In "Management's Discussion and Analysis of Financial Condition and Results of Operations" ("MD&A"), management explains the general financial condition and results of operations forAgilysys and subsidiaries including: - what factors affect our business; - what our earnings and costs were; - why those earnings and costs were different from the year before; - where the earnings came from; - how our financial condition was affected; and - where the cash will come from to fund future operations. The MD&A analyzes changes in specific line items in the Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Cash Flows and provides information that management believes is important to assessing and understanding our consolidated financial condition and results of operations. This Quarterly Report on Form 10-Q updates information included in our Annual Report on Form 10-K for the fiscal year endedMarch 31, 2020 , filed with theSecurities and Exchange Commission (SEC). This discussion should be read in conjunction with the Condensed Consolidated Financial Statements and related Notes that appear in Item 1 of this Quarterly Report as well as our Annual Report for the year endedMarch 31, 2020 . Information provided in the MD&A may include forward-looking statements that involve risks and uncertainties. Many factors could cause actual results to be materially different from those contained in the forward-looking statements. See "Forward-Looking Information" on page 29 of this Quarterly Report, Item 1A "Risk Factors" in Part II of this Quarterly Report, and Item 1A "Risk Factors" in Part I of our Annual Report for the fiscal year endedMarch 31, 2020 for additional information concerning these items. Management believes that this information, discussion, and disclosure is important in making decisions about investing inAgilysys . Overview Recent Developments COVID-19 Pandemic OnMarch 11, 2020 , theWorld Health Organization declared the COVID-19 outbreak a global pandemic. The outbreak has reached all geographic regions in which we do business, and government authorities around the world have implemented extensive measures attempting to contain the spread and mitigate the effects of the virus, including travel bans and restrictions, border closings, quarantines, shelter-in-place orders, closures of non-essential businesses, and social distancing requirements. The global spread of COVID-19 and the actions taken in response have negatively impacted us, our customers, our suppliers and the many communities in which we do business. The overall extent and duration of economic and business disruption is not currently known. In response to these challenges, we quickly adjusted our business policies and practices for employees to work from home and have taken other measures to continue our operations with safety as our top priority.
We continuously monitor and assess the impact of the COVID-19 pandemic, including recommendations and orders from government and public health authorities. We are working to help our customers maintain their operations during this difficult time while managing our teams to be prepared for continuously changing demand for our products and services.
During the first nine months of our fiscal 2021, revenue was negatively impacted by delays and reduced spending attributed to the impact of the COVID-19 pandemic on our customers' operational priorities and as a result of various one-time recurring revenue related and other concessions we have given to customers to help them during this time of need. Due to the pandemic, we have seen a reduction or delay in customer contracts, and we have seen a significant reduction in face-to-face meetings with existing or prospective customers, in-person demonstrations of our solutions, and have been unable to host or attend in-person trade shows and conferences. Limitations on access to the facilities of our customers have also impacted our ability to deliver some of our products, complete certain implementations, and provide in-person consulting and training services, negatively impacting our ability to recognize revenue. We continued to experience high recurring revenue renewal rates during the first nine months of the fiscal year. We also have an expanded product base that includes new products which allow for contactless capabilities and other features which help promote social distancing and guest safety. Despite our strong first nine months of recurring renewal rates and new solution offerings, we cannot predict how the pandemic will impact our results in the short-term future, including to the extent that customers delay or miss payments, customers defer, reduce, or refrain from placing orders or renewing subscriptions or maintenance arrangements, or travel restrictions and site access restrictions remain necessary. We likewise cannot predict our results in the long-term future as our customers adapt to the lingering and perhaps more permanent impact of the pandemic on the hospitality industry. 19
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We continue to conduct business with substantial modifications to employee travel, employee work locations, virtualization or cancellation of customer and employee events, and mostly remote sales, implementation, and support activities, among other modifications. These modifications may continue to delay or reduce sales and harm productivity and collaboration. In addition, during the first nine months of our fiscal 2021, we reduced discretionary costs, implemented a hiring freeze on non-essential positions and reduced payroll and related costs through layoffs, employee furloughs, employee retirement benefit limitations, and temporary salary decreases for executive team members and certain other employees of the Company. Such actions may have an adverse impact on us, particularly those actions that remain in place for an extended period as we continue to manage through the uncertainties around the timing and extent of the pandemic's impact. We may take further actions or retract previous actions that alter our business operations as the situation continues to evolve. As a result, the ultimate impact of the COVID-19 pandemic and the effects of the operational alterations we have made in response on our business, financial condition, liquidity, and financial results cannot be predicted at this time. OnMarch 27, 2020 , the Coronavirus Aid, Relief and Economic Security (CARES) Act was enacted and signed intoU.S. law to provide economic relief to individuals and businesses facing economic hardship as a result of the COVID-19 pandemic. We deferred$1.8 million in employer payroll tax payments under the CARES Act as ofDecember 31, 2020 . The CARES Act did not have a material impact on our consolidated results of operations as of and for the nine months endedDecember 31, 2020 .MAK Capital Investment InMay 2020 , we entered into an agreement to sell toMAK Capital One, LLC ("MAK Capital ")$35 million of convertible preferred stock carrying a 5.25% dividend that will be convertible into shares of the Company's common stock. The transaction resulted in the issuance of 1,735,457 preferred shares which added$35 million in preferred stock to the Company's balance sheet and increased our cash balance by the$35 million investment less closing costs of$1.0 million . The 5.25% dividends will accumulate and increase the liquidation preference of the preferred stock for any undeclared amounts.
