Aspen Technology, Inc. (AspenTech) (NASDAQ: AZPN), a global
leader in industrial software, today announced financial results
for its first quarter in fiscal 2024, ended September 30, 2023.
“We delivered solid results in the first quarter, once again
achieving double-digit ACV growth on strong demand across most
markets,” said Antonio Pietri, President and Chief Executive
Officer of AspenTech. “While our first year as new AspenTech was
centered on building the foundation, our focus in fiscal 2024 is on
execution and expansion. Our work in these areas is off to a strong
start, and we remain committed to helping our customers to run
their assets safer, greener, longer, and faster through our
expanded portfolio and greater market reach.”
Pietri continued, “AspenTech solutions are mission-critical to
customers around the world. We are seeing numerous opportunities to
help asset-intensive companies better meet their profitability and
sustainability objectives as well as promising signs of growth
across many different sustainability pathways. We remain confident
in our business outlook and are reiterating our guidance for fiscal
2024.”
First Quarter Fiscal Year 2024 Recent Business
Highlights
- Annual contract value1 (“ACV”) was $897.6 million at the end of
the first quarter of fiscal 2024, increasing 10.9% year over year
and 1.4% quarter over quarter.
- Operating cash flow was $17.0 million for the first quarter of
fiscal 2024, compared to $5.1 million in the first quarter of
fiscal 2023.
- Free cash flow2 was $16.0 million for the first quarter of
fiscal 2024, compared to $3.7 million in the first quarter of
fiscal 2023.
Summary of First Quarter Fiscal Year 2024 Financial
Results
AspenTech’s total revenue was $249.3 million in the first
quarter of fiscal 2024 and included the following:
- License and solutions revenue, which represents the
portion of a term license agreement allocated to the initial
license and Open Systems International, Inc. (OSI) revenue where
software, hardware and professional services are recognized as one
performance obligation, was $148.6 million in the first quarter of
fiscal 2024, compared to $160.2 million in the first quarter of
fiscal 2023.
- Maintenance revenue, which represents the portion of
customer agreements related to ongoing support and the right to
future product enhancements, was $85.0 million in the first quarter
of fiscal 2024, compared to $78.4 million in the first quarter of
fiscal 2023.
- Services and other revenue, which represents the portion
of customer agreements related to professional services and
training services, was $15.7 million in the first quarter of fiscal
2024, compared to $12.2 million in the first quarter of fiscal
2023.
Loss from operations was $60.2 million in the first quarter of
fiscal 2024, compared to loss from operations of $51.2 million in
the first quarter of fiscal 2023. Non-GAAP income from operations
was $77.8 million in the first quarter of fiscal 2024, compared to
$92.6 million in the first quarter of fiscal 2023. A reconciliation
of GAAP to non-GAAP results is presented in the financial tables
included in this press release.
Net loss was $34.5 million, or $0.54 per diluted share, in the
first quarter of fiscal 2024, compared to a net loss of $11.2
million, or $0.17 per diluted share, in the first quarter of fiscal
2023. AspenTech has increased amortization of intangible assets
following the close of its transaction with Emerson Electric Co. As
a result, AspenTech expects its amortization of intangible assets
to remain at higher levels for the next several years as the
related asset balance is amortized over the respective expected
useful lives of the intangible assets.
Non-GAAP net income was $74.9 million, or $1.16 per share, in
the first quarter of fiscal 2024, compared to non-GAAP net income
of $142.0 million, or $2.20 per share, in the first quarter of
fiscal 2023. The year-over-year decrease in non-GAAP net income was
mainly due to the lower benefit from income taxes in the first
quarter of fiscal 2024, following AspenTech's change in approach to
computing its tax provision, which initially occurred in the second
quarter of fiscal 2023.
AspenTech had cash and cash equivalents of $120.5 million as of
September 30, 2023, compared to $241.2 million as of June 30, 2023.
