Fourth Quarter and Fiscal Year 2019 Financial Results

• Q4 2019 Total Revenue of $120.4 million, up 25% year-over-year
• FY 2019 Total Revenue of $467.6 million, up 26% year-over-year

SCHAUMBURG, Ill. — August 8, 2019 — Paylocity Holding Corporation (Nasdaq: PCTY), a cloud-based provider of payroll and human capital management software solutions, announced today financial results for the fourth quarter and full fiscal year 2019, which ended June 30, 2019.

“We had a great fiscal 2019, which included 26% revenue growth and 28.7% adjusted EBITDA margins, while also generating record free cash flow,” said Steve Beauchamp, Chief Executive Officer of Paylocity. “I’m also pleased to announce the release of our Learning Management System, which helps us achieve our target PEPY of $400, and we are now setting our new target at $500 PEPY.”

Key Recent Achievements

• Q4 2019 Total Revenue of $120.4 million, up 25% year-over-year
• FY 2019 Total Revenue of $467.6 million, up 26% year-over-year 
• FY 2019 GAAP net income of $53.8 million, versus net income of $38.6 million in FY 2018, which includes a non-cash income tax benefit of $21.8 million, a 40% increase
• FY 2019 Adjusted EBITDA of $134.0 million or 28.7% of revenue, an increase of 50 basis points from initial FY 2019 guidance in August 2018

Fourth Quarter Fiscal 2019 Financial Highlights

Revenue

• Total revenue was $120.4 million, an increase of 25% from the fourth quarter of fiscal year 2018, as adjusted and as presented on a non-GAAP basis in the table below.
• Total recurring revenue was $116.7 million, representing 97% of total revenue and an increase of 26% from the fourth quarter of fiscal year 2018 total recurring revenue, as adjusted and as presented on a non-GAAP basis in the table below.

Operating Income

• GAAP operating income was $9.2 million and Non-GAAP operating income was $21.4 million in the fourth quarter of fiscal year 2019. 

Net Income

• GAAP net income was $10.2 million or $0.18 per share for the three months ended June 30, 2019 based on 55.7 million diluted weighted average common shares outstanding. 

Adjusted EBITDA

• Adjusted EBITDA, a non-GAAP measure, was $29.9 million in the fourth quarter of fiscal year 2019.

Fiscal Year 2019 Financial Highlights

Revenue

• Total revenue was $467.6 million, an increase of 26% from fiscal year 2018, as adjusted and as presented on a non-GAAP basis in the table below.
• Total recurring revenue was $456.8 million, representing 98% of total revenue and an increase of 26% from fiscal year 2018 total recurring revenue, as adjusted and as presented on a non-GAAP basis in the table below.

Operating Income

• GAAP operating income was $56.2 million and non-GAAP operating income was $100.9 million in fiscal year 2019.

Net Income

• GAAP net income was $53.8 million or $0.97 per share for fiscal year 2019, based on 55.4 million diluted weighted average common shares outstanding.

 Adjusted EBITDA

• Adjusted EBITDA, a non-GAAP measure, was $134.0 million for fiscal year 2019.

Balance Sheet and Cash Flow

• Cash, cash equivalents and invested corporate cash totaled $162.5 million at the end of the year.  
• Cash flow from operations for fiscal year 2019 was $115.0 million compared to $97.9 million for fiscal year 2018, an increase of 18%.
• Free cash flow, a non-GAAP measure, was $76.1 million or 16.3% of revenue for fiscal year 2019 compared to $48.8 million or 12.9% of revenue for fiscal year 2018, an increase of 56% and 340 basis points.

Accounting Update

We adopted ASC 606 using the modified retrospective method in fiscal 2019, which began on July 1, 2018. Under ASC 606, we will amortize certain sales and implementation expenses over a period of seven years. 

Also as of July 1, 2018, we began recognizing implementation revenue ratably over a period of generally up to 24 months.

In the interest of comparability during this transition year, in the reconciliation table below we are providing revenue for each quarter of fiscal 2018 on a GAAP and non-GAAP, pro-forma basis giving effect to the change in recognition of implementation revenue for fiscal 2018.

For the official press release, click here.