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AppFolio, Inc. Announces Second Quarter 2021 Financial Results

August 09, 2021

SANTA BARBARA, Calif., Aug. 09, 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 second quarter ended June 30, 2021.

AppFolio's operating results for the second 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 second 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 August 9, 2021, AppFolio's outlook for fiscal year 2021 follows:

  • Full year revenue is expected to be in the range of $350 million to $355 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, August 9, 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/2995293. 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 2995293. 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 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 June 30, 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)
 
  June 30,
2021
  December 31,
2020
Assets      
Current assets      
Cash and cash equivalents $ 48,610     $ 140,263  
Investment securities—current 102,978     28,256  
Accounts receivable, net 14,973     10,057  
Prepaid expenses and other current assets 23,306     20,777  
Total current assets 189,867     199,353  
Investment securities—noncurrent 11,541     6,770  
Property and equipment, net 27,324     26,439  
Operating lease right-of-use assets 40,983     30,561  
Capitalized software development costs, net 39,225     35,459  
Goodwill 56,147     56,147  
Intangible assets, net 14,017     16,357  
Deferred income taxes—noncurrent 12,774     12,181  
Other long-term assets 7,194     6,213  
Total assets $ 399,072     $ 389,480  
Liabilities and Stockholders’ Equity      
Current liabilities      
Accounts payable $ 2,411     $ 1,040  
Accrued employee expenses—current 27,504     18,888  
Accrued expenses 11,403     14,069  
Deferred revenue 3,205     2,262  
Income tax payable 66     9,095  
Other current liabilities 4,196     4,451  
Total current liabilities 48,785     49,805  
Accrued employee expenses—noncurrent 968     —   
Operating lease liabilities 53,936     40,146  
Deferred income taxes—noncurrent 8,116     13,609  
Total liabilities 111,805     103,560  
Stockholders’ equity:      
Preferred stock, $0.0001 par value, 25,000 shares authorized and no shares issued and outstanding as of June 30, 2021 and December 31, 2020 —      —   
Class A common stock, $0.0001 par value, 250,000 shares authorized as of June 30, 2021 and December 31, 2020; 19,408 and 19,148 shares issued as of June 30, 2021 and December 31, 2020, respectively; 18,989 and 18,729 shares outstanding as of June 30, 2020 and December 31, 2020, respectively 2     2  
Class B common stock, $0.0001 par value, 50,000 shares authorized as of June 30, 2021 and December 31, 2020; 15,621 and 15,659 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively 2     2  
Additional paid-in capital 160,160     161,247  
Accumulated other comprehensive (loss) income (10 )   56  
Treasury stock, at cost, 419 shares of Class A common stock as of June 30, 2021 and December 31, 2020 (25,756 )   (25,756 )
Retained earnings 152,869     150,369  
Total stockholders’ equity 287,267     285,920  
Total liabilities and stockholders’ equity $ 399,072     $ 389,480  
 


 
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(in thousands, except per share amounts)
 
  Three Months Ended
June 30,
  Six Months Ended
June 30,
  2021   2020   2021   2020
Revenue $ 89,040     $ 81,043     $ 167,961     $ 153,538  
Costs and operating expenses:              
Cost of revenue (exclusive of depreciation and amortization) 32,819     27,411     66,117     56,372  
Sales and marketing 17,714     13,717     33,893     28,223  
Research and product development 15,506     12,128     29,889     23,340  
General and administrative 14,206     14,785     27,567     23,357  
Depreciation and amortization 7,649     6,657     15,018     13,071  
Total costs and operating expenses 87,894     74,698     172,484     144,363  
Income (loss) from operations 1,146     6,345     (4,523 )   9,175  
Other income (loss), net 496     (10 )   1,058     12  
Interest income (expense), net 55     (562 )   108     (1,056 )
Income (loss) before benefit from income taxes 1,697     5,773     (3,357 )   8,131  
Benefit from income taxes (324 )   (13,484 )   (5,857 )   (13,109 )
Net income $ 2,021     $ 19,257     $ 2,500     $ 21,240  
               
