0001056696false00010566962024-04-232024-04-23

 

 

 

United States

Securities And Exchange Commission

Washington, DC 20549

______________

FORM 8-K

____________

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): April 23, 2024

 

Manhattan Associates, Inc.

(Exact Name of Registrant as Specified in Its Charter)

 

Georgia		0-23999		58-2373424
(State or Other Jurisdiction of Incorporation or organization)		(Commission File Number)		(I.R.S. Employer Identification No.)

 

2300 Windy Ridge Parkway, Tenth Floor, Atlanta, Georgia

30339

(Address of Principal Executive Offices)

(Zip Code)

 

(770) 955-7070

(Registrant’s telephone number, including area code)

 

NONE

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock	MANH	Nasdaq Global Select Market

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

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Item 2.02 Results of Operations and Financial Condition.

 

On April 23, 2024, Manhattan Associates, Inc. (“we”, “our”, or the “Company”) issued a press release providing its financial results for the three months ended March 31, 2024. A copy of this press release is attached as Exhibit 99.1. Pursuant to General Instruction B.2 of Form 8-K, this exhibit is “furnished” and not “filed” for purposes of Section 18 of the Securities Exchange Act of 1934.

Non-GAAP Financial Measures in the Press Release

The press release includes, as additional information regarding our operating results, our adjusted operating income and margin, adjusted income tax provision, adjusted net income and adjusted diluted earnings per share (collectively, “adjusted results”), which exclude the impact of equity-based compensation and related income tax effects. We have developed our internal reporting, compensation and planning systems using these additional financial measures.

These various measures are not in accordance with, or alternatives for, financial measures calculated in accordance with generally accepted accounting principles in the United States (“GAAP”) and may be different from similarly titled non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be used as a substitute for, or considered superior to, measures of financial performance prepared in accordance with GAAP.

Non-GAAP measures used in the press release exclude the impact of equity-based compensation and related income tax effects because equity-based compensation expense typically does not require cash settlement by the Company. We also exclude the tax benefits or deficiencies of vested stock awards caused by differences in the amount deductible for tax purposes related to the stock award from the compensation expense recorded for financial reporting purposes.

We assess our operating performance using these adjusted measures and believe our peers also typically present non-GAAP results similarly adjusted. Further, we rely on adjusted results as primary measures to review and assess the operating performance of our management team in connection with our executive compensation and bonus plans.

Management refers to adjusted results in making operating decisions because we believe they provide meaningful supplemental information regarding our operational performance and our ability to invest in research and development and fund capital expenditures and acquisitions. In addition, adjusted results facilitate management’s internal comparisons to our historical operating results and comparisons to competitors’ operating results.

We similarly believe reporting adjusted results facilitates investors’ understanding of our historical operating trends because it provides supplemental measurement information in evaluating the operating results of our business. We also believe that adjusted results provide a basis for comparisons to other companies in the industry and enable investors to evaluate our operating performance in a manner consistent with our internal basis of measurement.

 

 

 

 

 

 

 

 

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Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit
Number	Description
99.1	Press Release, dated April 23, 2024
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

 

Manhattan Associates, Inc.

 

 

 

By: /s/ Dennis B. Story

Dennis B. Story

Executive Vice President, Chief Financial Officer and Treasurer

 

 

 

Dated: April 23, 2024

 

3

 

 

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Contact:		Michael Bauer		Rick Fernandez
		Senior Director, Investor Relations		Director, Corporate Communications
		Manhattan Associates, Inc.		Manhattan Associates, Inc.
		678-597-7538		678-597-6988
		mbauer@manh.com		rfernandez@manh.com

 

Manhattan Associates Reports Record First Quarter Results

RPO Bookings Increase 31% over Prior Year on Solid Demand

Company Raises 2024 Full-Year Guidance

 

ATLANTA – April 23, 2024 – Leading Supply Chain and Omnichannel Commerce Solutions provider Manhattan Associates Inc. (NASDAQ: MANH) today reported revenue of $254.6 million for the first quarter ended March 31, 2024. GAAP diluted earnings per share for Q1 2024 was $0.86 compared to $0.62 in Q1 2023. Non-GAAP adjusted diluted earnings per share for Q1 2024 was $1.03 compared to $0.80 in Q1 2023.

