American Software Inc (NASDAQ:AMSWA) Q2 2020 Earnings Conference Call - Final Transcript

Nov 21, 2019 • 05:00 pm ET

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American Software Inc (NASDAQ:AMSWA) Q2 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day, everyone, and welcome to today's American Software Second Quarter Fiscal Year 2020 Preliminary Earnings Results Call. [Operator Instructions] Later, you will have the opportunity to ask questions, during the question-and-answer session. [Operator Instructions]

It is now my pleasure to turn today's conference over to Vincent Klinges, Chief Financial Officer of American Software.

Executive
Vincent Klinges

Thank you, David, and good afternoon, everyone, and welcome to American Software's second quarter fiscal 2020 earnings conference call. On the call with me is, Allan Dow, President of American Software. I will review the numbers, and then Allan will give some remarks after that.

But I would like to remind you that this conference call may contain forward-looking statements, including statements regarding, among other things, our business strategy and growth strategy. Any such forward-looking statements speak only as of this date. These forward-looking statements are based largely on our expectations, and are subject to a number of risks and uncertainties, some of which cannot be predicted or quantified and are beyond our control.

Future developments and actual results could differ materially from those set forth in, contemplated by or underlying the forward-looking statements. There are number of factors that could cause actual results to differ materially from those anticipated by statements made on this call. Such factors include, but are not limited to, changes and uncertainty in general economic conditions, the growth rate of the market for our products and services, the timely availability and market acceptance of these products and services, the effect of competitive products and pricing and other competitive pressures, and the irregular and unpredictable pattern of revenues. In light of these risks and uncertainties, there can be no assurance that the forward-looking information will prove to be accurate.

So taking a look at the second quarter of fiscal '20, the same period last year, total revenues increased 1% to $28.2 million for the current quarter, compared to $28 million in the same period last year. Subscription fees increased 64% to $5.5 million for the quarter, compared to $3.3 million for the same period last year, while our software license revenues decreased 48% to $1 million for the current quarter, compared to $2 million in the prior year period, as we continue to transition to the SaaS engagement model.

Our Cloud Services annual contract value or ACV increased by approximately 55% to $22.4 million for the current quarter, and that compares to $14.5 million for the same period last year. Our professional services and other revenues decreased 2% to $10.8 million for the current quarter, compared to $11.1 million for the same quarter last year, and that's primarily due to a decrease in our IT consulting business unit, The Proven Method, as a result of timing of project work. This was partially offset by a 16% increase in our supply chain management unit, due to stronger bookings in recent quarters and our backlog remains solid heading into Q3.

Maintenance revenues decreased 7% to $10.8 million compared to $11.6 million due to normal retention