OREANDA-NEWS. The Descartes Systems Group Inc.announced its financial results for its fiscal 2017 first quarter (Q1FY17) ended April 30, 2016. All financial results referenced are in United States (US) currency and, unless otherwise indicated, are determined in accordance with US Generally Accepted Accounting Principles (GAAP).

“We continue to add capabilities, content and scale to the Global Logistics Network so that shippers, carriers, logistics intermediaries and governments can collaborate to execute shipments in a safe and efficient manner,” said Edward J. Ryan, Descartes’ CEO. “We believe that consumer expectations relating to buying and delivering goods continue to evolve and are placing more and more demands on global and domestic supply chains. We continue to evolve our solutions and combine with complementary businesses to address this. With a long track record of significant research and development investment and profitable operations, combined with a strong balance sheet and additional capital capacity, we believe we’re ideally positioned to help delivery-sensitive customers compete in these new market conditions.”

Q1FY17 Financial Results
As described in more detail below, key financial highlights for Descartes in Q1FY17 included:

  • Revenues of $48.9 million, up 10% from $44.4 million in the first quarter of fiscal 2016 (Q1FY16) and up 2% from $48.0 million in the previous quarter (Q4FY16);
  • Services revenues of $47.5 million, up 14% from $41.7 million in Q1FY16 and up 3% from $46.3 million in Q4FY16. Services revenues comprised 97% of total revenues for the quarter;
  • Cash provided by operating activities of $15.9 million, up 34% from $11.9 million in Q1FY16 and down from $16.2 million in Q4FY16;
  • Net income of $6.0 million, up 22% from $4.9 million in Q1FY16 and up 11% from $5.4 million in Q4FY16;
  • Earnings per share on a diluted basis of $0.08, up 33% from $0.06 in Q1FY16 and up 14% from $0.07 in Q4FY16;
  • Adjusted EBITDA of $16.6 million, up 17% from $14.2 million in Q1FY16 and up 2% from $16.3 million in Q4FY16. Adjusted EBITDA as a percentage of revenues was 34%, up from 32% in Q1FY16 and consistent with Q4FY16; and
  • Adjusted EBITDA per share on a diluted basis of $0.22, up 16% from $0.19 in Q1FY16 and up 5% from $0.21 in Q4FY16.
On March 2, 2016, Descartes amended its $77.0 million revolving debt facility with a new senior secured credit facility. The credit facility consists of a $150.0 million revolving operating credit facility to be available for general corporate purposes including the financing of ongoing working capital needs and acquisitions. The credit facility also provides for an additional $7.5 million available to support foreign exchange and interest rate hedging. The credit facility has a five-year maturity (March 2021) with no fixed repayment dates prior to the end of the five-year term. As of April 30, 2016, $10.9 million has been borrowed on the revolving operating credit facility and $139.1 million of the revolving operating credit facility remains available for use. No amounts have been drawn on the facility available to support foreign exchange and interest rate hedging. We are in compliance with the covenants of the credit facility as of April 30, 2016.

Descartes’ existing base shelf prospectus was scheduled to expire in May 2016. On April 18, 2016, Descartes filed a new final short-form base shelf prospectus, allowing it to offer and issue securities in amounts, at prices and on terms that may be set forth in one or more shelf prospectus supplements. The aggregate initial offering price of securities that may be sold pursuant to the base shelf prospectus during the 25-month period ending in May 2018 is limited to $500 million.  

On April 29, 2016, Descartes acquired pixi* Software GmbH, a leading Germany-based provider of technology solutions for e-commerce order fulfilment and warehouse management. The company’s solutions help its customers automate e-commerce processes originating from online orders across hundreds of e-commerce sites in Europe. The total purchase price for the acquisition was approximately EUR 9.2 million (approximately USD $10.4 million at April 29, 2016), net of cash acquired, which was funded by drawing on our credit facility.