Agios Pharmaceuticals (AGIO) 2016年年度報告「NASDAQ」.pdf

1、10K1agys3312016x10k.htm10KTableofContentsUNITEDSTATESSECURITIESANDEXCHANGECOMMISSIONWashington,D.C.20549FORM10KANNUALREPORTPURSUANTTOSECTION13OR15(d)OFTHESECURITIESEXCHANGEACTOF1934ForthefiscalyearendedMarch31,2016orTRANSITIONREPORTPURSUANTTOSECTION13OR15(d)OFTHESECURITIESEXCHANGEACTOF1934Fortransit

2、ionperiodfromtoCommissionfilenumber05734AGILYSYS,INC.(Exactnameofregistrantasspecifiedinitscharter)Ohio340907152Stateorotherjurisdictionofincorporationororganization(I.R.S.EmployerIdentificationNo.)425WalnutStreet,Suite1800,Cincinnati,Ohio45,202(Addressofprincipalexecutiveoffices)(ZipCode)Registrant

3、stelephonenumber,includingareacode:(770)8107800SecuritiesregisteredpursuanttoSection12(b)oftheAct:TitleofeachclassNameofeachexchangeonwhichregisteredCommonShares,withoutparvalueTheNASDAQStockMarketLLCSecuritiesregisteredpursuanttoSection12(g)oftheAct:NoneIndicatebycheckmarkiftheregistrantisawellknow

4、nseasonedissuer,asdefinedinRule405oftheSecuritiesAct.YesNoIndicatebycheckmarkiftheregistrantisnotrequiredtofilereportspursuanttoSection13orSection15(d)oftheAct.YesNoIndicatebycheckmarkwhethertheregistrant(1)hasfiledallreportsrequiredtobefiledbySection13or15(d)oftheSecuritiesExchangeActof1934duringth

5、epreceding12months(orforsuchshorterperiodthattheregistrantwasrequiredtofilesuchreports),and(2)hasbeensubjecttosuchfilingrequirementsforthepast90days.YesNoIndicatebycheckmarkwhethertheregistranthassubmittedelectronicallyandpostedonitscorporateWebsite,ifany,everyInteractiveDataFilerequiredtobesubmitte

6、dandpostedpursuanttoRule405ofRegulationST(232.405ofthischapter)duringthepreceding12months(orforsuchshorterperiodthattheregistrantwasrequiredtosubmitandpostsuchfiles).YesNoIndicatebycheckmarkifdisclosureofdelinquentfilerspursuanttoItem405ofRegulationSK(229.405ofthischapter)isnotcontainedherein,andwil

7、lnotbecontained,tothebestofregistrantsknowledge,indefinitiveproxyorinformationstatementsincorporatedbyreferenceinPartIIIofthisForm10KoranyamendmenttothisForm10K.Indicatebycheckmarkwhethertheregistrantisalargeacceleratedfiler,anacceleratedfiler,anonacceleratedfiler,orasmallerreportingcompany.Seethede

8、finitionsof“largeacceleratedfiler,”“acceleratedfiler,”and“smallerreportingcompany”inRule12b2oftheExchangeAct.(Checkone):LargeacceleratedfilerAcceleratedfilerNonacceleratedfilerSmallerreportingcompany(Donotcheckifasmallerreportingcompany)Indicatebycheckmarkwhethertheregistrantisashellcompany(asdefine

9、dinRule12b2oftheAct).YesNoTheaggregatemarketvalueofCommonSharesheldbynonaffiliatesasofJune30,2015was$134,876,553.AsofMay27,2016,22,942,231sharesoftheregistrantscommonstockwereoutstanding.TableofContentsDOCUMENTSINCORPORATEDBYREFERENCEPortionsoftheregistrantsdefinitiveProxyStatementtobeusedinconnecti

10、onwithits2016AnnualMeetingofShareholdersareincorporatedbyreferenceintoPartIIIofthisForm10K.TableofContentsAGILYSYS,INC.AnnualReportonForm10KYearEndedMarch31,2016TableofContentsPagePARTI4ITEM1.Business4ITEM1A.RiskFactors12ITEM1B.UnresolvedStaffComments18ITEM2.Properties18ITEM3.LegalProceedings18ITEM4

11、.MineSafetyDisclosures18PARTII19ITEM5.MarketforRegistrantsCommonEquity,RelatedShareholderMattersandIssuerPurchasesofEquitySecurities19ITEM6.SelectedFinancialData21ITEM7.ManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperations22ITEM7A.QuantitativeandQualitativeDisclosuresaboutMarket

12、Risk40ITEM8.FinancialStatementsandSupplementaryData41ITEM9.ChangesinandDisagreementswithAccountantsonAccountingandFinancialDisclosure76ITEM9A.ControlsandProcedures76ITEM9B.OtherInformation77PARTIII77ITEM10.Directors,ExecutiveOfficersandCorporateGovernance77ITEM11.ExecutiveCompensation77ITEM12.Securi

13、tyOwnershipofCertainBeneficialOwnersandManagementandRelatedShareholderMatters77ITEM13.CertainRelationshipsandRelatedTransactions,andDirectorIndependence77ITEM14.PrincipalAccountantFeesandServices77PARTIV78ITEM15.ExhibitsandFinancialStatements78SIGNATURES 792TableofContentsForwardLookingInformationTh

14、isAnnualReportandotherpubliclyavailabledocuments,includingthedocumentsincorporatedhereinandthereinbyreference,contain,andourofficersandrepresentativesmayfromtimetotimemake,forwardlookingstatementswithinthemeaningofthesafeharborprovisionsoftheU.S.PrivateSecuritiesLitigationReformActof1995.Forwardlook

15、ingstatementscanbeidentifiedbywordssuchas:anticipate,intend,plan,goal,seek,believe,project,estimate,expect,strategy,future,likely,may,should,willandsimilarreferencestofutureperiods.Thesestatementsarenotguaranteesoffutureperformanceandinvolverisks,uncertainties,andassumptionsthataredifficulttopredict

16、.Thesestatementsarebasedonmanagementscurrentexpectations,intentions,orbeliefsandaresubjecttoanumberoffactors,assumptions,anduncertaintiesthatcouldcauseactualresultstodiffermateriallyfromthosedescribedintheforwardlookingstatements.Factorsthatcouldcauseorcontributetosuchdifferencesorthatmightotherwise

17、impactthebusinessincludetheriskfactorssetforthinItem1AofthisAnnualReport.Weundertakenoobligationtoupdateanysuchfactorortopubliclyannouncetheresultsofanyrevisionstoanyforwardlookingstatementscontainedhereinwhetherasaresultofnewinformation,futureevents,orotherwise.3TableofContentsPartIItem1.Business.O

18、verviewAgilysysisaleadingtechnologycompanythatprovidesinnovativesoftwareforpointofsale(POS),propertymanagement(PMS),inventoryandprocurement,workforcemanagement,analytics,documentmanagementandmobileandwirelesssolutionsandservicestothehospitalityindustry.Oursolutionsandservicesallowpropertymanagerstob

19、etterconnect,interactandtransactwiththeircustomersandenhancetheircustomerrelationshipsbystreamliningoperations,improvingefficiency,increasingguestrecruitmentandwalletshare,andenhancingtheoverallguestexperience.Weservefourmajormarketsectors:Gaming,bothcorporateandtribalHotels,ResortsandCruiseFoodserv

20、iceManagementandRestaurants,Universities,StadiaandHealthcare.Asignificantportionofourconsolidatedrevenueisderivedfromcontractsupport,maintenanceandsubscriptionservices.WeoperatethroughoutNorthAmerica,EuropeandAsia,withcorporateserviceslocatedinAlpharetta,GA,andofficesinSingapore,HongKong,Malaysiaand

21、thePhilippines.ThesalesofourRetailSolutionsGroup(RSG)businessandUnitedKingdombusinessentity(UKentity)eachrepresentedadisposalofacomponentofanentity.Assuch,theoperatingresultsofRSGandtheUKentityhavebeenreportedasacomponentofdiscontinuedoperationsintheConsolidatedStatementofOperationsandtheConsolidate

22、dStatementofCashFlowsforthetwelvemonthsendedMarch31,2014.Ourprincipalexecutiveofficesarelocatedat425WalnutStreet,Suite1800,Cincinnati,Ohio,45202andourcorporateservicesarelocatedat1000WindwardConcourse,Suite250,Alpharetta,Georgia,30005.Referencehereintoanyparticularyearorquarterreferstoperiodswithino

23、urfiscalyearendedMarch31.Forexample,fiscal2016referstothefiscalyearendedMarch31,2016.HistoryandSignificantEventsOrganizedin1963asPioneerStandardElectronics,Inc.,anOhiocorporation,webeganoperationsasadistributorofelectroniccomponentsand,later,enterprisecomputersolutions.Exitingtheformerinfiscal2003wi

24、ththesaleofourIndustrialElectronicDivision,weusedtheproceedstoreducedebt,fundgrowthofourenterprisesolutionsbusinessandacquirebusinessesfocusedonhighermarginandmorespecializedsolutionsforthehospitalityandretailindustries.Atthesametime,wechangedournametoAgilysys,Inc.Infiscal2004,weacquiredKyrusCorpora

25、tionandbecametheleadingproviderofIBMretailsolutionsandservicesinthesupermarket,chaindrug,generalretail,andhospitalitysegments.Inthatsameyear,theacquisitionofInterAmericanData,Inc.allowedustobecometheleadingdeveloperandprovideroftechnologysolutionsforpropertyandinventorymanagementinthecasinoandresort

26、industries.Incalendar2007,wedivestedKeyLinkSystemsandexitedtheenterprisecomputerdistributionbusiness.Weusedtheproceedsfromthatsaletoreturncashtoshareholdersandfundanumberofacquisitionsthatbroadenedoursolutionsandcapabilitiesportfolios.WeacquiredInfoGenesisandVisualOneSystemsCorp.incalendar2007,signi

27、ficantlyexpandingourspecializedofferingstothehospitalityindustrythroughenterpriseclass,POSandsoftwaresolutionstailoredforavarietyofapplicationsincruise,golf,spa,gaming,lodging,resort,andcatering.Theseofferingsfeaturehighlyintuitive,secureandrobustsolutions,easilyscalableacrossmultipledepartmentsorpr

28、opertylocations.Infiscal2008,webeganreportingthreeprimaryoperatingsegments:HospitalitySolutionsGroup(HSG),RetailSolutionsGroup(RSG)andTechnologySolutionsGroup(TSG).Infiscal2012,wesoldourTSGsegmentandrestructuredourbusinessmodeltofocusonhighermargin,profitablegrowthopportunitiesinthehospitalityandret

29、ailsectors.WealsoreducedourrealestatefootprintandloweredoverheadcostsbyrelocatingcorporateservicesfromSolon,OhiotoAlpharetta,Georgia,thusmovingourseniormanagementteamclosertoouroperatingunits.OnJune10,2013,weacquiredtheassetsofTimeManagementCorporation,aprivatelyownedMinneapolisbasedproviderofenterp

30、risewidesoftwareandservicesolutionsthatstreamlineworkforcemanagementenvironmentsforhospitalityoperators.4TableofContentsOnJuly1,2013,wecompletedthesaleofourRSGbusinesstoKyrusSolutions,Inc.(Kyrus),anaffiliateofClearlakeCapitalGroup,L.P.Followingcompletionofthetransaction,ourbusinessfocusedexclusively

31、onhospitalitysolutionsandthegrowthopportunitiesinthehospitalitymarket.OnMarch31,2014,wecompletedthesaleofourUnitedKingdombusinessentity(UKentity)toVertedaLimited(Verteda),ledbytheCompanysformerEuropeanmanagementteam.Inconnectionwiththesale,wehaveenteredintoamultiyeardistributionagreement,wherebyVert

32、edadistributescertainAgilysysproductswithintheU.K.marketplace.WecontinuetomanageallpropertymanagementsystemaccountsaswellaskeyglobalaccountsintheEMEAmarket.Today,wearefocusedonprovidingstateoftheart,endtoendsolutionsthatenhanceguestexperiencesandallowourcustomerstopromotetheirrespectivebrands.Wehelp

33、ourcustomerswintheguestrecruitmentbattleand,inturn,growrevenue,reducecostsandincreaseefficiency.Thisisaccomplishedbydevelopinganddeployingintuitivesolutionsthatincreasespeedandaccuracy,therebyenablingmoreeffectivemanagement,intelligentupselling,reducedshrinkage,improvedbrandrecognitionandbettercontr

34、olofthecustomerrelationship.Ourstrategyistoincreasetheproportionofrevenuewederivefromongoingsupportandmaintenanceagreements,softwareasasubscriptionservices,cloudapplicationsandprofessionalservices.Products,SupportandProfessionalServicesWearealeadingdeveloperandmarketerofsoftwareenabledsolutionsandse

35、rvicestothehospitalityindustry,including:hardwareandsoftwareproductssupport,maintenanceandsubscriptionservicesand,professionalservices.Areasofspecializationarepointofsale,propertymanagement,inventoryandprocurement,workforcemanagement,andmobileandwirelesssolutionsdesignedtostreamlineoperations,improv

36、eefficiencyandenhancetheguestexperience.Wepresentrevenueandcostsofgoodssoldinthreecategories:Products(hardwareandsoftware)Support,maintenanceandsubscriptionservicesProfessionalservicesTotalrevenuefromcontinuingoperationsforthesethreespecificareasisasfollows:YearendedMarch31,(Inthousands)201620152014

37、Products$41,445$31,846$34,629Support,maintenanceandsubscriptionservices60,10456,01353,169Professionalservices18,81715,65513,463Total$120,366$103,514$101,261Products:Thehospitalityindustryhaslongbeenfocusedonoperatinganendtoendbusiness,butthetechnologyvendorsthatservicedtheindustryhavebeenfocusedonpr

38、oductcentricsolutionsthatmakeuseofahighnumberofsoftwaremodulesandoperatingsilos.WehaveevolvedourapproachtotheindustrytoanintegratedplatformcentricsolutionsforLodging,Food&BeverageandPaymentsapplicationsthatlookstoleveragetheentirebusiness,byinvestinginthedevelopmentofanwebservicesorientedarchitectur

39、eenterpriseplatform.OurrGuestplatformisaimedattransitioningourproductandservicesofferingstobetteraddresstheneedsofhospitalityoperatorsastheyfocusonbuildingbetterconnectionswithguests,pre,duringandpostvisit.TherGuestplatformfacilitatesanendtoendsolutionthathelpsourcustomersimproveguestservices,increa

