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Agilysys Announces Unaudited Fiscal 2011 Fourth-Quarter and Full-Year Financial Results

   

·         Consolidated Revenue Advances 5.8% in Fiscal 2011 Fourth Quarter Compared with Fiscal 2010 Fourth Quarter

·         Fiscal Year 2011 Revenue Grew 6.5% From Fiscal 2010, Led by 23% Increase in Software Sales

·         Cash on Hand at Fiscal Yearend Increases 13% to $74.4 Million

·         Corporate Headquarters to Be Relocated to Alpharetta, Ga., in Fiscal 2012

 

CLEVELAND—June 14, 2011—Agilysys, Inc. (Nasdaq: AGYS), a leading provider of innovative IT solutions, today announced unaudited financial results for the fiscal 2011 fourth quarter and full year ended March 31, 2011.

 

Fourth-Quarter 2011 Unaudited Results of Operations

Fourth-quarter consolidated sales increased 5.8% to $143.8 million, compared with $135.8 million in the final quarter of fiscal 2010. Net revenues grew 16.5% and 8.7% in the Company’s Hospitality Solutions Group (HSG) and Technology Solutions Group (TSG), respectively, more than offsetting a 13.6% decline in its Retail Solutions Group (RSG).

 

Gross margin contracted to 25.3% of sales, compared with 26.4% of sales in the fiscal 2010 fourth quarter. Margins were negatively impacted during the quarter due to lower services margins and vendor rebates.

 

Selling, general and administrative (SG&A) expense was $44.8 million for the quarter, an increase of $2.9 million from the prior year, primarily due to higher incentive compensation.

 

During the quarter, the Company conducted its annual goodwill impairment test and concluded certain goodwill and intangible assets related primarily to its TSG business segment were impaired. As a result, the Company recorded a non-cash impairment charge of $37.7 million during the fiscal 2011 fourth quarter.

 

The reported operating loss for the quarter, which included the impairment charge and $0.8 million in restructuring charges, was $46.9 million. Adjusted EBITDA (operating loss plus depreciation and amortization), excluding asset impairment and restructuring charges, from continuing operations was a loss of $5.1 million for the quarter, compared with a loss of $2.9 million a year ago (see table attached).

 

The net loss from continuing operations for the quarter was $45.0 million, or a loss of $1.97 per diluted share, compared with a net loss from continuing operations of $0.5 million, or a loss of $0.02 per diluted share, in the prior-year fourth quarter.

 

James Dennedy, interim president and chief executive officer, commented: “Looking ahead to fiscal 2012, we are optimistic that the decisions and actions taken subsequent to the March fiscal yearend will  enhance shareholder value. After the proposed divestiture of the TSG segment is completed, Agilysys will have two industry-leading businesses that will serve as a solid platform for profitable future growth.

 

“A major theme of the ongoing restructuring is to tighten our cost controls and better align corporate functions with our operating businesses. To that end, today we also announced that the Board of Directors has approved a restructuring plan, as well as the relocation of the Company’s corporate functions from Solon, Ohio, to Alpharetta, Ga., during fiscal 2012.”

 

Fiscal 2011 Unaudited Results of Operations

Full-year revenue in fiscal 2011 increased 6.5% to $675.5 million from $634.3 million in fiscal 2010 due to improvement in customer demand and bundling more remarketed software with hardware purchases.  Sales of hardware, software and services increased 4%, 23% and 7%, respectively, compared with the prior year.

 

Full-year gross profit declined 2.4% to $157.7 million, versus $161.5 million in fiscal 2010. Gross margin as a percentage of sales was 23.3% in fiscal 2011, compared with 25.5% last year. Gross margin was negatively impacted by lower vendor rebates and services margins.

 

SG&A expense increased 3.6% to $173.2 million, compared with $167.2 million in the prior fiscal year. The increase was primarily due to higher incentive compensation, Guest360TM development costs that were capitalized in fiscal 2010 and higher costs associated with the Company’s ERP implementation in fiscal 2011.

 

Including the aforementioned asset impairment and restructuring charges, the operating loss for the year was $54.4 million, compared with the operating loss of $6.8 million in fiscal 2010. Charges related to restructuring and asset impairment totaled $38.9 million in fiscal 2011, versus $1.1 million in the prior year. Adjusted EBITDA from continuing operations, excluding asset impairment and restructuring charges, was a loss of $1.9 million for fiscal 2011, compared with a positive $10.1 million a year ago (see table attached).