Our Business
Agilysys has been a leader in hospitality software for more than 40 years, delivering innovative cloud-native subscription and on-premise guest-centric technology solutions for gaming, hotels, resorts and cruise, corporate foodservice management, restaurants, universities, stadia, airport foodservice and healthcare.Agilysys offers the most comprehensive solutions in the industry, including point of sale (POS), property management systems (PMS), inventory and procurement, payments, and related applications, to manage the entire guest journey.Agilysys is known for its leadership in hospitality, its broad product offerings and its customer-centric service. Some of the largest hospitality companies around the world useAgilysys solutions to help improve guest loyalty, drive revenue growth, increase operational efficiencies and support social distancing. The Company has just one reportable segment serving the global hospitality industry.Agilysys operates across theAmericas ,Europe , theMiddle East ,Africa ,Asia-Pacific , andIndia with headquarters located inAlpharetta, Georgia . We strive to increase shareholder value by improving operating and financial performance and profitably growing the business through superior products and services. To that end, we expect to invest a certain portion of our cash on hand to fund enhancements to existing software products, to develop and market new software products, and to expand our customer breadth, both vertically and geographically.
Our strategic plan specifically focuses on:
• Putting the customer first with world class support and services • Accelerating our product development • Improving organizational efficiency and teamwork • Developing our employees and leaders • Growing revenue by improving the breadth and depth of our product set • Growing revenue through international expansion The primary objective of our ongoing strategic planning process is to create shareholder value by capitalizing on growth opportunities, turning profitable and strengthening our competitive position within the specific technology solutions and end markets we serve. Profitability and industry leading growth will be achieved through tighter management of operating expenses and sharpening the focus of our investments to concentrate on growth opportunities that offer the highest returns. 20
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Revenue - Defined
As required by theSEC , we separately present revenue earned as products revenue, support, maintenance and subscription services revenue or professional services revenue in our condensed consolidated statements of operations. In addition to theSEC requirements, we may, at times, also refer to revenue as defined below. The terminology, definitions, and applications of terms we use to describe our revenue may be different from those used by other companies and caution should be used when comparing these financial measures to those of other companies. We use the following terms to describe revenue:
• Revenue - We present revenue net of sales returns and allowances.
• Products revenue - Revenue earned from the sales of software licenses, third
party hardware and operating systems.
