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Model N (MODN) Q4 Earnings & Revenues Top Estimates, Up Y/Y
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Model N, Inc. (MODN - Free Report) reported fourth-quarter fiscal 2021 non-GAAP earnings of 18 cents per share, which surpassed the Zacks Consensus Estimate by 80% and increased 28.6% year over year.
Revenues were $51.5 million, which beat the Zacks Consensus Estimate by 1.7% and increased 24% year over year.
Robust adoption of the company’s revenue management solutions boosted the fiscal fourth-quarter top line. Model N’s Revenue Cloud aids organizations with enhanced efficiency, visibility and transparency in reporting.
Business Services, which was acquired from Deloitte, contributed $6.0 million to total revenues in the fourth quarter of fiscal 2021.
For fiscal 2021, the company reported non-GAAP earnings of 54 cents per share, which increased 12.5% year over year. Revenues were $193.4 million, up 20% year over year.
Model N reports earnings under two business lines — Subscription and Professional Services.
In fourth-quarter fiscal 2021, Subscription revenues (74.1% of total fiscal fourth-quarter revenues) were $38.2 million, up 29% year over year.
Professional Services revenues (25.9%) increased 13% on a year-over-year basis to $13.3 million.
The company is making steady progress in its transformation to a Software-as-a-Service (SaaS) based model, which is driving the top line.
In the fiscal fourth quarter, Model N signed new contracts with customers for Life Sciences vertical including Jazz Pharmaceuticals and Cerecor. The company also added that it expanded its collaboration with the likes of AstraZeneca, Viatris and Fresenius .
For the High Tech Vertical, Model N added two customers — Cricut (engaged in manufacturing of computer-controlled scanners and cutting machines) and Ergotron (specializes in manufacturing of ergonomic mounting and mobility offerings for monitors and notebooks).
Operating Details
Non-GAAP gross margin contracted 140 basis points (bps) from the year-ago quarter’s figure to 61.6%.
Non-GAAP subscription gross margin contracted 390 bps from the prior-year quarter’s levels to 69.6%. Non-GAAP Professional services gross margin expanded 190 bps from the year-ago quarter’s figure to 38.6%.
Adjusted EBITDA during the quarter was $7.9 million, up 14% year over year.
Non-GAAP operating income was $7.7 million, up 13% year over year. Non-GAAP operating margin (as a percentage of total revenues) contracted 140 bps to 15%.
Balance Sheet
As of Sep 30, 2021, Model N had cash and cash equivalents of $165.5 million compared with $153.8 million as of Jun 30, 2021.
As of Sep 30, 2021, the company had long-term debt of $124.3 million compared with $121.7 million reported as of Jun 30, 2021.
For the fiscal fourth quarter, net cash provided by operating activities was $9.9 million compared with $9.4 million of net cash provided by operating activities in the prior quarter.
For fiscal 2021, net cash provided by operating activities was $19.6 million compared with $14.4 million of net cash provided by operating activities in the prior fiscal year.
Free cash flow was $18.5 million in fiscal 2021 compared with free cash flow of $13.8 million in the previous fiscal year.
Guidance in Detail
The company anticipates first-quarter fiscal 2022 total revenues between $49.5 million and $50 million. The Zacks Consensus Estimate for revenues is pegged at $51.8 million.
Subscription revenues are projected in the range of $37-$37.5 million. Adjusted EBITDA is expected between $4.5 million and $5 million. Non-GAAP income from operations is expected in the range of $4.3-$4.8 million.
Non-GAAP earnings per share are anticipated in the range of 8-9 cents per share. The Zacks Consensus Estimate for earnings is pegged at 10 cents.
For fiscal 2022, Model N expects total revenues in the range of $211-$214 million. Non-GAAP earnings are expected to be 44-49 cents per share.
Fiscal 2022 subscription revenues are forecast in the range of $152-$155 million.
Non-GAAP operating income is expected in the range of $22-$24 million. Adjusted EBITDA is projected in the band of $23-25 million.
Zacks Rank & Stocks to Consider
Currently, Model N carries a Zacks Rank #3 (Hold).
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Model N (MODN) Q4 Earnings & Revenues Top Estimates, Up Y/Y
Model N, Inc. (MODN - Free Report) reported fourth-quarter fiscal 2021 non-GAAP earnings of 18 cents per share, which surpassed the Zacks Consensus Estimate by 80% and increased 28.6% year over year.