“We are very pleased with our solid start to 2024 and better than expected first quarter results. Manhattan’s fundamentals are strong, as demand continues to drive favorable pipeline and revenue momentum,” said Manhattan Associates president and CEO Eddie Capel.

“While macro volatility persists, we are optimistic about our growing market opportunity. Our global teams are executing very well for our customers and are focused on delivering leading innovation across supply chain execution, Omni-channel solutions, and retail point of sale markets,” Mr. Capel concluded.
 

FIRST QUARTER 2024 FINANCIAL SUMMARY:

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2024 GUIDANCE

Manhattan Associates provides the following revenue, operating margin and diluted earnings per share guidance for the full year 2024:

		Guidance Range - 2024 Full Year
	($'s in millions, except operating margin and EPS)	$ Range				% Growth Range
	Total revenue - current guidance	$1,026		$1,034		10%		11%
	Operating margin:
	GAAP operating margin - current guidance	20.8%		21.2%
	Equity-based compensation	8.8%		8.7%
	Adjusted operating margin(1) - current guidance	29.6%		29.9%
	Diluted earnings per share (EPS):
	GAAP EPS - current guidance	$2.78		$2.86		-1%		1%
	Equity-based compensation, net of tax	1.22		1.22
	Excess tax benefit on stock vesting(2)	(0.14)		(0.14)
	Adjusted EPS(1) - current guidance	$3.86		$3.94		3%		5%
	(1) Adjusted operating margin and adjusted EPS are non-GAAP measures that exclude the impact of equity-based
	compensation and related income tax effects.
	(2) Excess tax benefit on stock vesting expected to occur primarily in the first quarter of 2024.

Manhattan Associates currently intends to publish in each quarterly earnings release certain expectations with respect to future financial performance. Those statements, including the guidance provided above, are forward looking. Actual results may differ materially. See our cautionary note regarding “forward-looking statements” below.

Manhattan Associates will make this earnings release and published expectations available on the investor relations section of the Manhattan Associates website at ir.manh.com. Following publication of this earnings release, any expectations with respect to future financial performance contained in this release, including the guidance, should be considered historical only, and Manhattan Associates disclaims any obligation to update them.

 

 

 

 

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CONFERENCE CALL

Manhattan Associates’ conference call regarding its first quarter financial results will be held today, April 23, 2024, at 4:30 p.m. Eastern Time. The Company will also discuss its business and expectations for the year and next quarter in additional detail during the call. We invite investors to a live webcast of the conference call through the Investor Relations section of the Manhattan Associates website at ir.manh.com. To listen to the live webcast, please go to the website at least 15 minutes before the call to download and install any necessary audio software. The Internet webcast will be available until Manhattan Associates’ second quarter 2024 earnings release.

GAAP VERSUS NON-GAAP PRESENTATION

Manhattan Associates provides adjusted operating income and margin, adjusted income tax provision, adjusted net income, and adjusted diluted earnings per share in this press release as additional information regarding the Company’s historical and projected operating results. These measures are not in accordance with, or alternatives to, GAAP, and may be different from similarly titled non-GAAP measures used by other companies. The Company believes the presentation of these non-GAAP financial measures facilitates investors’ ability to understand and compare the Company’s results and guidance, because the measures provide supplemental information in evaluating the operating results of its business, as distinct from results that include items not indicative of ongoing operating results, and because the Company believes its peers typically publish similar non-GAAP measures. This release should be read in conjunction with the Company’s Form 8-K earnings release filing for the three months ended March 31, 2024.

Non-GAAP adjusted operating income and margin, adjusted income tax provision, adjusted net income and adjusted diluted earnings per share exclude the impact of equity-based compensation – net of income tax effects. They also exclude the tax benefits or deficiencies of vested stock awards caused by differences in the amount deductible for tax purposes from the compensation expense recorded for financial reporting purposes. We include reconciliations of the Company’s GAAP financial measures to non-GAAP adjustments in the supplemental information attached to this release.

