Simulations Plus, Inc. (Nasdaq: SLP), a top provider of biosimulation and performance solutions for the biopharma industry, has announced its financial results for the fourth quarter and fiscal year 2024, ending August 31, 2024.
Fourth Quarter 2024 Financial Highlights (vs. Q4 2023)
- Total Revenue: Up 19% to $18.7 million.
- Software Revenue: Increased 6% to $9.9 million (53% of total revenue).
- Services Revenue: Up 39% to $8.8 million (47% of total revenue).
- Gross Profit: $6.8 million with a gross margin of 37%.
- Adjusted EBITDA: $4.1 million (22% of total revenue), down from $4.9 million (31%).
- Net Income: $0.8 million with diluted EPS of $0.04, compared to $0.5 million and $0.03 EPS in the prior year.
- Adjusted Diluted EPS: $0.06, excluding acquisition costs, compared to $0.18.
Full Year 2024 Financial Highlights (vs. FY 2023)
- Total Revenue: Up 18% to $70.0 million.
- Software Revenue: Increased 12% to $41.0 million (59% of total revenue).
- Services Revenue: Up 26% to $29.0 million (41% of total revenue).
- Gross Profit: $43.2 million with a gross margin of 62%.
- Adjusted EBITDA: $20.3 million (29% of total revenue), slightly down from $20.6 million (35%).
- Net Income: $10.0 million with diluted EPS of $0.49, unchanged from the prior year.
- Adjusted Diluted EPS: $0.53, excluding acquisition costs, compared to $0.67.
Management Commentary
“Our fiscal year 2024 results show strong performance in both software and services,” said Shawn O’Connor, CEO of Simulations Plus. “Total revenue rose 18%, driven by upgrades that solidified our biosimulation leadership across platforms like GastroPlus®, MonolixSuite™, and ADMET Predictor®. Excluding Pro-ficiency’s contribution in Q4, organic growth was 14%. Software revenue grew 12%, particularly from our Clinical Pharmacology & Pharmacometrics (CPP) unit, which expanded 20%. Our services segment also performed well, increasing 26% led by growth in our Quantitative Systems Pharmacology (QSP) and CPP units.
“In June, we acquired Pro-ficiency, the most significant M&A deal in our history, which doubled our addressable market to $8 billion. This acquisition is expected to enhance our support for clients in clinical operations and medical affairs. Integration is progressing ahead of schedule, and we expect our combined strategies to drive new business opportunities and improved products.
“Overall, we had a successful year, reinforcing our leadership in the drug development value chain. I thank our team for their dedication to creating value through innovative software and consulting solutions that improve patient outcomes.
“Looking ahead, we project healthy revenue growth in fiscal 2025, with organic growth expected between 10% to 15%. The Pro-ficiency acquisition is anticipated to contribute $15 to $18 million. Our fiscal 2025 guidance includes:
- Revenue: $90M – $93M
- Revenue Growth: 28 – 33%
- Software Mix: 55 – 60%
- Adjusted EBITDA Margin: 31 – 33%
- Adjusted Diluted EPS: $1.07 – $1.20
“The funding environment in pharma and biotech has been constrained for two years. While initial discussions for 2025 budgets are promising, we remain cautiously optimistic. We believe we are well-positioned to respond to any increase in spending.
“Our near-term priorities include completing the acquisition integration, expanding cross-selling opportunities, and striving for our historical adjusted EBITDA margin target of 35-40%. We remain committed to executing our growth strategy and delivering long-term value for our stakeholders,” concluded O’Connor.