Net income per common share:              
Basic $ 0.06     $ 0.56     $ 0.07     $ 0.62  
Diluted $ 0.06     $ 0.54     $ 0.07     $ 0.60  
Weighted average common shares outstanding:              
Basic 34,548     34,254     34,479     34,214  
Diluted 35,674     35,614     35,697     35,647  
                       


 
Stock-Based Compensation Expense
(in thousands)
 
  Three Months Ended
June 30,
  Six Months Ended
June 30,
  2021   2020   2021   2020
Costs and operating expenses:              
Cost of revenue (exclusive of depreciation and amortization) $ 463     $ 520     $ 934     $ 646  
Sales and marketing 447     477     849     702  
Research and product development 1,214     580     2,071     874  
General and administrative 1,090     1,176     2,136     1,490  
Total stock-based compensation expense $ 3,214     $ 2,753     $ 5,990     $ 3,712  
 


 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(in thousands)
 
  Three Months Ended
June 30,
  Six Months Ended
June 30,
  2021   2020   2021   2020
Cash from operating activities              
Net income $ 2,021     $ 19,257     $ 2,500     $ 21,240  
Adjustments to reconcile net income to net cash provided by operating activities:              
Depreciation and amortization 7,649     6,657     15,018     13,071  
Amortization of operating lease right-of-use assets 737     1,018     1,399     2,071  
Deferred income taxes (363 )   (13,499 )   (6,086 )   (13,137 )
Stock-based compensation 3,214     2,753     5,990     3,712  
Other (422 )   8     (579 )   (30 )
Changes in operating assets and liabilities:              
Accounts receivable (2,111 )   (3,520 )   (4,007 )   (5,136 )
Prepaid expenses and other current assets (2,218 )   2,530     (2,171 )   (292 )
Other assets (579 )   41     (982 )   (107 )
Accounts payable 431     555     1,301     193  
Accrued employee expenses—current 6,910     6,144     7,638     717  
Accrued expenses 757     3,808     (3,047 )   4,534  
Deferred revenue (266 )   (161 )   33     532  
Income tax payable (2,535 )   —      (9,029 )   —   
Other current liabilities (280 )   —      30     100  
Accrued employee expenses—noncurrent (204 )   (422 )   968     —   
Operating lease liabilities 2,357     (876 )   1,685     (92 )
Net cash provided by operating activities 15,098     24,293     10,661     27,376  
Cash from investing activities              
Purchases of available-for-sale investments (49,282 )   (12,740 )   (148,293 )   (13,389 )
Proceeds from sales of available-for-sale investments 24,299     —      42,198     13,942  
Proceeds from maturities of available-for-sale investments 25,750     500     26,750     7,750  
Purchases of property, equipment and intangible assets (1,866 )   (6,314 )   (2,804 )   (14,306 )
Capitalization of software development costs (5,771 )   (5,887 )   (11,911 )   (12,709 )
Net cash used in investing activities (6,870 )   (24,441 )   (94,060 )   (18,712 )
Cash from financing activities              
Proceeds from stock option exercises 546     232     646     329  
Tax withholding for net share settlement (4,908 )   (3,232 )   (8,900 )   (9,690 )
Payment of contingent consideration —      —      —      (5,977 )
Proceeds from issuance of debt —      753     —      50,190  
Principal payments on debt —      (1,069 )   —      (1,818 )
Purchase of treasury stock —      —      —      (4,194 )
Net cash (used in) provided by financing activities (4,362 )   (3,316 )   (8,254 )   28,840  
Net increase (decrease) in cash and cash equivalents and restricted cash 3,866     (3,464 )   (91,653 )   37,504  
Cash, cash equivalents and restricted cash              
Beginning of period 45,180     57,215     140,699     16,247  
End of period $ 49,046     $ 53,751     $ 49,046     $ 53,751  


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Source: AppFolio, Inc.
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