 

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ABOUT MANHATTAN ASSOCIATES

Manhattan Associates is a global technology leader in supply chain and omnichannel commerce. We unite information across the enterprise, converging front-end sales with back-end supply chain execution. Our software, platform technology and unmatched experience help drive both top-line growth and bottom-line profitability for our customers.

Manhattan Associates designs, builds and delivers leading edge cloud solutions so that across the store, through your network or from your fulfillment center, you are ready to reap the rewards of the omnichannel marketplace. For more information, please visit www.manh.com.

This press release contains “forward-looking statements” relating to Manhattan Associates, Inc. Forward-looking statements in this press release include, without limitation, the information set forth under “2024 Guidance” and statements identified by words such as “may,” “expect,” “forecast,” “anticipate,” “intend,” “plan,” “believe,” “could,” “seek,” “project,” “estimate” and similar expressions. Prospective investors are cautioned that any of those forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by those forward-looking statements. Among the important factors that could cause actual results to differ materially from those indicated by those forward-looking statements are: economic conditions, including inflation; disruption and transformation in the retail sector and our vertical markets; delays in product development; competitive and pricing pressures; software errors and information technology failures, disruption and security breaches; risks related to our products’ technology and customer implementations; global instability, including the wars in Ukraine and the Middle East; and the other risk factors set forth in Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, and in Item 1A of Part II in subsequent Quarterly Reports on Form 10-Q. Manhattan Associates undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes in future operating results.

 

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MANHATTAN ASSOCIATES, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Income

(in thousands, except per share amounts)

 

		Three Months Ended March 31,
		2024		2023
		(unaudited)		(unaudited)
Revenue:
Cloud subscriptions		$78,027		$57,220
Software license		2,810		5,352
Maintenance		34,972		35,650
Services		132,195		116,170
Hardware		6,548		6,621
Total revenue		254,552		221,013
Costs and expenses:
Cost of cloud subscriptions, maintenance and services		118,955		103,327
Cost of software license		332		302
Research and development		35,010		30,794
Sales and marketing		19,929		18,065
General and administrative		21,203		19,953
Depreciation and amortization		1,493		1,487
Total costs and expenses		196,922		173,928
Operating income		57,630		47,085
Other income, net		996		143
Income before income taxes		58,626		47,228
Income tax provision		4,825		8,437
Net income		$53,801		$38,791
Basic earnings per share		$0.87		$0.62
Diluted earnings per share		$0.86		$0.62
Weighted average number of shares:
Basic		61,625		62,211
Diluted		62,493		62,767

 

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MANHATTAN ASSOCIATES, INC. AND SUBSIDIARIES

Reconciliation of Selected GAAP to Non-GAAP Measures

(in thousands, except per share amounts)

			Three Months Ended March 31,
			2024		2023
Operating income			$57,630		$47,085
Equity-based compensation (a)			22,095		16,640
Adjusted operating income (Non-GAAP)			$79,725		$63,725
Income tax provision			$4,825		$8,437
Equity-based compensation (a)			3,436		2,409
Tax benefit of stock awards vested (b)			8,157		2,955
Adjusted income tax provision (Non-GAAP)			$16,418		$13,801
Net income			$53,801		$38,791
Equity-based compensation (a)			18,659		14,231
Tax benefit of stock awards vested (b)			(8,157)		(2,955)
Adjusted net income (Non-GAAP)			$64,303		$50,067
Diluted EPS			$0.86		$0.62
Equity-based compensation (a)			0.30		0.23
Tax benefit of stock awards vested (b)			(0.13)		(0.05)
Adjusted diluted EPS (Non-GAAP)			$1.03		$0.80
Fully diluted shares			62,493		62,767

 

 

			Three Months Ended March 31,
			2024		2023
Cost of services			$9,289		$6,516
Research and development			5,240		3,655
Sales and marketing			1,990		1,648
General and administrative			5,576		4,821
Total equity-based compensation			$22,095		$16,640

 

 

 

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MANHATTAN ASSOCIATES, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(in thousands, except share and per share data)

 