40、setoplineperformanceandreduceoperatingcosts,whichleadstoopportunitiesforhigherprofitability.Ournextgenerationofproductsandservicesareaimedathelpinghospitalityoperatorsrecruitcustomersintotheirfacilities,increasetheirwalletsharefromeachcustomerandimprovetheoverallguestexperiencefromtheinitialcustomer

41、touchpointthroughthepostvisitexperience.Ourproprietaryproductsuiteiscomprisedof:5TableofContentsTherGuestplatformunderliesourindustryleadinghospitalitysolutionsthatarebeingintroducedtooperatorsofallsizesandwithvaryingneeds.TherGuestplatformisdesignedtorunasaSoftwareasaService(“SaaS”)basedplatformont

42、hepubliccloud,privatecloud,onpremise,orinahybridconfigurationwheretheinfrastructuremaybeabovepremisebutthedataresidesonpremise.rGuestsarchitectureseamlesslyfunctionsaswellforamultipropertycustomerasitdoesforasingleproperty.TherGuestenterpriseplatformhelpsoperatorsmoreefficientlymanagetheirbusinessan

43、dgrowtheirsalesby:IdentifyingandtrackingguestprofileandbehaviorsothatitmaybeusedtocreateeffectiveloyaltyprogramsandtherightpromotionsandofferstoensurethebestguestexperiencewhileensuringthepropertyextractsthemaximumwalletsharefromeachcustomerEnablinghistoricalanalysisofdataAllowingforrealtimemanageme

44、ntthroughmobileandwebinterfacesforimmediateremediationofbusinessandguestrelatedissuesCreatingaframeworkforcoreservicesforthedeliveryofbusinessapplicationsfasterwiththecriticalbenefitofhavingfewermovingpartstomanageEnsuringthatallnewrGuestmoduleswillbewrittenontopoftherGuestplatformtocreateacommonloo

45、k/feel,functionsandusageparadigmsandreducetheoverheadofmanagingandlearningmultiplesystems,and,ProvidingforeasyintegrationwithotherhospitalitymanagementsystemsIncorporatingkeyinfrastructuredesignelementssuchasglobalandmultilanguagesupport,regulatorycomplianceandsecurity,includingauthentication,author

46、ization,encryption,tokenization,handlingofpayment&PIIinformationandoverallapplicationdataandusersecurity.OurrGuestproductsuiteisdesignedtomaximizetheinsightandvalueavailablein“bigdata”by:IdentifyingtherightdataanddetermininghowtobestuseitEmpoweringuserstobecapableofbothworkingwithnewtechnologiesando

47、finterpretingthedatatofindmeaningfulbusinessinsightsCreatingdataaccessandconnectivityacrossthemajorityofcustomertouchpointsProvidinganITplatformthatcanadapttochangesinthelandscapeinanefficientmannerWorkingacrossfunctionsorganizationalchallengesandfindingwaysofcollaboratingacrossfunctionsandbusinesse

48、sand,ImplementingthehighestlevelsofsecuritytoensuredataprotectionTherGuestplatformcurrentlyincludesthefollowinginmarketsolutions:rGuestStayisthecompanysgroundbreakingcloudbasedpropertymanagementsystemthatoptimizesoperationalefficiency,increasesrevenueandenhancesguestservice.rGuestStayiscurrentlygene

49、rallyavailableforlimitedserviceandselectservicehotelsandchains.rGuestStayisaninnovativewebbasedpropertymanagementsystembuiltusingtherevolutionaryAgilysysrGuesthospitalityplatform.TheguestcentricPMSleveragesastandardsbasedsolutiononanopenarchitecturewithpublicAPIstoenablerichlyintegratedapplicationsd

50、eliveredfromAgilysys,itspartnersandcustomers.rGuestStayofferspowerfulcapabilitiesformultipropertyoperations.Managerscanviewguestprofiles,historyandreservations,aswellasroomavailabilityandoperationalreports,seamlesslyacrossmultipleproperties.Focusedonimprovingrevenueandstreamliningoperations,rGuestSt

51、ayisdesignedtoenablehotelstogatherandanalyzeguestinformationthatcanbeusedtocreateloyaltygeneratingoffersandincreaseguestwalletshare.Inaddition,runningnativelyinabrowseronbothdesktopandtabletdevices,itdeliversrealtimeoperatingmetricssothathotelscanmoreaccuratelyforecastdemandandscaleguestservicesacco

52、rdingly.Tohelpimprovepropertyoperations,rGuestStayoffersanextgenerationhousekeepingoptimizationenginebuiltusingtheincludedrGuestworkflowenginethatassignsstaffresourcestobalanceguestneedsandoperationalefficiency.Inaddition,itsintuitiveuserinterfaceandonlinehelpfunctionalityreduceteamtrainingtimeanden

53、suresuperiorguestservicewithrapidsolutionROI.6TableofContentsrGuestBuyisanenterpriseclassselfservice,andcustomerfacingpointofsalesolutionforthehospitalityindustry.Itisidealforfood&beveragevenuessuchasGrabNGo,corporatecafeteriasandfoodcourts.Itincludesselfservice“orderandpay”kiosks,andkitchenworkflow

54、managementsystems.rGuestBuyiscurrentlyavailableinlimitedrelease.rGuestBuysintuitivecustomerfacingorderandpayexperiencestransferthecontrolandconveniencetotheenduser.Theselfservicecomponentsreduceonsitelaborneededtomanagevenueoperations,whileimprovingcustomerthroughput,checksize,orderaccuracy,customer

55、experienceandsatisfaction.Theplatformdrivenandcloudbasedsolutionallowsforeasydeploymentsandmanagementatscaleresultinginaloweredoverallcostofownership.rGuestBuyoffers:Extensibility&partnerecosystem:ThetechnologyarchitectureallowsforrichdataintegrationsforallAgilysysproducts(InfoGenesis,rGuestPay,rGue

56、stAnalyze,etc.),aswellaseasyintegrationsforapartnerdevelopmentecosystem,andcustomerapplications.“Selfmanaged”CloudSolution:Fullymanagedcloudsolutionpusheslatestreleases,patchesandfeaturesautomaticallytoallrGuestBuydevicesattheproperty.Thisensuresquickersupportturnaroundtimes,zeroonsiteITresourcesfor

57、maintenance,robustsecurityanduptimes.“Alwayson”BusinessNoofflineinterruptions:rGuestBuyoffers“alwayson”customerexperiencewithrobustnetworktoleranceandofflinecapabilities.ManageatScale:rGuestBuyallowstomapacomplexbusinessstructureinanintuitivewaytosupportpropagationofbrands,concepts,andotherpolicies.

58、ReduceRiskPCIvalidatedpaymentplatform:rGuestBuyintegrateswithrGuestPay,oursecurepaymentplatform.Protectbrandvalueandavoidliabilitywithourencryptedcarddatasolution.SafeguardagainstfraudandchargebacksbyimplementingEMVsolutions,andprotectapplicationdataviaSSL.rGuestPayisourinnovativepaymentsgateway.rGu

59、estPayprotectsguestsfinancialdataandreducesriskbyleveragingpointtopointencryption(P2PE)andtokenizationwitheverycreditcardtransaction.rGuestPayGatewayleveragesoneofthefirstpaymentgatewaysintheworldtoreceiveofficialPCIP2PEvalidation,allowingustoofferPCIcostandscopereductionthatotherproviderscannot.The

60、sesecuritybenefitsarebuiltontopofafullfeatured,enterprisegradegatewaythatoffersbroadsupportforU.S.creditcardprocessorsandawidevarietyofpaymentdeviceoptionsforeveryusecase,includingcountertop,payattable,EMV,mobiletablet,andsignaturecapturescenarios.rGuestPayoffers:Afullsuiteofcreditcardprocessingserv

61、icesIndustryleadingpaymentsecuritythroughtokenizationandP2PEFlexiblehardwaresupportingEMVandNFCcontactlesstransactionsIntegrationwith3rdPartyapplicationthroughasimpletouseAPIConsolidatedtransactionreportingComprehensivepaymentprocessorsupport7TableofContentsrGuestSeatisaguestcentrictable,reservation

62、andwaitlistmanagementsolutionthathelpsrestaurantsincreaserevenuebyretainingrepeatcustomersandprovidingasuperiorguestexperience.Onlinediningreservationsenablerestaurantstoincreasebookingsbyallowingdinerstoreserveatablethroughtherestaurantswebsiteormobileapp.Waitlistmanagementoptimizestherestaurantsus

63、eoftablesandresources,helpingstaffestimatewaittimesmoreaccuratelyandavoidinglostordissatisfiedcustomers.rGuestSeatoffers:StreamlinedonlinereservationsincreaseguestbookingswithouttyingstaffuponthephoneWaitlistautomationtoaccuratelypredictwaittimesandmeetguestexpectationsTwowaytextcommunicationswithwa

64、itingguestsTogglebetweenrestaurantswithinpeergrouptogetacompleteviewofthereservationorwaitliststatusAccessibilityofguestdatabasedontheirpreviousdiningexperiencestoprovideamuchhighlevelofguestserviceLibraryofreconfigurablereportscanbeaccessedinrealtimeorreceivedthroughemailatascheduleddeliverytimeInt

65、egratedPOSautomaticallyupdatesthestatusoftheguestexperienceandimportsvaluabledataabouttheguestRealtimetablestatusvisibilitytominimizetableturntimesandkeeprestaurantoperationsandreservationsrunningsmoothlyrGuestAnalyzeisaplatformbasedsubscriptiondataanalysisservicefocusedontheneedsofthehospitalityind

66、ustry.Itisafullbusinessintelligencesolutionthatisdeliveredthroughthecloud(SaaS).rGuestAnalyzecollectsdatafromAgilysyspointofsaleandpropertymanagementsolutionsandhelpsfood&beverageandpropertyoperatorsgaincriticalinsightintobusinessoperationsandperformance.Outoftheboxanalysishelpshospitalityoperatorsm

67、anagecosts,minimizelossduetofraud,boostitemsales,increaseserverproductivity,occupancy,roomrevenue,andotherprofitenhancingcapabilities.rGuestAnalyzeoffers:Crossenterpriseandcentralizedreportingacrosssites,venuesandprofitcentersSliceanddicereportingwithouttheneedforIT/DBAresourcesimmediatelydrivesinsi

68、ghtintofood&beverageaswellaslodgingoperationsOutoftheboxcustomizablereportsprovideinsightintosales,revenue,server/cashieractivity,discounts,tenders,ADR,RevPAR,andOccupancyEasytolearn,webbasedreportingtoolwithsimpledraganddropcapabilitiesforfastdataexplorationandreportgenerationDesign,publishanddisse

69、minateexecutiveleveldashboardsaseasilyascreatingaworddocumentwithbothwebandmobileviewsGoingforward,AgilysysplanstointroduceadditionalfunctionalityandmodulesfortherGuestplatform.AswemoveforwardwithafocusonsellingtherGuestplatformandmodules,wearecommittedtoprovidingourcustomersanupgradeand/ormigration

70、pathfrompreviouslypurchasedAgilysysproductstothenewrGuestapplication.Agilysysadditionaliconicofferingsforpointofsale,propertymanagement,inventoryprocurement,workforcemanagement,documentmanagementandactivitybookingproductandservicesinclude:AllPOSproductsareavailablethroughtraditionalsoftwarelicensing

71、orviasubscription.PointofSaleAgilysysInfoGenesisPOSisawardwinningpointofsalesoftwarethatcombinespowerfulreportingandconfigurationcapabilitiesinthebackofficewithafast,intuitiveandeasytouseterminalapplication.Theflexiblesystemiseasytosetup,anditsscalablearchitectureenablescustomerstoaddworkstationswit

72、houthavingtobuildoutexpensiveinfrastructure.Thesystemsdetailedandhighqualityreportingcapabilitiesgiveinsightintosalesdataandguestpurchasingtrends.Otherfeaturesincludepackagesandprixfixemenus,signaturecaptureandmultilanguagecapability.InfoGenesisPOSisavailableasanonpremisesolutionorthroughasubscripti

73、onservice.8TableofContentsAgilysysInfoGenesisFlexisamobilitysolutionthatoffersfullPOSfunctionalityonaWindowstablet,suchastheDellVenue8Pro.Itprovidesasleek,modernalternativetotraditionalPOSinstallationsandcanbeusedasaslimfixedterminalorasaconvertiblesimplybyremovingthetabletfromitsbase.AgilysyseCasht

74、akestraditionalcashlesspaymentandstoredvaluecardcapabilitiesandintegratesthemdirectlywithInfoGenesisPOS,increasingconsumerspaymentoptions.PropertyManagementSystems(“PMS”)AgilysysLodgingManagementSystem(LMS)isanonpremises,webenabledPMSsolutiontargetingtheCasino/Gamingsegment(alsoofferedasahostedsolut

75、ion).Itruns24/7toautomateeveryaspectofhoteloperationsinpropertiesof1,000roomsormore,andhasinterfacestoallcorecasinomanagementsystems.Itsfoundationexpandstoincorporatemodulesforsalesandcatering,activitiesscheduling,attractionticketingandmore.AgilysysVisualOnePMSisinstalledinhotelsandresortsrangingfro

76、m501,500rooms.ItisacompletePMSsolutionenablingtheresorttorunitsendtoendoperations,includingFrontDesk,HouseKeeping,Sales&Catering,Maintenance,Accounting,SPA,GolfandActivities.Forcomplexresortsthatrequireanenterprisewidesystem,VisualOneprovidesanintegratedsolutionwithinterfacestoleadingglobaldistribut

77、ionsystems(GDSs)andourotherproducts.AgilysysInsightMobileManagerisamobiledashboardapplicationthatenableshotelmanagerstoquicklyviewkeypropertyinformationincludingarrivalsanddepartures,VIPs,totalguests,housekeeping,revenueandgroupsfromamobiledevice.ItissupportedbyiPad,iPadminiandiPhonemobiledevicesand

78、integratesfullywiththeAgilysysLMSpropertymanagementsolution.InventoryandProcurementAgilysysEatecprovidescorepurchasing,inventory,recipe,forecasting,productionandsalesanalysisfunctionsandisuniqueinofferingcatering,restaurant,buffetmanagementandnutritionmodulesinasinglewebenabledsolution.AgilysysEatec

79、TouchisanoptionalsoftwareappletthatoperatesonanyMicroSoftWindowsbasedPOSterminal,providinguserswithaccesstotheEatecapplicationfromanyterminallocation.AgilysysEatecPocketisaMicrosoftWindowsMobilecompatibleapplicationdesignedtoworkonahandheldwirelessdevice,enablinguserstoperforminventorytransactions.T

