EX-99.1 2 slp-20241130xexx991x251.htm EX-99.1
Exhibit 99.1
Simulations Plus Reports First Quarter Fiscal 2025 Financial Results
Total revenue up 31% year-over-year primarily driven by strong software growth
RESEARCH TRIANGLE PARK, NC, January 7, 2025 – Simulations Plus, Inc. (Nasdaq: SLP) (“Simulations Plus”), a leading provider of cheminformatics, biosimulation, simulation-enabled performance and intelligence solutions, and medical communications to the biopharma industry, today reported financial results for its first quarter fiscal 2025, ended November 30, 2024.
First Quarter 2025 Financial Highlights (compared to first quarter 2024)
•Total revenue increased 31% to $18.9 million
•Software revenue increased 41% to $10.7 million, representing 57% of total revenue
•Services revenue increased 19% to $8.2 million, representing 43% of total revenue
•Gross profit of $10.2 million; gross margin was 54%
•Net income of $0.2 million and diluted EPS of $0.01 compared to net income of $1.9 million and diluted EPS of $0.10
•Adjusted EBITDA of $4.5 million, representing 24% of total revenue, compared to $3.4 million, representing 23% of total revenue
•Adjusted net income of $3.4 million and adjusted diluted EPS of $0.17, compared to adjusted net income of $3.7 million and adjusted diluted EPS of $0.18
Management Commentary
“We are off to a strong start to fiscal 2025 with total revenue increasing by 31% in the first quarter,” said Shawn O’Connor, Chief Executive Officer of Simulations Plus. “Our team delivered 41% growth across our software platforms. MonolixSuite™ was a meaningful contributor with a 43% growth rate this quarter. We are seeing increased adoption for this leading edge solution including a recent commitment from a major pharmaceutical client to fully implement PKanalix®, which is the user-friendly and fast application for compartmental analysis, non-compartmental analysis, and bioequivalence studies component of MonolixSuite. Additionally, we saw 40% growth in our Quantitative Systems Pharmacology (QSP) business unit with strong demand for model licenses in the disease areas of Psoriatic Arthritis and Crohn’s Disease.
“Services revenue increased 19%, however this segment faced some temporary headwinds this quarter. There were some client-driven data delays that postponed the ramp up of certain projects into our fiscal year second quarter. We were pleased to see that this quarter’s bookings were especially strong in our Clinical Pharmacology & Pharmacometrics (CPP) and Medical Communications (MC) business units.
“Overall, our team achieved solid results despite ongoing funding challenges and cost constraints in the pharma and biotech sectors. The integration of our Adaptive Learning and Insights (ALI) and MC business units is progressing well. For fiscal 2025, we expect momentum to be strongest in the back half of the year, which puts us on track to meet our stated guidance.”
Fiscal 2025 Guidance

|  |  | Fiscal 2025 Guidance |  |
Revenue |  |  | $90M - $93M |  |
Revenue growth |  |  | 28 - 33% |  |
Software mix |  |  | 55 - 60% |  |
Adjusted EBITDA margin |  |  | 31 - 33% |  |
Adjusted diluted EPS |  |  | $1.07 - $1.20 |  |

