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AppFolio, Inc. Announces First Quarter 2021 Financial Results

May 10, 2021

SANTA BARBARA, Calif., May 10, 2021 (GLOBE NEWSWIRE) -- AppFolio, Inc. (NASDAQ: APPF) ("AppFolio" or the "Company"), a leading provider of cloud-based business software solutions, services, and data analytics to the real estate market, today announced its financial results for the first quarter ended March 31, 2021.

AppFolio's operating results for the first quarter of 2021 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 March 1, 2021, as well as its more detailed first quarter 2021 results that will be included in the Company's Quarterly Report on Form 10-Q, which will be filed with the SEC today. 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 May 10, 2021, AppFolio's outlook for fiscal year 2021 follows:

  • Full year revenue is expected to be in the range of $348 million to $355 million.
  • Diluted weighted average shares are expected to be approximately 36 million for the full year.

Executive Management Transition
AppFolio announced that its Chief Financial Officer, Ida Kane, has notified its Board of Directors of her plans to depart the Company. Ms. Kane will remain in her current position until a mutually determined future date. The Company is initiating a search for her successor and all parties are committed to ensuring a smooth transition.

Conference Call Information
As previously announced, the Company will host a conference call today, May 10, 2021, at 1:30 p.m. Pacific Time, 4:30 p.m. Eastern Time, to discuss its financial results. Participants who wish to dial into the conference call please register in advance at http://www.directeventreg.com/registration/event/6585354. After registering, a confirmation email will be sent, including dial-in details and a unique code for entry. Registration will be open through the start of the live call.

Following the conference call, a replay will be available at (800) 585-8367 (domestic) or (416) 621-4642 (international). The replay passcode is 6585354. An archived webcast of this conference call will also be available on AppFolio’s Investor Relations website at http://ir.appfolioinc.com.

About AppFolio, Inc.
AppFolio provides innovative software, services and data analytics to the real estate industry. Our industry-specific, cloud-based business management solutions are designed to enable our customers to digitally transform their businesses, address critical business operations and enable exceptional customer service. Today our core solutions include AppFolio Property Manager, AppFolio Property Manager PLUS, and AppFolio Investment Management. In addition, the Company offers a variety of Value+ services that are designed to enhance, automate and streamline essential processes and workflows for our customers. 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,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts, “projects,” “seeks,” “should,” “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 March 31, 2021, which will be filed with the SEC today, 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)

  March 31,
2021
  December 31,
2020
Assets      
Current assets      
Cash and cash equivalents $ 44,744     $ 140,263  
Investment securities—current 103,341     28,256  
Accounts receivable, net 12,524     10,057  
Prepaid expenses and other current assets 20,843     20,777  
Total current assets 181,452     199,353  
Investment securities—noncurrent 11,806     6,770  
Property and equipment, net 26,530     26,439  
Operating lease right-of-use assets 30,021     30,561  
Capitalized software development costs, net 37,554     35,459  
Goodwill 56,147     56,147  
Intangible assets, net 15,170     16,357  
Deferred income taxes—noncurrent 13,401     12,181  
Other long-term assets 6,616     6,213  
Total assets $ 378,697     $ 389,480  
Liabilities and Stockholders’ Equity      
Current liabilities      
Accounts payable $ 2,262     $ 1,040  
Accrued employee expenses—current 20,050     18,888  
Accrued expenses 10,231     14,069  
Deferred revenue 3,135     2,262  
Income tax payable 2,601     9,095  
Other current liabilities 4,758     4,451  
Total current liabilities 43,037     49,805  
Accrued employee expenses—noncurrent 1,172      
Operating lease liabilities 39,598     40,146  
Deferred income taxes—noncurrent 9,106     13,609  
Total liabilities 92,913     103,560  
Stockholders’ equity:      
Preferred stock, $0.0001 par value, 25,000 shares authorized and no shares issued and outstanding as of March 31, 2021 and December 31, 2020      
Class A common stock, $0.0001 par value, 250,000 shares authorized as of March 31, 2021 and December 31, 2020; 19,321 and 19,148 shares issued as of March 31, 2021 and December 31, 2020, respectively; 18,902 and 18,729 shares outstanding as of March 31, 2020 and December 31, 2020, respectively 2     2  
Class B common stock, $0.0001 par value, 50,000 shares authorized as of March 31, 2021 and December 31, 2020; 15,551 and 15,659 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively 2     2  
Additional paid-in capital 160,650     161,247  
Accumulated other comprehensive income 38     56  
Treasury stock, at cost, 419 shares of Class A common stock as of March 31, 2021 and December 31, 2020 (25,756 )   (25,756 )
Retained earnings 150,848     150,369  
Total stockholders’ equity 285,784     285,920  
Total liabilities and stockholders’ equity $ 378,697     $ 389,480  


CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(in thousands, except per share amounts)

  Three Months Ended
March 31,
  2021   2020
Revenue $ 78,921     $ 72,495  
Costs and operating expenses:      
Cost of revenue (exclusive of depreciation and amortization) 33,298     28,961  
Sales and marketing 16,179     14,506  
Research and product development 14,383     11,212  
General and administrative 13,361     8,572  
Depreciation and amortization 7,369     6,414  
Total costs and operating expenses 84,590     69,665  
(Loss) income from operations (5,669 )   2,830  
Other income, net 562     22  
Interest income (expense), net 53     (494 )
(Loss) income before (benefit from) provision for income taxes (5,054 )   2,358  
(Benefit from) provision for income taxes (5,533 )   375  
Net income $ 479     $ 1,983  
       
Net income per common share:      
Basic $ 0.01     $ 0.06  
Diluted $ 0.01     $ 0.06  
Weighted average common shares outstanding:      
Basic 34,409     34,175  
Diluted 35,712     35,681  


Stock-Based Compensation Expense
(in thousands)

  Three Months Ended
March 31,
  2021   2020
Costs and operating expenses:      
Cost of revenue (exclusive of depreciation and amortization) $ 471     $ 126  
Sales and marketing 402     225  
Research and product development 857     294  
General and administrative 1,046     314  
Total stock-based compensation expense $ 2,776     $ 959  


 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(in thousands)
  Three Months Ended
March 31,
  2021   2020
Cash from operating activities      
Net income $ 479     $ 1,983  
Adjustments to reconcile net income to net cash (used in) provided by operating activities:      
Depreciation and amortization 7,369     6,414  
Amortization of operating lease right-of-use assets 662     1,053  
Deferred income taxes (5,723 )   362  
Stock-based compensation 2,776     959  
Other (157 )   (38 )
Changes in operating assets and liabilities:      
Accounts receivable (1,896 )   (1,616 )
Prepaid expenses and other current assets 47     (2,822 )
Other assets (403 )   (148 )
Accounts payable 870     (362 )
Accrued employee expenses—current 728     (5,427 )
Accrued expenses (3,804 )   726  
Deferred revenue 299     693  
Income tax payable (6,494 )    
Other current liabilities 310     522  
Accrued employee expenses—noncurrent 1,172      
Operating lease liabilities (672 )   784  
Net cash (used in) provided by operating activities (4,437 )   3,083  
Cash from investing activities      
Purchases of available-for-sale investments (99,011 )   (649 )
Proceeds from sales of available-for-sale investments 17,899     13,942  
Proceeds from maturities of available-for-sale investments 1,000     7,250  
Purchases of property, equipment and intangible assets (938 )   (7,992 )
Capitalization of software development costs (6,140 )   (6,822 )
Net cash (used in) provided by investing activities (87,190 )   5,729  
Cash from financing activities      
Proceeds from stock option exercises 100     97  
Tax withholding for net share settlement (3,992 )   (6,458 )
Payment of contingent consideration     (5,977 )
Proceeds from issuance of debt     49,437  
Principal payments on debt     (749 )
Purchase of treasury stock     (4,194 )
Net cash (used in) provided by financing activities (3,892 )   32,156  
Net (decrease) increase in cash and cash equivalents and restricted cash (95,519 )   40,968  
Cash, cash equivalents and restricted cash      
Beginning of period 140,699     16,247  
End of period $ 45,180     $ 57,215  

 


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Source: AppFolio, Inc.
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