 

The fiscal year 2011 net loss from continuing operations was $55.5 million, or $2.44 per diluted share. This compares with net income from continuing operations of $3.6 million, or $0.15 per diluted share, last year.

 

Liquidity

Cash on hand grew $8.8 million during the year, reaching $74.4 million at the end of fiscal 2011 due to lower investments in working capital. The Company remains debt free, except for certain capital leases.

 

Business Outlook

Management indicated that, at this time, it is not prepared to provide guidance for fiscal 2012. As soon as practicable after the close of the proposed TSG transaction, the Company intends to provide estimates regarding the cost of restructuring, as well as the expected impact of the restructuring on fiscal 2012’s anticipated results.

 

The Company plans to file its Form 10-K with the SEC later today.

 

Conference Call Information

A conference call will be held today at 11:00 a.m. ET. A slide deck, which will be the basis for the review, will accompany the conference call. Both the slide deck and the conference call can be accessed via the Investor Relations section of www.agilysys.com. In addition, a replay of the call will be archived on the website.

 

Additional Information

In connection with the proposed TSG divesture, the Company will file a proxy statement with the Securities and Exchange Commission (SEC). INVESTORS ARE URGED TO READ THE PROXY STATEMENT WHEN IT BECOMES AVAILABLE BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION AND THE COMPANY. You will be able to obtain the proxy statement, as well as other filings containing information about the Company, free of charge, at the website maintained by the SEC at www.sec.gov. Copies of the proxy statement and other filings made by the Company with the SEC can also be obtained, free of charge, by directing a request to Agilysys Inc., 28925 Fountain Parkway, Solon, Ohio, 44139, Attention: Treasurer.


Participants in the Solicitation

The Company and its directors and officers may be deemed to be participants in the solicitation of proxies from the Company’s shareholders with respect to the special meeting of shareholders that will be held to consider the proposed transaction.  Information about the Company’s directors and executive officers and their ownership of the Company’s common stock is set forth in the proxy statement for the Company’s Annual Meeting of shareholders, which was filed with the SEC on June 25, 2010.  Shareholders may obtain additional information regarding the interests of the Company and its directors and executive officers in the proposed transaction, which may be different than those of the Company’s shareholders generally, by reading the proxy statement and other relevant documents regarding the proposed transaction, when filed with the SEC.

 

Forward-Looking Language

This release contains certain management expectations, which may constitute forward-looking information within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities and Exchange Act of 1934, and the Private Securities Reform Act of 1995. Forward-looking information speaks only as to the date of this release and may be identified by use of words such as “may,” “will,” “believes,” “anticipates,” “plans,” “expects,” “estimates,” “projects,” “targets,” “forecasts,” “continues,” “seeks,” or the negative of those terms or similar expressions. Many important factors could cause actual results to be materially different from those in forward-looking information including, without limitation, competitive factors, disruption of supplies, changes in market conditions, pending or future claims or litigation, or technology advances. No assurances can be provided as to the outcome of cost reductions, expected benefits and outcomes from our recent ERP implementation, business strategies, future financial results, unanticipated downturns to our relationships with customers and macroeconomic demand for IT products and services, unanticipated difficulties integrating acquisitions, new laws and government regulations, interest rate changes, consequences related to the concentrated ownership of our outstanding shares by MAK Capital, and unanticipated deterioration in economic and financial conditions in the United States and around the world or the consequences; uncertainties associated with the proposed sale of the Company’s TSG business to OnX Enterprise Solutions, including uncertainties related to the anticipated timing of filings and approvals relating to the transaction, the expected timing of completion of the transaction and the ability to complete the transaction. The Company does not undertake to update or revise any forward-looking information even if events make it clear that any projected results, actions, or impact, express or implied, will not be realized.

 

Other potential risks and uncertainties that may cause actual results to be materially different from those in forward-looking information are described in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC), under Item 1A, “Risk Factors.” Copies are available from the SEC or the Agilysys website.

 

Use of Non-GAAP Financial Information

To supplement the unaudited condensed consolidated financial statements presented in accordance with U.S. GAAP in this presentation, certain non-GAAP financial measures as defined by the SEC rules are used. Management believes that such information can enhance investors' understanding of the company's ongoing operations. The non-GAAP measures included in this presentation have been reconciled to the comparable GAAP measures within an accompanying table, shown on the last page of this presentation.

