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PRESS RELEASE: Paid content from Globe Newswire
Press release content from Globe Newswire. The AP news staff was not involved in its creation.

AppFolio, Inc. Announces First Quarter 2019 Financial Results

May 2, 2019

SANTA BARBARA, Calif., May 02, 2019 (GLOBE NEWSWIRE) -- AppFolio, Inc. (NASDAQ: APPF) (“AppFolio” or the “Company”), a leading provider of cloud-based business software solutions, today announced its financial results for the quarter ended March 31, 2019.

AppFolio’s operating results for the first quarter of 2019 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 February 28, 2019, as well as its more detailed first quarter 2019 results that will be included in the Company’s Quarterly Report on Form 10-Q, which will be filed with the SEC on May 2, 2019. 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 May 2, 2019, AppFolio’s outlook for fiscal year 2019 follows:

-- Full year revenue is expected to be in the range of $250 million to $255 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, May 2, 2019, at 1:30 p.m. Pacific Time, 4:30 p.m. Eastern Time, to discuss its financial results. Investors are invited to submit questions to management via the Investor Q&A form located on the Investor Overview section of AppFolio’s website.

The conference call can be accessed by dialing 866.393.4306 and entering ID # 8096079. International callers may dial 734.385.2616. A replay of the conference call will be available at 855.859.2056 and 404.537.3406 for international callers. A live and recorded webcast of the conference call will be available at http://ir.appfolioinc.com.

About AppFolio, Inc.AppFolio offers industry-specific, cloud-based business software solutions, services, and data analytics to the real estate and legal markets. Today our products include real estate software ( AppFolio Property Manager, including AppFolio Property Manager PLUS and recently launched AppFolio Investment Management ) and legal practice management software ( MyCase ). AppFolio was founded in 2006 and is headquartered in Santa Barbara, CA. Learn more at www.appfolioinc.com.

Investor Relations Contact: Erica Abrams, 805.364.6093 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,” “seeks,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “could,” “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 March 31, 2019, which will be filed with the SEC on May 2, 2019, 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)

March 31, December 2019 31, 2018 ----------- ----------- Assets Current assets Cash and cash equivalents $ 16,783 $ 74,076 Investment securities—current 17,712 16,631 Accounts receivable, net 7,966 5,516 Prepaid expenses and other current assets 15,086 11,775 --------- - --------- - Total current assets 57,547 107,998 Investment securities—noncurrent 6,300 11,256 Property and equipment, net 7,169 6,871 Operating lease right-of-use assets 16,004 — Capitalized software, net 22,396 20,485 Goodwill 57,496 15,548 Intangible assets, net 26,644 5,895 Other long-term assets 7,026 7,688 --------- - --------- - Total assets $ 200,582 $ 175,741 - ------- - - ------- - Liabilities and Stockholders’ Equity Current liabilities Accounts payable $ 1,557 $ 1,481 Accrued employee expenses 10,795 12,377 Accrued expenses 9,450 8,281 Deferred revenue 4,045 3,414 Other current liabilities 11,099 1,447 Long-term debt, net—current portion 1,213 1,213 --------- - --------- - Total current liabilities 38,159 28,213 Operating lease liabilities 19,064 — Long-term debt, net 48,290 48,602 Other long-term liabilities 14 7,080 --------- - --------- - Total liabilities 105,527 83,895 --------- - --------- - Stockholders’ equity: Preferred stock, $0.0001 par value, 25,000 authorized and no shares issued and outstanding — — at March 31, 2019 and December 31, 2018 Class A common stock, $0.0001 par value, 250,000 shares authorized at March 31, 2019 and December 31, 2018; issued - 16,269 and 16,159, shares at March 31, 2019 and December 31, 2018; 2 2 outstanding - 15,899 and 15,789 shares at March 31, 2019 and December 31, 2018, respectively; Class B common stock, $0.0001 par value, 50,000 shares authorized at March 31, 2019 and December 31, 2018; 2 2 18,071 and 18,109 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively; Additional paid-in capital 157,253 157,898 Accumulated other comprehensive loss (49 ) (178 ) Treasury stock, at cost, 370 Class A shares at March 31, 2019 and December 31, 2018 (21,562 ) (21,562 ) Accumulated deficit (40,591 ) (44,316 ) --------- - --------- - Total stockholders’ equity 95,055 91,846 --------- - --------- - Total liabilities and stockholders’ equity $ 200,582 $ 175,741 - ------- - - ------- -

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

Three Months Ended March 31, 2019 2018 ---------- Revenue $ 57,091 $ 42,340 Costs and operating expenses: Cost of revenue (exclusive of depreciation and amortization) 24,181 16,613 Sales and marketing 11,219 7,405 Research and product development 8,481 5,333 General and administrative 8,192 5,316 Depreciation and amortization 5,076 3,500 -------- - -------- - Total costs and operating expenses 57,149 38,167 -------- - -------- - Income (loss) from operations (58 ) 4,173 Other expense, net (1 ) (3 ) Interest income (expense), net (497 ) 176 -------- - -------- - Income (loss) before provision for (benefit from) income taxes (556 ) 4,346 Provision for (benefit from) income taxes (4,281 ) 26 Net income $ 3,725 $ 4,320 - ------ - - ------ - Net income per common share: Basic $ 0.11 $ 0.13 Diluted $ 0.11 $ 0.12 Weighted average common shares outstanding: Basic 33,913 34,070 Diluted 35,342 35,300

Stock-Based Compensation Expense(in thousands)

Three Months Ended March 31, 2019 2018 -------- -------- Costs and operating expenses: Cost of revenue (exclusive of depreciation and amortization) $ 324 $ 220 Sales and marketing 248 210 Research and product development 308 225 General and administrative 672 663 Total stock-based compensation expense $ 1,552 $ 1,318 - ----- - -----

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) Three Months Ended March 31, 2019 2018 ---------- --------- Cash from operating activities Net income $ 3,725 $ 4,320 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 5,076 3,500 Stock-based compensation 1,552 1,318 Deferred income taxes (4,281 ) — Other 27 79 Changes in operating assets and liabilities: Accounts receivable (2,051 ) (1,148 ) Prepaid expenses and other current assets (3,340 ) 441 Other long-term assets 1,365 (766 ) Accounts payable 100 415 Accrued employee expenses (2,867 ) (3,842 ) Accrued expenses 1,580 611 Deferred revenue 268 (1,334 ) Other long-term liabilities (859 ) (252 ) Net cash provided by operating activities 295 3,342 -------- - ------- - Cash from investing activities Purchases of property and equipment (1,030 ) (263 ) Additions to capitalized software (4,658 ) (2,936 ) Purchases of investment securities — (15,573 ) Sales of investment securities 1,750 5 Maturities of investment securities 2,250 8,296 Acquisition, net of cash acquired (54,004 ) — Net cash used in investing activities (55,692 ) (10,471 ) -------- - ------- - Cash from financing activities Proceeds from stock option exercises 90 470 Tax withholding for net share settlement (1,315 ) (901 ) Proceeds from issuance of debt 597 32 Principal payments on debt (909 ) (32 ) Payment of debt issuance costs (360 ) — Net cash used in financing activities (1,897 ) (431 ) -------- - ------- - Net decrease in cash and cash equivalents and restricted cash (57,294 ) (7,560 ) Cash, cash equivalents and restricted cash Beginning of period 74,506 16,537 -------- - ------- - End of period $ 17,212 $ 8,977 - ------ - - ----- -