Supply chain software provider Descartes has once again posted record quarterly results, citing increased business acquisition from competitors.
Descartes (NASDAQ: DSGX) reported consolidated revenue of $148.2 million, marking a 19% year-over-year (y/y) increase for its 2024 fiscal fourth quarter ending Jan. 31. Services revenue saw a 20% increase to $135.7 million, bolstered by the prior acquisitions of final-mile solutions providers GroundCloud and Localz. Excluding the impact of these acquisitions and changes in foreign exchange rates, revenue increased by 10% on a same-store basis.
Earnings per share rose by 3 cents y/y to 37 cents in the quarter.
CEO Ed Ryan highlighted the company’s growth drivers, emphasizing the complexity and change in global trade dynamics. He noted that conflicts worldwide have led to more companies being placed on sanctioned parties’ lists, while shifts in tariffs and duties have created additional growth opportunities for operators seeking trade compliance solutions.
“During challenging times, people tend to gravitate towards a safe and reliable source,” Ryan stated.
Descartes reported adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $65.7 million, reflecting a 19% y/y increase. For the full fiscal year 2024, adjusted EBITDA amounted to $247.5 million, marking a 15% increase y/y.
Looking ahead, the company forecasted revenue of $130.5 million and adjusted EBITDA of $49.5 million for its fiscal first quarter ending Apr. 30.
Ryan expressed optimism about the continued importance of supply chain and logistics, highlighting ongoing investments in technology due to its quick return on investment and high visibility for customers.
The company generated $50.8 million in cash flow from operations in the quarter, although this result included a $12.6 million negative impact from higher-than-expected earnout payments on past acquisitions.
Descartes ended the quarter with $321 million in cash and an untapped $350 million line of credit.
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