Ms. Momoko Beran, chief financial officer of Simulations Plus, stated: “I’m pleased to report that our c onsolidated net sales increased 14.2% to $2,437,000 in 1QFY10 from $2,133,000 in the first fiscal quarter of fiscal 2009 (1QFY09). Sales for our pharmaceutical software and services business increased 21.3%, or $305,000, for 1QFY10 over 1QFY09. Revenues from our Words+ subsidiary were essentially flat, with a 0.1% decrease over 1QFY09.”
Ms. Beran continued: “For 1QFY10, consolidated gross profit increased 16.2% to $1,830,000 from $1,574,000 in 1QFY09. R&D expense decreased 2.9% to $261,000 in 1QFY10 from $269,000 in 1QFY09 due to more staff hours being spent on consulting studies in 1QFY10. Total R&D expenditures, which include capitalized software development costs, decreased by 1.9% to $462,000 from $471,000. Consolidated SG&A increased $100,000, or 11.1% to $1,004,000 in 1QFY10, compared to $904,000 in 1QFY09. As a percentage of sales, SG&A decreased to 41.2% in 1QFY10 from 42.4% in 1QFY09. Expanded travel and trade show expenses accounted for a significant portion of the increase as we have increased our marketing and sales efforts substantially over last year. For 1QFY10, net income before taxes increased 46.0%, or $208,000, to $661,000 compared with $453,000 in 1QFY09. Our provision for income taxes increased by 63.7%, or $90,000, to $231,000 (estimated tax rate of 35.0%) for 1QFY10 from $141,000 (tax rate of 31.2%) in 1QFY09. Using our best estimates for the remainder of the year, we anticipate a tax rate for the year to be in the range of 33-37%; however, this will depend on the tax credits we obtain from Non-qualified Incentive Stock Option events and the amount of R&D tax credits generated during the current fiscal year.
“Consolidated net earnings for 1QFY10 were $430,000, or $0.03 per fully diluted share, an increase of 38.0% from $312,000, or $0.02 per diluted share in 1QFY09. We attribute this to our increased revenues from pharmaceutical software licenses and consulting services, which offset the increase in our investment in marketing and sales. Our cash continues to grow, with cash at the end of 1QFY10 of $7,973,000, up 31.5% from $6,064,000 at the end of 1QFY09. Shareholders’ equity increased 4.8% from $10,315,004 on
Walt Woltosz, chairman and chief executive officer of Simulations Plus, said: “ These results represent a new record first quarter for both revenues and earnings. We believe much of the growth is the result of the aggressive marketing and sales program we began early in 2009, wherein we have attended approximately three times as many scientific meetings and trade shows compared to what we had typically done in previous years. The recognition we’ve received through scientific presentations by our industry and government customers at many of these scientific meetings has also undoubtedly contributed to our success. With the upcoming release of GastroPlus™ Version 7.0, which will add three very important new capabilities in drug-drug interaction, ocular drug delivery, and nasal/pulmonary drug delivery, and coming improvements in ADMET Predictor™, ClassPharmer™, and DDDPlus™, combined with the continued strong demand for our consulting services, we expect 2010 to continue to be a very good year. ”
About Simulations Plus, Inc.
Simulations Plus, Inc., is a premier developer of groundbreaking drug discovery and development simulation software, which is licensed to and used in the conduct of drug research by major pharmaceutical and biotechnology companies worldwide. We have two other businesses that are based on our proprietary technologies: a wholly owned subsidiary, Words+, Inc., which provides assistive technologies to persons with disabilities as well as a personal productivity tool for the mass market called Abbreviate! ™; and an educational software series for science students in middle and high schools known as FutureLab™. For more information, visit our Web sites at www.simulations-plus.com and www.simulations-plus.com.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 – With the exception of historical information, the matters discussed in this press release are forward-looking statements that involve a number of risks and uncertainties. Words like “believe,” “expect” and “anticipate” mean that these are our best estimates as of this writing, but that there can be no assurances that expected or anticipated results or events will actually take place, so our actual future results could differ significantly from those statements. Factors that could cause or contribute to such differences include, but are not limited to: our ability to maintain our competitive advantages, acceptance of new software and improved versions of our existing software by our customers, the general economics of the pharmaceutical industry, our ability to finance growth, our ability to continue to attract and retain highly qualified technical staff, our ability to identify and close acquisitions on terms favorable to the Company, and a sustainable market. Further information on our risk factors is contained in our quarterly and annual reports as filed with the Securities and Exchange Commission.