		March 31, 2024				December 31, 2023
		(unaudited)
ASSETS
Current assets:
Cash and cash equivalents		$	207,524			$	270,741
Accounts receivable, net of allowance			205,701				181,173
Prepaid expenses and other current assets			31,981				27,276
Total current assets			445,206				479,190
Property and equipment, net			12,684				11,795
Operating lease right-of-use assets			52,031				21,645
Goodwill, net			62,232				62,235
Deferred income taxes			69,868				66,043
Other assets			32,741				32,445
Total assets		$	674,762			$	673,353
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable		$	26,401			$	24,508
Accrued compensation and benefits			48,517				73,210
Accrued and other liabilities			24,920				27,374
Deferred revenue			263,905				237,793
Income taxes payable			8,277				3,030
Total current liabilities			372,020				365,915
Operating lease liabilities, long-term			51,813				17,694
Other non-current liabilities			11,322				11,466
Shareholders' equity:
Preferred stock, no par value; 20,000,000 shares authorized, no shares issued or outstanding in 2024 and 2023			-				-
Common stock, $0.01 par value; 200,000,000 shares authorized; 61,569,549 and 61,566,037 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively			615				615
Retained earnings			266,757				304,701
Accumulated other comprehensive loss			(27,765	)			(27,038	)
Total shareholders' equity			239,607				278,278
Total liabilities and shareholders' equity		$	674,762			$	673,353

 

 

 

 

 

 

 

 

 

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MANHATTAN ASSOCIATES, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(in thousands)

 

		Three Months Ended March 31,
		2024				2023
		(unaudited)				(unaudited)
Operating activities:
Net income		$	53,801			$	38,791
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			1,493				1,487
Equity-based compensation			22,095				16,640
(Gain) loss on disposal of equipment			(138	)			16
Deferred income taxes			(3,869	)			(2,523	)
Unrealized foreign currency loss			501				1,167
Changes in operating assets and liabilities:
Accounts receivable, net			(25,434	)			6,730
Other assets			(4,520	)			(8,760	)
Accounts payable, accrued and other liabilities			(20,809	)			(10,009	)
Income taxes			4,594				7,850
Deferred revenue			27,024				7,327
Net cash provided by operating activities			54,738				58,716
Investing activities:
Purchase of property and equipment			(2,321	)			(666	)
Net cash used in investing activities			(2,321	)			(666	)
Financing activities:
Repurchase of common stock			(113,834	)			(101,688	)
Net cash used in financing activities			(113,834	)			(101,688	)
Foreign currency impact on cash			(1,800	)			(230	)
Net change in cash and cash equivalents			(63,217	)			(43,868	)
Cash and cash equivalents at beginning of period			270,741				225,463
Cash and cash equivalents at end of period		$	207,524			$	181,595

 

 

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MANHATTAN ASSOCIATES, INC.

SUPPLEMENTAL INFORMATION

 

1. GAAP and adjusted earnings per share by quarter are as follows:

 

	2023										2024
	1st Qtr		2nd Qtr		3rd Qtr		4th Qtr		Full Year		1st Qtr
GAAP Diluted EPS	$0.62		$0.63		$0.79		$0.78		$2.82		$0.86
Adjustments to GAAP:
Equity-based compensation	0.23		0.25		0.26		0.25		0.97		0.30
Tax benefit of stock awards vested	(0.05)		-		-		-		(0.06)		(0.13)
Adjusted Diluted EPS	$0.80		$0.88		$1.05		$1.03		$3.74		$1.03
Fully Diluted Shares	62,767		62,432		62,310		62,555		62,608		62,493

2. Revenues and operating income by reportable segment are as follows (in thousands):
 

	2023										2024
	1st Qtr		2nd Qtr		3rd Qtr		4th Qtr		Full Year		1st Qtr
Revenue:
Americas	$170,759		$179,208		$186,564		$182,664		$719,195		$196,312
EMEA	39,658		40,902		41,204		44,874		166,638		46,620
APAC	10,596		10,906		10,673		10,717		42,892		11,620
	$221,013		$231,016		$238,441		$238,255		$928,725		$254,552
GAAP Operating Income:
Americas	$29,647		$32,326		$34,655		$38,530		$135,158		$36,687
EMEA	12,793		13,556		14,415		15,959		56,723		15,884
APAC	4,645		4,601		4,378		4,376		18,000		5,059
	$47,085		$50,483		$53,448		$58,865		$209,881		$57,630
Adjustments (pre-tax):
Americas:
Equity-based    compensation	$16,640		$17,928		$19,030		$17,973		$71,571		$22,095
	$16,640		$17,928		$19,030		$17,973		$71,571		$22,095
Adjusted non-GAAP Operating Income:
Americas	$46,287		$50,254		$53,685		$56,503		$206,729		$58,782
EMEA	12,793		13,556		14,415		15,959		56,723		15,884
APAC	4,645		4,601		4,378		4,376		18,000		5,059
	$63,725		$68,411		$72,478		$76,838		$281,452		$79,725