Webcast and Conference Call Details
S hawn O’Connor, Chief Executive Officer, and Will Frederick, Chief Financial and Operating Officer, will host a conference call and webcast today at 5 p.m. Eastern Time to discuss the details of Simulations Plus’ performance for the quarter and certain forward-looking information. The call may be accessed by registering here or by calling 1-877-451-6152 (domestic) or 1-201-389-0879 (international) or by clicking on this Call me™ link to request a return call. The webcast can be accessed on the investor relations page of the Simulations Plus website https://www.simulations-plus.com/investorscorporate-profile/corporate-profile/ where it will also be available for replay approximately one hour following the call.
Non-GAAP Financial Measures
This press release contains “non-GAAP financial measures,” which are measures that either exclude or include amounts that are not excluded or included in the most directly comparable measures calculated and presented in accordance with U.S. generally accepted accounting principles (“GAAP”).
A further explanation and reconciliation of these non-GAAP financial measures is included below and in the financial tables in this release.
The Company believes that the non-GAAP financial measures presented facilitate an understanding of operating performance and provide a meaningful comparison of its results between periods. The Company’s management uses non-GAAP financial measures to, among other things, evaluate its ongoing operations in relation to historical results, for internal planning and forecasting purposes and in the calculation of performance-based compensation. Adjusted EBITDA and Adjusted Diluted EPS represent measures that we believe are customarily used by investors and analysts to evaluate the financial performance of companies in addition to the GAAP measures that we present. Our management also believes that these measures are useful in evaluating our core operating results. However, Adjusted EBITDA and Adjusted Diluted EPS are not measures of financial performance under accounting principles generally accepted in the United States of America and should not be considered an alternative to net income, operating income, or diluted EPS as indicators of our operating performance or to net cash provided by operating activities as a measure of our liquidity. We believe the Company’s Adjusted EBITDA and Adjusted Diluted EPS measures provide information that is directly comparable to that provided by other peer companies in our industry, but other companies may calculate non-GAAP financial results differently, particularly related to nonrecurring, unusual items.
Please note that the Company has not reconciled the adjusted EBITDA or adjusted diluted earnings per share forward-looking guidance included in this press release to the most directly comparable GAAP measures because this cannot be done without unreasonable effort due to the variability and low visibility with respect to costs related to acquisitions, financings, and employee stock compensation programs, which are potential adjustments to future earnings. We expect the variability of these items to have a potentially unpredictable, and a potentially significant, impact on our future GAAP financial results.
Adjusted EBITDA
Adjusted EBITDA represents net income excluding the effect of interest expense (income), provision (benefit) for income taxes, amortization expense, intangible asset amortization, equity-based compensation expense, loss (gain) on currency exchange, goodwill impairment, change in fair value of contingent consideration, reorganization expense, acquisition and integration expense and other items not indicative of our ongoing operating performance.
Adjusted Net Income and Adjusted Diluted EPS
Adjusted net income and adjusted diluted earnings per share exclude the effect of amortization expense, equity-based compensation expense, loss (gain) on currency exchange, goodwill impairment, change in fair value of contingent consideration, reorganization expense, acquisition and integration expense and other items not indicative of our ongoing operating performance as well as the income tax provision adjustment for such charges.
The Company excludes the above items because they are outside of the Company’s normal operations and/or, in certain cases, are difficult to forecast accurately for future.
About Simulations Plus
With more than 25 years of experience serving clients globally, Simulations Plus stands as a premier provider in the biopharma sector, offering advanced software and consulting services that enhance drug discovery, development, research, clinical trial operations, regulatory submissions, and commercialization. Our comprehensive biosimulation solutions integrate artificial intelligence/machine learning (AI/ML), physiologically based pharmacokinetics, physiologically based biopharmaceutics, quantitative systems pharmacology/toxicology, and population PK/PD modeling approaches. We also deliver simulation-enabled performance and intelligence solutions alongside medical communications support for clinical and commercial drug development. Our cutting-edge technology is licensed and utilized by leading pharmaceutical, biotechnology, and regulatory agencies worldwide. For more information, visit our website at www.simulations-plus.com. Follow us on LinkedIn | X | YouTube.
Environmental, Social, and Governance
We focus our Environmental, Social, and Governance (ESG) efforts where we can have the most positive impact. To learn more about our latest initiatives and priorities, please visit our website to read our 2023 ESG update.
Forward-Looking Statements
Except for historical information, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties. Words like “believe,” “expect,” and “anticipate” mean that these are our best estimates as of this writing, but there can be no assurances that expected or anticipated results or events will actually take place, so our actual future results could differ significantly from those statements. Factors that could cause or contribute to such differences include, but are not limited to: our ability to integrate our ALI and MC business units, our ability to meet our stated guidance, our ability to maintain our competitive advantages, acceptance of new software and improved versions of our existing software by our customers, the general economics of the pharmaceutical industry, our ability to finance growth, our ability to continue to attract and retain highly qualified technical staff, market conditions, macroeconomic factors, and a sustainable market. Further information on our risk factors is contained in our quarterly and annual reports and filed with the U.S. Securities and Exchange Commission.
Investor Relations Contact:
Lisa Fortuna
Financial Profiles
310-622-8251
slp@finprofiles.com
1

