SYZLF - Earnings call transcript Q2 2021

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Bill Wood

Hello, and welcome to our Q2 Earnings Call for Fiscal 2021. I'm Bill Wood, Sylogist President and CEO.

On the call with me today is Xavier Shorter, our Chief Financial Officer. We'd like to walk you through our financial performance and material developments for Q2, which ended on March 31st.

Before we get into it, I’d like to note that this call may contain forward-looking statements relating to the future operations and profitability of the company, any of which are subject to risks, uncertainties and assumptions, and actual events or outcomes may differ materially from those we contemplate here. are law, of to we statements as and revise forward-looking by required have such made today, as except them. Any no obligation Q&A of like at questions can throughout also to your submit to I'd call. direct use to the screens, your the bottom today’s which you attention button

I comments, have questions as that may answer not time with allows, our prepared will offline to Following and to answers to. get time Xavier and questions we’ll follow-up we

of be the do if we get the name question he to, questions, call posing the and individual the applicable, or For the she announced moderator. organization the represents will by

provide that please your question. So along information with

Technology made In great the Terry announced and we of progress Chief of a Information January, just Officer. we in QX. hiring So our deal LoPresti,

Exchange we approval perhaps graduate Systems. Municipal TSX, listed also the the was XXth, Venture XXst, on our March We March acquired from where on to stock subsequently Accounting notably to most received

strategic footprint. serve importantly, defining retention, alike. for customer opportunity to share several we will of strategically beyond with pre-close growth. organic products the also sell already current investments developments acquisition and opportunities implementing facility alignment, our to on I'd strategic MAS it’s credit like expansion cross-sell website During we innovative to MAS’s to available listen and it's leverage have K-XX further our acquisitions. community, the wallet highly and that IP so. on our some investment speak we've portfolio. and call, set to we to the you invite IP highly the for modern haven't accelerating is in you announced the providing We accretive bookings previous of valuable. Conversely, customer Oklahoma complimentary, resources to future we're the and staffing it’s new making discussed with expansion Simultaneously diligence ARR The already enhance these transaction, to our and been fundamental the capabilities groundwork across and and stage million, afterwards, identified important Most I if platform recording done $XX

made into effectively. us of our and and management voice These product customer hires insight our the give to most greater resources against teams. subsequently several we will both competitive align First, expectations and us new product allow and execute into roadmap landscape R&D

also resources to development have bulk on short-term We In year development meet to increased release sprint historically make where we waterfall improvements iterative agile product would a from parallel, or offshore where offerings contract expand updates to once frequent, an twice more cadence. and we in development the up a large transitioned a our engaged monthly QA output. we methodology, methodology to

want the these to and customers in in position front, With a understand what to raise we providing bar respond foundation the competitive the investment better changes, are and for growth.

be marketing and also fulfil sales resources to will adding We objective. this

cumulative most to the many to calendar effect investments public not QX. education profile the of sector public nonprofit, expect the towards of apparent and unlike non-governmental, end on the We Not revenue before. these if pay-off that in see markets, COVID our year, was serve start

our phases additional impacted and the and projects new both retention strong, customer revenue. our implementation of While ARR postponement of bookings subscription was

in revenue take successful are profile year been non-governmental over normally have now like of COVID have would discussions the cadence basis, more completion the country the months. QX While we on we for to to a the has to in turn figure, up. on year project I deal were or coming delayed exceeded last on And organization, back celebrating of updating the that impact, to over will things financials normal deal year our Xavier due pipeline look however, seven in XX pick I'd seeing global plus to detail. implementation you forward matriculation revenue us a positive replaced through a that

Xavier Shorter

Chief Thanks, Bill. Sylogist’s I'm Shorter, Financial Xavier Officer.

As perspective, we over and quarter in were X% a our quarters two in X% mentioned, under which revenue currency US million, reduction, to a was COVID, or million quarter USD. Bill we our faced from have is $X.X financial for From $X.X this slightly a dollar. made up mainly responsible headwinds; progress bit to denominated Three $XXX,XXX weakening attributable directly of X% quite to of decline the revenue quarter.

decrease from professional So revenue an X.XX, in year CAD as accordingly. our to due The line average this fell of fell in X.XX, to services. QX top CAD the QX was dollar remaining last year,

As generally and QX highlighted, quarter size approximately facing professional last are lumpy unpredictable uncertain, $XXX,XXX they someone ongoing delays, customers alone. major environment Large constituted due due financially NGO pressured project or currently and hesitant Bill the of mentioned. comparable response which nature are are Many COVID directly project, have in been service nonprofit year's to either projects there's begin that trading multiyear Bill cautiously and included of by large the and no a to our implementations. involved a pandemic to turn in in

this been lost. confident not has revenue we're delayed, However,

this normal. pipeline we more was $X.X expect $X.XX vaccinations down Adjusted million EBITDA XXXX. The strong see as to and QX, remains the become the and decline Expenses caused for recover reason widely came available from to revenue professional professional rates move sales things decrease somewhat return fees million TSX the of unfavorable and in main from and Our man Much in to already our also incurred foreign costs. were by exchange I expense we lower higher compliance services, increase QX higher. which detailed. was

responsible material charitable was gesture. donation made socially also we that a $XXX,XXX felt We a

know, not we you issue do As guidance.