Revenues were $51.5 million, which beat the Zacks Consensus Estimate by 1.7% and increased 24% year over year.
Robust adoption of the company’s revenue management solutions boosted the fiscal fourth-quarter top line. Model N’s Revenue Cloud aids organizations with enhanced efficiency, visibility and transparency in reporting.
Business Services, which was acquired from Deloitte, contributed $6.0 million to total revenues in the fourth quarter of fiscal 2021.
For fiscal 2021, the company reported non-GAAP earnings of 54 cents per share, which increased 12.5% year over year. Revenues were $193.4 million, up 20% year over year.
Model N, Inc. Price, Consensus and EPS Surprise
Model N, Inc. price-consensus-eps-surprise-chart | Model N, Inc. Quote
Quarter Details & Business Highlights
Model N reports earnings under two business lines — Subscription and Professional Services.
In fourth-quarter fiscal 2021, Subscription revenues (74.1% of total fiscal fourth-quarter revenues) were $38.2 million, up 29% year over year.
Professional Services revenues (25.9%) increased 13% on a year-over-year basis to $13.3 million.
The company is making steady progress in its transformation to a Software-as-a-Service (SaaS) based model, which is driving the top line.
In the fiscal fourth quarter, Model N signed new contracts with customers for Life Sciences vertical including Jazz Pharmaceuticals and Cerecor. The company also added that it expanded its collaboration with the likes of AstraZeneca, Viatris and Fresenius .
For the High Tech Vertical, Model N added two customers — Cricut (engaged in manufacturing of computer-controlled scanners and cutting machines) and Ergotron (specializes in manufacturing of ergonomic mounting and mobility offerings for monitors and notebooks).
Operating Details
Non-GAAP gross margin contracted 140 basis points (bps) from the year-ago quarter’s figure to 61.6%.
Non-GAAP subscription gross margin contracted 390 bps from the prior-year quarter’s levels to 69.6%. Non-GAAP Professional services gross margin expanded 190 bps from the year-ago quarter’s figure to 38.6%.
Adjusted EBITDA during the quarter was $7.9 million, up 14% year over year.
Non-GAAP operating income was $7.7 million, up 13% year over year. Non-GAAP operating margin (as a percentage of total revenues) contracted 140 bps to 15%.
Balance Sheet
As of Sep 30, 2021, Model N had cash and cash equivalents of $165.5 million compared with $153.8 million as of Jun 30, 2021.
As of Sep 30, 2021, the company had long-term debt of $124.3 million compared with $121.7 million reported as of Jun 30, 2021.
For the fiscal fourth quarter, net cash provided by operating activities was $9.9 million compared with $9.4 million of net cash provided by operating activities in the prior quarter.
For fiscal 2021, net cash provided by operating activities was $19.6 million compared with $14.4 million of net cash provided by operating activities in the prior fiscal year.
Free cash flow was $18.5 million in fiscal 2021 compared with free cash flow of $13.8 million in the previous fiscal year.
Guidance in Detail
The company anticipates first-quarter fiscal 2022 total revenues between $49.5 million and $50 million. The Zacks Consensus Estimate for revenues is pegged at $51.8 million.
Subscription revenues are projected in the range of $37-$37.5 million. Adjusted EBITDA is expected between $4.5 million and $5 million. Non-GAAP income from operations is expected in the range of $4.3-$4.8 million.
Non-GAAP earnings per share are anticipated in the range of 8-9 cents per share. The Zacks Consensus Estimate for earnings is pegged at 10 cents.
For fiscal 2022, Model N expects total revenues in the range of $211-$214 million. Non-GAAP earnings are expected to be 44-49 cents per share.
Fiscal 2022 subscription revenues are forecast in the range of $152-$155 million.
Non-GAAP operating income is expected in the range of $22-$24 million. Adjusted EBITDA is projected in the band of $23-25 million.
Zacks Rank & Stocks to Consider
Currently, Model N carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader technology sector include Alphabet (GOOGL - Free Report) , Arrow Electronics (ARW - Free Report) and Cirrus Logic (CRUS - Free Report) . All the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate of Alphabet, Arrow Electronics and Cirrus Logic is pegged at 25.8%, 27.4% and 9.4%, respectively.