SIMULATIONS PLUS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

|  |  |  | Three Months Ended
(in thousands, except per common share amounts) |  |  |  |  |  | November 30, 2024 |  | November 30, 2023 |  |
Revenues |  |  |  |  |  |  |  |  |  |
Software |  |  |  |  |  | $ | 10,715 |  |  | $ | 7,589 |  |  |
Services |  |  |  |  |  | 8,209 |  |  | 6,911 |  |  |
Total revenues |  |  |  |  |  | 18,924 |  |  | 14,500 |  |  |
Cost of revenues |  |  |  |  |  |  |  |  |  |
Software |  |  |  |  |  | 2,638 |  |  | 991 |  |  |
Services |  |  |  |  |  | 6,068 |  |  | 3,661 |  |  |
Total cost of revenues |  |  |  |  |  | 8,706 |  |  | 4,652 |  |  |
Gross profit |  |  |  |  |  | 10,218 |  |  | 9,848 |  |  |
Operating expenses |  |  |  |  |  |  |  |  |  |
Research and development |  |  |  |  |  | 1,848 |  |  | 1,217 |  |  |
Sales and marketing |  |  |  |  |  | 2,851 |  |  | 1,989 |  |  |
General and administrative |  |  |  |  |  | 5,393 |  |  | 5,682 |  |  |
Total operating expenses |  |  |  |  |  | 10,092 |  |  | 8,888 |  |  |
Income from operations |  |  |  |  |  | 126 |  |  | 960 |  |  |
Other income |  |  |  |  |  | 144 |  |  | 1,446 |  |  |
Income before income taxes |  |  |  |  |  | 270 |  |  | 2,406 |  |  |
Provision for income taxes |  |  |  |  |  | (64) |  |  | (461) |  |  |
Net income |  |  |  |  |  | $ | 206 |  |  | $ | 1,945 |  |  |
Earnings per share |  |  |  |  |  |  |  |  |  |
Basic |  |  |  |  |  | $ | 0.01 |  |  | $ | 0.10 |  |  |
Diluted |  |  |  |  |  | $ | 0.01 |  |  | $ | 0.10 |  |  |
Weighted-average common shares outstanding |  |  |  |  |  |  |  |  |  |
Basic |  |  |  |  |  | 20,068 |  |  | 19,947 |  |  |
Diluted |  |  |  |  |  | 20,266 |  |  | 20,279 |  |  |
Other comprehensive (loss) income, net of tax |  |  |  |  |  |  |  |  |  |
Foreign currency translation adjustments |  |  |  |  |  | (42) |  |  | (54) |  |  |
Unrealized gains on available-for-sale securities |  |  |  |  |  | $ | 4 |  |  | $ | — |  |  |
Comprehensive income |  |  |  |  |  | $ | 168 |  |  | $ | 1,891 |  |  |