• Support, maintenance and subscription services revenue - Revenue earned from
the sale of proprietary and remarketed ongoing support, maintenance and subscription services. • Professional services revenue - Revenue earned from the delivery of implementation, integration and installation services for proprietary and remarketed products. Results of Operations
Third Fiscal Quarter 2021 Compared to Third Fiscal Quarter 2020
Net Revenue and Operating (Loss)
The following table presents our consolidated revenue and operating results for
the three months ended
Three months ended December 31, Increase (decrease) (In thousands) 2020 2019 $ % Net revenue: Products$ 7,599 $ 12,126 $ (4,527 ) (37.3 )% Support, maintenance and subscription services 22,846 20,965 1,881 9.0 Professional services 6,230 8,896 (2,666 ) (30.0 ) Total net revenue 36,675 41,987 (5,312 ) (12.7 ) Cost of goods sold: Products (inclusive of developed technology amortization) 3,660 9,639 (5,979 ) (62.0 ) Support, maintenance and subscription services 4,655 4,841 (186 ) (3.8 ) Professional services 4,164 6,443 (2,279 ) (35.4 ) Total cost of goods sold 12,479 20,923 (8,444 ) (40.4 ) Gross profit$ 24,196 $ 21,064 $ 3,132 14.9 % Gross profit margin 66.0 % 50.2 % Operating expenses: Product development$ 12,376 $ 11,285 $ 1,091 9.7 % Sales and marketing 3,327 4,918 (1,591 ) (32.4 ) General and administrative 7,509 6,084 1,425 23.4 Depreciation of fixed assets 722 854 (132 ) (15.5 ) Amortization of intangibles 521 608 (87 ) (14.3 ) Severance and other charges 1,552 11 1,541 nm Operating loss$ (1,811 ) $ (2,696 ) $ 885 32.8 % Operating (loss) percentage (4.9 )% (6.4 )% nm - not meaningful 21
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The following table presents the percentage relationship of our condensed consolidated statement of operations line items to our consolidated net revenues for the periods presented: Three months ended December 31, 2020 2019 Net revenue: Products 20.7 % 28.9 % Support, maintenance and subscription services 62.3 49.9 Professional services 17.0 21.2 Total net revenue 100.0 % 100.0 % Cost of goods sold: Products (inclusive of developed technology amortization) 10.0 % 23.0 % Support, maintenance and subscription services 12.7 11.5 Professional services 11.3 15.3 Total cost of goods sold 34.0 % 49.8 % Gross profit 66.0 % 50.2 % Operating expenses: Product development 33.7 % 26.9 % Sales and marketing 9.1 11.7 General and administrative 20.5 14.5 Depreciation of fixed assets 2.0 2.0 Amortization of intangibles 1.4 1.5 Severance and other charges 4.2 0.0 Operating loss (4.9 )% (6.4 )% Net revenue. Total net revenue decreased$5.3 million , or 12.7%, during the third quarter of fiscal 2021 compared to the third quarter of fiscal 2020. Products revenue decreased$4.5 million , or 37.3%, due to lower sales due to delayed customer purchasing decisions as the timing of the hospitality recovery from the COVID-19 pandemic remains unclear. Support, maintenance and subscription services revenue increased$1.9 million , or 9.0%, compared to the third quarter of fiscal 2020 driven by continued growth in subscription-based service revenue that increased 18.1% during the third quarter of fiscal 2021 compared to the third quarter of fiscal 2020. Professional services revenue decreased$2.7 million , or 30.0%, due to lower sales due to delayed customer purchasing decisions as the timing of the hospitality recovery from the COVID-19 pandemic remains unclear. Gross profit and gross profit margin. Our total gross profit increased$3.1 million , or 14.9%, for the third quarter of fiscal 2021 and total gross profit margin increased from 50.2% to 66.0% driven by changes in the composition of revenue by category and the absence of software development cost amortization during the third quarter of fiscal 2021. Products gross profit increased$1.5 million , or 58.4%, compared to the third quarter of fiscal 2020 and products gross profit margin increased from 20.5% to 51.8% due to the absence of software development cost amortization during the third quarter of fiscal 2021 and a higher proportion of proprietary software sales over third party products. Support, maintenance and subscription services gross profit increased$2.1 million and gross profit margin increased 272 basis points to 79.6%. The margin increase is the result of increased revenue on a relatively flat cost base. Professional services gross profit decreased$0.4 million due to the delay in professional service projects as customers continued to work towards re-opening their locations. Gross profit margin increased from 27.6% to 33.2% due to improved utilization rates and a slightly larger decrease in the percentage of professional services costs compared to professional services revenue as a result of employee furloughs and layoffs, lower incentive pay and employee benefits. Operating expenses
Operating expenses, excluding legal settlements, severance and other charges,
increased
Product development. Product development increased$1.1 million , or 9.7%, in the third quarter of fiscal 2021 due to lower cash-based incentive pay and employee benefits offset by higher share-based compensation. Sales and marketing. Sales and marketing decreased$1.6 million , or 32.4%, in the third quarter of fiscal 2021 compared with the third quarter of fiscal 2020 due to layoffs, temporary reductions in employee benefits, and reduced commission expense due to lower sales levels. The decrease also includes the impact of significantly reduced travel, the absence of in-person trade shows and conference activity, and the ability to conduct more business remotely. 22
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General and administrative. General and administrative increased by$1.4 million , or 23.4%, in the third quarter of fiscal 2021 compared with the third quarter of fiscal 2020 due to higher share-based compensation offsetting lower cash-based incentive pay and employee benefits. Severance and other charges. Severance, and other charges increased$1.5 million in the third quarter of fiscal 2021 due to layoffs and other employee terminations. Other (Income) Expenses Three Months Ended December 31, (Unfavorable) favorable (Dollars in thousands) 2020 2019 $ % Other (income) expense: Interest income$ (27 ) $ (92 ) $ (65 ) (70.7 )% Interest expense 9 25 16 (64.0 ) Other expense (income), net 95 (142 ) (237 ) nm
Total other expense (income), net
nm nm - not meaningful
Interest income. Interest income consists of interest earned through interest-bearing bank accounts and on cash equivalents including short-term investments in certificates of deposit, commercial paper, treasury bills and money market funds.