 

About Agilysys

Agilysys is a leading developer and marketer of proprietary enterprise software, services and solutions to the hospitality and retail industries.  The Company specializes in market-leading point-of-sale, property management, inventory & procurement, and mobile & wireless solutions that are designed to streamline operations, improve efficiency and enhance the consumer’s experience. Agilysys serves casinos, resorts, hotels, foodservice venues, stadiums, cruise lines, grocery stores, convenience stores, general & specialty retail businesses, and partners.  Headquartered in Cleveland, Agilysys operates extensively throughout North America, with additional sales and support offices in the United Kingdom, Singapore and Hong Kong. For more information, visit www.agilysys.com

 

# # #

Investor Contact:

 

Curtis Stout

Vice President and Treasurer

Agilysys, Inc.                                                           

440-519-8635

curtis.stout@agilysys.com


 

AGILYSYS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

(In thousands, except share and per share data)

 

Three Months Ended

 

Year Ended

March 31,

 

March 31,

 

 

2011

 

2010

 

2011

 

2010

 

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

 

Net sales:

 

 

 

 

 

 

 

 

Products

 

$  111,806

 

 $ 103,709

 

 $  545,348

 

 $ 512,459

Services

 

31,971

 

 32,139

 

130,122

 

 121,861

Total net sales

 

143,777

 

135,848

 

675,470

 

634,320

Cost of goods sold:

 

 

 

 

 

 

 

 

Products

 

93,917

 

87,787

 

460,969

 

421,431

Services

 

13,535

 

12,234

 

56,810

 

 51,362

Total cost of goods sold

 

107,452

 

100,021

 

517,779

 

472,793

Gross margin

 

36,325

 

35,827

 

157,691

 

161,527

Selling, general and administrative expenses

 

44,823

 

41,907

 

173,211

 

         167,248

Asset impairment charges

 

37,662

 

55

 

37,721

 

293

Restructuring charges

 

789

 

78

 

 1,195

 

823

Operating loss

 

 (46,949)

 

(6,213)

 

 (54,436)

 

 (6,837)

Other (income) expenses:

 

 

 

 

 

 

 

 

Other income, net

 

   (43)

 

    (213)

 

     (2,320)

 

           (6,176)

Interest income

 

  (69)

 

 (4)

 

 (130)

 

(31)

Interest expense

 

 421

 

282

 

1,301

 

 970

Loss before income taxes

 

(47,258)

 

(6,278)

 

 (53,287)

 

 (1,600)

Income tax (benefit) expense

 

 (2,251)

 

  (5,769)

 

 2,188

 

 (5,176)

(Loss) income from continuing operations

 

(45,007)

 

    (509)

 

  (55,475)

 

  3,576

Income (loss) from discontinued operations, net of taxes

 

       -

 

9

 

       -

 

   (29)

Net (loss) income

 

$ (45,007)

 

$      (500)

 

$ (55,475)

 

$    3,547

 

 

 

 

 

 

 

 

 

Earnings per share – basic:

 

 

 

 

 

 

 

 

(Loss) income from continuing operations

 

$     (1.97)

 

$     (0.02)

 

$     (2.44)

 

$       0.16

Net (loss) income

 

$     (1.97)

 

$     (0.02)

 

$     (2.44)

 

$       0.16

 

 

 

 

 

 

 

 

 

Earnings per share – diluted:

 

 

 

 

 

 

 

 

(Loss) income from continuing operations

 

$     (1.97)

 

$     (0.02)

 

$     (2.44)

 

$       0.15

Net (loss) income

 

$     (1.97)

 

$     (0.02)

 

$     (2.44)

 

$       0.15

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

Basic

 

22,805,434

 

22,628,788

 

22,785,192

 

22,626,586

Diluted

 

22,805,434

 

22,628,788

 

22,785,192

 

23,087,742

 

 

 

 

 

 

 

 

 

Cash dividends per share

 

 $             -  

 

 $             -  

 

$              -  

 

 $      0.06

 

 


AGILYSYS, INC.