2

SIMULATIONS PLUS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts) |  | November 30, 2024 |  | August 31, 2024
ASSETS |  |  |  |
Current assets |  |  |  |
Cash and cash equivalents |  | $ | 6,187 |  |  | $ | 10,311 |
Accounts receivable, net of allowance for credit losses of $145 and $149 |  | 12,804 |  |  | 9,136 |
Prepaid income taxes |  | 2,327 |  |  | 2,197 |
Prepaid expenses and other current assets |  | 7,098 |  |  | 7,753 |
Short-term investments |  | 11,983 |  |  | 9,944 |
Total current assets |  | 40,399 |  |  | 39,341 |
Long-term assets |  |  |  |
Capitalized computer software development costs, net of accumulated amortization of $19,500 and $18,727 |  | 12,441 |  |  | 12,499 |
Property and equipment, net |  | 819 |  |  | 812 |
Operating lease right-of-use assets |  | 1,342 |  |  | 1,027 |
Intellectual property, net of accumulated amortization of $6,575 and $5,490 |  | 22,045 |  |  | 23,130 |
Other intangible assets, net of accumulated amortization of $3,497 and $3,177 |  | 23,076 |  |  | 23,210 |
Goodwill |  | 96,305 |  |  | 96,078 |
Other assets |  | 489 |  |  | 542 |
Total assets |  | $ | 196,916 |  |  | $ | 196,639 |
LIABILITIES AND SHAREHOLDERS' EQUITY |  |  |  |
Current liabilities |  |  |  |
Accounts payable |  | $ | 1,120 |  |  | $ | 602 |
Accrued compensation |  | 1,882 |  |  | 4,513 |
Accrued expenses |  | 580 |  |  | 2,043 |
Contracts payable - current portion |  | 2,440 |  |  | 2,440 |
Operating lease liability - current portion |  | 485 |  |  | 475 |
Deferred revenue |  | 3,231 |  |  | 1,996 |
Total current liabilities |  | 9,738 |  |  | 12,069 |
Long-term liabilities |  |  |  |
Deferred income taxes, net |  | 1,648 |  |  | 1,608 |
Operating lease liability - net of current portion |  | 835 |  |  | 531 |
Total liabilities |  | 12,221 |  |  | 14,208 |
Commitments and contingencies |  | — |  |  | — |
Shareholders' equity |  |  |  |
Preferred stock, $0.001 par value - 10,000,000 shares authorized; no shares issued and outstanding |  | $ | — |  |  | $ | — |
Common stock, $0.001 par value and additional paid-in capital —50,000,000 shares authorized; 20,085,014 and 20,051,134 shares issued and outstanding |  | 154,424 |  |  | 152,328 |
Retained earnings |  | 30,560 |  |  | 30,354 |
Accumulated other comprehensive loss |  | (289) |  |  | (251) |
Total shareholders' equity |  | 184,695 |  |  | 182,431 |
Total liabilities and shareholders' equity |  | $ | 196,916 |  |  | $ | 196,639 |

3

SIMULATIONS PLUS, INC.
Trended Financial Information (1)
(Unaudited)
(in millions except earnings per share amounts)