lead expand the and to clear investments Bill discussed EBITDA as that compress R&D, may should earlier I strategic teams. However, sales product, make we more margins our

and to right is the expansion. Our to capabilities healthy add objective drive profitable

to some be two. we extent is guided there to and a seeking the while both always, shareholders' tradeoff recognizing organic interests, growth between As will by that produce margins, strong steady

to Operating were of to in Our gross mainly QX year. services the service-oriented This XX% mentioned. compared QX in revenue business expenses XXXX. With to $XXX,XXX this last its prior in somewhat quarter. professional due historically April the quarter, lower InfoStrat I is acquisition of factors up InfoStrat margins, in the profit margins relatively XXXX for relative the were XX% to due contributed quarter

Although qualify were more accounting rather R&D more expenses on not the down, that capitalized but This expensed. were reflects appropriately capitalization. is change, this on work simply based projects guidance, projects for solely and an economic team's

are in were year course down shareholders, $X.XX period from the We $X.XX the $X.X share, R&D million dividends per remain in for profit In at QX $X.XXX remains and effect. As normal per million, year. $X remained up the distributed our share. Earnings a to $X.X or an to a repurchase share investors in in from XXX,XXX Bill shares mentioned, shares we same common from of million and same investments. average ramping strategic price Quarterly down at Return period total, was share, $X.X strong. last issuer XX,XXX million of dividends up $XX.XX. prior bid

strategic go-forward has excited strong you M&A continued In a $XX.X sheet and interest organically balance $XX of focus than clarity headroom be to of the both end highlight Bill already position few that and and to will I questions. to company are Sylogist's we're are Our through take grow more do Bill on our time in now in your credit strategy, in and making so. executing had to we and we our to continues in million strong. Sylogist. I'd brought ever about million like future. for conclusion, The investments facility. is the it. QX, a plus cash, At Thank we and

Unidentified Company Representative

Thanks, Xavier.

questions Acumen Our from Capital. few first Byrne Jim are of

So, of products first, we plan whether our portfolio? the how's And Jim going? mass asks, utilize in to some their integration

Bill Wood

well, how The alignment, from different Different standpoint that the done. alignment systems than able measurable I'd question. other for to going the wide integration to repeatable involved. leads mass mass thanks brought use look business IP done their methodology and in me importantly, the quite and is visibility know that where relative well. been most standpoint, standpoint, through the the IP, Jim, into well, the is they team theirs. and and our have. that's methodology us the working companies organization with a was through with that acquisitions a But of us. systematically giving be That diligence an and organization is from serve we for amount the integration and methodology going I Hi, effort past -- the had at they interacting very It's to markets

expect along with early well are integration, by we largely completed we the of June, end, the to that end July. be that to so And

Unidentified Company Representative

Thanks Bill.

And Second further how how Sylogist’s question is Jim from does for appetite M&A? pipeline look? is

Bill Wood

out can is as companies excess and for mentioned on just continuing them be and I've added up are us. number and fit put good our We're we And the But the calls effort an qualified The those boxes. appetite following, that opportunities we into to a opportunities that outbound to to good there, looking he fresh point. as is for to actually there's of will to tracker team. additional connections be through are a XXX to strong possible. tick fit that And as that on engaged for extent resource this in several keep more research a of different lens,

execute once to be is and we is those, our the is strong, resources strong. the identify pipeline appetite So engage, very and to strong able on

good very look in position positive a we forward. a in very as we're So position

Unidentified Company Representative

Thank you.

months Third clients, have a question of few clients opening Jim. from seeing Are they conversations willing that we The and from the kind is are economy wouldn't quickly. to that have? US ago

Bill Wood

Yes.

are become the really and of, down concept, reoccur related the we just in to mentioned fulsome seeing discussions of not decisions terms they're in and I that deal prepared As to. start -- come final activity our timing Those now comments, some to but in details more the pipeline.

think, and to charities recently now now been XX% supporting starting and extraordinarily did strong Philanthropy in that in that internet ready little them. they're But the NPO first this out customers XX I that get get industry NGO charity where being the and into ultimately to want are out. to their overall. prospective some America I us a charities for helping states down pull I giving position managing so everyone, pockets often in the bit through. caution are and many reaching impacted see economy, And yes, last for customers to so feel position of do hunker people community to they've of been better. and trigger community, up years, almost to the in North end, US in was is of And that the US has charitable their are past, and

Unidentified Company Representative

Thanks, Do for term that margins? growth in the Bill. stronger we And anticipate some final Jim. what’s questions mean near from and

Xavier Shorter

Yes. This Jim. Xavier. is Thanks, Yes.

more of back to finalizing NGO, discussions seeing deals. out, are, about pointed we the NPOs So and having as Bill the table coming

We as so given expect on are those the to hit perhaps are though of we year. probably billable execute compress far as and go, And have, that, growth. we strategic investments. QX until we margins it with on and have where start going as which to our for ground running our time forth, negotiations -- -- in as will fiscal that not we to rapid we will continued margins gear execute, It so

Unidentified Company Representative

Xavier. for That's have come in actually you, Thank today. questions the it

to you who Appreciate call. your thank everyone attended time. So, this

answer please free feel and you up offline. to we Thank further can you. questions, If follow have them

Sylogist (SYZLF) 18 May 212021 Q2 Earnings call transcript