Interest expense. Interest expense consists of costs associated with finance leases.
Other expense. Other expense consists mainly of the impact of foreign currency due to movement of European and Asian currencies against the US dollar.
Income Taxes Three Months Ended December 31, (Unfavorable) favorable (Dollars in thousands) 2020 2019 $ % Income tax expense$ 182 $ 95 $ (87 ) nm Effective tax rate (9.6 )% (3.8 )% nm - not meaningful For the three months endedDecember 31, 2020 , the effective tax rate was different than the statutory tax rate due primarily to the recognition of net operating losses that were offset by increased valuation allowance in theU.S , certain foreign and state tax effects and otherU.S. permanent book to tax differences. For the three months endedDecember 31, 2019 , the effective tax rate was different than the statutory rate due primarily to the recognition of net operating losses in theU.S. and certain foreign jurisdictions that were offset by increased valuation allowance, certain foreign and state tax effects and otherU.S. permanent book to tax differences. Although the timing and outcome of tax settlements are uncertain, it is reasonably possible that during the next 12 months an immaterial reduction in unrecognized tax benefits may occur based on the outcome of tax examinations and as a result of the expiration of various statutes of limitations. We are consistently subject to tax audits; due to the nature of examinations in multiple jurisdictions, changes could occur in the amount of gross unrecognized tax benefits during the next 12 months which cannot be estimated at this time. 23
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Because of our losses in prior periods, we have recorded a valuation allowance offsetting substantially all of our deferred tax assets in theU.S. and certain foreign jurisdictions, as management believes that it is more likely than not that we will not realize the benefits of these deductible differences. The ultimate realization of deferred tax assets depends on the generation of future taxable income during the periods in which those temporary differences are deductible.
Results of Operations
First Nine Months Fiscal 2021 Compared to First Nine Months Fiscal 2020
Net Revenue and Operating Income (Loss)
The following table presents our consolidated revenue and operating results for
the nine months ended
Nine months ended December 31, Increase (decrease) (In thousands) 2020 2019 $ % Net revenue: Products$ 19,396 $ 34,868 $ (15,472 ) (44.4 )% Support, maintenance and subscription services 65,647 61,377 4,270 7.0 Professional services 15,797 24,854 (9,057 ) (36.4 ) Total net revenue 100,840 121,099 (20,259 ) (16.7 ) Cost of goods sold: Products (inclusive of developed technology amortization) 9,625 28,056 (18,431 ) (65.7 ) Support, maintenance and subscription services 13,515 13,676 (161 ) (1.2 ) Professional services 11,802 18,071 (6,269 ) (34.7 ) Total cost of goods sold 34,942 59,803 (24,861 ) (41.6 ) Gross profit$ 65,898 $ 61,296 $ 4,602 7.5 % Gross profit margin 65.3 % 50.6 % Operating expenses: Product development$ 28,900 $ 32,127 $ (3,227 ) (10.0 )% Sales and marketing 8,278 14,307 (6,029 ) (42.1 ) General and administrative 18,446 17,998 448 2.5 Depreciation of fixed assets 2,160 1,774 386 21.8 Amortization of intangibles 1,490 1,900 (410 ) (21.6 ) Severance and other charges 2,762 438 2,324 nm Legal settlements, net 50 (125 ) 175 nm Operating income (loss)$ 3,812 $ (7,123 ) $ 10,935 153.5 % Operating income (loss) percentage 3.8 % (5.9 )% nm - not meaningful 24
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The following table presents the percentage relationship of our condensed consolidated statement of operations line items to our consolidated net revenues for the periods presented: Nine months ended December 31, Net revenue: 2020 2019 Products 19.2 % 28.8 % Support, maintenance and subscription services 65.1 50.7 Professional services 15.7 20.5 Total net revenue 100.0 % 100.0 % Cost of goods sold: Products (inclusive of developed technology amortization) 9.5 % 23.2 % Support, maintenance and subscription services 13.5 11.3 Professional services 11.7 14.9 Total cost of goods sold 34.7 % 49.4 % Gross profit 65.3 % 50.6 % Operating expenses: Product development 28.7 % 26.5 % Sales and marketing 8.2 11.8 General and administrative 18.3 14.9 Depreciation of fixed assets 2.1 1.4 Amortization of intangibles 1.5 1.6 