Plus (SLP) 14 Nov 172017 Q4 Earnings call transcript