Simulations Plus Inc. on Wednesday said that its first quarter profit jumped 71 percent as the developer of pharmaceutical simulation software benefited from the sale of a non-core business.
The Lancaster company, which sells its software on a subscription basis to drug companies and government research labs, reported net income of $971,021 (6 cents a share) compared with $567,493 (3 cents) in the same period a year earlier.
Net sales for the quarter that ended Nov. 30 rose 9.8 percent to $2.25 million. The quarter was affected by the company’s revenue from the sale of its Words+ educational software subsidiary to an Ohio company for $2.1 million, and expenses related to the company unsuccessful attempt to acquire assets of a bankrupt company.
The year-earlier period also included $67,000 in grant revenue, so Chief Executive Walt Woltosz noted that software and consulting revenue growth would have been up more than 13 percent without that distortion.
“The increased sales and net income from our continuing operations for this new record first quarter are enhanced even more with the small profit from the (Words+) sale,” said Woltosz in a statement. “Accomplishing that sale was a major effort over the past half year that leaves us now with a focused business and without the losses that occurred all too often in the subsidiary that reduced (our) overall financial performance.”
Shares were up 2 cents, or less than 1 percent, to $3.07 in midday trading on the Nasdaq.