Kinaxis Inc.

Good morning, ladies and gentlemen. Welcome to the Kinexis Inc. Fiscal 2024 First Quarter Results Conference Call. Currently, all participants are in a listen-only mode. Following the presentation, we will conduct a question and answer session. Instructions will be provided at the time for you to queue up your questions. I'd like to remind everyone that this call is being recorded today, Thursday, May 9, 2024. I will now turn the call over to Rick Wadsworth, Vice President of Investor Relations at Kinaxis Inc. Please go ahead, Mr. Wadsworth.

Thanks, Operator. Good morning and welcome to the Kinaxis Earnings Call. Today we'll be discussing our first quarter results, which we issued after close of markets yesterday. With me on the call are John Sicard, our President and Chief Executive Officer, and Blaine Fitzgerald, our Chief Financial Officer. Before we get started, I want to emphasize that some of the information discussed in this call is based on information as of today, May 9, 2024, and contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from those set forth in such statements. For a discussion of these risks and uncertainties, you should review the forward-looking statements disclosure in the earnings press release as well as in our CDAR filings, CDAR Plus filings. During this call, we will discuss IFRS results and non-IFRS financial measures, including adjusted EBITDA, a reconciliation between adjusted EBITDA, and the corresponding IFRS result is available in our earnings press release and our MD&A, both of which can be found on the investor relations section of our website, canaxis.com, and on CDAR+. Participants are advised that the webcast is live and is also being recorded for playback purposes. An archive of the webcast will be made available on the Investor Relations section of our website. Neither this call nor the webcast archive may be re-recorded or otherwise reproduced or distributed without prior written permission from Canaxis. To begin our call, John will discuss the highlights of our quarter as well as recent business developments, followed by Blaine, who will review our financial results and Outlook. Finally, John will make some closing statements before opening the line for questions. We have a presentation to accompany today's call, which can be downloaded from the Investor Relations homepage of our website, canaccess.com. We'll let you know when to change slides. Before I turn the call over to John, I'm excited to announce that for the first time, we're making our annual user conference, Connections, open to investors. It will take place from June 17 to June 20 in Miami. You can review event details at connections.com, and if you're interested in joining us, please reach out to me directly, at rwadsworth at canaxis.com before registering as we do have capacity limitations.

Over to you, John. Thank you, Rick. Good morning, everyone, and thank you for joining us today. I'll be starting with slide four. We delivered solid results for the first quarter, including $119.4 million in total revenue or 18% growth. 73.4 million in SAS revenue, representing 16% growth, and a 19% adjusted EBITDA margin, which is a very strong result. As we have committed to on recent calls, we are heightening our focus on profitability, and we've taken another important step towards that goal recently, which I'll speak to shortly. Moving to slide five. One of the great privileges of working here at Kinaxis is being able to talk about how our industry views us. Hopefully, you've had the opportunity to see the latest Gartner Magic Quadrant for Supply Chain Planning Solutions, which was launched a couple of weeks ago. Of the 20 vendors evaluated, Gartner positioned Kinaxis highest on our ability to execute, making the company's 10th consecutive leaders quadrant within the report. We occupy the top right corner while only one of three competitors we see most is in the leaders quadrant at all. We see this dynamic play out in the field every day and it's reflected in our strong competitive win rates and outstanding customer retention rate. We are thrilled with this recognition as it implies to the market that if you want a solution that is proven to work for you, Kinexus is the responsible choice. And how gratifying is that? Now onto slide six. We are dedicated to remaining both a product leader and a company that executes on its promises to our customers. This philosophy continues to be reflected through some go-to-market and product partnerships we announced in the quarter, including with Volantik, a regional systems integrator that has decades of experience successfully delivering supply chain solutions across Europe. We also announced agreements with Elixim and Climatic, both being solution extension partners that complement our capabilities around production planning and scheduling and sustainability. Overall, our PartnerLink program which includes all partner categories, has grown to more than 170 partners and over 2,500 certified consultants worldwide, making it one of the industry's largest networks of supply chain transformation experts and specialists. We continue to rapidly add exciting brands to our customer base. In the quarter, we won the same number of new customers as we did a year ago. I'm excited to be able to name just a few of the new brands that have joined the Kinaxis family. We're extremely pleased to welcome Harley-Davidson, one of the most iconic motorcycle brands in the world. It's so inspiring to be able to associate Kinaxis with leaders like this. We can also name two customers we won through our VAR channel. Dr. Wolf Group, a Germany-based provider of cosmetics, and over-the-counter medical products, and the Taco Group, which offers interior products such as flooring based in Indonesia. I am very, very, very pleased with the momentum coming from the bar channel. These, among some others, including a large automotive company in India and one of the world's most recognized European luxury goods brands, are all great successes and reflect how we can serve companies of any size across diverse industries anywhere in the world, all with the same powerful platform. I'm also looking forward to being able to name some very large new enterprise customers as we progress through 2024. Now, since the macro environment changed at the beginning of 2023, our largest opportunities have been the most time consuming to get across the line. Historically, these have been the biggest drivers of our ARR and SAS growth. We continue to see great interest from companies wanting to transform outdated approaches to supply chain management and perhaps even more satisfying, several companies coming to us following failed attempts to deploy competitive solutions. I remain as excited as ever about the opportunities ahead. Earlier, I mentioned that we took another major step related to our focus on returning to higher profitability. In the first quarter, we started restructuring of our organization to focus on our next wave of growth, including eliminating roughly 6% of our workforce, a process that will be substantially complete in Q2. Supply chain markets continue to evolve rapidly. and we are reshaping the organization to ensure the company is aimed at and able to capitalize on the very best opportunities ahead. Almost immediately, we will be reinvesting some of the savings from this initiative into key product innovations and go-to-market priorities throughout the remainder of the year and into 2025. While detailed plans are still underway, I can give you some examples of some of these themes. To accelerate our go-to-market efforts, we have tremendous opportunities to work even more closely with certain large, strategic, long-standing partners, and this will require some additional investment to capitalize on. We also see an opportunity to reallocate some sales and marketing spending into customer-facing roles that will make a more direct impact on sales growth. On the product innovation side, we're working towards some very exciting announcements at Connections, which will include AI becoming an even more integral part of our platform. So we're reinvesting to align the skill sets in R&D accordingly. As part of the changes we've made to date, I want to congratulate Claire Ryszluski, who has been promoted to Chief Sales Officer. Claire has been with us for over four years and began by successfully leading and growing our European sales team. Then took on global sales responsibilities almost two years ago working under Paul Carrero. Paul led our sales functions through the fastest growing years and we are extremely grateful for his leadership over that time and wish him continued success ahead. Finally, I'm pleased to be able to increase our adjusted EBITDA margin guidance for 2024 to 18 to 20%. We have committed to consistently achieving a 25% adjusted EBITDA margin within the next three years and we are making great progress towards this goal. Now I'll turn the call over to Blaine to review the financials for the quarter and discuss our increased outlook in detail. Blaine.