Mr. Peter Brereton reports

TECSYS REPORTS RECORD REVENUE FOR THE FIRST QUARTER OF FISCAL 2024

Tecsys Inc. has released its results for the first quarter fiscal year 2024, ended July 31, 2023. All amounts are prepared in accordance with international financial reporting standards (IFRS).

"We are pleased to kick off fiscal 2024 with robust results, led by 44-per-cent growth in [software-as-a-service] revenue and record quarterly revenue," said Peter Brereton, president and chief executive officer at Tecsys. "Our focus on innovation and customer-centricity has driven significant gains across key metrics, and we are seeing the impact of that in our results. This quarter's performance sets a positive tone for the rest of the year."

Mark Bentler, chief financial officer of Tecsys, added: "Our momentum continues with back-to-back quarters of total revenue growth of 20 per cent or more. We are seeing positive results in our gross margin, and we've demonstrated our ability to manage costs while investing in areas that drive growth. Underpinned by a 36-per-cent increase in our SaaS RPO, we remain well positioned for the future."

First quarter highlights:

• SaaS revenue increased by 44 per cent to $11.5-million, up from $8.0-million in Q1 2023.
• SaaS subscription bookings (i) (measured on an ARR (i) basis) decreased by 50 per cent to $1.9-million, compared with $3.9-million in the first quarter of fiscal 2023.
• SaaS remaining performance obligation (RPO (i)) increased by 36 per cent to $139.4-million at July 31, 2023, up from $102.5-million at the same time last year.
• Annual recurring revenue (ARR (i)) at July 31, 2023, was up 20 per cent to $78.3-million compared with $65.1-million at July 31, 2022.
• Professional service revenue was up 9 per cent to $14.9-million compared with $13.6-million in Q1 2023.
• Total revenue excluding hardware revenue was $35.2-million, 16 per cent higher than $30.4-million reported for Q1 last year, while total revenue rose 23 per cent to reach a record $42.0-million.
• Gross margin was 46 per cent for the first quarter of fiscal 2024 compared with 43 per cent for the same period in fiscal 2023.
• Total gross profit increased to $19.5-million, up 32 per cent from $14.8-million in Q1 2023.
• Operating expenses increased to $17.7-million, higher by $3-million or 21 per cent, compared with $14.7-million in Q1 last year.
• Profit from operations was $1.8-million, up from $100,000 in Q1 2023.
• Net profit was $1.2-million or eight cents per share on a fully diluted basis in Q1 2024, compared with $40,000 or nil per share for the same period in fiscal 2023.
• Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) (ii) was $3.2-million, up 114 per cent compared with $1.5-million reported in Q1 last year.

Financial guidance

Tecsys is reiterating previously presented financial guidance.

                        FINANCIAL GUIDANCE

                               FY 2024 guidance    FY 2025 guidance

Total revenue growth                      10-15%                n.a.         
SaaS revenue growth                       35-37%                n.a.         
Adjusted EBITDA (ii) margin                   6%                8-9%         

On Sept. 7, 2023, the company declared a quarterly dividend of 7.5 cents per share to be paid on Oct. 6, 2023, to shareholders of record on Sept. 22, 2023.

Pursuant to the Canadian Income Tax Act, dividends paid by the company to Canadian residents are considered to be eligible dividends.

(i) See key performance indicators in management's discussion and analysis of the Q1 2024 financial statements.

(ii) See non-IFRS performance measures in management's discussion and analysis of the Q1 2024 financial statements.

First quarter fiscal 2024 results conference call

Date:  Sept. 8, 2023

Time:  8:30 a.m. EDT

Phone number:  877-209-9554 or 416-981-9007

The call can be replayed until Sept. 15, 2023, by calling 800-558-5253 or 416-626-4144 (access code: 22027896).

About TECSYS Inc.

Since its founding 40 years ago, much has changed in the realm of supply chain technology. But one thing has remained constant: By developing dynamic and innovative supply chain solutions, Tecsys has been equipping organizations for growth and competitive advantage. Serving health care, distribution and converging commerce industries, and spanning multiple complex, regulated and high-volume markets, Tecsys delivers warehouse management, distribution and transportation management, supply management at point of use, and retail order management, as well as complete financial management and analytic solutions.

Tecsys shares are listed on the Toronto Stock Exchange under the ticker symbol TCS.

We seek Safe Harbor.