|  |  |  |  |  |  |  | FY24 |  | FY25 |  |  |  |  |  |  |  |  |  |  |  | FY24
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Q1 |  | Q2 |  | Q3 |  | Q4 |  | Q1 |  |  |  |  |  |  |  |  |  |  |  | Full Year
Revenue |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Software |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 7.589 |  |  | $ | 11.614 |  |  | $ | 11.908 |  |  | $ | 9.913 |  |  | $ | 10.715 |  |  |  |  |  |  |  |  |  |  |  |  | $ | 41.024 |
Services |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 6.911 |  |  | $ | 6.691 |  |  | $ | 6.636 |  |  | $ | 8.751 |  |  | $ | 8.209 |  |  |  |  |  |  |  |  |  |  |  |  | $ | 28.989 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 14.500 |  |  | $ | 18.305 |  |  | $ | 18.544 |  |  | $ | 18.664 |  |  | $ | 18.924 |  |  |  |  |  |  |  |  |  |  |  |  | $ | 70.013 |
Gross Margin |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Software |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 86.9 | % |  | 88.4 | % |  | 88.2 | % |  | 72.4 | % |  | 75.4 | % |  |  |  |  |  |  |  |  |  |  |  | 84.2 | %
Services |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 47.0 | % |  | 44.2 | % |  | 41.4 | % |  | -4.0 | % |  | 26.1 | % |  |  |  |  |  |  |  |  |  |  |  | 29.7 | %
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 67.9 | % |  | 72.2 | % |  | 71.5 | % |  | 36.6 | % |  | 54.0 | % |  |  |  |  |  |  |  |  |  |  |  | 61.6 | %
Income from operations |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 0.960 |  |  | $ | 4.442 |  |  | $ | 1.880 |  |  | $ | (1.151) |  |  | $ | 0.126 |  |  |  |  |  |  |  |  |  |  |  |  | $ | 6.131 |
Operating Margin |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 6.6 | % |  | 24.3 | % |  | 10.1 | % |  | -6.2 | % |  | 0.7 | % |  |  |  |  |  |  |  |  |  |  |  | 8.8 | %
Net Income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 1.945 |  |  | $ | 4.029 |  |  | $ | 3.137 |  |  | $ | 0.843 |  |  | $ | 0.206 |  |  |  |  |  |  |  |  |  |  |  |  | $ | 9.954 |
Diluted Earnings Per Share |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 0.10 |  |  | $ | 0.20 |  |  | $ | 0.15 |  |  | $ | 0.04 |  |  | $ | 0.01 |  |  |  |  |  |  |  |  |  |  |  |  | $ | 0.49 |
Adjusted EBITDA |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 3.388 |  |  | $ | 7.135 |  |  | $ | 5.586 |  |  | $ | 4.148 |  |  | $ | 4.493 |  |  |  |  |  |  |  |  |  |  |  |  | $ | 20.257 |
Adjusted Diluted EPS |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 0.18 |  |  | $ | 0.32 |  |  | $ | 0.27 |  |  | $ | 0.18 |  |  | $ | 0.17 |  |  |  |  |  |  |  |  |  |  |  |  | $ | 0.95 |
Cash Flow from Operations |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 0.162 |  |  | $ | 5.810 |  |  | $ | 5.700 |  |  | $ | 1.600 |  |  | $ | (1.274) |  |  |  |  |  |  |  |  |  |  |  |  | $ | 13.320 |
Revenue Breakdown by Region |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Americas |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 10.891 |  |  | $ | 12.461 |  |  | $ | 12.428 |  |  | $ | 14.700 |  |  | $ | 14.469 |  |  |  |  |  |  |  |  |  |  |  |  | $ | 50.473 |
EMEA |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2.302 |  |  | 4.665 |  |  | 4.513 |  |  | 2.600 |  |  | 2.720 |  |  |  |  |  |  |  |  |  |  |  |  | 14.072 |
Asia Pacific |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1.307 |  |  | 1.179 |  |  | 1.603 |  |  | 1.400 |  |  | 1.735 |  |  |  |  |  |  |  |  |  |  |  |  | 5.468 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 14.500 |  |  | $ | 18.305 |  |  | $ | 18.544 |  |  | $ | 18.700 |  |  | $ | 18.924 |  |  |  |  |  |  |  |  |  |  |  |  | $ | 70.013 |
Software Performance Metrics |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Avg. Revenue per Customer (in thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $79.0 |  | $113.0 |  | $97.0 |  | $89.0 |  | $94.0 |  |  |  |  |  |  |  |  |  |  |  |
Services Performance Metrics |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Backlog (in millions) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $18.910 |  | $18.041 |  | $19.602 |  | $14.091 |  | $17.254 |  |  |  |  |  |  |  |  |  |  |  |

(1) Numbers may not add due to rounding
4

SIMULATIONS PLUS, INC.
Reconciliation of Adjusted EBITDA to Net Income (1)
(Unaudited)
(in millions)

