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CST: 11/12/2019 18:41:51   

AppFolio, Inc. Announces Second Quarter 2019 Financial Results

135 Days ago

SANTA BARBARA, Calif., July 29, 2019 (GLOBE NEWSWIRE) -- AppFolio, Inc. (NASDAQ: APPF) ("AppFolio" or the "Company"), a leading provider of cloud-based business software solutions, today announced its financial results for the quarter ended June 30, 2019.

AppFolio's operating results for the second quarter of 2019 are summarized in the tables accompanying this press release. The Company nevertheless urges investors to read its Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission (the "SEC") on February 28, 2019, as well as its more detailed second quarter 2019 results that will be included in the Company's Quarterly Report on Form 10-Q, which will be filed with the SEC on July 29, 2019.  These periodic report filings, together with other documents the Company files with the SEC from time to time, will be accessible on AppFolio's website, http://ir.appfolioinc.com. The limited information that follows in this press release is not adequate for making an informed investment judgment.

Financial Outlook
Based on information available as of July 29, 2019, AppFolio's outlook for fiscal year 2019 follows:

  • Full year revenue is expected to be in the range of $253 million to $255 million.
     
  • Diluted weighted average shares are expected to be approximately 36 million for the full year.

Conference Call Information
As previously announced, the Company will host a conference call today, July 29, 2019, at 1:30 p.m. Pacific Time, 4:30 p.m. Eastern Time, to discuss its financial results. Investors are invited to submit questions to management via the Investor Q&A form located on the Investor Overview section of AppFolio's website.

The conference call can be accessed by dialing 844.624.1561 and entering ID # 7094869. International callers may dial 647.253.8652. A replay of the conference call will be available at 800.585.8367 and 416.621.4642 for international callers. A live and recorded webcast of the conference call will be available at http://ir.appfolioinc.com.

About AppFolio, Inc.
AppFolio offers industry-specific, cloud-based business software solutions, services, and data analytics to the real estate and legal markets. Today our products include real estate software (AppFolio Property Manager, AppFolio Property Manager PLUS and AppFolio Investment Management) and legal practice management software (MyCase). AppFolio was founded in 2006 and is headquartered in Santa Barbara, CA. Learn more at www.appfolioinc.com.

Investor Relations Contact: ir@appfolio.com

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which statements are subject to considerable risks and uncertainties. Forward-looking statements include all statements that are not statements of historical fact contained in this press release, and can be identified by words such as “anticipates,” “believes,” “seeks,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “could,” “will,” “would,” or similar expressions and the negatives of those expressions. In particular, forward-looking statements contained in this press release relate to the Company's future or assumed revenues and weighted-average outstanding shares, as well as its future growth and success.

Forward-looking statements represent AppFolio's current beliefs and assumptions based on information currently available. Forward-looking statements involve numerous known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Some of the risks and uncertainties that may cause the Company's actual results to materially differ from those expressed or implied by these forward-looking statements are described in the section entitled “Risk Factors” in AppFolio's Quarterly Report on Form 10-Q for the quarter ended June 30, 2019, which will be filed with the SEC on July 29, 2019, as well as in the Company's other filings with the SEC. You should read this press release with the understanding that the Company's actual future results may be materially different from the results expressed or implied by these forward looking statements.

Except as required by applicable law or the rules of the NASDAQ Global Market, AppFolio assumes no obligation to update any forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.


 
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(in thousands, except par values)
 
    June 30,
2019
  December 31,
2018
Assets        
Current assets        
Cash and cash equivalents   $ 19,514     $ 74,076  
Investment securities—current   19,425     16,631  
Accounts receivable, net   8,180     5,516  
Prepaid expenses and other current assets   16,945     11,775  
Total current assets   64,064     107,998  
Investment securities—noncurrent   3,586     11,256  
Property and equipment, net   7,930     6,871  
Operating lease right-of-use assets   15,440      
Capitalized software, net   24,658     20,485  
Goodwill   58,518     15,548  
Intangible assets, net   24,003     5,895  
Deferred taxes   21,704      
Other long-term assets   6,191     7,688  
Total assets   $ 226,094     $ 175,741  
Liabilities and Stockholders’ Equity        
Current liabilities        
Accounts payable   $ 1,579     $ 1,481  
Accrued employee expenses   13,626     12,377  
Accrued expenses   9,407     8,281  
Deferred revenue   3,929     3,414  
Other current liabilities   12,067     1,447  
Long-term debt, net—current portion   1,208     1,213  
Total current liabilities   41,816     28,213  
Operating lease liabilities   18,071      
Long-term debt, net   47,979     48,602  
Other long-term liabilities   13     7,080  
Total liabilities   107,879     83,895  
Stockholders’ equity:        
Preferred stock, $0.0001 par value, 25,000 authorized and no shares issued and outstanding at June 30, 2019 and December 31, 2018        
Class A common stock, $0.0001 par value, 250,000 shares authorized at June 30, 2019 and December 31, 2018; issued - 16,456 and 16,159, shares at June 30, 2019 and December 31, 2018; outstanding - 16,086 and 15,789 shares at June 30, 2019 and December 31, 2018, respectively;   2     2  
Class B common stock, $0.0001 par value, 50,000 shares authorized at June 30, 2019 and December 31, 2018; 17,952 and 18,109 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively;   2     2  
Additional paid-in capital   157,195     157,898  
Accumulated other comprehensive loss   18     (178 )
Treasury stock, at cost, 370 Class A shares at June 30, 2019 and December 31, 2018   (21,562 )   (21,562 )
Accumulated deficit   (17,440 )   (44,316 )
Total stockholders’ equity   118,215     91,846  
Total liabilities and stockholders’ equity   $ 226,094     $ 175,741  


