AppFolio, Inc. Announces Third Quarter 2021 Financial Results

November 8, 2021

SANTA BARBARA, Calif., Nov. 08, 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 industry, today announced its financial results for the third quarter ended September 30, 2021.

AppFolio's operating results for the third 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 third 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 November 8, 2021, AppFolio's outlook for fiscal year 2021 follows:

  • Full year revenue is expected to be in the range of $355 million to $357 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, November 8, 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 https://www.incommglobalevents.com/registration/q4inc/9012/appfolio-inc-announces-third-quarter-2021-financial-results. 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 866.813.9403 (domestic) or 929.458.6194 (international). The passcode is 367726. To access the webcast during the live call, participants may access https://events.q4inc.com/attendee/783445260 and use passcode 367726. 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 September 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)

  September 30,
2021
  December 31,
2020
Assets      
Current assets      
Cash and cash equivalents $ 84,444     $ 140,263  
Investment securities—current 76,034     28,256  
Accounts receivable, net 12,184     10,057  
Prepaid expenses and other current assets 24,714     20,777  
     Total current assets 197,376     199,353  
Investment securities—noncurrent 9,287     6,770  
Property and equipment, net 28,177     26,439  
Operating lease right-of-use assets 42,597     30,561  
Capitalized software development costs, net 40,711     35,459  
Goodwill 56,147     56,147  
Intangible assets, net 12,864     16,357  
Deferred income taxes—noncurrent 12,834     12,181  
Other long-term assets 7,394     6,213  
     Total assets $ 407,387     $ 389,480  
Liabilities and Stockholders’ Equity      
Current liabilities      
Accounts payable $ 2,493     $ 1,040  
Accrued employee expenses—current 25,785     18,888  
Accrued expenses 13,090     14,069  
Deferred revenue 2,738     2,262  
Income tax payable 186     9,095  
Other current liabilities 4,910     4,451  
     Total current liabilities 49,202     49,805  
Accrued employee expenses—noncurrent 2,059      
Operating lease liabilities 56,559     40,146  
Deferred income taxes—noncurrent 7,868     13,609  
     Total liabilities 115,688     103,560  
Stockholders’ equity:      
Preferred stock, $0.0001 par value, 25,000 shares authorized and no shares issued and outstanding as of September 30, 2021 and December 31, 2020      
Class A common stock, $0.0001 par value, 250,000 shares authorized as of September 30, 2021 and December 31, 2020; 19,610 and 19,148 shares issued as of September 30, 2021 and December 31, 2020, respectively; 19,191 and 18,729 shares outstanding as of September 30, 2020 and December 31, 2020, respectively 2     2  
Class B common stock, $0.0001 par value, 50,000 shares authorized as of September 30, 2021 and December 31, 2020; 15,453 and 15,659 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively 2     2  
Additional paid-in capital 164,740     161,247  
Accumulated other comprehensive (loss) income (17 )   56  
Treasury stock, at cost, 419 shares of Class A common stock as of September 30, 2021 and December 31, 2020 (25,756 )   (25,756 )
Retained earnings 152,728     150,369  
     Total stockholders’ equity 291,699     285,920  
     Total liabilities and stockholders’ equity $ 407,387     $ 389,480  



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

  Three Months Ended
September 30,
  Nine Months Ended
September 30,
               
Revenue $ 95,809     $ 84,086     $ 263,770     $ 237,624  
Costs and operating expenses:              
Cost of revenue (exclusive of depreciation and amortization) 38,730     32,752     104,847     89,124  
Sales and marketing 19,362     14,894     53,255     43,117  
Research and product development 16,500     13,454     46,389     36,794  
General and administrative 13,404     12,946     40,971     36,303  
Depreciation and amortization 7,826     6,680     22,844     19,751  
     Total costs and operating expenses 95,822     80,726     268,306     225,089  
(Loss) income from operations (13 )   3,360     (4,536 )   12,535  
Other (loss) income, net (353 )   187,747     705     187,759  
Interest income (expense), net 65     (853 )   173     (1,909 )
(Loss) income before (benefit from) provision for income taxes (301 )   190,254     (3,658 )   198,385  
(Benefit from) provision for income taxes (160 )   52,578     (6,017 )   39,469  
Net (loss) income $ (141 )   $ 137,676     $ 2,359     $ 158,916  
               