80、hesoftwareincorporatesbarcodescannerfunctionalityformobileupdatesofthedatabase.AgilysysStrattonWarrenSystem(SWS)integrateswithallleadingfinancialandPOSsoftwareproducts.Thesoftwaremanagestheentireprocurementprocessviaecommerce,frombusinessdevelopmenttothemanagementofenterprisewidebackendsystemsanddai

81、lyoperations.AgilysysSWSDirectisanaddonmoduleforSWSthatprovidesaconvenient,efficientandintuitiveshoppingcartexperiencetoSWSusers.SWSDirectstreamlinesoperations,providesenhancedbiddingandrequestforpricingservices,andofferssupplierregistrationtoolsandselfservicemaintenancecapabilities.EatecandStratton

82、WarrenSystemsolutionsareavailablethroughtraditionalsoftwarelicensingorviasubscription.9TableofContentsWorkforceManagementTheAgilysysWorkforceManagementSolution(WMx)isacomprehensiveenterpriselevellabormanagementsolutionthathelpshospitalityorganizationsimprovetheefficiencyandproductivityoftheirworkfor

83、ce.WMxofferstoolsforperformancebasedscheduling,dynamiclaborforecasting,embeddedworkflowforemployeehiring,employeeselfservice,multipletimecapturesolutionsandseamlessintegrationtonumerousPOS,PMS,inventoryandpayrollsystems.TheWMxsolutionisavailablethroughtraditionalsoftwarelicensingorviasubscription.Do

84、cumentManagementAgilysysDataMagineisaU.S.patentedimagingmoduleandarchivingsolutionthatallowsuserstosecurelycaptureandretrievedocumentsandsystemgeneratedinformation.DataMagineintegrateswithallofourproducts,addingfunctionalityandincreasingbenefittocustomers.ActivitiesAgilysysGolfProisamodulethatoffers

85、golfpropertymanagerscompleteproshopmanagementwithteetimescheduling,memberprofile/billing,tournamentmanagementandWebandemailaccessbundledintoonesolution.AgilysysSpaManagementsoftwarecoversallaspectsofrunningaspabusiness,fromschedulingguestsforservicestomanagingstaffschedules.Thesoftwarealsointegrates

86、withourPMSsolutions.AgilysysLMSARTSinterfaceswithhotelguestdata,allowingreservationiststopreplanactivitieswhenbookingaguestsroom.Theapplicationalsoplacescanceledactivitiesbackintoinventoryforresale,resultinginoptimumpropertyutilizationandprofitability.AgilysysVisualOneActivitiessoftwarestreamlinesth

87、emanagementofalloftheamenitiesandactivitiesapropertyhastooffer.Staffcaneasilyscheduleandpersonalizereservationsforguestsactivitiesthenappearonitinerary/confirmations.Productsrevenuealsoincludesremarketedhardwareandproprietaryandremarketedsoftwarethatisdeployedasanintegralcomponentofthesolutionswepro

88、vide.Support,MaintenanceandSubscriptionServices:Contractedtechnicalsupport,maintenanceandsubscriptionservicesareasignificantportionofourconsolidatedrevenueandtypicallygeneratehigherprofitmarginsthanproductsrevenue.Growthhasbeendrivenbyastrategicfocusondevelopingandpromotingtheseofferingswhilemarketd

89、emandformaintenanceservicesandupdatesthatenhancereliability,aswellasthedesireforflexibilityinpurchasingoptions,continuetoreinforcethistrend.Ourcommitmenttoexceptionalservicehasenabledustobecomeatrustedpartnerwithcustomerswhowishtooptimizethelevelofservicetheyprovidetotheirguestsandmaximizecommerceop

90、portunitiesbothonandoffpremise.ProfessionalServices:Wehaveindustryleadingexpertiseindesigning,implementing,integratingandinstallingcustomizedsolutionsintobothtraditionalandnewlycreatedplatforms.Forexistingenterprises,weseamlesslyintegratenewsystemsandforstartupsandfastgrowingcustomers,webecomeapartn

91、erthatcanmanagelargescalerolloutsandtightconstructionschedules.Ourextensiveexperiencerangesfromstagingequipmenttophasedrolloutsaswellastrainingstaffinamannerthatsavesourcustomerstimeandmoney.AgilysyshasrecentlyaddedtheabilitytomigrateonpremisepropertylodgingdatatotheLMSPropertyManagementSystemhosted

92、solution.Inaddition,aspartoftheadditionofanewconsultingpractice,wenowcanprovideoperationalexpertisetohelpachievemaximumeffectivenessandefficiencies.RepresentativeAgilysysclientsinclude:10TableofContentsAVIFoodsystems,Inc.TheCosmopolitanofLasVegasResortsWorldBiminiBannerHealthCSUFullertonAuxiliarySer

93、vicesCorporationRosenHotels&ResortsBenchmarcRestaurantsDruryHotelsCompanyRoyalCaribbeanInternationalBlackRockResortFarmersRestaurantGroupRoyalLahainaResortBoydGamingCorporationGoldenNuggetLakeCharlesSandsCasinoResortBethlehemBRGuestHospitalityGrandSierraResortandCasinoSAVORTheBreakersPalmBeachHarbor

94、WindsHotelTheSeaPinesResortTheBroadmoorsRanchatEmeraldValleyHialeahParkSpookyNookSportsCaesarsEntertainmentHoChunkGamingSugarFactoryCalDiningatUCBerkeleyMarylandLive!CasinoSUNYCobleskillCamancheNationofOklahomaNorwegianCruiseLineTheVenetianResortHotelCasinoCamelbackLodge&WaterparkOxfordCasinoUnivers

95、ityofAkronCompassGroupNorthAmericaPalmGardenHotelVailResortsCasaYbelResortPinehurstResortValleyViewCasino&HotelCasinodelSolPinnacleEntertainmentVanderbiltUniversityCopperMountainPrairieBandCasino&ResortYaleUniversityIndustryandMarketsWeofferspecificsolutionsforcustomersofvaryingsizesacrossfourmajorm

96、arketsectors:Gaming,bothcorporateandtribalHotels,ResortsandCruiseFoodserviceManagementandRestaurants,Universities,StadiaandHealthcare.Thehospitalityindustryencompassesawidevarietyofmarketsectorsandcustomers.WeoperatethroughoutNorthAmerica,EuropeandAsia,withcorporateserviceslocatedinAlpharetta,GA,and

97、officesinSingapore,HongKong,MalaysiaandthePhilippines.SalestocustomersoutsideoftheUnitedStatesrepresentapproximately5%oftotalsales.Thehospitalityindustryishighlyfragmentedandcomposedbyanumberofdefinedmarketsincludinglodging,casinos,cruiseships,resortsandspas,franchiseoperators,restaurantchains,stadi

98、ums,andarenas,amongothers.Forexample,inthelodgingsegment,nosinglehotelbrandaccountsformorethan4%ofallhotelroomsintheUnitedStates.AccordingtoAmericanHotel&LodgingAssociation,theU.S.lodgingindustrygeneratedapproximately$176billioninlodgingrevenueincalendar2014,whilePwCs,HospitalityDirectionsUS2016,rep

99、ortsanaverageofapproximately65.5%ofapproximately4.9millionavailableroomsoccupiedatanaveragedailyrate(ADR)of$120.04.Thiscompareswith64.4%in2014atanADRof$114.95.USlodgingrevenuefurthergrewby8%in2015(TravelWeekly).Thehospitalitybusinessissensitivetothestrengthofdomesticandglobaleconomicandcreditconditi

100、ons.Businessanddestinationresorttravelarehighlycorrelatedwiththeeconomicconditionsintheirrespectivemarkets.Competitionisintenseforconsumerspending,andhospitalityindustryparticipantsareseekingwaystoincreasetheirvisibilityandappealaswellasenhancetheexperienceoftheirguests.Ourproductsandsolutionsaremea

101、nttoleveragetheopportunitythesechallengescreatebyprovidingourcustomerswithhigherdegreeofguestconnectivityandaddedengagementtoolsthatwillenablethemtocapitalizeontheirbrandequitybetterandmoreprofitablymanagetheiroperations,andgrowtheirbusiness.Inadditiontobespokeproductsolutionsthataredesignedandcusto

102、mizedtomeetuniquefacilityormultifacilityneeds,wealsoprovideanarrayofsupportandsubscriptionoptionsgearedtowardsmaintainingsystemsandprofessionalservicesforimplementationandrollouts.Wehaveasignificantcustomerbaseinthecommercialcasinoandgamingsector.AccordingtoStatista,USGamingindustryannualrevenuessur

103、passed$71billionin2015,ascomparedtoapproximately$68.7billionin2014.Amenitiesincontemporarycasinosextendwellbeyondgamingtoincludeavarietyofentertainmentandleisureoptionsaswellasmodernconventioncentersandmeetingfacilitiestoattractthecorporatemarket.Internationalgamingmarketsaregrowingrapidlybothinsize

104、andnewjurisdictions.Asiangamingmarketscontinuetogeneraterobustgrowth.GrossgamingrevenueinMacauexceedsthatoftheLasVegasStrip,withanumberofthecurrentandplannedpropertiesintheregionoperatedbyU.S.basedcompanies.AsthemarketshareleaderinprovidingPMSsystemstocasinosontheLasVegasStrip,wearewellpositionedtob

105、enefitfromthesestrongandlongstandingrelationshipsasourcustomerbaseexpandsintointernationalmarkets.Additionally,asgamingoperatorsmigratetowardcashlessoperationsanddigitaltrackandlogofuniqueguestbehavior,weareabletoprovidetherequisitetechnologiesandexpertisetosatisfytheirneeds.Wealsohaveexpertiseinser

106、vingtheuniqueneedsofCruiseshipoperators.Guestsandpotentialcustomersareexpectinganexperiencethatreflectstheiruniquetastes,preferencesandtravelhabitsandcruiseoperatorshaveseentheneedtoadequatelysupporttheincreasinglevelofpersonalizationanddetailrequiredtocapturethehighestlevelofguestsatisfaction.Ourpr

107、oductsandservicescanbesthelpthemtodeliveronthiscriticalpartoftheirbusiness.AccordingtotheCruiseLinesInternationalAssociationandCruise11TableofContentsMarketWatch,cruiselinescontinuedthegrowthtrendsofrecentyearsin2015withTotalworldwidecruisecapacityattheendof2015at486,385passengers(a7.3%increaseover2

108、014).Theworldwidecruiseshipfleetcurrentlystandsat298shipsandthecurrentorderbook,covering20152020,includes55newbuilds.Theindustrycarriedover22.2millionpassengersin2015,upfromnearly21.5millionpassengersin2014.CustomersOurcustomersincludelarge,mediumsizedandboutiquecompanies,anddivisionsordepartmentsof

109、largecorporationsinthehospitalityindustry.Weconcentrateonservingtheneedsofcustomersinarangeofcustomerfocusedsettingswherebranddifferentiationisimportant,particularlyinthelodging,casino,destinationresort,cruiseline,foodserviceindustrieswherecompetitionforguestrecruitmentisintense.Ourcurrentcustomerba

110、seishighlyfragmented,withonecustomerrepresentingapproximately10%ofconsolidatedrevenuefromcontinuingoperationsasofMarch31,2016.SeasonalityWehavetraditionallyexperiencedseasonalrevenueweaknessduringourfiscalfirstquarterendingJune30.Additionally,thetimingoflargeonetimeorders,suchasthoseassociatedwithsi

111、gnificantremarketedproductsalesaroundlargecustomerrefreshcyclesorsignificantvolumerollouts,occasionallycreatesvolatilityinourquarterlyresults.CompetitionOursolutionsfaceahighlycompetitivemarket.Competitionexistswithrespecttodevelopingandmaintainingrelationshipswithcustomers,pricingforproductsandsolu

112、tions,andcustomersupportandservice.WecompetewithotherfullserviceprovidersthatsellandservicebundledPOSandPMSsolutionscomprisedofhardware,software,supportandservices.Thesecompanies,someofwhicharemuchlargerthanweare,includeOracleCorp.,NCR,ConstellationSoftware,Inc.andInfor.Wealsocompetewithsoftwarecomp

113、anieslikeIDeaSRevenueSolutions,POSitouch,NorthwindandXpientSolutions.Inaddition,wecompetewithPMSsystemsthataredesignedandmaintainedinhousebylargehotelchains.EnvironmentalMattersWebelieveweareincomplianceinallmaterialrespectswithallapplicableenvironmentallaws.Presently,wedonotanticipatethatsuchcompli

114、ancewillhaveamaterialeffectoncapitalexpenditures,earningsorcompetitivepositionwithrespecttoanyofouroperations.EmployeesAsofMay30,2016,wehad553employees.Wearenotapartytoanycollectivebargainingagreements,havehadnostrikesorworkstoppagesandconsiderouremployeerelationstobegood.AccesstoInformationOurannua

115、lreportsonForm10K,quarterlyreportsonForm10Q,currentreportsonForm8Kandanyamendmentstothesereportsareavailablefreeofchargethroughourcorporatewebsite,http:/,assoonasreasonablypracticableaftersuchmaterialiselectronicallyfiledwith,orfurnishedto,theSecuritiesandExchangeCommission(SEC).Theinformationposted

116、onourwebsiteisnotincorporatedintothisAnnualReportonForm10K(AnnualReport).Reports,proxyandinformationstatements,andotherinformationregardingissuersthatfileelectronically,aremaintainedontheSECwebsite,http:/www.sec.gov.Item1A.RiskFactors.RisksRelatingtoOurBusinessOurfuturesuccesswilldependonourabilityt

117、odevelopnewproducts,productupgradesandservicesthatachievemarketacceptance.Ourbusinessischaracterizedbyrapidandcontinualchangesintechnologyandevolvingindustrystandards.Webelievethatinordertoremaincompetitiveinthefuturewewillneedtocontinuetodevelopnewproducts,productupgradesandservices,requiringtheinv

118、estmentofsignificantfinancialresources.Ifwefailtoaccuratelyanticipateourcustomersneedsandtechnologicaltrends,orareotherwiseunabletocompletethedevelopmentofaproductorproductupgradeonatimelybasis,wewillbeunabletointroducenew12TableofContentsproductsorproductupgradesintothemarketonatimelybasis,ifatall,

119、andourbusinessandoperatingresultswouldbemateriallyandadverselyaffected.Thedevelopmentprocessformostnewproductsandproductupgradesiscomplicated,involvesasignificantcommitmentoftimeandresourcesandissubjecttoanumberofrisksandchallengesincluding:Managingthelengthofthedevelopmentcyclefornewproductsandprod

120、uctenhancements,whichhasfrequentlybeenlongerthanweoriginallyexpectedAdaptingtoemergingandevolvingindustrystandardsandtotechnologicaldevelopmentsbyourcompetitorsandcustomersandExtendingtheoperationofourproductsandservicestonewandevolvingplatforms,operatingsystemsandhardwareproducts,suchasmobiledevice