The decrease in cash and cash equivalents was due to the impact of
share repurchase activity under AspenTech’s $300.0 million share
repurchase authorization in the first quarter of fiscal 2024.
AspenTech had no borrowings and $197.7 million available under its
revolving credit facility as of September 30, 2023.
AspenTech generated $17.0 million in cash flow from operations
and $16.0 million in free cash flow2 in the first quarter of fiscal
2024, compared to $5.1 million in cash flow from operations and
$3.7 million in free cash flow in the first quarter of fiscal 2023.
Free cash flow is a non-GAAP metric that is calculated as net cash
provided by operating activities adjusted for the net impact of
purchases of property, equipment and leasehold improvements and
payments for capitalized computer software development costs.
Recent Developments
Chief Financial Officer Transition
On October 19, 2023, AspenTech announced that Chantelle
Breithaupt had informed the Company that she plans to step down as
Chief Financial Officer for another opportunity. Ms. Breithaupt
will continue in her role through December 31, 2023. Christopher
Stagno, who currently serves as SVP, Chief Accounting Officer, will
assume the role of Interim CFO, effective January 1, 2024, should a
permanent CFO not have been named.
Share Repurchase Programs Update
AspenTech settled its $100 million accelerated share repurchase
program in the first quarter of fiscal 2024, which resulted in the
delivery of an additional 107,045 shares of AspenTech common stock,
for a total of 594,671 shares delivered under the program. Upon
completion of the accelerated share repurchase program, AspenTech
began purchasing shares pursuant to its $300.0 million share
repurchase authorization announced on August 1, 2023. During the
first quarter of fiscal 2024, AspenTech repurchased 579,798 shares
for $114.2 million under the share repurchase authorization. The
total value remaining under the share repurchase authorization as
of September 30, 2023, was $185.8 million, which AspenTech expects
to utilize in the remainder of fiscal 2024.
Fiscal Year 2024 Business Outlook
Based on information as of today, November 6, 2023, AspenTech is
issuing the following guidance for fiscal 2024.
- ACV1 growth of at least 11.5% year-over-year
- GAAP operating cash flow of at least $378 million
- Free cash flow2 of at least $360 million
- Total bookings of at least $1.04 billion
- Total revenue of at least $1.12 billion
- GAAP total expense of approximately $1.22 billion
- Non-GAAP total expense of approximately $675 million
- GAAP operating loss at or better than $100 million
- Non-GAAP operating income of at least $445 million
- GAAP net loss at or better than $7 million
- Non-GAAP net income of at least $424 million
- GAAP net loss per share at or better than $0.11
- Non-GAAP net income per share of at least $6.57
These statements are forward-looking and actual results may
differ materially. Refer to the Forward-Looking Statements safe
harbor below for information on the factors that could cause
AspenTech’s actual results to differ materially from these
forward-looking statements.
Conference Call and Webcast
AspenTech will host a conference call and webcast presentation
on Monday, November 6, 2023, at 4:30 p.m. ET to discuss its
financial results, business outlook, and related corporate and
financial matters. A live webcast of the call will be available on
AspenTech's Investor Relations website, ir.aspentech.com, via its
“Webcasts” page. To access the call by phone, please use the
following registration link. To avoid delays, we encourage
participants to dial into the conference call fifteen minutes ahead
of the scheduled start time. A replay of the webcast also will be
available for a limited time at http://ir.aspentech.com/.
AspenTech has provided an earnings presentation for its first
quarter of fiscal 2024. The Company asks that shareholders refer to
this presentation in conjunction with today’s conference call,
which can be found at ir.aspentech.com.
Footnotes
- AspenTech defines ACV as the estimate of the annual value of
our portfolio of term license and software maintenance and support,
or SMS, contracts, the annual value of SMS agreements purchased
with perpetual licenses and the annual value of standalone SMS
agreements purchased with certain legacy term license agreements,
which have become an immaterial part of our business.