Severance and other charges 2.7 0.4 Legal settlements, net 0.0 (0.1 ) Operating income (loss) 3.8 % (5.9 )% Net revenue. Total net revenue decreased$20.3 million , or 16.7%, during the first nine months of fiscal 2021 compared to the first nine months of fiscal 2020. Products revenue decreased$15.5 million , or 44.4%, due to lower sales combined with delayed deliveries resulting from customer restrictions including temporary site closures in response to the COVID-19 pandemic. Support, maintenance and subscription services revenue increased$4.3 million , or 7.0%, compared to the first nine months of fiscal 2020 driven by continued growth in subscription-based service revenue that increased 17.0% during the first nine months of fiscal 2021 compared to the first nine months of fiscal 2020. The growth rate in our support, maintenance and subscription services is significantly lower than we have reported in recent periods due to one-time COVID-19 related financial relief we provided to certain customers primarily during the first half of fiscal 2021 to help them as they dealt with temporary site closures. Professional services revenue decreased$9.1 million , or 36.4%, due to lower sales combined with delayed installations and integration of our software solutions resulting from travel and customer restrictions including temporary site closures in response to the COVID-19 pandemic. Gross profit and gross profit margin. Our total gross profit increased$4.6 million , or 7.5%, for the first nine months of fiscal 2021 and total gross profit margin increased from 50.6% to 65.3% driven by changes in the composition of revenue by category and the absence of software development cost amortization. Products gross profit increased$3.0 million , or 43.4%, compared to the first nine months of fiscal 2020 and products gross profit margin increased from 19.5% to 50.4% due to the absence of software development cost amortization during the first nine months of fiscal 2021 along with a higher proportion of proprietary software sales over third party products. Support, maintenance and subscription services gross profit increased$4.4 million and gross profit margin increased 169 basis points to 79.4%. The margin increase is the result of increased revenue on a relatively flat cost base. Professional services gross profit decreased$2.8 million and gross profit margin decreased from 27.3% to 25.3% due to the drop in demand for professional services resulting from travel and customer restrictions including temporary site closures in response to the COVID-19 pandemic.
Operating expenses
Operating expenses, excluding legal settlements, severance and other charges, decreased$8.8 million , or 13.0%, during the first nine months of fiscal 2021 compared with the first nine months of fiscal 2020. Product development. Product development decreased$3.2 million , or 10.0%, in the first nine months of fiscal 2021 due to temporary salary reductions, lower incentive pay and employee benefits, lower recruiting fees, and significantly reduced travel and outside service expenses due to employees working from home. Sales and marketing. Sales and marketing decreased$6.0 million , or 42.1%, in the first nine months of fiscal 2021 compared with the first nine months of fiscal 2020 due to temporary reductions in salaries and employee benefits, furloughs, layoffs, and reduced commission expense due to lower sales levels. The decrease also includes the impact of significantly reduced travel, the absence of in-person trade shows and conference activity, and the ability to conduct more business remotely. 25
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General and administrative. General and administrative increased by
Severance and other charges. Severance, and other charges increased$2.3 million in the first nine months of fiscal 2021 due to layoffs and other employee terminations. Other (Income) Expenses Nine Months Ended December 31, (Unfavorable) favorable (Dollars in thousands) 2020 2019 $ % Other (income) expense: Interest income$ (76 ) $ (287 ) $ (211 ) (73.5 )% Interest expense 13 28 15 nm Other expense, net 284 50 (234 ) nm
Total other expense (income), net
nm nm - not meaningful
Interest income. Interest income consists of interest earned through interest-bearing bank accounts and on cash equivalents including short-term investments in certificates of deposit, commercial paper, treasury bills and money market funds.