BUSINESS SEGMENT INFORMATION

 

 

Three Months Ended March 31, 2011 (Unaudited)

 

Year Ended March 31, 2011 (Unaudited)

 

 

Reportable Segments

Corporate/

 

 

Reportable Segments

Corporate/

 

 

(In thousands)

HSG

RSG

TSG

Other

Consolidated

 

HSG

RSG

TSG

Other

Consolidated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue

$ 24,814

 $ 22,015

 $ 97,145

 $           -  

 $    143,974

 

 $   92,839

 $  109,147

 $ 474,052

 $              -  

 $   676,038

 

Elimination of intersegment revenue

      (26)

  (171)

      -  

        -  

    (197)

 

       (92)

         (476)

       -  

     -  

      (568)

 

Revenue from external customers

$ 24,788

 $ 21,844

 $  97,145

 $           -  

 $  143,777

 

 $   92,747

 $  108,671

 $ 474,052

 $              -  

 $   675,470

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

 $15,821

 $   3,958

 $  16,546

 $           -  

 $    36,325

 

 $   54,669

 $    20,970

 $   82,052

 $              -  

 $   157,691

 

Gross margin

 percentage

63.8%

18.1%

17.0%

 

25.3%

 

58.9%

19.3%

17.3%

 

23.3%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 $  1,622

 $  (520)

$ (41,288)

 $ (6,763)

 $  (46,949)

 

 $     6,030

 $     3,369

 $ (31,736)

 $ (32,099)

 $  (54,436)

 

Other income, net

       -  

     -  

  -  

  (43)

    (43)

 

       -  

     -  

     -  

   (2,320)

 (2,320)

 

Interest expense, net

       -  

      -  

    -  

    352

   352

 

         -  

     -  

      -  

      1,171

 1,171

 

Income (loss) from continuing operations before income taxes

 $ 1,622

 $ (520)

 $(41,288)

 $ (7,072)

 $   (47,258)

 

 $     6,030

 $     3,369

 $ (31,736)

 $ (30,950)

 $ (53,287)

 

Other information:

 

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures

 $  1,249

 $     1

 $   45

 $         26

 $       1,321

 

 $     3,760

 $        623

 $         914

 $     1,694

 $ 6,991

 

Other charges:

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization - non-cash (1)

 $ 1,091

 $   203

 $   329

 $  1,771

 $       3,394

 

 $     4,297

 $        449

 $      2,881

 $     5,987

 $    13,614

 

Asset impairment charges - non-cash

   900

        -  

     36,762

       -  

    37,662

 

  959

     -  

   36,762

          -  

     37,721

 

Restructuring charges - cash

     -   

        -  

     790

       -  

   790

 

      -  

       -  

    790

          -  

       790

 

Restructuring charges (credits) - non-cash

     -  

        -  

      -  

       (1)

     (1)

 

    -  

   -  

        -  

        405

       405

 

Total

 $  1,991

 $   203

 $   37,881

 $   1,770

 $    41,845

 

 $     5,256

 $        449

 $  40,433

 $     6,392

 $   52,530

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended March 31, 2010 (Unaudited)

 

Year Ended March 31, 2010

 

 

 

Reportable Segments

Corporate/

 

 

Reportable Segments

Corporate/

 

 

 

HSG

RSG

TSG

Other

Consolidated

 

HSG

RSG

TSG

Other

Consolidated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue

$ 21,313

 $  25,373

 $  89,295

 $             -  

 $  135,981

 

 $ 83,361

 $ 110,506

 $ 440,887

 $           -  

 $   634,754

 

Elimination of intersegment revenue

 (33)

  (91)

   (9)

        -  

(133)

 

   (206)

 (155)

           (73)

         -  

      (434)

 

Revenue from external customers

 $ 21,280

 $ 25,282

 $  89,286

 $             -  

 $ 135,848

 

 $ 83,155

 $ 110,351

 $ 440,814

 $            -  

 $   634,320

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

 $ 13,374

 $   5,840

 $ 16,613

 $             -  

 $    35,827

 

 $ 51,463

 $  23,326

 $   87,501

 $    (763)

 $   161,527

 

Gross margin

 percentage

62.8%

23.1%

18.6%

 

26.4%

 

61.9%

21.1%

19.8%

 

25.5%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 $    2,220

 $     737

 $ (1,531)

 $  (7,639)

 $   (6,213)

 

 $  7,666

 $     5,759

 $    9,407

 $ (29,669)

 $   (6,837)

 

Other income, net

   -  

         -  

         -  

    (213)

    (213)

 

        -  

     -  

              -  

   (6,176)

 (6,176)

 

Interest expense, net

     -  

       -  

       -  

     278

    278

 