Net (loss) income per common share:              
Basic $     $ 4.01     $ 0.07     $ 4.64  
Diluted $     $ 3.86     $ 0.07     $ 4.46  
Weighted average common shares outstanding:              
Basic 34,614     34,296     34,525     34,241  
Diluted 34,614     35,665     35,695     35,662  



Stock-Based Compensation Expense
(in thousands)

  Three Months Ended
September 30,
  Nine Months Ended
September 30,
  2021   2020   2021   2020
Costs and operating expenses:              
Cost of revenue (exclusive of depreciation and amortization) $ 575     $ 452     $ 1,509     $ 1,098  
Sales and marketing 738     367     1,587     1,069  
Research and product development 1,451     474     3,522     1,348  
General and administrative 1,299     1,803     3,435     3,293  
Total stock-based compensation expense $ 4,063     $ 3,096     $ 10,053     $ 6,808  


 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(in thousands)
 
  Three Months Ended
September 30,
  Nine Months Ended
September 30,
  2021   2020   2021   2020
Cash from operating activities              
Net income $ (141 )   $ 137,676     $ 2,359     $ 158,916  
Adjustments to reconcile net income to net cash provided by operating activities:              
Depreciation and amortization 7,826     6,680     22,844     19,751  
Amortization of operating lease right-of-use assets 913     902     2,312     2,973  
Deferred income taxes (308 )   36,015     (6,394 )   22,878  
Stock-based compensation 4,063     3,096     10,053     6,808  
Gain on sale of business (21 )   (187,636 )   (380 )   (187,636 )
Other 309     200     89     170  
Changes in operating assets and liabilities:              
Accounts receivable 2,657     2,907     (1,350 )   (2,229 )
Prepaid expenses and other current assets (1,387 )   (567 )   (3,558 )   (859 )
Other assets (199 )   (213 )   (1,181 )   (320 )
Accounts payable 83     502     1,384     695  
Accrued employee expenses—current (1,303 )   1,202     6,335     1,919  
Accrued expenses 1,621     1,397     (1,426 )   5,931  
Deferred revenue (335 )   283     (302 )   815  
Income tax payable 120         (8,909 )    
Accrued employee expenses—noncurrent 1,091         2,059      
Operating lease liabilities 310     (1,043 )   1,995     (1,135 )
Other liabilities 499     16,439     529     16,539  
     Net cash provided by operating activities 15,798     17,840     26,459     45,216  
Cash from investing activities              
Purchases of available-for-sale investments (18,748 )   (16,490 )   (167,041 )   (29,879 )
Proceeds from sales of available-for-sale investments 1,000         43,198     13,942  
Proceeds from maturities of available-for-sale investments 47,004     5,550     73,754     13,300  
Purchases of property, equipment and intangible assets (2,362 )   (2,245 )   (5,166 )   (16,551 )
Capitalization of software development costs (6,600 )   (6,988 )   (18,511 )   (19,697 )
Proceeds from sale of business, net of cash divested     191,427         191,427  
     Net cash provided by (used in) investing activities 20,294     171,254     (73,766 )   152,542  
Cash from financing activities              
Proceeds from stock option exercises 145     73     791     402  
Tax withholding for net share settlement (403 )   (1,269 )   (9,303 )   (10,959 )
Payment of contingent consideration             (5,977 )
Proceeds from issuance of debt     562         50,752  
Principal payments on debt     (97,747 )       (99,565 )
Purchase of treasury stock             (4,194 )
     Net cash used in financing activities (258 )   (98,381 )   (8,512 )   (69,541 )
     Net increase (decrease) in cash and cash equivalents and restricted cash 35,834     90,713     (55,819 )   128,217  
Cash, cash equivalents and restricted cash              
Beginning of period 49,046     53,751     140,699     16,247  
End of period $ 84,880     $ 144,464     $ 84,880     $ 144,464  

 


Appfolio

Source: AppFolio, Inc.
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