Interest expense. Interest expense consists of costs associated with finance leases.
Other expense. Other expense consists mainly of the impact of foreign currency due to movement of European and Asian currencies against the US dollar.
Income Taxes Nine Months Ended December 31, (Unfavorable) favorable (Dollars in thousands) 2020 2019 $ % Income tax expense$ 311 $ 161 $ (150 ) nm Effective tax rate 8.7 % (2.3 )% nm - not meaningful For the nine months endedDecember 31, 2020 , the effective tax rate was different than the statutory tax rate due primarily to the utilization of net operating losses that were offset by decreased valuation allowance in theU.S , certain foreign and state tax effects and otherU.S. permanent book to tax differences. For the nine months endedDecember 31, 2019 , the effective tax rate was different than the statutory rate due primarily to the recognition of net operating losses in theU.S. and certain foreign jurisdictions that were offset by increased valuation allowance, certain foreign and state tax effects and otherU.S. permanent book to tax differences.
Liquidity and Capital Resources
Overview
Our operating cash requirements consist primarily of working capital needs, operating expenses, capital expenditures, payments on indebtedness outstanding, which primarily consists of lease obligations and preferred stock dividends.
AtDecember 31, 2020 , 100% of our cash and cash equivalents, of which 96% were located inthe United States , were deposited in bank accounts. We believe credit risk is limited with respect to our cash and cash equivalents balances.The MAK Capital investment increased our cash balance by$34.0 million after closing costs of$1.0 million . As described above under Recent Developments and further in Note 11 to the condensed consolidated financial statements, the transaction resulted in the issuance of 1,735,457 preferred shares with an annual dividend rate of 5.25%.
Our liquidity could be negatively impacted by a decrease in demand for our products and services, including the impact of changes in customer buying behavior due to circumstances over which we have no control, including, but not limited to, the effects of the
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COVID-19 pandemic. If we require additional funding, for operating needs, a business acquisition or otherwise, we may need access to more capital, which could involve borrowings under a credit facility.
As of
We believe that cash flow from operating activities, cash on hand of
Cash Flow Nine Months Ended December 31, (In thousands) 2020 2019 Net cash provided by (used in): Operating activities$ 15,084 $ 5,273 Investing activities (1,078 ) (3,035 ) Financing activities 31,765 (1,071 ) Effect of exchange rate changes on cash 184 (33 )
Net increase in cash and cash equivalents
Cash flow provided by operating activities. Cash flow provided by operating activities was$15.1 million in the first nine months of fiscal 2021. The provision of cash was due primarily to the addition of$12.5 million in non-cash expense including depreciation, amortization, and share-based compensation, to our operating income of$3.3 million offset by a decrease of$0.7 million in net operating assets and liabilities.
Cash flow used in investing activities. Consists primarily of property and equipment purchases.
Cash flow provided by (used in) financing activities. During the first nine
months of fiscal 2021, the
Contractual Obligations
As of
Off-Balance Sheet Arrangements
We have not entered into any off-balance sheet arrangements that have had or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources.
Critical Accounting Policies
A detailed description of our significant accounting policies is included in our Annual Report for the year endedMarch 31, 2020 . Other than as described in Note 2 to the condensed consolidated financial statements, there have been no material changes in our significant accounting policies and estimates sinceMarch 31, 2020 .
Forward-Looking Information
This Quarterly Report and other publicly available documents, including the documents incorporated herein and therein by reference, contain, and our officers and representatives may from time to time make, "forward-looking statements" within the meaning of the safe harbor provisions of theU.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "will" and similar references to future periods. These statements are not guarantees of future performance and involve risks, uncertainties, and assumptions that are difficult to predict. These statements are based on management's current expectations, intentions, or beliefs and are subject to a number of factors, assumptions, and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Factors that could cause or contribute to such differences 27
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or that might otherwise impact the business include the risk factors set forth in Item 1A in Part II of this Quarterly Report and Item IA of our Annual Report for the fiscal year endedMarch 31, 2020 . We undertake no obligation to update any such factor or to publicly announce the results of any revisions to any forward-looking statements contained herein whether as a result of new information, future events, or otherwise.
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