By: Qinthara Fasya, DigitalCFO | 20 May 2021
May 20, 2021 – Rimini Street, Inc. (Nasdaq: RMNI), a global provider of enterprise software products and services, the leading third-party support provider for Oracle and SAP software products and a Salesforce partner, today announced results for the first quarter ended March 31, 2021.
“For the first quarter, we remain on track to achieve our strategic growth plan to achieve $1 billion in annual revenue by 2026. We achieved record revenue of $87.9 million, up 12.6% year over year, a record active client count of 2,550, up 22.8% year over year, ended the quarter with strong billings growth of 24.2% and delivered a gross margin greater than 61%,” stated Seth A. Ravin, Rimini Street co-founder, CEO and chairman of the board.
“We also continued making investments to take advantage of growing global demand for Rimini Street’s expanded breadth of support solutions, including our Support, Application Management, Security, Interoperability, Monitoring and Professional services.”
“We further strengthened the balance sheet with record cash of $153 million at March 31, 2021 and generated $24.5 million of operating cash flow for the quarter,” stated Michael L. Perica, Rimini Street chief financial officer. “Today, we are issuing guidance for the second quarter ending June 30, 2021, maintaining full year 2021 guidance and re-affirming our continued commitment to the long-term goals of increasing operating cash flow and growing GAAP profitability.”
First Quarter 2021 Financial Highlights
- Revenue was $87.9 million for the 2021 first quarter, an increase of 12.6% compared to $78.0 million for the same period last year.
- Annual Recurring Revenue was $349 million for the 2021 first quarter, an increase of 12.8% compared to $310 million for the same period last year.
- Active Clients as of March 31, 2021 were 2,550, an increase of 22.8% compared to 2,077 Active Clients as of March 31, 2020.
- Revenue Retention Rate was 91% for the trailing 12 months ended March 31, 2021 and 92% for the comparable period ended March 31, 2020.
- Gross margin was 61.5% for the 2021 first quarter compared to 61.3% for the same period last year.
- Operating income was $1.9 million for the 2021 first quarter compared to $3.7 million for the same period last year.
- Non-GAAP Operating Income was $9.3 million for the 2021 first quarter compared to $8.9 million for the same period last year.
- Net loss was $3.6 million for the 2021 first quarter compared to net income of $2.5 million for the same period last year.
- Non-GAAP Net Income was $8.5 million for the 2021 first quarter compared to $7.7 million for the same period last year.
- Adjusted EBITDA for the 2021 first quarter was $10.7 million compared to $9.2 million for the same period last year.
- Basic and diluted net loss per share attributable to common stockholders was a net loss per share of $0.13 for the 2021 first quarter compared to a net loss per share of $0.06 for the same period last year.
- Employee count as of March 31, 2021 was 1,501, a year-over-year increase of 15.3%.
- Completed a follow-on public offering of 7.75 million shares of the Company’s common stock, with net proceeds to the Company of approximately $57 million.
- On January 5, 2021, completed the buyback of $10 million face-value of Series A preferred stock for an approximate 10% discount to face-value (par); no make-whole payments were required. The purchased preferred shares were retired.
- On April 16, 2021, completed the buyback of $60 million face-value of Series A preferred stock, plus make-whole of approximately $2.3 million, reducing the outstanding Series A preferred liquidation value to approximately $87 million as of April 16, 2021. The purchased preferred shares were retired.
Reconciliations of the non-GAAP financial measures provided in this press release to their most directly comparable GAAP financial measures are provided in the financial tables included at the end of this press release. An explanation of these measures, why we believe they are meaningful and how they are calculated is also included under the heading “About Non-GAAP Financial Measures and Certain Key Metrics.”
First Quarter 2021 Company Highlights
- Appointed three new regional general managers of North America to accelerate growth and help achieve the Company’s $1 billion in annual revenue by 2026 goal. Also announced the appointment of Phil Cullen to the newly created role of senior vice president for Global Operations.
- Announced several new clients globally who made the switch from vendor support to Rimini Street Support to extend the life and ROI of their existing enterprise software including:
o Homeplus Co., a Korean grocery and outlet retailer;
o Nottinghamshire County Council, serving a local population of more than 800,000 in the UK;
o Ampol Limited, Australia’s largest petrol and convenience network;
o Poplar Co. Ltd, a national convenience store chain in Japan;
o Kent County Council, the largest County Council in England; and
o Hankook Tire, a leading global tire company headquartered in Korea.
- Also announced that Iguatemi, Brazil’s leading shopping center management company, extended its SAP support agreement with Rimini Street to include Application Management Services (AMS) for SAP, enabling them to benefit from an integrated, one provider approach to their SAP landscape.
- Closed nearly 10,000 support cases and delivered over 32,000 tax, legal and regulatory updates for 36 countries. Also achieved an average client satisfaction rating on the Company’s support delivery of 4.9 out of 5.0 (where 5.0 is “excellent”).
- Released an Oracle Database survey report which highlights that top challenges with Oracle Database include cost, quality and value of vendor support – issues resolved with Rimini Street Support.
- Announced that the Company is now an approved supplier on the New Zealand Government Marketplace, enabling agencies to more easily procure Rimini Street’s services.
- Awarded a Best and Brightest Companies to Work For® Grand Trophy for delivering exceptional HR practices and commitment to the Company’s employees across the U.S.
- Honored with a Stevie® Sales & Customer Service award in the “Best Use of Technology in Customer Service” category for Rimini Street’s innovative AI Support Applications.
- Presented at 10 CIO, IT and finance leader conferences globally.
- Supported more than 25 charities around the world through the Rimini Street Foundation, providing financial contributions, personal protective equipment and hygiene essentials to regions in great need.
2021 Revenue Guidance
The Company is providing second quarter 2021 revenue guidance to be in the range of $88.5 million to $90.5 million. The Company is maintaining full year revenue guidance to be in the range of $370 million to $380 million.