    -  

    -  

              -  

     939

  939

 

Income (loss) from continuing operations before income taxes

 $   2,220

 $     737

 $ (1,531)

 $  (7,704)

 $   (6,278)

 

 $  7,666

 $  5,759

 $    9,407

 $ (24,432)

 $  (1,600)

 

Other information:

 

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures

 $   1,041

 $          -

 $         41

 $     2,552

 $     3,634

 

 $  4,694

 $     31

 $      103

 $     8,478

 $  13,306

 

Non-cash charges:

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization (1)

 $   1,029

 $       55

 $       839

 $     1,266

 $     3,189

 

 $  4,337

 $    198

 $    6,418

 $     4,876

 $  15,829

 

Asset impairment charges

           -  

             -  

            55

             -  

          55

 

       90

        -  

     55

   148

  293

 

Restructuring charges

      -  

      -  

       -  

      78

      78

 

         -  

         -  

         -  

      823

     823

 

Total

 $   1,029

 $       55

 $       894

 $     1,344

$     3,322

 

 $   4,427

 $     198

 $  6,473

 $  5,847

 $   16,945

 

(1) Does not include the amortization of deferred financing fees totaling $131 and $139 for the three months ended March 31, 2011 and 2010, respectively, and $524 and $485 for the year ended March 31, 2011 and 2010, respectively.

 


 

 

AGILYSYS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

March 31,

 

March 31,

(In thousands, except share and per share data)

2011

 

2010

 

 

(Unaudited)

 

 

ASSETS

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

 $  74,354

 

 $  65,535

Accounts receivable, net

 

123,666

 

104,808

Inventories, net

 

20,632

 

14,446

Deferred income taxes – current, net

 

  -

 

144

Prepaid expenses

 

3,063

 

4,399

Other current assets

 

6,494

 

726

Income taxes receivable

 

1,583

 

10,394

Total current assets

 

229,792

 

200,452

Goodwill

 

20,569

 

50,418

Intangible assets, net

 

 22,535

 

32,510

Deferred income taxes – non-current, net

 

    -

 

  899

Other non-current assets

 

12,959

 

18,175

Property and equipment, net

 

26,543

 

27,995

Total assets

 

$ 312,398

 

$ 330,449

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

 

 $  93,486

 

 $  70,171

Deferred revenue

 

27,914

 

23,810

Accrued liabilities

 

23,887

 

17,183

Income taxes payable

 

 156

 

        -

Deferred income taxes – current, net

 

77

 

    -

Capital lease obligations – current

 

 1,267

 

311

Total current liabilities

 

 146,787

 

111,475

Deferred income taxes – non-current, net

 

 3,894

 

   412

Capital lease obligations – non-current

 

  1,461

 

384

Other non-current liabilities

 

12,152

 

19,254

Shareholders’ equity:

 

 

 

 

Common shares, without par value, at $0.30 stated value; 80,000,000 shares authorized; 31,606,831 shares issued; and 23,022,398 and 22,932,043 shares outstanding at March 31, 2011 and 2010, respectively

 

 9,482

 

9,482

Treasury shares (8,584,433 and 8,674,788 shares at March 31, 2011 and 2010, respectively)

 

  (2,575)

 

 (2,602)

Capital in excess of stated value

 

 (5,421)

 

 (8,770)

Retained earnings

 

 146,659

 

202,134

Accumulated other comprehensive loss

 

  (41)

 

 (1,320)

Total shareholders’ equity

 

148,104

 

198,924

Total liabilities and shareholders’ equity

 

 $ 312,398

 

$  330,449

 

 

 

 

 

 

 


AGILYSYS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

 

Year Ended March 31,

 

 

2011

 

2010

Operating activities:

 

(Unaudited)

 

 

Net (loss) income

 

 $   (55,475)

 

 $    3,547

Add: Loss from discontinued operations

 

  -

 

   29

(Loss) income from continuing operations

 

  (55,475)

 

  3,576

Adjustments to reconcile net (loss) income from continuing operations to net cash provided by operating activities:

 

 

 

 

Gain on redemption of Company-owned life insurance policies

 

 (2,065)

 

  -

Gain on redemption of investment in The Reserve Fund's Primary Fund

 

  (147)

 

 (2,505)

Asset impairment charges

 

37,721

 

  293

Loss on the sale of securities

 

 -

 

 91

Depreciation

 

    4,698

 

   3,914

Amortization

 