SIMULATIONS
CONSOLIDATED BALANCE SHEETS
|
ASSETS |
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Current assets |
|
|
|||||||||
|
|
Cash and cash equivalents |
$ 7,973,340 |
$ 7,473,485 |
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|
|
Accounts receivable, net of allowance for doubtful accounts |
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|
|
|
and estimated contractual discounts of $387,149 and $447,073 |
1,831,307 |
1,888,904 |
|||||||
|
|
Contracts receivable |
177,259 |
79,565 |
||||||||
|
|
Inventory |
370,691 |
325,926 |
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|
|
Prepaid expenses and other current assets |
58,870 |
158,738 |
||||||||
|
|
Deferred income taxes |
338,516 |
338,516 |
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|
|
|
Total current assets |
10,749,983 |
10,265,134 |
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Capitalized computer software development costs
, |
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net of accumulated amortization of $3,994,139 and $3,843,743 |
1,993,035 |
1,942,893 |
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Property and equipment
, net |
47,644 |
53,220 |
|||||||||
|
Customer relationships,
net of accumulated amortization of $108,717 and $104,728 |
19,325 |
23,314 |
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|
Other assets |
18,445 |
18,445 |
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|
|
|
|
Total assets |
$ 12,828,432 |
$ 12,303,006 |
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|
LIABILITIES |
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Current liabilities |
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Accounts payable |
$ 299,502 |
$ 199,218 |
||||||||
|
|
Accrued payroll and other expenses |
576,874 |
552,431 |
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|
|
Accrued bonuses to officer |
123,749 |
60,000 |
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|
|
Accrued warranty and service costs |
35,101 |
43,236 |
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Accrued income tax |
36,591 |
- |
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Deferred revenue |
149,810 |
82,190 |
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|
|
|
Total current liabilities |
1,221,627 |
937,075 |
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Long-Term liabilities |
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|
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Deferred income taxes |
795,140 |
795,140 |
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Total liabilities |
2,016,767 |
1,732,215 |
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Commitments and contingencies
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Shareholders' equity
|
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Preferred stock, $0.001 par value 10,000,000 shares authorized |
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no shares issued and outstanding |
- |
- |
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Common stock, $0.001 par value |
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50,000,000 shares authorized |
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|
|||||||
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15,684,046 and 15,700,382 shares issued and outstanding |
4,155 |
4,172 |
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Additional paid-in capital |
5,383,499 |
5,572,411 |
||||||||
|
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Retained Earnings |
5,424,011 |
4,994,208 |
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|
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Total shareholders' equity |
10,811,665 |
10,570,791 |
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|
|
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|
Total liabilities and shareholders' equity |
$ 12,828,432 |
$ 12,303,006 |
|||||
SIMULATIONS
CONSOLIDATED STATEMENTS OF OPERATIONS
for the three months ended November 30,
(Unaudited)
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2009 |
2008 |
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|
|
|
|
|
|
Net sales |
|
$ 2,437,052 |
$ 2,133,250 |
|||
|
|
|
|
|
|
|
|
|
Cost of sales |
606,889 |
558,726 |
||||
|
|
|
|
|
|
|
|
|
Gross profit |
1,830,163 |
1,574,524 |
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Operating expenses |
|
|
||||
|
|
Selling, general, and administrative |
1,004,273 |
903,690 |
|||
|
|
Research and development |
261,325 |
269,085 |
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|
|
|
|
|
|
|
|
|
|
Total operating expenses |
1,265,598 |
1,172,775 |
||
|
|
|
|
|
|
|
|
|
Income from operations |
564,565 |
401,749 |
||||
|
|
|
|
|
|
|
|
|
Other income (expense) |
|
|
||||
|
|
Interest income |
22,486 |
33,387 |
|||
|
|
interest expense |
(302) |
- |
|||
|
|
Miscellaneous income |
231 |
43 |
|||
|
|
Gain on sales of assets |
1,024 |
- |
|||
|
|
Gain on currency exchange |
73,232 |
17,876 |
|||
|
|
|
|
|
|
|
|
|
|
|
Total other income (expense) |
96,671 |
51,306 |
||
|
|
|
|
|
|
|
|
|
Income before income taxes |
661,236 |
453,055 |
||||
|
|
|
|
|
|
|
|
|
Provision for income taxes |
(231,433) |
(141,333) |
||||
|
|
|
|
|
|
|
|
|
Net income |
$ 429,803 |
$ 311,722 |
||||
|
|
|
|
|
|
|
|
|
Basic earnings per share |
$ 0.03 |
$ 0.02 |
||||
|
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Diluted earnings per share |
$ 0.03 |
$ 0.02 |
||||
|
|
|
|
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|
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Weighted-average common shares outstanding |
|
|
||||
|
|
Basic |
|
15,648,630 |
16,348,818 |
||
|
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|
|
|
|
|
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Diluted |
|
16,775,287 |
17,516,583 |
||
For further information:
Simulations Plus, Inc.
42505 10th Street West
Lancaster, CA
93534-7059 USA
www.simulations-plus.com
CONTACT: investor relations:
Contact: Renee Bouche