121、s.Ifwearenotsuccessfulinmanagingtheserisksandchallenges,orifournewproducts,productupgrades,andservicesarenottechnologicallycompetitiveordonotachievemarketacceptance,ourbusinessandoperatingresultscouldbeadverselyaffected.Continuingchallengingglobaleconomicconditionscouldadverselyaffectourbusinessandf

122、inancialresults.Globaleconomicconditionscontinuetobechallenging.Ourrevenueandprofitabilitydependsignificantlyongeneraleconomicconditionsandthelevelofcapitalavailabletoourcustomers.Ourbusinesstrendsandrevenuegrowthcontinuetobeaffectedbythechallengingeconomicclimate.Thesedifficulteconomicconditionsand

123、theuncertaintyaboutfutureeconomicconditionsmayadverselyaffectourcustomerslevelofspending,abilitytoobtainfinancingforpurchases,abilitytomaketimelypaymentstousandadoptionofnewtechnologies,whichcouldrequireustoincreaseourallowancefordoubtfulaccounts,negativelyimpactourdayssalesoutstanding,leadtoincreas

124、edpricecompetitionandadverselyaffectourresultsofoperations.Wefaceextensivecompetitioninthemarketsinwhichweoperate,andourfailuretocompeteeffectivelycouldresultinpricereductionsand/ordecreaseddemandforourproductsandservices.Severalcompaniesofferproductsandservicessimilartoours.Therapidrateoftechnologi

125、calchangeinthehospitalitymarketmakesitlikelywewillfacecompetitionfromnewproductsdesignedbycompaniesnotcurrentlycompetingwithus.Webelieveourcompetitiveabilitydependsonourproductofferings,ourexperienceinthehospitalityindustry,ourproductdevelopmentandsystemsintegrationcapability,andourcustomerserviceor

126、ganization.Thereisnoassurance,however,thatwewillbeabletocompeteeffectivelyinthehospitalitytechnologymarketinthefuture.Wecompeteforcustomersbasedonseveralfactors,includingprice.Insomecases,wemayhavetoreduceourpricingtoobtainbusiness.Ifwearenotabletomaintainfavorablepricingforourproductsandservices,ou

127、rprofitmarginandourprofitabilitycouldsuffer.Ifwefailtomeetourcustomersperformanceexpectations,ourreputationmaybeharmed,andwemaybeexposedtolegalliability.Ourabilitytoattractandretaincustomersdependstoalargeextentonourrelationshipswithourcustomersandourreputationforhighqualityprofessionalservicesandin

128、tegrity.Asaresult,ifacustomerisnotsatisfiedwithourservicesorsolutions,ourreputationmaybedamaged.Moreover,ifwefailtomeetourclientsperformanceexpectations,wemayloseclientsandbesubjecttolegalliability,particularlyifsuchfailureadverselyimpactsourclientsbusinesses.Inaddition,manyofourprojectsarecriticalt

129、otheoperationsofourcustomersbusinesses.Whileourcontractstypicallyincludeprovisionsdesignedtolimitourexposuretolegalclaimsrelatingtoourproductsandservices,theseprovisionsmaynotadequatelyprotectusormaynotbeenforceableinallcases.Thegeneralliabilityinsurancecoveragethatwemaintain,includingcoverageforerr

130、orsandomissions,issubjecttoimportantexclusionsandlimitations.Wecannotbecertainthatthiscoveragewillcontinuetobeavailableonreasonabletermsorwillbeavailableinsufficientamountstocoveroneormorelargeclaims,orthattheinsurerwillnotdisclaimcoverageastoanyfutureclaim.Asuccessfulassertionofoneormorelargeclaims

131、againstusthatexceedsouravailableinsurancecoverageorchangesinourinsurancepolicies,includingpremiumincreasesortheimpositionoflargedeductibleorcoinsurancerequirements,couldadverselyaffectourprofitability.Actualorperceivedsecurityvulnerabilitiesinoursoftwareproductsmayresultinreducedsalesorliabilities.1

132、3TableofContentsOursoftwaremaybeusedinconnectionwithprocessingsensitivedata(e.g.,creditcardnumbers).Itmaybepossibleforthedatatobecompromisedifourcustomerdoesnotmaintainappropriatesecurityprocedures.Inthoseinstances,thecustomermayattempttoseekdamagesfromus.Whilewebelievethatallofourcurrentsoftwarecom

133、plieswithapplicableindustrysecurityrequirementsandthatwetakeappropriatesecuritymeasurestoreducethepossibilityofbreachthroughoursupportandothersystems,wecannotassurethatourcustomerssystemswillnotbebreached,orthatallunauthorizedaccesscanbeprevented.Ifacustomer,orotherperson,seeksredressfromusasaresult

134、ofasecuritybreach,ourbusinesscouldbeadverselyaffected.Ourcloudbasedsolutionspresentexecutionandcompetitiverisks.Oursolutionsofferedinthecloudaccessibleviathewebwithouthardwareinstallationorsoftwaredownloadspresentnewanddifficulttechnologychallenges.Theseofferingsdependonintegrationofthirdpartyhardwa

135、re,softwareandcloudhostingvendorsworkingtogetherwithourproducts.Asaresult,wemaybesubjecttoclaimsifcustomersexperienceservicedisruptions,breachesorotherqualityissuesrelatedtoourcloudbasedsolutions.Cloudbasedplatformandsoftwareapplicationspresentsincreasedsecurityrisks.Asweexpandourcloudbasedplatforma

136、ndsoftwarehostingcapabilities,includingourrGuestproducts,andoffermoreofoursoftwareapplicationstoourcustomersonacloudbasedbasis,ourresponsibilityfordataandsystemsecuritywithrespecttodataheldinourhostingcentersincreasessignificantly.Whilewebelievethatourcurrentplatform,softwareapplicationsanddatacente

137、rscomplywithapplicablelawsandindustrysecurityrequirements,andwhilewebelievethatweuseappropriatesecuritymeasurestoreducethepossibilityofunauthorizedaccessormisuseofdatainthedatacenters,wecannotprovideabsoluteassurancethatourcloudbasedapplicationswillnotbebreached,orthatallunauthorizedaccesscanbepreve

138、nted.Ifasecuritybreachweretooccur,acustomer,regulatoryagency,orotherpersoncouldseekredressfromus,whichcouldadverselyaffectourbusiness.Wemaynotbeabletoenforceorprotectourintellectualpropertyrights.Werelyonacombinationofcopyright,patent,trademarkandtradesecretlawsandrestrictionsondisclosuretoprotectou

139、rintellectualpropertyrights.Wecannotbecertainthatthestepswehavetakenwillpreventunauthorizeduseofourtechnology.Anyfailuretoprotectourintellectualpropertyrightswoulddiminishoreliminatethecompetitiveadvantagesthatwederivefromourproprietarytechnology.Wemaybesubjecttoclaimsofinfringementofthirdpartyintel

140、lectualpropertyrights.Whilewedonotbelievethatourproductsandservicesinfringeanypatentsorotherintellectualpropertyrights,fromtimetotime,wereceiveclaimsthatwehaveinfringedtheintellectualpropertyrightsofothers.OnApril6,2012,Ameranth,Inc.filedacomplaintagainstusforpatentinfringementintheUnitedStatesDistr

141、ictCourtfortheSouthernDistrictofCaliforniaallegingthatpointofsaleandpropertymanagementandotherhospitalityinformationtechnologyproductssoldbyusinfringethreepatentsownedbyAmeranth.Thislawsuitandanyothersuchclaim,withorwithoutmerit,couldresultincostlylitigationanddistractmanagementfromdaytodayoperation

142、s.Ifwearefoundliable,wecouldbeobligatedtopaysignificantdamagesorenterintolicenseagreements.Wearesubjecttolitigation,whichmaybecostly.Asacompanythatdoesbusinesswithmanycustomers,employeesandsuppliers,wearesubjecttolitigation.Theresultsofsuchlitigationaredifficulttopredict,andwemayincursignificantlega

143、lexpensesifanysuchclaimwerefiled.Whilewegenerallytakestepstoreducethelikelihoodthatdisputeswillresultinlitigation,litigationisverycommonplaceandcouldhaveanadverseeffectonourbusiness.Ourdependenceoncertainstrategicpartnersmakesusvulnerabletotheextentwerelyonthem.Werelyonaconcentratednumberofvendorsfo

144、rthemajorityofourhardwareandforcertainsoftwareandrelatedservicesneeds.Wedonothavelongtermagreementswithmanyofthesevendors.Ifwecannolongerobtainthesehardware,softwareorservicesneedsfromourmajorsuppliersduetomergers,acquisitionsorconsolidationwithinthemarketplace,materialchangesintheirpartnerprograms,

145、theirrefusaltocontinuetosupplytousonreasonabletermsoratall,andwecannotfindsuitablereplacementsuppliers,itmayhaveamaterialadverseimpactonourfutureoperatingresultsandgrossmargins.Ifweacquirenewbusinesses,wemaynotbeabletosuccessfullyintegratethemorattaintheanticipatedbenefits.Aspartofouroperatinghistor

146、yandgrowthstrategy,wehaveacquiredotherbusinesses.Inthefuture,wemaycontinuetoseekacquisitions.Wecanprovidenoassurancethatwewillbeabletoidentifyandacquiretargetedbusinessesorobtainfinancingforsuch14TableofContentsacquisitionsonsatisfactoryterms.Theprocessofintegratingacquiredbusinessesintoouroperation

147、smayresultinunforeseendifficultiesandmayrequireadisproportionateamountofresourcesandmanagementattention.Ifintegrationofouracquiredbusinessesisnotsuccessful,wemaynotrealizethepotentialbenefitsofanacquisitionorsufferotheradverseeffects.Ifwefailtoretainkeyemployees,ourbusinessmaybeharmed.Oursuccessdepe

148、ndsontheskill,experienceanddedicationofouremployees.Ifweareunabletoretainandattractsufficientlyexperiencedandcapablepersonnel,especiallyinproductdevelopment,salesandmanagement,ourbusinessandfinancialresultsmaysuffer.Forexample,ifweareunabletoretainandattractasufficientnumberofskilledtechnicalpersonn

149、el,ourabilitytodevelophighqualityproductsandprovidehighqualitycustomerservicemaybeimpaired.Experiencedandcapablepersonnelinthetechnologyindustryremaininhighdemand,andthereiscontinualcompetitionfortheirtalents.Whentalentedemployeesleave,wemayhavedifficultyreplacingthem,andourbusinessmaysuffer.Thereca

150、nbenoassurancethatwewillbeabletosuccessfullyretainandattractthepersonnelthatweneed.Wemayincurgoodwill,intangibleassetandcapitalizedsoftwaredevelopmentimpairmentchargesthatadverselyaffectouroperatingresults.Wereviewourgoodwill,intangibleassetsandcapitalizedsoftwaredevelopmentcostsforimpairmentonatlea

151、stanannualbasis.Duringthefourthquarteroffiscal2016,wedeterminedthattheremainingnetbookvalueofouracquireddevelopedtechnologyWMxexceededitsnetrealizablevalueresultinginanimpairmentchargeof$0.6million.Ourfutureoperatingresultsandthemarketpriceofourcommonstockcouldbemateriallyadverselyaffectedifwearereq

152、uiredtofurtherwritedownthecarryingvalueofgoodwill,intangibleassetsorcapitalizedsoftwaredevelopmentinthefuture.Ifwefailtomaintainaneffectivesystemofinternalcontrols,wemaynotbeabletodetectfraud,whichcouldhaveamaterialadverseeffectonourbusiness.Whilewebelieveourinternalcontroloverfinancialreportingisef

153、fective,acontrolssystemcannotprovideabsoluteassurancethattheobjectivesofthecontrolssystemaremet,andnoevaluationofcontrolscanprovideabsoluteassurancethatcontrolissuesandinstancesoffraud,ifany,withinourcompanyhavebeendetected.Wehaveencounteredrisksassociatedwithmaintaininglargecashbalances.Whilewehave

154、attemptedtoinvestourcashbalancesininvestmentsgenerallyconsideredtoberelativelysafe,weneverthelessconfrontcreditandliquidityrisks.Bankfailurescouldresultinreducedliquidityortheactuallossofmoneyheldindepositaccountsinexcessoffederallyinsuredamounts,ifany.Wemayhaveexposuretogreaterthananticipatedtaxlia

155、bilities.Someofourproductsandservicesmaybesubjecttosalestaxesinstateswherewehavenotcollectedandremittedsuchtaxesfromourcustomers.Wehavereservesforcertainstatesalestaxcontingenciesbasedonthelikelihoodofobligation.Thesecontingenciesareincludedin“Accruedliabilities”inourConsolidatedBalanceSheets.Webeli

156、evewehaveappropriatelyaccruedforthesecontingencies.Intheeventthatactualresultsdifferfromthesereserves,wemayneedtomakeadjustments,whichcouldmateriallyimpactourfinancialconditionandresultsofoperations.OurbusinessmaybeimpactedbytherecentbankruptcyfilingofCaesarsEntertainmentOperatingCompany,Inc.OnJanua

157、ry12,2015,aninvoluntarybankruptcypetitionwasfiledagainstCaesarsEntertainmentOperatingCompany,Inc.(Caesars)underChapter11oftheU.S.BankruptcyCode.OnJanuary15,2015,CaesarsandcertainofitsaffiliatesfiledavoluntarybankruptcypetitionunderChapter11.ThosecaseshavebeenconsolidatedintheUnitedStatesBankruptcyCo

158、urtfortheNorthernDistrictofIllinois.AsofMay26,2015,wefiledaproofofclaimwiththeBankruptcyCourtidentifyingapproximately$0.7millionofprepetitionclaimsstilloutstanding.InJanuary2016,wefiledanamendedproofofclaimwiththeBankruptcyCourtidentifyingapproximately$0.2millionofprepetitionclaiminadditiontothosefi

159、ledonMay26,2015.AsofMarch31,2016,approximately$0.7millionofprepetitionclaimsremainoutstanding.Caesarsentertainmentpropertieshavecontinuedtooperateintheordinarycoursefollowingthebankruptcyfiling,andwehavecontinuedtodobusinesswithCaesarsintheordinarycourse.OurbusinesswithCaesarsissubjecttoanumberofris

160、ks,includingourabilitytocollectoutstandingaccountsreceivable,aswellastherisksthatCaesarsbankruptcyrestructuringmaynotbesuccessful,orthatCaesarsceasesnormaloperationsorseekstorenegotiateitsexistingobligationsthroughbankruptcyprotectionorotherwise.Wehaveidentifiedmaterialweaknessesinourinternalcontrol