- Effective January 1, 2023, we no longer exclude acquisition and
integration planning related payments from our computation of free
cash flow. Free cash flow for all prior periods presented has been
revised to the current period computation.
About AspenTech
Aspen Technology, Inc. (NASDAQ: AZPN) is a global software
leader helping industries at the forefront of the world’s dual
challenge meet the increasing demand for resources from a rapidly
growing population in a profitable and sustainable manner.
AspenTech solutions address complex environments where it is
critical to optimize the asset design, operation and maintenance
lifecycle. Through our unique combination of deep domain expertise
and innovation, customers in capital-intensive industries can run
their assets safer, greener, longer and faster to improve their
operational excellence. To learn more, visit AspenTech.com.
Forward-Looking Statements
Statements in this press release that are not strictly
historical may be “forward-looking” statements for purposes of the
safe harbor provisions of the Private Securities Litigation Reform
Act of 1995, which involve risks and uncertainties, and AspenTech
undertakes no obligation to update any such statements to reflect
later developments. These forward-looking statements include, but
are not limited to, our guidance for fiscal 2024, our expectations
regarding cash collections and completion of our share repurchase
authorization. In some cases, you can identify forward-looking
statements by the following words: “may,” “will,” “could,” “would,”
“should,” “expect,” “intend,” “plan,” “strategy,” “anticipate,”
“believe,” “estimate,” “predict,” “project,” “potential,”
“continue,” “ongoing,” “opportunity” or the negative of these terms
or other comparable terminology, although not all forward-looking
statements contain these words. These risks and uncertainties
include, without limitation: the failure to realize the anticipated
benefits of our transaction with Emerson Electric Co.; risks
resulting from our status as a controlled company; the scope,
duration and ultimate impacts of the Russia-Ukraine war, and the
Israeli-Hamas conflict; as well as economic and currency
conditions, market demand (including related to the pandemic and
adverse changes in the process or other capital-intensive
industries such as materially reduced spending budgets due to oil
and gas price declines and volatility), pricing, protection of
intellectual property, cybersecurity, natural disasters, tariffs,
sanctions, competitive and technological factors, and inflation;
and others, as set forth in AspenTech’s most recent Annual Report
on Form 10-K and subsequent reports filed with the Securities and
Exchange Commission. The outlook contained herein represents
AspenTech’s expectation for its consolidated results, other than as
noted herein.
© 2023 Aspen Technology, Inc. AspenTech, aspenONE, asset
optimization and the Aspen leaf logo are trademarks of Aspen
Technology, Inc. All rights reserved. All other trademarks not
owned by AspenTech are property of their respective owners.
Use of Non-GAAP Financial Measures
This press release contains “non-GAAP financial measures” under
the rules of the U.S. Securities and Exchange Commission. Non-GAAP
financial measures are not based on a comprehensive set of
accounting rules or principles. This non-GAAP information
supplements, and is not intended to represent a measure of
performance in accordance with, disclosures required by generally
accepted accounting principles, or GAAP. Non-GAAP financial
measures should be considered in addition to, not as a substitute
for or superior to, financial measures determined in accordance
with GAAP. A reconciliation of GAAP to non-GAAP results is included
in the financial tables included in this press release.
Management considers both GAAP and non-GAAP financial results in
managing AspenTech’s business. As the result of adoption of new
licensing models, management believes that a number of AspenTech’s
performance indicators based on GAAP, including revenue, gross
profit, operating income and net income, should be viewed in
conjunction with certain non-GAAP and other business measures in
assessing AspenTech’s performance, growth and financial condition.
Accordingly, management utilizes a number of non-GAAP and other
business metrics, including the non-GAAP metrics set forth in this
press release, to track AspenTech’s business performance. None of
these non-GAAP metrics should be considered as an alternative to
any measure of financial performance calculated in accordance with
GAAP.