 

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3. Impact of Currency Fluctuation

The following table reflects the increases (decreases) in the results of operations for each period attributable to the change in foreign currency exchange rates from the prior period as well as foreign currency gains (losses) included in other income, net for each period (in thousands):

 

	2023										2024
	1st Qtr		2nd Qtr		3rd Qtr		4th Qtr		Full Year		1st Qtr
Revenue	$(3,084)		$104		$2,755		$2,341		$2,116		$648
Costs and expenses	(3,616)		(1,133)		1,033		1,212		(2,504)		176
Operating income	532		1,237		1,722		1,129		4,620		472
Foreign currency gains (losses)    in other income	(810)		(516)		387		(527)		(1,466)		(564)
	$(278)		$721		$2,109		$602		$3,154		$(92)

 

Manhattan Associates has a large research and development center in Bangalore, India. The following table reflects the increases (decreases) in the financial results for each period attributable to changes in the Indian Rupee exchange rate (in thousands):
 

	2023										2024
	1st Qtr		2nd Qtr		3rd Qtr		4th Qtr		Full Year		1st Qtr
Operating income	$1,632		$1,222		$728		$267		$3,849		$185
Foreign currency gains (losses)     in other income	(283)		(31)		812		(105)		393		164
Total impact of    changes in the    Indian Rupee	$1,349		$1,191		$1,540		$162		$4,242		$349

4. Other income includes the following components (in thousands):
 

	2023										2024
	1st Qtr		2nd Qtr		3rd Qtr		4th Qtr		Full Year		1st Qtr
Interest income	$969		$1,555		$1,371		$1,409		$5,304		$1,414
Foreign currency gains (losses)	(810)		(516)		387		(527)		(1,466)		(564)
Other non-operating     income (expense)	(16)		2		(19)		(15)		(48)		146
Total other income (loss)	$143		$1,041		$1,739		$867		$3,790		$996

5. Capital expenditures are as follows (in thousands):
 

	2023										2024
	1st Qtr		2nd Qtr		3rd Qtr		4th Qtr		Full Year		1st Qtr
Capital expenditures	$666		$1,009		$1,086		$1,969		$4,730		$2,321

 

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6. Stock Repurchase Activity (in thousands):

 

	2023										2024
	1st Qtr		2nd Qtr		3rd Qtr		4th Qtr		Full Year		1st Qtr
Shares purchased under publicly announced buy-back program	515		381		128		-		1,024		294
Shares withheld for taxes due upon vesting of restricted stock units	208		4		8		2		222		165
Total shares purchased	723		385		136		2		1,246		459
Total cash paid for shares purchased under publicly announced buy-back program	$74,177		$66,769		$25,072		$0		$166,018		$73,411
Total cash paid for shares withheld for taxes due upon vesting of restricted stock units	27,511		658		1,529		331		30,029		40,423
Total cash paid for shares repurchased	$101,688		$67,427		$26,601		$331		$196,047		$113,834

 

 

7. Remaining Performance Obligations

We disclose revenue we expect to recognize from our remaining performance obligations ("RPO"). Over 98% of our RPO represent cloud native subscriptions with a non-cancelable term greater than one year (including cloud-deferred revenue as well as amounts we will invoice and recognize as revenue from our performance of cloud services in future periods). Maintenance contracts are typically one year and not included in the RPO. Our RPO as of the end of each period appears below (in thousands):

 

	March 31, 2023				June 30, 2023				September 30, 2023				December 30, 2023				March 31, 2024
Remaining Performance Obligations	$	1,153,404			$	1,238,672			$	1,324,861			$	1,427,854			$	1,516,430

 

 

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