161、soverfinancialreporting,andourbusinessmaybeadverselyaffectedifwehaveothermaterialweaknessesorsignificantdeficienciesinourinternalcontroloverfinancialreporting.15TableofContentsWeconcludedthatourdisclosurecontrolsandprocedureswerenoteffectiveasofMarch31,2015,andDecember31,2015,becauseofmaterialweakne

162、ssesinourinternalcontroloverfinancialreporting.Specifically,atthesetimeswehadnotadequatelydesignedandmaintainedeffectivecontrolsrelatedtothereviewofsignificantassumptionsusedintheimpairmenttestsrelatedtothevaluationofindefinitelivedintangibleassetsandcapitalizedsoftwareassets.Also,multipleoutofquart

163、eradjustmentsthatwerenotdetectedandcorrectedonatimelybasisbyourreviewcontrolsinfiscalyear2016indicatedthatcertainofourreviewcontrolswerenotthenoperatingeffectively.Whilethesecontroldeficienciesdidnotresultinamaterialmisstatementofpreviouslyfiledannualorinterimconsolidatedfinancialstatementsandhavesi

164、ncebeenremediated,thesecontroldeficienciessuggestanunderlyingriskthatamaterialmisstatementoftheannualorinterimconsolidatedfinancialstatementswouldnotbepreventedordetectedonatimelybasis.Theexistenceofoneormoreadditionalmaterialweaknessesorsignificantdeficienciescouldresultinerrorsinourfinancialstatem

165、ents,andsubstantialcostsandresourcesmayberequiredtoaddresstheseandanyotherinternalcontroldeficiencies.Ifwecannotproducereliablefinancialreports,investorscouldloseconfidenceinourreportedfinancialinformation,themarketpriceofourstockcoulddeclinesignificantly,andourbusinessandoperatingresultscouldbemate

166、riallyandadverselyaffected.RisksRelatingtotheIndustriesWeServeOurbusinessdependstoasignificantdegreeonthehospitalityindustryandaweakeningcouldadverselyaffectourbusinessandresultsofoperations.Becauseourcustomerbaseisconcentratedinthehospitalityindustry,ourbusinessislargelydependentonthehealthofthatin

167、dustry.Oursalesaredependentinlargepartonthehealthofthehospitalityindustry,whichinturnisdependentonthedomesticandinternationaleconomy.Instabilitiesordownturnsinthehospitalityindustrycoulddisproportionatelyimpactourrevenue,asclientsmayexittheindustryordelay,cancelorreduceplannedexpendituresforourprodu

168、cts.Ageneraldownturninthehospitalityindustrycoulddisproportionatelyimpactourrevenue,asclientsmayexittheindustryordelay,cancelorreduceplannedexpendituresforourproducts.Higheroilandgaspricesworldwidecouldhaveamaterialadverseimpactonthehospitalityindustry,andindirectly,onourbusiness.Materialincreasesin

169、oilandgaspricestendtoreducediscretionaryspendingbyconsumers,suchasontravelanddining,aswellasonretailspendinggenerally.Reductionsindiscretionaryspendingbyconsumersadverselyaffectourcustomersand,indirectly,ourbusiness.Moreover,increasesinoilandgaspricesalsodirectlyadverselyaffectourcustomerbaseinother

170、ways.Forexample,oilandgaspriceincreasescanresultinhigheringredientandfoodcostsforourrestaurantcustomers.Consolidationinthehospitalityindustrycouldadverselyaffectourbusiness.Customersthatweservemayseektoachieveeconomiesofscaleandothersynergiesbycombiningwithoracquiringothercompanies.Thehospitalityind

171、ustryhasexperiencedrecentconsolidations,includingthehotelandcasinosectorsoftheindustry.Althoughrecentconsolidationsinthehospitalityindustryhavenotmateriallyadverselyaffectedourbusiness,thereisnoassurancethatfutureconsolidationswillnothavesuchaffect.Forexample,ifoneofourcurrentcustomersmergesorconsol

172、idateswithacompanythatreliesonanotherprovidersproductsorservices,itcoulddecidetoreduceorceaseitspurchasesofproductsorservicesfromus,whichcouldhaveanadverseeffectourbusiness.RisksRelatingtoOurStockOurstockhasbeenvolatileandweexpectthatitwillcontinuetobevolatile.Ourstockpricehasbeenvolatile,andweexpec

173、titwillcontinuetobevolatile.Forexample,duringtheyearendedMarch31,2016,thetradingpriceofourcommonstockrangedfromahighof$12.56toalowof$7.97.Thevolatilityofourstockpricemaybeduetofactorsotherthanthosespecifictoourbusiness,suchaseconomicnewsorothereventsgenerallyaffectingthetradingmarkets.Additionally,o

174、urownershipbasehasbeenandmaycontinuetobeconcentratedinafewshareholders,whichcouldincreasethevolatilityofourcommonsharepriceovertime.16TableofContentsOurlargestshareholder,MAKCapital,currentlyholdsapproximately31%ofourcommonshares,whichcouldimpactcorporatepolicyandstrategy,andMAKCapitalsinterestsmayd

175、ifferfromthoseofothershareholders.Pursuanttotheapprovalbyshareholdersofacontrolshareacquisitionproposal,MAKCapitalholdsapproximately31%ofouroutstandingcommonshares.AsasignificantshareholderwhoseresponsescouldpotentiallyaffecttheinterestsofAgilysysandtheothershareholders,ourBoardmayconsiderMAKCapital

176、spotentialresponsetoaparticulardecisionoftheBoardinconsideringtherangeofpossiblecorporatepoliciesandstrategiesinthefuture,potentiallyinfluencingcorporatepolicyandstrategicplanning.MAKenteredintoaVotingTrustAgreementwithComputershare,astrustee,whichprovidesthat,forbothstrategicandothertransactionsreq

177、uiringatleasttwothirdsofthevotingpowertoapprove,thetrusteewillvoteacertainpercentageofMAKCapitalssharesinfavorof,against,orabstainingfromvotinginthesameproportionasallothersharesvotedbyshareholders(includingMAKCapitalssharesnotbeingvotedbythetrustee).IftheVotingTrustAgreement,asamended,thatMAKentere

178、dintowithComputershareweretoterminateforanyreason,MAKCapitalwouldhavealevelofcontrolthatwouldhighlyinfluencetheapprovalordisapprovaloftransactionsrequiringunderOhiolawtheapprovaloftwothirdsoftheoutstandingcommonshares,suchasabusinesscombination,ormajorityshareacquisitioninvolvingtheissuanceofcommons

179、haresentitlingtheholderstoexerciseonesixthormoreofthevotingpowerofourcommonshares,eachofwhichrequiresapprovalbytwothirdsoftheoutstandingcommonshares.MAKCapitalmightalsobeabletoinitiateorsubstantiallyassistanysuchtransaction.EvenwiththelimitationsonMAKCapitalsvotingpowerimposedbytheVotingTrustAgreeme

180、nt,asamended,itwouldbemoredifficultfortheothershareholderstoapprovesuchatransactionifMAKCapitalopposedit,andMAKCapitalsinterestsmaydifferfromthoseofothershareholders.17TableofContentsItem1B.UnresolvedStaffComments.None.Item2.Properties.OurcorporateservicesarelocatedinAlpharetta,Georgiawhereweleaseap

181、proximately23,000squarefeetofofficespace.Inaddition,weleaseapproximately34,000squarefeetofofficespaceinLasVegas,Nevadaand22,000squarefeetofofficespaceinBellevue,Washington.Ourmajorleasescontainrenewaloptionsforperiodsofupto10years.Webelievethatourcurrentfacilitiesandofficespacearesufficienttomeetour

182、needsanddonotanticipateanydifficultysecuringadditionalspaceasneeded.Item3.LegalProceedings.Weareinvolvedinlegalactionsthatariseintheordinarycourseofbusiness.Itistheopinionofmanagementthattheresolutionofanycurrentpendinglitigationwillnothaveamaterialadverseeffectonourfinancialpositionorresultsofopera

183、tions.OnApril6,2012,Ameranth,Inc.filedacomplaintagainstusforpatentinfringementintheUnitedStatesDistrictCourtfortheSouthernDistrictofCalifornia.Thecomplaintalleges,amongotherthings,thatpointofsaleandpropertymanagementandotherhospitalityinformationtechnologyproducts,software,componentsand/orsystemssol

184、dbyusinfringethreepatentsownedbyAmeranthpurportingtocovergenerationandsynchronizationofmenus,includingrestaurantmenus,eventtickets,andotherproductsacrossfixed,wirelessand/orinternetplatformsaswellassynchronizationofhospitalityinformationandhospitalitysoftwareapplicationsacrossfixed,wirelessandintern

185、etplatforms.Thecomplaintseeksmonetarydamages,injunctiverelief,costsandattorneysfees.Atthistime,wearenotabletopredicttheoutcomeofthislawsuit,oranypossiblemonetaryexposureassociatedwiththelawsuit.However,wedisputetheallegationsofwrongdoingandarevigorouslydefendingourselvesinthismatter.Item4.MineSafety

186、Disclosures.Notapplicable.18TableofContentsPartIIItem5.MarketforRegistrantsCommonEquity,RelatedShareholderMattersandIssuerPurchasesofEquitySecurities.Ourcommonshares,withoutparvalue,aretradedontheNASDAQStockMarketLLCunderthesymbol“AGYS”.Thehighandlowsalespricesforthecommonsharesforeachquarterduringt

187、hepasttwofiscalyearsarepresentedinthetablebelow.2016HighLowFourthquarter$11.77$8.50Thirdquarter$12.56$9.62Secondquarter$12.19$7.97Firstquarter$10.43$8.72 2015HighLowFourthquarter$12.54$9.39Thirdquarter$12.74$10.35Secondquarter$14.52$11.58Firstquarter$15.02$11.89TheclosingpriceofthecommonsharesonMay2

188、7,2016,was$11.68pershare.Therewere1,688activeshareholdersofrecord.Wedidnotpaydividendsinfiscal2016or2015andareunlikelytodosointheforeseeablefuture.ThecurrentpolicyoftheBoardofDirectorsistoretainanyavailableearningsforuseintheoperationsofourbusiness.19ShareholderReturnPerformancePresentationThefollow

189、ingchartcomparesthevalueof$100investedinourcommonshares,includingreinvestmentofdividends,withasimilarinvestmentintheRussell2000Index(the“Russell2000”)andwiththecompanieslistedintheSICCode7373ComputerIntegratedSystemsDesignfortheperiodMarch31,2011throughMarch31,2016.Thestockpriceperformanceinthisgrap

190、hisnotnecessarilyindicativeofthefutureperformanceofourcommonshares.Comparisonof5YearCumulativeTotalReturnINDEXEDRETURNSFiscalYearsEndedMarch31,BasePeriodCompanyName/Index201120122013201420152016Agilysys,Inc.$100.00$156.62$173.17$233.45$171.43$177.87Russell2000$100.00$99.82$116.09$145.00$156.90$141.5

191、9PeerGroup$100.00$92.50$114.89$153.45$181.27$161.94Thisperformancegraphshallnotbedeemed“filed”forpurposesofSection18oftheSecuritiesExchangeActof1934,asamendedorincorporatedbyreferenceintoanyofourfilingsundertheSecuritiesActof1933,asamended,oftheExchangeAct,exceptasshallbeexpresslysetforthbyspecificr

192、eferenceinsuchfiling.20Item6.SelectedFinancialData.ThefollowingselectedconsolidatedfinancialandoperatingdatawasderivedfromourauditedconsolidatedfinancialstatementsandthecurrentandpriorperiodoperatingresultsofourUKentityandRSGhavebeenclassifiedwithindiscontinuedoperationsforallperiodspresentedasdiscu

193、ssedinItem7.ManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperations.TheselectedfinancialdatashouldbereadinconjunctionwiththeConsolidatedFinancialStatementsandNotesthereto,andItem7containedinPartIIofthisAnnualReport.YearendedMarch31,(Inthousands,exceptpersharedata)20162015201420132

194、012OperatingresultsNetrevenue$120,366$103,514$101,261$94,008$82,051Grossprofit68,10660,08164,04057,61949,626Operatingloss(4,313)(12,467)(6,188)(9,307)(45,840)Lossfromcontinuingoperations,netoftaxes(3,765)(11,497)(2,895)(6,214)(37,493)Incomefromdiscontinuedoperations,netoftaxes19,9924,91614,710Net(lo

195、ss)income$(3,765)$(11,497)$17,097$(1,298)$(22,783)Persharedata(1)BasicanddilutedLossfromcontinuingoperations$(0.17)$(0.51)$(0.13)$(0.28)$(1.67)Incomefromdiscontinuedoperations0.900.220.65Net(loss)income$(0.17)$(0.51)$0.77$(0.06)$(1.02)Weightedaveragesharesoutstandingbasicanddiluted22,48322,33822,135

196、21,88022,432BalancesheetdataatyearendCashandcashequivalents$60,608$75,067$99,566$82,444$95,511Workingcapital41,40154,40781,71172,12276,286Totalassets185,157181,525190,895197,498204,464Totaldebt33318933586384Totalshareholdersequity123,473124,188132,873113,856114,438(1)Whenalossisreported,thedenominat

197、orofdilutedearningspersharecannotbeadjustedforthedilutiveimpactofsharebasedcompensationawardsbecausedoingsowouldbeantidilutive.Inaddition,whenalossfromcontinuingoperationsisreported,adjustingthedenominatorofdilutedearningspersharewouldalsobeantidilutivetothelosspershare,eveniftheentityhasnetincomeaf

198、teradjustingforadiscontinuedoperation.Therefore,forallperiodspresented,basicweightedaveragesharesoutstandingwereusedincalculatingthedilutednetlosspershare.21TableofContentsItem7.ManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperations.In“ManagementsDiscussionandAnalysisofFinancialC

199、onditionandResultsofOperations”(“MD&A”),managementexplainsthegeneralfinancialconditionandresultsofoperationsforAgilysysandsubsidiariesincluding:whatfactorsaffectourbusinesswhatourearningsandcostswerewhythoseearningsandcostsweredifferentfromtheyearbeforewheretheearningscamefromhowourfinancialconditio

200、nwasaffectedandwherethecashwillcomefromtofundfutureoperations.TheMD&AanalyzeschangesinspecificlineitemsintheConsolidatedStatementsofOperationsandConsolidatedStatementsofCashFlowsandprovidesinformationthatmanagementbelievesisimportanttoassessingandunderstandingourconsolidatedfinancialconditionandresu