ASPEN TECHNOLOGY, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended September
30,
2023
2022
(Dollars and Shares in
Thousands, Except per share data)
Revenue:
License and solutions
$
148,648
$
160,224
Maintenance
84,968
78,366
Services and other
15,692
12,229
Total revenue
249,308
250,819
Cost of revenue:
License and solutions
71,578
69,513
Maintenance
10,200
9,217
Services and other
16,282
12,400
Total cost of revenue
98,060
91,130
Gross profit
151,248
159,689
Operating expenses:
Selling and marketing
122,378
118,274
Research and development
53,676
49,740
General and administrative
35,405
42,848
Restructuring costs
—
9
Total operating expenses
211,459
210,871
Loss from operations
(60,211
)
(51,182
)
Other expense, net
(5,830
)
(58,632
)
Interest income, net
14,049
5,023
Loss before benefit for income taxes
(51,992
)
(104,791
)
Benefit for income taxes
(17,467
)
(93,547
)
Net loss
$
(34,525
)
$
(11,244
)
Net loss per common share:
Basic
$
(0.54
)
$
(0.17
)
Diluted
$
(0.54
)
$
(0.17
)
Weighted average shares
outstanding:
Basic
64,319
64,454
Diluted
64,319
64,454
ASPEN TECHNOLOGY, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(Unaudited)
September 30, 2023
June 30, 2023
(Dollars in Thousands, Except
Share and Per Share Data)
ASSETS
Current assets:
Cash and cash equivalents
$
120,540
$
241,209
Accounts receivable, net
87,977
122,789
Current contract assets, net
369,019
367,539
Prepaid expenses and other current
assets
32,010
27,728
Receivables from related parties
59,458
62,375
Prepaid income taxes
15,319
11,424
Total current assets
684,323
833,064
Property, equipment and leasehold
improvements, net
17,484
18,670
Goodwill
8,328,192
8,330,811
Intangible assets, net
4,549,858
4,659,657
Non-current contract assets, net
547,617
536,104
Contract costs
17,138
15,992
Operating lease right-of-use assets
64,322
67,642
Deferred income tax assets
12,019
10,638
Other non-current assets
19,721
13,474
Total assets
$
14,240,674
$
14,486,052
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable
$
15,301
$
20,299
Accrued expenses and other current
liabilities
79,536
99,526
Due to related parties
29,253
22,019
Current operating lease liabilities
12,570
12,928
Income taxes payable
48,461
46,205
Current contract liabilities
117,110
151,450
Total current liabilities
302,231
352,427
Non-current contract liabilities
27,671
30,103
Deferred income tax liabilities
911,967
957,911
Non-current operating lease
liabilities
52,485
55,442
Other non-current liabilities
19,401
19,240
Stockholders’ equity:
Common stock, $0.0001 par value
Authorized— 600,000,000 shares
Issued— 65,030,408 and 64,952,868
shares
Outstanding— 63,855,939 and 64,465,242
shares
6
6
Additional paid-in capital
13,230,178
13,194,028
Accumulated deficit
(75,916
)
(41,391
)
Accumulated other comprehensive (loss)
income
(8,765
)
2,436
Treasury stock, at cost — 1,174,469 and
487,626 shares of common stock
(218,584
)
(84,150
)
Total stockholders’ equity
12,926,919
13,070,929
Total liabilities and stockholders’
equity
$
14,240,674
$
14,486,052
ASPEN TECHNOLOGY, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended September
30,
2023
2022
(Dollars in Thousands)
Cash flows from operating
activities:
Net loss
$
(34,525
)
$
(11,244
)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization
123,219
122,546
Reduction in the carrying amount of
right-of-use assets
3,562
3,291
Net foreign currency losses
5,894
8,332
Stock-based compensation
16,699
17,736
Deferred income taxes
(51,080
)
(70,438
)
Provision for uncollectible
receivables
1,788
3,609