|  |  |  |  |  |  |  | FY 2024 | FY25 |  |  |  |  |  | FY24
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Q1 |  | Q2 |  | Q3 |  | Q4 | Q1 |  |  |  |  |  | Full Year
Net Income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 1.945 |  |  | $ | 4.029 |  |  | $ | 3.137 |  |  | $ | 0.843 |  | $ | 0.206 |  |  |  |  |  |  | $ | 9.954 |
Excluding: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest income and expense, net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (1.292) |  |  | (1.348) |  |  | (1.522) |  |  | (0.213) |  | (0.159) |  |  |  |  |  |  | (4.375) |
Provision for income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 0.461 |  |  | 1.223 |  |  | 0.753 |  |  | 0.020 |  | 0.064 |  |  |  |  |  |  | 2.457 |
Depreciation and amortization |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1.091 |  |  | 1.105 |  |  | 1.263 |  |  | 2.206 |  | 2.265 |  |  |  |  |  |  | 5.665 |
Stock-based compensation |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1.303 |  |  | 1.585 |  |  | 1.665 |  |  | 1.387 |  | 1.589 |  |  |  |  |  |  | 5.940 |
(Gain) loss on currency exchange |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (0.044) |  |  | 0.098 |  |  | (0.009) |  |  | (0.431) |  | 0.015 |  |  |  |  |  |  | (0.386) |
Change in value of contingent consideration |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (0.110) |  |  | 0.440 |  |  | (0.599) |  |  | (1.370) |  | — |  |  |  |  |  |  | (1.639) |
Reorganization expense |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | — |  |  | — |  |  | — |  |  | — |  | 0.258 |  |  |  |  |  |  | — |
Mergers & Acquisitions expense |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 0.034 |  |  | 0.003 |  |  | 0.898 |  |  | 1.706 |  | 0.255 |  |  |  |  |  |  | 2.641 |
Adjusted EBITDA |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 3.388 |  |  | $ | 7.135 |  |  | $ | 5.586 |  |  | $ | 4.148 |  | $ | 4.493 |  |  |  |  |  |  | $ | 20.257 |

(1) Numbers may not add due to rounding
5

SIMULATIONS PLUS, INC.
Reconciliation of Adjusted Diluted EPS to Diluted EPS (1)
(Unaudited)
(in millions, except Diluted EPS and Adjusted Diluted EPS)

|  |  |  |  |  | FY 2024 |  | FY25 |  |  |  |  |  | FY24
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Q1 |  | Q2 |  | Q3 |  | Q4 |  | Q1 |  |  |  |  |  | Full Year
Net Income (GAAP) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 1.945 |  |  | $ | 4.029 |  |  | $ | 3.137 |  |  | $ | 0.843 |  |  | $ | 0.206 |  |  |  |  |  |  | $ | 9.954 |
Excluding: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Amortization |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 0.991 |  |  | 0.991 |  |  | 1.122 |  |  | 2.059 |  |  | 2.130 |  |  |  |  |  |  | 5.163 |
Stock-based compensation |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1.303 |  |  | 1.585 |  |  | 1.665 |  |  | 1.387 |  |  | 1.589 |  |  |  |  |  |  | 5.940 |
(Gain) loss on currency exchange |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (0.044) |  |  | 0.098 |  |  | (0.009) |  |  | (0.431) |  |  | 0.015 |  |  |  |  |  |  | (0.386) |
Mergers & Acquisitions expense |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 0.034 |  |  | 0.003 |  |  | 0.898 |  |  | 1.706 |  |  | 0.255 |  |  |  |  |  |  | 2.641 |
Change in value of contingent consideration |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (0.110) |  |  | 0.440 |  |  | (0.599) |  |  | (1.370) |  |  | — |  |  |  |  |  |  | (1.639) |
Reorganization expense |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 0.258 |  |  |  |  |  |  | — |
Tax effect on above adjustments |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (0.417) |  |  | (0.746) |  |  | (0.603) |  |  | (0.554) |  |  | (1.007) |  |  |  |  |  |  | (2.320) |
Adjusted Net income (Non-GAAP) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 3.702 |  |  | $ | 6.400 |  |  | $ | 5.611 |  |  | $ | 3.640 |  |  | $ | 3.446 |  |  |  |  |  |  | $ | 19.353 |
Weighted-avg. common shares outstanding: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Diluted |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 20.279 |  |  | 20.315 |  |  | 20.433 |  |  | 20.338 |  |  | 20.266 |  |  |  |  |  |  | 20.301 |
Diluted EPS (GAAP) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 0.10 |  |  | $ | 0.20 |  |  | $ | 0.15 |  |  | $ | 0.04 |  |  | $ | 0.01 |  |  |  |  |  |  | $ | 0.49 |
Adjusted Diluted EPS (Non-GAAP) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 0.18 |  |  | $ | 0.32 |  |  | $ | 0.27 |  |  | $ | 0.18 |  |  | $ | 0.17 |  |  |  |  |  |  | $ | 0.95 |

(1) Numbers may not add due to rounding
6