Mr. Edward Ryan reports

DESCARTES ANNOUNCES FISCAL 2024 SECOND QUARTER FINANCIAL RESULTS

The Descartes Systems Group Inc. has released its financial results for its second quarter fiscal 2024. All financial results referenced are in U.S. currency and, unless otherwise indicated, are determined in accordance with U.S. generally accepted accounting principles.

"The Global Logistics Network (GLN) continues to help shippers, carriers and logistics services providers meet challenges facing their logistics and supply chain operations," said Edward J. Ryan, Descartes's chief executive officer. "As our customers succeed, they trust us to invest in the GLN's technologies to power logistics and supply chains into the future. Our strong financial results reflect the confidence our customers and other stakeholders have in Descartes and its role in helping their businesses."

Q2 fiscal 2024 financial results

As described in more detail herein, key financial highlights for Descartes's Q2 fiscal 2024 included:

• Revenues of $143.4-million, up 17 per cent from $123.0-million in the second quarter of fiscal 2023 and up 5 per cent from $136.6-million in the previous quarter (first quarter fiscal 2024);
• Revenues were composed of service revenues of $130.7-million (91 per cent of total revenues), professional services and other revenues of $11.3-million (8 per cent of total revenues), and licence revenues of $1.4-million (1 per cent of total revenues); service revenues were up 19 per cent from $109.4-million in Q2 fiscal 2023 and up 5 per cent from $124.1-million in Q1 fiscal 2024;
• Cash provided by operating activities of $52.0-million, up 12 per cent from $46.4-million in Q2 fiscal 2023 and up 6 per cent from $48.9-million in Q1 fiscal 2024;
• Income from operations of $36.8-million, up 17 per cent from $31.5-million in Q2 fiscal 2023 and up 1 per cent from $36.5-million in Q1 fiscal 2024;
• Net income of $28.1-million, up 23 per cent from $22.9-million in Q2 fiscal 2023 and down from $29.4-million in Q1 fiscal 2024; net income as a percentage of revenue was 20 per cent, compared with 19 per cent in Q2 fiscal 2023 and 22 per cent in Q1 fiscal 2024;
• Earnings per share on a diluted basis of 32 cents, up 19 per cent from 27 cents in Q2 fiscal 2023 and down from 34 cents in Q1 fiscal 2024, respectively;
• Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $60.6-million, up 12 per cent from $54.0-million in Q2 fiscal 2023 and up 5 per cent from $57.7-million in Q1 fiscal 2024; adjusted EBITDA as a percentage of revenues was 42 per cent, compared with 44 per cent and 42 per cent in Q2 fiscal 2023 and Q1 fiscal 2024, respectively.

Year-to-date financial results

As described in more detail herein, key financial highlights for Descartes's six-month period ended July 31, 2023, included:

• Revenues of $280.0-million, up 17 per cent from $239.4-million in the same period a year ago (first half fiscal 2023);
• Revenues were composed of service revenues of $254.9-million (91 per cent of total revenues), professional service and other revenues of $22.8-million (8 per cent of total revenues), and licence revenues of $2.3-million (1 per cent of total revenues); service revenues were up 20 per cent from $212.2-million in first half fiscal 2023;
• Cash provided by operating activities of $100.9-million, up 11 per cent from $90.8-million in first half fiscal 2023;
• Income from operations of $73.4-million, up 18 per cent from $62.1-million in first half fiscal 2023;
• Net income of $57.5-million, up 25 per cent from $46.0-million in first half fiscal 2023; net income as a percentage of revenues was 21 per cent, compared with 19 per cent in first half fiscal 2023;
• Earnings per share on a diluted basis of 66 cents, up 25 per cent from 53 cents in first half fiscal 2023;
• Adjusted EBITDA of $118.3-million, up 12 per cent from $105.2-million in first half fiscal 2023; adjusted EBITDA as a percentage of revenues was 42 per cent, compared with 44 per cent in first half fiscal 2023.

Cash position

At July 31, 2023, Descartes had $227.4-million in cash. Cash increased by $45.2-million in second quarter fiscal 2024 and decreased $49.0-million in first half fiscal 2024.

Conference call

Members of Descartes's executive management team will host a conference call to discuss the company's financial results at 5:30 p.m. ET on Wednesday, Sept. 6. Designated numbers are 1-416-764-8658 for North America and 1-888-886-7786 for international, using conference ID 54207156 followed by the number sign.

The company will simultaneously conduct an audio webcast on the Descartes website. Phone conference dial-in or webcast log-in is required approximately 10 minutes beforehand.

Replays of the conference call will be available until Sept. 13, 2023, by dialling 1-416-764-8692 or toll-free for North America using 1-877-674-7070 with playback passcode 207156 followed by the number sign. An archived replay of the webcast will be available at the Descartes website.

About The Descartes Systems Group Inc.

Descartes (Nasdaq: DSGX) (Toronto Stock Exchange: DSG) is the global leader in providing on-demand, software-as-a-service solutions focused on improving the productivity, performance and security of logistics-intensive businesses. Customers use its modular, software-as-a-service solutions to route, schedule, track and measure delivery resources; plan, allocate and execute shipments; rate, audit and pay transportation invoices; obtain global trade data; file customs and security documents for imports and exports; and complete numerous other logistics processes by participating in the world's largest, collaborative multimodal logistics community. Its headquarters its in Waterloo, Ont., Canada, and the company has offices and partners around the world.

We seek Safe Harbor.