Other non-cash operating activities
19
3,225
Changes in assets and
liabilities:
Accounts receivable
29,417
8,009
Contract assets
(24,062
)
(68,357
)
Contract costs
(1,163
)
(3,451
)
Lease liabilities
(3,770
)
(1,659
)
Prepaid expenses, prepaid income taxes,
and other assets
(17,022
)
(47,004
)
Liability from foreign currency forward
contract
—
50,259
Accounts payable, accrued expenses, income
taxes payable and other liabilities
4,735
(13,476
)
Contract liabilities
(36,730
)
3,699
Net cash provided by operating
activities
16,981
5,077
Cash flows from investing
activities:
Purchases of property, equipment and
leasehold improvements
(937
)
(1,321
)
Payments for business acquisitions, net of
cash acquired
(8,273
)
(74,947
)
Payments for equity method investments
(98
)
—
Payments for capitalized computer software
development costs
—
(99
)
Payments for asset acquisitions
(12,500
)
—
Net cash used in investing activities
(21,808
)
(76,367
)
Cash flows from financing
activities:
Issuance of shares of common stock
3,285
8,470
Repurchases of common stock
(114,224
)
—
Payment of tax withholding obligations
related to restricted stock
(1,938
)
(3,422
)
Deferred business acquisition payments
—
(1,363
)
Repayments of amounts borrowed under term
loan
—
(6,000
)
Net transfers from Parent Company
3,890
12,446
Payments of debt issuance costs
—
(2,375
)
Net cash (used in) provided by financing
activities
(108,987
)
7,756
Effect of exchange rate changes on cash
and cash equivalents
(6,855
)
(3,733
)
Decrease in cash and cash equivalents
(120,669
)
(67,267
)
Cash and cash equivalents, beginning of
period
241,209
449,725
Cash and cash equivalents, end of
period
$
120,540
$
382,458
ASPEN TECHNOLOGY, INC. AND
SUBSIDIARIES
Reconciliation of GAAP to
Non-GAAP Results of Operations and Cash Flows
(Unaudited Dollars in Thousands,
Except per Share Data)
Three Months Ended September
30,
2023
2022
Total
expenses
GAAP total expenses (a)
$
309,519
$
302,001
Less:
Stock-based compensation (b)
(16,699
)
(17,736
)
Amortization of intangibles (c)
(121,587
)
(121,160
)
Acquisition and integration planning
related fees
255
(4,858
)
Non-GAAP total expenses
$
171,488
$
158,247
(Loss) income
from operations
GAAP loss from operations
$
(60,211
)
$
(51,182
)
Plus:
Stock-based compensation (b)
16,699
17,736
Amortization of intangibles (c)
121,587
121,160
Acquisition and integration planning
related fees
(255
)
4,858
Non-GAAP income from operations
$
77,820
$
92,572
Net (loss)
income
GAAP net loss
$
(34,525
)
$
(11,244
)
Plus:
Stock-based compensation (b)
16,699
17,736
Amortization of intangibles (c)
121,587
121,160
Acquisition and integration planning
related fees
(255
)
4,858
Unrealized loss on foreign currency
forward contract
—
50,259
Less:
Income tax effect on Non-GAAP items
(d)
(28,621
)
(40,730
)
Non-GAAP net income
$
74,885
$
142,039
Diluted (loss)
income per share
GAAP diluted loss per share
$
(0.54
)
$
(0.17
)
Plus:
Stock-based compensation (b)
0.26
0.28
Amortization of intangibles (c)
1.88
1.88
Acquisition and integration planning
related fees
—
0.07
Unrealized loss on foreign currency
forward contract
—
0.77
Less:
Income tax effect on Non-GAAP items
(d)
(0.44
)
(0.63
)
Non-GAAP diluted income per share
$
1.16
$
2.20
Shares used in computing Non-GAAP diluted
income per share
64,658
64,454
Three Months Ended September
30,
2023
2022
Free Cash
Flow (2)
Net cash provided by operating activities
(GAAP)
$
16,981
$
5,077
Purchases of property, equipment and
leasehold improvements
(937
)
(1,321
)
Payments for capitalized computer software