201、ltsofoperations.ThisdiscussionshouldbereadinconjunctionwiththeConsolidatedFinancialStatementsandrelatedNotesthatappearinItem15ofthisAnnualReporttitled,FinancialStatementsandSupplementaryData.InformationprovidedintheMD&Amayincludeforwardlookingstatementsthatinvolverisksanduncertainties.Manyfactorscou

202、ldcauseactualresultstobemateriallydifferentfromthosecontainedintheforwardlookingstatements.See“ForwardLookingInformation”onpage3ofthisAnnualReportandItem1A“RiskFactors”inPartIofthisAnnualReportforadditionalinformationconcerningtheseitems.Managementbelievesthatthisinformation,discussion,anddisclosure

203、isimportantinmakingdecisionsaboutinvestinginAgilysys.OverviewAgilysysisaleadingtechnologycompanythatprovidesinnovativesoftwareforpointofsale(POS),propertymanagement(PMS),inventoryandprocurement,workforcemanagement,analytics,documentmanagementandmobileandwirelesssolutionsandservicestothehospitalityin

204、dustry.Oursolutionsandservicesallowpropertymanagerstobetterconnect,interactandtransactwiththeircustomersandenhancetheircustomerrelationshipsbystreamliningoperations,improvingefficiency,increasingguestrecruitmentandwalletshare,andenhancingtheoverallguestexperience.Agilysysservesfourmajormarketsectors

205、:Gaming,bothcorporateandtribalHotels,ResortsandCruiseFoodserviceManagementandRestaurants,Universities,StadiaandHealthcare.Asignificantportionofourconsolidatedrevenueisderivedfromcontractsupport,maintenanceandsubscriptionservices.AgilysysoperatesextensivelythroughoutNorthAmerica,EuropeandAsia,withcor

206、porateserviceslocatedinAlpharetta,GA,andofficesinSingapore,HongKong,MalaysiaandthePhilippines.Agilysysiscomprisedofasingleoperatingsegmentandoperatesasapureplaysoftwaredrivensolutionsprovidertothehospitalityindustry.FollowingthedivestitureoftheRetailSolutionsGroup(RSG)inJuly2013,andourUnitedKingdomb

207、usinessentity(UKentity)inMarch2014,Agilysysoperatesasoneoperatingsegmentandasapureplaysoftwaredrivensolutionsprovidertothehospitalityindustry.ThesaleofRSGandtheUKentityeachrepresentedthedisposalofacomponentofanentity.Assuch,theoperatingresultsofRSGandtheUKentityhavebeenreportedasacomponentofdisconti

208、nuedoperationsintheConsolidatedFinancialStatementsfortheperiodspresented(seeNote4).Ourtoppriorityisincreasingshareholdervaluebyimprovingoperatingandfinancialperformanceandprofitabilitygrowingthebusinessthroughsuperiorproductsandservices.Tothatend,weexpecttoinvestacertainportionofourcashonhandtodevel

209、opandmarketnewsoftwareproducts,tofundenhancementstoexistingsoftwareproducts,toexpandourcustomerbreadth,bothverticallyandgeographically.Ourstrategicplanspecificallyfocuseson:Strongcustomerfocus,withclearandrealisticservicecommitments.Growingsalesofourproprietaryofferings:products,support,maintenancea

210、ndsubscriptionservicesandprofessionalservices.Diversifyingourcustomerbaseacrossindustriesandgeographies.Capitalizingonourintellectualpropertyandemergingtechnologytrends.Theprimaryobjectiveofourongoingstrategicplanningprocessistocreateshareholdervaluebyexploitinggrowthopportunitiesandstrengtheningour

211、competitivepositionwithinthespecifictechnologysolutionsandintheendmarketsweservice.Theplanbuildsonourexistingstrengthsandtargetsindustryleadinggrowthandpeerbeatingfinancialandoperatingresultsdrivenbynewtechnologytrendsandmarketopportunities.Industryleadinggrowthandpeerbeatingfinancialandoperationalr

212、esultswillbeachievedthrough22TableofContentstightercouplingandmanagementofoperatingexpensesofthebusinessandsharpeningthefocusofourinvestmentstoconcentrateongrowthopportunitieswiththehighestreturnbyseekingthehighestmarginrevenueopportunitiesinthemarketsinwhichwecompete.23TableofContentsRevenueDefined

213、AsrequiredbytheSEC,weseparatelypresentrevenueearnedasproductsrevenue,support,maintenanceandsubscriptionservicesrevenueorprofessionalservicesrevenueinourConsolidatedStatementsofOperations.InadditiontotheSECrequirements,wemay,attimes,alsorefertorevenueasdefinedbelow.Theterminology,definitions,andappli

214、cationsoftermsweusetodescribeourrevenuemaybedifferentfromthoseusedbyothercompaniesandcautionshouldbeusedwhencomparingthesefinancialmeasurestothoseofothercompanies.Weusethefollowingtermstodescriberevenue:RevenueWepresentrevenuenetofsalesreturnsandallowances.ProductsrevenueRevenueearnedfromthesalesofh

215、ardwareequipmentandproprietaryandremarketedsoftware.Support,maintenanceandsubscriptionservicesrevenueRevenueearnedfromthesaleofproprietaryandremarketedongoingsupport,maintenanceandsubscriptionorhostingservices.ProfessionalservicesrevenueRevenueearnedfromthedeliveryofimplementation,integrationandinst

216、allationservicesforproprietaryandremarketedproducts.MattersAffectingComparabilityOnJuly1,2013wecompletedthesaleofRSGtoKyrusSolutions,Inc.(Kyrus),anaffiliateofClearlakeCapitalGroup,L.P.Forfinancialreportingpurposes,RSGsoperatingresultsforallperiodspresentedwereclassifiedwithindiscontinuedoperations.O

217、nMarch31,2014,wecompletedthesaleofourUKentitytoVertedaLimited(Verteda),aU.K.basedcompany.Inconnectionwiththesale,wehaveenteredintoamultiyeardistributionagreement,wherebyVertedawilldistributecertainofourproductswithintheU.K.marketplace.Wewillcontinuetomanageallpropertymanagementsystemaccountsaswellas

218、keyglobalaccountsintheEMEAmarket.Forfinancialreportingpurposes,theUKentityoperatingresultsforallperiodpresentedwereclassifiedwithindiscontinuedoperations.Accordingly,thediscussionandanalysispresentedbelow,reflectsourcontinuingoperationsonly.24TableofContentsResultsofOperationsFiscal2016ComparedwithF

219、iscal2015NetRevenueandOperatingLossThefollowingtablepresentsourconsolidatedrevenueandoperatingresultsforthefiscalyearsendedMarch31,2016and2015:YearendedMarch31,Increase(decrease)(Dollarsinthousands)20162015$%Netrevenue:Products$41,445$31,846$9,599 30.1%Support,maintenanceandsubscriptionservices60,10

220、456,0134,091 7.3%Professionalservices18,81715,6553,162 20.2%Totalnetrevenue120,366103,51416,852 16.3%Costofgoodssold:Products,inclusiveofdevelopedtechnologyamortization23,32618,7324,594 24.5%Support,maintenanceandsubscriptionservices15,39412,4612,933 23.5%Professionalservices13,54012,2401,300 10.6%T

221、otalcostofgoodssold52,26043,4338,827 20.3%Grossprofit68,10660,0818,025 13.4%Grossprofitmargin56.6%58.0%Operatingexpenses:Productdevelopment26,68825,3161,372 5.4%Salesandmarketing19,74016,3573,383 20.7%Generalandadministrative21,81821,668150 0.7%Depreciationoffixedassets2,1992,225(26)(1.2)%Amortizati

222、onofintangibles1,2433,461(2,218)(64.1)%Restructuring,severanceandothercharges2831,836(1,553)nmAssetwriteoffsandotherfairvalueadjustments1801,482(1,302)nmLegalsettlements26820365 100.0%Operatingloss$(4,313)$(12,467)$8,154(65.4)%Operatinglosspercentage(3.6)%(12.0)%nmnotmeaningful25TableofContentsThefo

223、llowingtablepresentsthepercentagerelationshipofourConsolidatedStatementofOperationslineitemstoourconsolidatednetrevenuesfortheperiodspresented:YearendedMarch31,20162015Netrevenue:Products34.4%30.8%Support,maintenanceandsubscriptionservices50.054.1Professionalservices15.615.1Totalnetrevenue100.0100.0

224、Costofgoodssold:Products,inclusiveofdevelopedtechnologyamortization19.418.1Support,maintenanceandsubscriptionservices12.812.0Professionalservices11.211.8Totalnetcostofgoodssold43.442.0Grossprofit56.658.0Operatingexpenses:Productdevelopment22.224.5Salesandmarketing16.415.8Generalandadministrative18.1

225、20.9Depreciationoffixedassets1.82.1Amortizationofintangibles1.03.3Assetwriteoffsandotherfairvalueadjustments0.21.8Restructuring,severanceandothercharges0.11.4Legalsettlements0.20.2Operatingloss(3.6)%(12.0)%Netrevenue.Totalrevenueincreased$16.9million,or16.3%,infiscal2016comparedtofiscal2015.Products

226、revenueincreased$9.6million,or30.1%,withasignificantportionofthegrowthcomingfromincreasedsalesrelatedtoourexistingonpremiseproprietaryofferings,includinghardwarereplacementsales,aswellasincreasednewlogohardwaresalesassociatedwithourproprietarysoftwaresoldasaservice.Support,maintenanceandsubscription

227、servicesrevenueincreased$4.1million,or7.3%,asaresultofcontinuedfocusonsellinghostedperpetualandsubscriptionservicesrevenuewhichincreased29.0%yearoveryear,andongoingsupportfromourproprietaryproductsales.Hostedperpetualandsubscriptionservicerevenuecomprised9%oftotalconsolidatedrevenuesin2016comparedto

228、8%in2015.Professionalservicesrevenueincreased$3.2million,or20.2%,asaresultofincreasedvolumeofcustomerinstallationandimplementationprojectsassociatedwithgrowthinoverallproprietaryproductrevenue.Grossprofitandgrossprofitmargin.Ourtotalgrossprofitincreased$8.0million,or13.4%,infiscal2016andtotalgrosspr

229、ofitmargindecreased140basispointsto56.6%.Productsgrossprofitincreased$5.0millionandgrossprofitmarginincreased250basispointsto43.7%primarilyasaresultofahighermixoflowermarginhardwaresales,offsetby$0.3millionofsoftwareamortizationbenefitrelatedtodevelopedtechnologybecomingfullyamortizedintheprioryearp

230、eriod.Support,maintenanceandsubscriptionservicesgrossprofitincreased$1.2millionandgrossprofitmargindecreased340basispointsto74.4%duetoachangeinthemixoflaborresourcesneededformaintenanceofourproductsandcontinuedinvestmentinoursubscriptionplatform.Professionalservicesgrossprofitincreased$1.9millionand

231、grossprofitmarginincreased620basispointsto28.0%asaresultofhighercostoflaborrequiredinthethirdandfourthquarteroffiscal2015tomeetacustomercommitmentthatdidnotrecurinfiscal2016.OperatingexpensesOperatingexpenses,excludingthechargesforassetwriteoffsandotherfairvalueadjustments,legalsettlementsandrestruc

232、turing,severanceandothercharges,increased$2.7,or3.9%,infiscal2016comparedwithfiscal2015.Asapercentoftotalrevenue,operatingexpenseshavedeclined7.1%infiscal2016comparedwithfiscal2015.Productdevelopment.Productdevelopmentincludesallexpensesassociatedwithresearchanddevelopment.Productdevelopmentincrease

233、d$1.4million,or5.4%,duringfiscal2016ascomparedtofiscal2015.ThisincreaseisprimarilydrivenbyourourcontinuedinvestmentinresourcesrelatedtobothourrGuestandiconicproductenhancementstoexpandthecustomerexperienceacrossour26TableofContentsinstallbaseaswellasourfutureofferingswithexistingandnewcustomers.Inad

234、dition,certainresearchanddevelopmentcostsarecapitalizedassoftwaredevelopmentcostsuponachievingspecificmilestonesinthedevelopmentlifecycle.Wecapitalizedapproximately$14.2millionand$17.6millionduringfiscal2016and2015,respectively.Salesandmarketing.Salesandmarketingincreased$3.4million,or20.7%,infiscal

235、2016comparedwithfiscal2015.Thechangeisdueprimarilyto$3.9millionofcostsrelatedtoanincreaseinheadcountofquotacarryingsalespeopleandcommissionexpenseinlinewithrevenueachievementsinfiscal2016comparedtofiscal2015.Generalandadministrative.Generalandadministrativeremainedrelativelyconsistentincreasing$0.2m

236、illion,or0.7%,infiscal2016comparedtofiscal2015.Thechangeisprimarilyduetofavorablereductionsof$0.9millionasaresultoffiscal2016and2015initiativestocontinuetoreduceoperatingcostsinlinewithourcompanystrategy,offsetbyanincreaseinincentivecompensationof$1.3millionassociatedwithoverallimprovedfinancialresu

237、lts.Depreciationoffixedassets.Depreciationoffixedassetsremainedflatinfiscal2016ascomparedtofiscal2015.Amortizationofintangibles.Amortizationofintangiblesdecreased$2.2million,or64.1%,infiscal2016ascomparedtofiscal2015.InOctober2013,weinitiatedaninternalERPreplacementprojectanddeterminedthatamortizati

238、onforourexistingERPsystemshouldbeaccelerated.Werecordedapproximately$0.9millioninfiscal2015ofadditionalamortizationinconnectionwiththisacceleration.TheexistingERPsystemwasfullyamortizedasofJune30,2014.Additionally,$1.1millionwasrecordedduringfiscal2015relatedtoassetsbecomingfullyamortizedandassetsbe

239、ingreplacedorimpairedduringfiscal2015.Assetwriteoffsandotherfairvalueadjustments.Assetwriteoffsandotherfairvalueadjustmentsdecreased$1.5millionfrom$1.8millioninfiscal2015to$0.3millioninfiscal2016.Thenetchangewasdrivenbythefollowingfactors:Fiscal2016Activity:Intangiblewriteoff(DevelopedTechnology).As

240、ofMarch31,2016,inconnectionwiththepartnershipenteredintotoresellathirdpartyworkforcemanagementsolution,wedeterminedthattheremainingnetbookvalueoftheacquireddevelopedtechnologyWMxexceededitsnetrealizablevalueresultinginanimpairmentchargeof$0.3million.Producttransitioncostfairvalueadjustment.Duringfis

241、cal2016,werecordedagainof$0.2millionrelatedtothewriteoffofproducttransitioncostspreviouslyaccruedforinconnectionwithanimpairmentofourGuest360propertymanagementsolutioninfiscal2012.Thecustomerassociatedwiththisresidualreservebecameinsolventduringthesecondquarteroffiscal2016.Contingentconsiderationfai