  9,440

 

 12,400

Deferred income taxes

 

  4,133

 

  6,596

Stock based compensation

 

   3,614

 

  2,426

Excess tax benefit from exercise of stock options

 

    -

 

     (9)

Change in cash surrender value of company owned life insurance policies

 

   179

 

   (802)

Changes in operating assets and liabilities:

 

 

 

 

Accounts receivable

 

  (17,908)

 

  49,481

Inventories

 

 (6,186)

 

  12,839

Accounts payable

 

   22,773

 

   41,889

Accrued and other liabilities

 

   4,004

 

  (18,076)

Income taxes receivable

 

  8,267

 

  (9,021)

Other changes, net

 

   2,213

 

  (1,451)

Other non-cash adjustments

 

   (478)

 

 2,283

Total adjustments

 

  70,258

 

 100,348

Net cash provided by operating activities

 

 14,783

 

 103,924

Investing activities:

 

 

 

 

Proceeds from The Reserve Fund’s Primary Fund

 

147

 

4,772

Proceeds from redemption of/borrowings against Company-owned life insurance policies

 

15,980

 

  12,500

Additional investments in Company-owned life insurance policies

 

 (1,129)

 

 (1,712)

Proceeds from the sale of marketable securities

 

  14

 

   61

Additional investments in marketable securities

 

 (13,731)

 

  (45)

Purchase of property and equipment

 

  (6,991)

 

  (13,306)

Net cash (used for) provided by investing activities

 

 (5,710)

 

 2,270

Financing activities:

 

 

 

 

Floor plan financing agreement, net

 

-

 

  (74,468)

Proceeds from borrowings under credit facility

 

15,325

 

  5,077

Principal payments under credit facility

 

 (15,325)

 

  (5,077)

Debt financing costs

 

   -

 

  (1,578)

Issuance of common shares

 

   -

 

 89

Repurchase of common shares to satisfy employee tax withholding

 

(238)

 

  -

Excess tax benefit from exercise of stock options

 

     -

 

  9

Dividends paid

 

     -

 

  (1,360)

Principal payments under long term obligations

 

   (419)

 

  (216)

Net cash used for financing activities

 

 (657)

 

(77,524)

Effect of exchange rate changes on cash

 

  403

 

   695

Cash flows provided by continuing operations

 

  8,819

 

 29,365

Cash flows of discontinued operations - operating

 

    -

 

  (74)

Net increase in cash

 

8,819

 

29,291

Cash at beginning of period

 

65,535

 

 36,244

Cash at end of period

 

$   74,354

 

 $   65,535

 

AGILYSYS, INC.

RECONCILIATION OF NET (LOSS) INCOME TO ADJUSTED EBITDA FROM CONTINUING OPERATIONS

 

(In thousands)

 

Three Months Ended

 

Year Ended

March 31,

 

March 31,

 

 

2011

 

2010

 

2011

 

2010

 

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income

 

 $  (45,007)

 

 $   (500)

 

 $   (55,475)

 

 $   3,547

Plus:

 

 

 

 

 

 

 

 

    Interest expense, net

 

  352

 

 278

 

   1,171

 

  939

    Income tax (benefit) expense

 

   (2,251)

 

 (5,769)

 

   2,188

 

 (5,176)

    Depreciation and amortization expense (a)

 

   3,394

 

  3,189

 

  13,614

 

 15,829

    Other income, net

 

 (43)

 

     (213)

 

  (2,320)

 

 (6,176)

    (Income) loss from discontinued operations, net of tax

 

  -

 

    (9)

 

     -

 

  29

Adjusted EBITDA from continuing operations

 

 $  (43,555)

 

 $  (3,024)

 

 $   (40,822)

 

 $   8,992

Asset impairment charges

 

37,662

 

    55

 

    37,721

 

    293

Restructuring charges

 

  789

 

   78

 

 1,195

 

 823

Adjusted EBITDA from continuing operations excluding asset impairment and restructuring charges

 

 $   (5,104)

 

 $  (2,891)

 

 $    (1,906)

 

$ 10,108

 

 

 

 

 

 

 

 

 

 (a)Depreciation and amortization expense excludes amortization of deferred financing fees totaling $131 and $139 for the three months ended March 31, 2011 and 2010, respectively, and $524 and $485 for the twelve months ended March 31, 2011 and 2010, respectively, as such costs are already included in interest expense, net.

 


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