development costs
—
(99
)
Free cash flow (non-GAAP)
$
16,044
$
3,657
(a) GAAP total expenses
Three Months Ended September
30,
2023
2022
Total costs of revenue
$
98,060
$
91,130
Total operating expenses
211,459
210,871
GAAP total expenses
$
309,519
$
302,001
(b) Stock-based compensation expense was
as follows:
Three Months Ended September
30,
2023
2022
Cost of license and solutions
$
680
$
742
Cost of maintenance
488
561
Cost of services and other
498
408
Selling and marketing
2,942
3,347
Research and development
4,553
3,611
General and administrative
7,538
9,067
Total stock-based compensation
$
16,699
$
17,736
(c) Amortization of intangible assets was
as follows:
Three Months Ended September
30,
2023
2022
Cost of license and solutions
$
48,035
$
47,670
Selling and marketing
73,552
73,490
Total amortization of intangible
assets
$
121,587
$
121,160
(d) The income tax effect on non-GAAP items for the three months
ended September 30, 2023 and 2022, respectively, is calculated
utilizing the Company's combined US federal and state statutory tax
rate as following:
Three Months Ended September
30,
2023
2022
U.S. Statutory Rate
21.79
%
21.79
%
ASPEN TECHNOLOGY, INC. AND
SUBSIDIARIES
Reconciliation of
Forward-Looking Guidance
(Unaudited Dollars in Thousands,
Except per Share Data)
Twelve Months Ended June 30,
2024 (3)
Guidance - Total expenses
GAAP expectation - total expenses
$
1,220,000
Less:
Stock-based compensation
(59,000
)
Amortization of intangible assets
(486,000
)
Non-GAAP expectation - total expenses
$
675,000
Guidance - (Loss) income from
operations
GAAP expectation - loss from
operations
$
(100,000
)
Plus:
Stock-based compensation
59,000
Amortization of intangible assets
486,000
Non-GAAP expectation - income from
operations
$
445,000
Guidance - Net (loss) income and
diluted (loss) income per share
GAAP expectation - net loss and diluted
loss per share
$
(7,000
)
$
(0.11
)
Plus:
Stock-based compensation
59,000
Amortization of intangible assets
486,000
Less:
Income tax effect on Non-GAAP items
(4)
(114,000
)
Non-GAAP expectation - net income and
diluted income per share
$
424,000
$
6.57
Shares used in computing guidance for
Non-GAAP diluted income per share
64,560
Guidance - Free Cash Flow (5)
GAAP expectation - Net cash provided by
operating activities
$
378,000
Less:
Purchases of property, equipment and
leasehold improvements
(17,500
)
Payments for capitalized computer software
development costs
(500
)
Free cash flow expectation (non-GAAP)
$
360,000
__________
(3)
Rounded amount used, except per share
data.
(4)
The income tax effect on non-GAAP items
for the twelve months ended June 30, 2024 is calculated utilizing
the Company's statutory tax rate of 21.79 percent.
(5)
Free cash flow guidance has been updated
to reflect a change in methodology to calculate free cash flow and
does not represent a change in management's expectations. Effective
January 1, 2023, we no longer exclude acquisition and integration
planning related payments from our computation of free cash flow.
We have updated our guidance computation for free cash flow to
reflect that such payments are no longer excluded from free cash
flow.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231106823775/en/
Media Len Dieterle Aspen Technology +1 781-221-4291
len.dieterle@aspentech.com
Investors Brian Denyeau ICR for Aspen Technology +1
646-277-1251 ir@aspentech.com
Grafico Azioni Aspen Technology (NASDAQ:AZPN)
Storico
Da Mag 2024 a Giu 2024
Grafico Azioni Aspen Technology (NASDAQ:AZPN)
Storico
Da Giu 2023 a Giu 2024