242、rvalueadjustment.AsofMarch31,2016,weadjustedthefairvalueoftheTimeManagementCorporation(TMC)by$0.1milliontoreflectexpectedsettlementandearlyterminationinconnectionwithourstrategictransitiontoenterintoapartnershiptoresellathirdpartyworkforcemanagementsolution.Fiscal2015Activity:Internaluseassetwriteof

243、f.Duringthefourthquarteroffiscal2015,ashiftincustomerpreferencefornextgenerationofferingswithmorefeaturesandcompatibilityascomparedtoourElevatePOShostedsubscriptionsolution,resultedinawriteoffintheamountof$1.5million.Infiscal2014,wewroteoffapproximately$0.3millionrelatedtocertaininternalusesoftwarei

244、nconnectionwiththeERPsystemreplacementproject.Intangiblewriteoff(DevelopedTechnologyandTradeName).AsofMarch31,2015,determinedthattheremainingnetbookvalueofourInfoGenesisMobile(IGMobile)softwareexceededitsnetrealizablevalueresultinginanimpairmentchargeof$1.4million.Thiswasdrivenprimarilybycustomerpre

245、ferenceforInfoGenesisFlex(IGFlex),anotheroneofourInfoGenesisPOSmobilitysolutions.Inaddition,duringthefourthquarteroffiscal2015,certainrestructuringactivitiesincurredtobetteralignproductdevelopment,salesandmarketingandgeneralandadministrativefunctionsimpactedtheexpectedremainingusefullifeoftheproduct

246、sundertheEatectradename.Thetradenamewasdeterminedtohaveafinitelifeandsubsequentlywrittendowntoitsfairvaluetobeamortizedoverfiveyears.Thefairvalueofthistradenamewascalculatedbasedonfuturecashflowsovertheremainingusefulliferesultinginanimpairmentchargeof$0.6millionasofMarch31,2015.Contingentconsiderat

247、ionfairvalueadjustment.Thefiscal2015writeoffswereoffsetbyagainof$1.6millionrecordedinfiscal2015toadjustthecarryingvalueoftheTimeManagementCorporation(TMC)contingentconsiderationtofairvalue.Thisadjustmentwasrecordedasaresultofadecreaseinexpectedrevenuesassociatedwiththecontingentconsideration.27Table

248、ofContentsRestructuring,severanceandothercharges.Inthefourthquarteroffiscal2016,wecontinuedoureffortstobetteralignproductdevelopmentandgeneralandadministrativefunctionswithourcompanystrategyandtoreduceoperatingcosts.Todate,wehaverecorded$0.3millioninrestructuringchargesrelatedtotheQ4fiscal2016restru

249、cturingactivity,comprisedofseveranceandotheremployeerelatedbenefits.AsofMarch31,2016,wehadaremainingliabilityofapproximately$0.2millionrecordedfortheQ4fiscal2016restructuringactivity.WeexpecttorecordadditionalrestructuringexpenserelatedtotheQ4fiscal2016restructuringeventduringfiscal2017asthoseobliga

250、tionsbecomepresentandthedefinitionofaliabilityincludedinFASBConceptsStatementNo.6,ElementsofFinancialStatements,ismet.Theseadditionalchargesarenotexpectedtoexceed$0.2million.OurrestructuringactionsarediscussedfurtherinNote5,RestructuringCharges.Legalsettlements.Duringfiscal2016,werecorded$0.3million

251、inlegalsettlementsforemploymentandotherbusinessrelatedmatterscomparedto$0.2millioninlegalsettlementsrecordedinfiscal2015tofinalizelegaldisputesoriginallyestimatedandrecordedinthatfiscalyear.Other(Income)ExpensesYearendedMarch31,(Unfavorable)favorable(Dollarsinthousands)20162015$%Other(income)expense

252、:Interestincome$(92)$(110)$(18)nmInterestexpense29 48 19 39.6%Other(income)expense,net(491)146 637 nmTotalother(income)expense,net$(554)$84$638 nmnmnotmeaningfulInterestincome.Interestincomeremainedrelativelyconsistentduringfiscal2016ascomparedtofiscal2015.Interestexpense.Interestexpenseconsistsofco

253、stsassociatedwithcapitalleasesandloansoncorporateownedlifeinsurancepolicies.Interestexpensedecreasedinfiscal2016comparedtofiscal2015duetoexpirationandnonrenewalofcertaincapitalleases.Otherincome(expense),net.Otherincomeincreased$0.5millioninfiscal2016comparedtofiscal2015primarilydueto$0.1millionofch

254、angesincashsurrendervalueofcompanyownedlifeinsurancepoliciesanda$0.5milliongainontheredemptionofcompanyownedlifeinsurancepoliciesin2016.IncomeTaxesYearendedMarch31,(Unfavorable)favorable(Dollarsinthousands)20162015$%Incometaxexpense(benefit)$6$(1,054)$(1,060)nmEffectivetaxrate(0.2)%8.4%nmnotmeaningf

255、ulForfiscal2016,theeffectivetaxratewasdifferentthanthestatutoryratedueprimarilytotherecognitionofnetoperatinglossesasdeferredtaxassets,whichwereoffsetbyincreasesinthevaluationallowance,receiptofdeathbenefitsoncompanyownedlifeinsurance,statetaxesandotherU.S.permanentbooktotaxdifferences.Forfiscal2015

256、,theeffectivetaxratewasdifferentthanthestatutoryratedueprimarilytotherecognitionofnetoperatinglossesasdeferredtaxassets,whichwereoffsetbyincreasesinthevaluationallowance,adecreaseinunrecognizedtaxbenefitsattributabletoexpirationofstatuteoflimitations,statetaxesandotherU.S.permanentbooktotaxdifferenc

257、es.Althoughthetimingandoutcomeoftaxsettlementsareuncertain,itisreasonablypossiblethatduringthenext12monthsareductioninunrecognizedtaxbenefitsmayoccurintherangeofzerotolessthan$0.1millionasaresultoftheexpirationofvariousstatutesoflimitations.Weareroutinelyauditedandtheoutcomeoftaxexaminationscouldals

258、oresultinareductioninunrecognizedtaxbenefits.Otherchangescouldoccurintheamountofgrossunrecognizedtaxbenefitsduringthenext12monthswhichcannotbeestimatedatthistime.28TableofContentsBecauseofourlossesinpriorperiods,wehaverecordedavaluationallowanceoffsettingsubstantiallyallofourdeferredtaxassets.Theamo

259、untofthevaluationallowance,however,couldbereducedinthenearterm.Theexacttimingwillbebasedonthelevelofprofitabilitythatweareabletoachieveandourvisibilityintofutureresults.Weexpectthatwemayrelease$0.2M,theHongKongportionofthevaluationallowance.Weexpectthatthereleaseofthevaluationallowancewillberecorded

260、asanincometaxbenefitatthetimeofthereleaseincreasingourreportednetincome.Ourrecordedtaxratemayincreaseinsubsequentperiodsfollowingavaluationrelease.Anyvaluationallowancereleasewillnotaffecttheamountofcashpaidforincometaxes.Fiscal2015ComparedtoFiscal2014NetRevenueandOperatingLossThefollowingtableprese

261、ntsourconsolidatedrevenueandoperatingresultsforthefiscalyearsendedMarch31,2015and2014:YearendedMarch31,Increase(decrease)(Dollarsinthousands)20152014$%Netrevenue:Products$31,846$34,629$(2,783)(8.0)%Support,maintenanceandsubscriptionservices56,01353,1692,844 5.3%Professionalservices15,65513,4632,192

262、16.3%Totalnetrevenue103,514101,2612,253 2.2%Costofgoodssold:Products,inclusiveofdevelopedtechnologyamortization18,73217,0271,705 10.0%Support,maintenanceandsubscriptionservices12,46110,7861,675 15.5%Professionalservices12,2409,4082,832 30.1%Totalcostofgoodssold43,43337,2216,212 16.7%Grossprofit60,08

263、164,040(3,959)(6.2)%Grossprofitmargin58.0%63.2%Operatingexpenses:Productdevelopment25,31625,212104 0.4%Salesandmarketing16,35714,0592,298 16.3%Generalandadministrative21,66820,750918 4.4%Depreciationoffixedassets2,2252,074151 7.3%Amortizationofintangibles3,4616,414(2,953)(46.0)%Restructuring,severan

264、ceandothercharges1,8363271,509 nmAssetwriteoffsandotherfairvalueadjustments1,4821,39290 6.5%Legalsettlements203203 nmOperatingloss$(12,467)$(6,188)$(6,279)101.5%Operatinglosspercentage(12.0)%(6.1)%nmnotmeaningful29TableofContentsThefollowingtablepresentsthepercentagerelationshipofourConsolidatedStat

265、ementofOperationslineitemstoourconsolidatednetrevenuesfortheperiodspresented:YearendedMarch31,20152014Netrevenue:Products30.8%34.2%Support,maintenanceandsubscriptionservices54.152.5Professionalservices15.113.3Totalnetrevenue100.0100.0Costofgoodssold:Products,inclusiveofdevelopedtechnologyamortizatio

266、n18.116.8Support,maintenanceandsubscriptionservices12.010.7Professionalservices11.89.3Totalcostofgoodssold42.036.8Grossprofit58.063.2Operatingexpenses:Productdevelopment24.524.9Salesandmarketing15.813.9Generalandadministrative20.920.5Depreciationoffixedassets2.12.0Amortizationofintangibles3.36.3Rest

267、ructuring,severanceandothercharges1.80.3Assetwriteoffsandotherfairvalueadjustments1.41.4Legalsettlements0.2Operatingloss(12.0)%(6.1)%Netrevenue.Totalrevenueincreased$2.3million,or2.2%,infiscal2015comparedtofiscal2014.Productsrevenuedecreased$2.8million,or8.0%,primarilyasaresultofaslowinginproductsal

268、esinlinewithourstrategicinitiativestoemphasizesubscriptionbasedservicerevenueandnewlogobusiness.Support,maintenanceandsubscriptionservicesrevenueincreased$2.8million,or5.3%,asaresultofcontinuedfocusonsellinghostedperpetualandsubscriptionbasedservicerevenuewhichwasanincreaseof11.3%yearoveryear,andong

269、oingsupportfromourproprietaryproductsales.Hostedperpetualandsubscriptionbasedservicerevenuecomprised8%oftotalconsolidatedrevenuesin2015comparedto7%in2014.Professionalservicesrevenueincreased$2.2million,or16.3%,duetothetimingofcustomerinstallationsincludingtwolargeserviceprojectsduringfiscal2015thatr

270、esultedinapproximately$1.9millioninrevenue.Grossprofitandgrossprofitmargin.Ourtotalgrossprofitdecreased$4.0million,or6.2%,infiscal2015andtotalgrossprofitmargindecreased520basispointsto58.0%.Productsgrossprofitdecreased$4.5millionandgrossprofitmargindecreased960basispointsto41.2%mainlyasaresultoflowe

271、rsalesofhighermarginproprietarysoftwaresaleswhichmadeupasmallerportionoftotalproductsalesduringfiscal2015ascomparedtofiscal2014.Alsoimpactinggrossprofitmarginwas$1.0millioninincrementalamortizationexpenseofsoftwareproductsthatwererecentlyplacedintoservice.Support,maintenanceandsubscriptionservicesgr

272、ossprofitincreased$1.2millionandgrossprofitmargindecreased190basispointsto77.8%duetoachangeinthemixoflaborresourcesneededformaintenanceofourproducts.Professionalservicesgrossprofitdecreased$0.6millionandgrossprofitmargindecreased830basispointsto21.8%asaresultofhighercostoflaborrequiredinthethirdandf

273、ourthquartertomeetacustomercommitment.OperatingexpensesOperatingexpenses,excludingthechargesforassetwriteoffsandotherfairvalueadjustments,legalsettlementsandrestructuring,severanceandothercharges,increased$0.5,or0.7%,infiscal2015comparedwithfiscal2014.Productdevelopment.Productdevelopmentincludesall

274、expensesassociatedwithresearchanddevelopment.Productdevelopmentremainedconsistentduringfiscal2015ascomparedtofiscal2014.Increasesinlaborcostsaswecontinueinvestinginengineeringresourcestohelpachieveourplannedmilestoneswereoffsetbytheincreasedcapitalizationyearoveryearascertainresearchanddevelopmentco

275、stsarecapitalizedassoftwaredevelopmentcostsuponachievingspecificmilestonesinthedevelopmentlifecycle.Wecapitalizedapproximately$17.6millionand$13.7millionduringfiscal2015and2014,respectively.30TableofContentsSalesandmarketing.Salesandmarketingincreased$2.3million,or16.3%,infiscal2015comparedwithfisca

276、l2014.TheincreaseisduemainlytothetimingofoursalesreorganizationaswecontinuetoalignandrampoursalesforcetobetterserveourcustomersandourlongtermstrategyandincreasedmarketingactivitiessurroundingthelaunchofournextgenerationproductrGuest.Generalandadministrative.Generalandadministrativeincreased$0.9milli

277、on,or4.4%,infiscal2015comparedtofiscal2014.asaresultof$1.5millionofincreasedspendduringthefirsthalfoffiscal2015surroundingtheongoingefforttostreamlineandrationalizeourbackofficeprocesses,includingthecostofresourcesinvolvedinanERPreplacementproject.Thiswasoffsetby$0.6millionrelatedtocertainsoftwareli

278、censesfeesincurredinthethirdquarteroffiscal2014thatdidnotrecurinthecurrentfiscalyear.Depreciationoffixedassets.Depreciationoffixedassetsincreased$0.2million,or7.3%,infiscal2015ascomparedtofiscal2014duetothetimingofassetpurchases.Amortizationofintangibles.Amortizationofintangiblesdecreased$3.0million

279、,or46.0%,infiscal2015ascomparedtofiscal2014.InOctober2013,weinitiatedaninternalERPreplacementprojectanddeterminedthatamortizationofourexistingERPsystemshouldbeacceleratedresultingin$3.2millionofadditionalamortizationexpenseinfiscal2014.Assetwriteoffsandotherfairvalueadjustments.Assetwriteoffsandothe

280、rfairvalueadjustmentsincreased$1.5millioninfiscal2015ascomparedtofiscal2014.Thenetchangewasdrivenbythefollowingfactors:Internaluseassetwriteoff.Duringthefourthquarteroffiscal2015,ashiftincustomerpreferencefornextgenerationofferingswithmorefeaturesandcompatibilityascomparedtoourElevatePOShostedsubscr

