Agilysys(AGYS) - 2025 Q4 - Annual Report

Revenue Growth - Total net revenue increased by $38.2 million, or 16.1%, in fiscal 2025 compared to fiscal 2024, reaching $275.6 million[192] - Subscription and maintenance revenue grew by $32.0 million, or 23.2%, driven by continued growth in subscription-based revenue, including service to Book4Time customers[192] - Professional services revenue increased by $13.9 million, or 27.7%, due to higher sales and service activity[192] - Total net revenue for fiscal 2024 was $237.5 million, an increase of $39.4 million or 19.9% compared to fiscal 2023[206] - Subscription and maintenance revenue grew by $19.8 million or 16.7%, driven by a 29.6% increase in subscription-based revenue[207] - Professional services revenue increased by $14.2 million or 39.2%, reflecting higher sales and service activity[207] - Revenue from international operations constituted 10% of total revenue in fiscal 2025, compared to 6% in fiscal 2024 and 7% in fiscal 2023[251] Profitability - Gross profit increased by $27.7 million, or 19.2%, with gross profit margin rising from 60.7% to 62.4%[194] - Operating income rose to $22.6 million, an increase of $6.8 million or 43.4%, with operating income percentage improving from 6.6% to 8.2%[192] - Gross profit rose by $23.4 million or 19.4%, while gross profit margin slightly decreased from 61.0% to 60.7%[208] - Operating expenses increased by $19.6 million or 18.3%, but as a percentage of total revenue, they decreased by 0.7%[209] Expenses - Product development expenses increased by $5.7 million, or 10.0%, due to hiring and increased compensation rates[196] - Sales and marketing expenses rose by $4.7 million, or 16.5%, attributed to hiring and expanded marketing activities[197] - Product development expenses rose by $6.5 million or 12.9% due to increased hiring and compensation rates[210] Cash Flow - Cash flow from operating activities for fiscal 2025 was $55.1 million, up from $48.2 million in fiscal 2024[226][227] - Cash flows used in investing activities for fiscal 2025 were $148.6 million, primarily due to $145.8 million for business combinations and property and equipment purchases[229] - Cash flows used in financing activities for fiscal 2025 were $21.9 million, driven by $49.6 million in debt proceeds and $26.0 million in debt repayments[232] - Cash flows used in financing activities for fiscal 2024 were $8.6 million, primarily due to share repurchases of $6.9 million[233] - Cash flows used in investing activities for fiscal 2024 were $7.6 million, mainly from $8.1 million in property and equipment purchases[230] - Cash flows used in investing activities for fiscal 2023 were $6.9 million, primarily due to $7.3 million in property and equipment purchases[231] Acquisitions - The company acquired Book4Time for $145.8 million, enhancing its position in the spa management SaaS market[183] - The company completed the acquisition of Book4Time for $145.8 million in net cash during the year ended March 31, 2025[224] Tax and Interest - Effective tax rate for fiscal 2025 was 9.4%, influenced by U.S. R&D credits and the release of valuation allowances against foreign deferred tax assets[203] - Interest income decreased by $1.3 million, or 25.6%, to $3.8 million, while total other income, net fell by $1.9 million, or 38.3%, to $3.0 million[201] - Interest income increased to $5.1 million in fiscal 2024, up from $2.2 million in fiscal 2023[216] Other Financial Information - The company had $78.5 million of federal net operating loss carryforwards expiring between fiscal years 2033 to 2039[220] - The cash surrender value of corporate-owned life insurance policies was $1.1 million, recorded under "Other non-current assets" as of the balance sheet date[234] - The present value of future proceeds owed to designated beneficiaries of corporate-owned life insurance policies was $0.1 million, recorded within "Other non-current liabilities"[234] - Share repurchases in fiscal 2025 amounted to $2.7 million to satisfy employee tax withholding on share-based compensation[232] - The company has not entered into any off-balance sheet arrangements that could affect its financial condition[235]