       
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(in thousands, except per share amounts)
       
  Three Months Ended
June 30,
  Six Months Ended
June 30,
  2019   2018   2019   2018
Revenue $ 63,624     $ 47,240     $ 120,715     $ 89,580  
Costs and operating expenses:              
Cost of revenue (exclusive of depreciation and amortization) 25,128     17,729     49,309     34,342  
Sales and marketing 13,232     7,625     24,451     15,030  
Research and product development 9,339     5,750     17,820     11,083  
General and administrative 8,214     5,248     16,406     10,564  
Depreciation and amortization 5,415     3,579     10,491     7,079  
Total costs and operating expenses 61,328     39,931     118,477     78,098  
Income from operations 2,296     7,309     2,238     11,482  
Other expense, net (56 )   (18 )   (57 )   (21 )
Interest income (expense), net (427 )   226     (924 )   402  
Income before provision for (benefit from) income taxes 1,813     7,517     1,257     11,863  
Provision for (benefit from) income taxes (21,338 )   43     (25,619 )   69  
Net income $ 23,151     $ 7,474     $ 26,876     $ 11,794  
               
Net income per common share:              
Basic $ 0.68     $ 0.22     $ 0.79     $ 0.35  
Diluted $ 0.65     $ 0.21     $ 0.76     $ 0.33  
Weighted average common shares outstanding:              
Basic 34,010     34,173     33,962     34,122  
Diluted 35,412     35,408     35,385     35,361  
                       

Stock-Based Compensation Expense

(in thousands)

  Three Months Ended
June 30,
  Six Months Ended
June 30,
  2019   2018   2019   2018
Costs and operating expenses:              
Cost of revenue (exclusive of depreciation and amortization) $ 415     $ 250     $ 739     $ 470  
Sales and marketing 302     228     550     438  
Research and product development 363     287     671     512  
General and administrative 607     572     1,279     1,235  
Total stock-based compensation expense $ 1,687     $ 1,337     $ 3,239     $ 2,655  


CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(in thousands)
  Three Months Ended
June 30,
  Six Months Ended
June 30,
  2019   2018   2019   2018
Cash from operating activities              
Net income $ 23,151     $ 7,474     $ 26,876     $ 11,794  
Adjustments to reconcile net income to net cash provided by operating activities:              
Depreciation and amortization 5,415     3,579     10,491     7,079  
Amortization of operating lease right-of-use assets 987         1,928      
Stock-based compensation 1,687     1,337     3,239     2,655  
Deferred income taxes (21,362 )       (25,643 )    
Other 81     67     108     146  
Changes in operating assets and liabilities:              
Accounts receivable (644 )   (1,020 )   (2,695 )   (2,168 )
Prepaid expenses and other current assets (1,859 )   (1,000 )   (5,199 )   (559 )
Other long-term assets 830     (296 )   1,254     (1,062 )
Accounts payable 88     424     188     839  
Accrued employee expenses 3,547     1,802     680     (2,040 )
Accrued expenses (196 )   822     1,384     1,433  
Deferred revenue 313     (1,955 )   581     (3,289 )
Operating lease liabilities (1,024 )       (1,759 )    
Other long-term liabilities 504     478     380     226  
Net cash provided by operating activities 11,518     11,712     11,813     15,054  
Cash from investing activities              
Purchases of property and equipment (1,365 )   (317 )   (2,395 )   (580 )
Additions to capitalized software (4,762 )   (2,569 )   (9,420 )   (5,505 )
Purchases of investment securities (678 )   (5,259 )   (678 )   (20,832 )
Sales of investment securities         1,750     5  
Maturities of investment securities 1,750     7,299     4,000     15,595  
Acquisition, net of cash acquired         (54,004 )    
Purchases of intangible assets (30 )       (30 )    
Net cash used in investing activities (5,085 )   (846 )   (60,777 )   (11,317 )
Cash from financing activities              
Proceeds from stock option exercises 109     188     199     658  
Tax withholding for net share settlement (3,436 )   (1,593 )   (4,751 )   (2,494 )
Proceeds from issuance of debt 572     31     1,169     63  
Principal payments on debt (885 )   (31 )   (1,794 )   (63 )
Payment of debt issuance costs (60 )       (420 )    
Net cash used in financing activities (3,700 )   (1,405 )   (5,597 )   (1,836 )
Net increase (decrease)  in cash, cash equivalents and restricted cash 2,733     9,461     (54,561 )   1,901  
Cash, cash equivalents and restricted cash              
Beginning of period 17,212     8,977     74,506     16,537  
End of period $ 19,945     $ 18,438     $ 19,945     $ 18,438  
               

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