Tecsys Delivers Strong Q2 Results, SaaS Revenue Surges 34%

Tecsys Inc. (TSX: TCS), a leading provider of advanced supply chain solutions, has reported robust financial results for the second quarter of fiscal 2025, ended October 31, 2024. The company's SaaS revenue increased by a remarkable 34% year-over-year, reaching $16.1 million compared to the $12.1 million reported in the same period last year. This impressive growth reflects Tecsys' commitment to innovation, customer success, and strategic investments in the supply chain management sector.

Tecsys' strong performance in the second quarter was driven by several key factors, including its expanding customer base, increasing demand for cloud-based solutions, and a focus on platform optimization. The company's SaaS subscription bookings remained flat at $3.7 million, while its Remaining Performance Obligation (RPO) increased by 39% to $203.8 million, indicating a healthy pipeline of recurring revenue.

Tecsys' total revenue for the quarter reached $42.4 million, a marginal increase from the $41.5 million reported in the same period last year. The company's net profit improved to $0.8 million or $0.05 per share on a fully diluted basis, compared to a net loss of $0.3 million or $0.02 per share in the same period in fiscal 2024. Adjusted EBITDA also increased to $2.9 million, up from $1.0 million reported in Q2 last year.



Tecsys' Normal Course Issuer Bid (NCIB) also played a role in the company's shareholder value strategy. In the second quarter of fiscal 2025, Tecsys acquired 51,600 of its outstanding common shares for approximately $2.1 million, compared to 25,800 shares acquired in the same period last year for around $0.7 million. This consistent buyback activity demonstrates Tecsys' commitment to returning capital to shareholders and reducing the number of shares outstanding.

Looking ahead, Tecsys is maintaining its fiscal 2025 guidance on SaaS revenue growth at 30-32% and adjusted EBITDA margins at 8-9% for FY25 and 10-11% for FY26. The company is also revising its total revenue guidance to roughly flat for FY25, given the unpredictability of hardware revenue and evolving business models.

In conclusion, Tecsys' strong financial performance in the second quarter of fiscal 2025 reflects the company's strategic investments in innovation, customer success, and platform optimization. With a growing customer base and increasing demand for cloud-based supply chain management solutions, Tecsys is well-positioned to continue its growth trajectory and maintain its competitive advantage in the market.