281、iptionsolution,resultedinawriteoffintheamountof$1.5million.Infiscal2014,wewroteoffapproximately$0.3millionrelatedtocertaininternalusesoftwareinconnectionwiththeERPsystemreplacementproject.Intangiblewriteoff(DevelopedTechnologyandTradeName).AsofMarch31,2015,determinedthattheremainingnetbookvalueofour

282、InfoGenesisMobile(IGMobile)softwareexceededitsnetrealizablevalueresultinginanimpairmentchargeof$1.4million.ThiswasdrivenprimarilybycustomerpreferenceforInfoGenesisFlex(IGFlex),anotheroneofourInfoGenesisPOSmobilitysolutions.Inaddition,duringthefourthquarteroffiscal2015,certainrestructuringactivitiesi

283、ncurredtobetteralignproductdevelopment,salesandmarketingandgeneralandadministrativefunctionsimpactedtheexpectedremainingusefullifeoftheproductsundertheEatectradename.Thetradenamewasdeterminedtohaveafinitelifeandsubsequentlywrittendowntoitsfairvaluetobeamortizedoverfiveyears.Thefairvalueofthistradena

284、mewascalculatedbasedonfuturecashflowsovertheremainingusefulliferesultinginanimpairmentchargeof$0.6millionasofMarch31,2015.Contingentconsiderationfairvalueadjustment.Thefiscal2015writeoffswereoffsetbyagainof$1.6millionrecordedinfiscal2015toadjustthecarryingvalueoftheTimeManagementCorporate(TMC)contin

285、gentconsiderationtofairvalue.Thisadjustmentwasrecordedasaresultofadecreaseinexpectedrevenuesassociatedwiththecontingentconsideration.Restructuring,severanceandothercharges.Inthefourthquarteroffiscal2015,weannouncedadditionalrestructuringactionsdesignedtocontinuetheefforttobetteralignproductdevelopme

286、nt,salesandmarketingandgeneralandadministrativefunctionswithourcompanystrategyandtoreduceoperatingcosts.Todate,wehaverecorded$0.5millioninrestructuringchargesrelatedtotheQ4fiscal2015restructuringactivity,comprisedofseveranceandotheremployeerelatedbenefits.AsofMarch31,2015,wehadaremainingliabilityofa

287、pproximately$0.5millionrecordedfortheQ4fiscal2015restructuringactivity.Inthesecondquarteroffiscal2015,weimplementedrestructuringactionstobetteralignproductdevelopment,salesandmarketingandgeneralandadministrativefunctionsandtoreduceoperatingcostsandrecorded$0.2millioninrestructuringchargesduringthefi

288、rsthalfoffiscal2015,comprisedofseveranceandotheremployeerelatedbenefits.AsofMarch31,2015,therewasnoremainingliabilityrelatedtotheQ2fiscal2015activity.Infiscal2014,followingthesaleofRSG,werecordedrestructuringchargesforseveranceandrelatedemployeebenefitsforarestructuringplanofapproximately$0.7million

289、inordertobetteraligncorporatefunctionswithourHSGoperatingunitandtoreducecosts.Wealsoinitiatedasalesandmarketingrestructuringplaninordertomaximizesaleseffectivenessandmorecloselyalignsalesandmarketingeffortsfortargetedverticalgrowth,newproductlaunches,andmarketingalliances.Werecordedrestructuringchar

290、gesforseveranceandrelatedemployeebenefitsofapproximately$0.6millionrelatedtothesalesandmarketingrestructuring.Duringfiscal2015,werecordedanadditional$0.4millionrelatedtothe2014restructuringactivity.AsofMarch31,2015,therewasnoremainingliabilityrelatedtothefiscal2014restructuring.Ourrestructuringactio

291、nsarediscussedfurtherinNote5,RestructuringCharges.31TableofContentsLegalsettlements.Duringfiscal2015,werecorded$0.2millioninlegalsettlementstofinalizelegaldisputesoriginallyestimatedandrecordedinthecurrentfiscalyear.OtherExpense(Income)YearendedMarch31,(Unfavorable)favorable(Dollarsinthousands)20152

292、014$%Other(income)expenses Interestincome$(110)$(123)$(13)nmInterestexpense48 184 136 73.9%Other(income)expense,net146(863)(1,009)nmTotalotherexpense(income),net$84$(802)$(886)nmnmnotmeaningfulInterestincome.Interestincomeremainedrelativelyconsistentduringfiscal2015ascomparedtofiscal2014.Interestexp

293、ense.Interestexpenseconsistsofcostsassociatedwithcapitalleasesandloansoncorporateownedlifeinsurancepolicies.Interestexpensedecreasedinfiscal2015comparedtofiscal2014duetoexpirationandnonrenewalofcertaincapitalleases.Otherincome,net.Otherincomedecreasedinfiscal2015comparedtofiscal2014primarilyduetothe

294、gainontheredemptionofacompanyownedlifeinsurancepolicyofapproximately$0.6millionin2014.ThiswasoffsetbytheimpactofforeigncurrencymovementagainsttheUSdollar.IncomeTaxesYearendedMarch31,(Unfavorable)favorable(Dollarsinthousands)20152014$%Incometaxbenefit$(1,054)$(2,491)$(1,437)nmEffectivetaxrate8.4%46.2

295、%nmnotmeaningfulForfiscal2015,theeffectivetaxratewasdifferentthanthestatutoryratedueprimarilytotherecognitionofnetoperatinglossesasdeferredtaxassets,whichwereoffsetbyincreasesinthevaluationallowance,adecreaseinunrecognizedtaxbenefitsattributabletoexpirationofstatuteoflimitations,statetaxesandotherU.

296、S.permanentbooktotaxdifferences.Forfiscal2014,theeffectivetaxratewasdifferentthanthestatutoryratedueprimarilytotheintraperiodtaxallocationrulesassociatedwiththediscontinuedoperations,theexpirationofstatuteoflimitationsforunrecognizedtaxpositionsandrecognitionofnetoperatinglossesasdeferredtaxassets,w

297、hichwereoffsetbyincreasesinthevaluationallowance.OtheritemsaffectingtherateincludestatetaxesandotherU.S.permanentbooktotaxdifferences.AcquisitionsPurchaseofassetsfromDiningVenturesFiscal2015OnJuly3,2014wepurchasedcertainassetsfromDiningVentures,Inc.TheacquiredassetsarethebaseforourrGuestSeatproduct,

298、adiningreservationsandtablemanagementapplication.Thepurchaseconsiderationconsistedofapproximately$3.8millionandwasfundedwithcashonhand.ManagementconcludedthatthisacquisitionwasnotamaterialacquisitionundertheprovisionsofASC805,BusinessCombinations(ASC805).Theresultsderivedfromthispurchasedassethavebe

299、enincludedinourConsolidatedFinancialStatementsfromthedateofacquisitionanddidnothaveamaterialimpactonourconsolidatedfinancialstatementsorrelateddisclosures.PurchaseofTimeManagementCorporationFiscal2014OnJune10,2013,AgilysyspurchasedcertainassetsandassumedcertainliabilitiesofTimeManagementCorporation(

300、TMC),aprivatelyownedMinneapolisbasedtechnologyproviderwithsolutionsthatstreamlineworkforcemanagementenvironmentsfor32hospitalityoperators.Thistechnologybasedacquisitionisconsistentwiththecorevalueweprovidetotheindustryandintegrateswithourpointofsale,inventoryandprocurementsystems,includingInfoGenesi

301、spointofsalesystemandEatecinventoryandprocurementsolution.Thepurchaseconsiderationconsistedof$1.8millionincashpaidand$1.8millionofcontingentconsideration.Thefairvalueofthecontingentconsiderationwasestimatedtobe$1.8millionatthedateofacquisitionandisexpectedtobepaidoutoverthenextfiveyears.Paymentscoul

302、dvarybasedonactualrevenueduringthattime.Thefairvalueofthecontingentconsiderationwasdeterminedbycalculatingtheprobabilityweightedearnoutpaymentsbasedontheassessmentofthelikelihoodthatcertainmilestoneswouldbeachieved.AsofMarch31,2015,werecordedagainof$1.6milliontoadjustthecarryingvalueoftheTMCcontinge

303、ntconsiderationtofairvalue.Thisadjustmentwasrecordedasaresultofadecreaseinexpectedrevenuesassociatedwiththecontingentconsideration.AsofMarch31,2016,werecordedanadditional$0.1milliontoreflectexpectedsettlementandearlyterminationoftheliabilityinconnectionwithourstrategictransitiontoenterintoapartnersh

304、iptoresellathirdpartyworkforcemanagementsolution.TheadjustmentsarerecordedwithinAssetwriteoffsandotherfairvalueadjustmentsintheConsolidatedStatementsofOperations.Theacquisitionwasfundedwithcashonhand.ManagementconcludedthatthisacquisitionwasnotamaterialacquisitionundertheprovisionsofASC805,BusinessC

305、ombinations.TheoperationsofthepurchasedbusinesshavebeenincludedinourConsolidatedFinancialStatementsfromthedateofacquisitionanddidnothaveamaterialimpactonourConsolidatedFinancialStatementsorrelateddisclosures.AdditionalinformationregardingtheacquisitionsareprovidedinNote3totheConsolidatedFinancialSta

306、tementstitled,Acquisitions.DiscontinuedOperationsUKEntityFiscal2014InMarch2014,wecompletedthesaleofourUKentitytoVertedaLimited(Verteda),aU.K.basedcompany,fortotalconsiderationofapproximately$0.6million,comprisedof$0.7millionincashandareceivableduetousfromVertedaof$0.8million,netofcashonhandof$0.9mil

307、lion.Duringfiscal2016wereceivedfullpaymentoftheamountduetousfromVerteda.Inconnectionwiththesale,wehaveenteredintoamultiyeardistributionagreementwherebyVertedawilldistributecertainofourproductswithintheU.K.WewillcontinuetomanageallpropertymanagementsystemaccountsaswellaskeyglobalaccountsintheEMEAmark

308、et.ThesaleofourUKentityrepresentedadisposalofacomponentofanentity.Assuch,theoperatingresultsoftheUKentityhavebeenreportedasacomponentofdiscontinuedoperationsintheConsolidatedStatementsofOperationsfortheperiodspresented.Inaddition,theassetsandliabilitiesoftheUKentityareclassifiedasdiscontinuedoperati

309、onsinourConsolidatedBalanceSheetsfortheperiodspresented.RSGFiscal2014InJuly2013,wecompletedthesaleofourRSGbusinesstoKyrusSolutions,Inc.(Kyrus),anaffiliateofClearlakeCapitalGroup,L.P.,fortotalconsiderationofapproximately$37.6millionincash,includingaworkingcapitaladjustmentof$3.1million.Uponthecloseof

310、thetransaction,theaggregatepurchasepricewasreducedbyfeesofapproximately$1.6millionfortransactionrelatedcosts,resultinginnetproceedsreceivedofapproximately$36.0million.Inadditiontothepurchaseagreement,weenteredintoatransitionservicesagreementwithKyrus,underwhichweprovidedcertaintransitionaladministra

311、tiveandsupportservicestoKyrusthroughJanuary31,2014.ThesaleofRSGrepresentedadisposalofacomponentofanentity.Assuch,theoperatingresultsofRSGhavebeenreportedasacomponentofdiscontinuedoperationsintheConsolidatedStatementsofOperationsfortheperiodspresented.Additionalinformationregardingthediscontinuedoper

312、ationsareprovidedinNote4totheConsolidatedFinancialStatementstitled,DiscontinuedOperations.RestructuringandRelatedChargesWerecognizerestructuringchargeswhenaplanthatmateriallychangesthescopeofourbusinessorthemannerinwhichthatbusinessisconductedisadoptedandcommunicatedtotheimpactedparties,andtheexpens

313、eshavebeenincurredorarereasonablyestimable.Inaddition,weassessthepropertyandequipmentassociatedwiththerelatedfacilitiesforimpairment.Theremainingusefullivesofpropertyandequipmentassociatedwiththerelatedoperationsarereevaluatedbasedontherespectiverestructuringplan,resultingintheaccelerationofdeprecia

314、tionandamortizationofcertainassets.AdditionalinformationregardingrestructuringchargesisprovidedwithintheprecedingResultsofOperationssectionandinNote5totheConsolidatedFinancialStatementstitled,RestructuringCharges.33TableofContentsLiquidityandCapitalResourcesOverviewOuroperatingcashrequirementsconsis

315、tprimarilyofworkingcapitalneeds,operatingexpenses,capitalexpenditures,andpaymentsofprincipalandinterestonindebtednessoutstanding,whichprimarilyconsistsofleaseandrentalobligationsatMarch31,2016.Webelievethatcashflowfromoperatingactivities,cashonhandof$60.6millionasofMarch31,2016,andaccesstocapitalmar

316、ketswillprovideadequatefundstomeetourshortandlongtermliquidityrequirements.AsofMarch31,2016andMarch31,2015,ourtotaldebtwasapproximately$0.3millionand$0.2million,respectively,comprisedofcapitalleaseobligationsinbothperiods.AtMarch31,2016,100%ofourcashandcashequivalentsweredepositedinbankaccountsorinv

317、estedinhighlyliquidinvestmentswithoriginalmaturityfromdateofacquisitionofthreemonthsorless,includinginvestmentsincommercialpaper,ofwhich95%islocatedintheUnitedStates.Therefore,webelievethatcreditriskislimitedwithrespecttoourcashandcashequivalentsbalances.CashFlowYearendedMarch31,(Inthousands)2016201

318、52014Netcash(usedin)providedbycontinuingoperations:Operatingactivities$7,218$(2,186)$1,384Investingactivities(21,013)(21,632)17,724Financingactivities(577)(401)(883)Effectofexchangeratechangesoncash(87)(280)(44)Cashflows(usedin)providedbycontinuingoperations(14,459)(24,499)18,181Cashflowsusedindisco

319、ntinuedoperations (1,546)Net(decrease)increaseincashandcashequivalents$(14,459)$(24,499)$16,635Cashflowprovidedby(usedin)operatingactivitiesfromcontinuingoperations.Cashflowsprovidedbyoperatingactivitieswere$7.2millioninfiscal2016.Theuseofcashwasattributableto$3.2millioninnetworkingcapitalmovementsa

320、ssociatedmainlywith$3.2millioninincreasedcollectionsonaccountsreceivable.Workingcapitalmovementswerepositivelyimpactedby$4.1millionrelatedtoouroperatinglossadjustedfordepreciation,amortization,sharebasedcompensation,assetwriteoffsandfairvalueadjustments,lossondisposalofproperty&equipment,andchangein

321、cashsurrendervalueofcompanyownedlifeinsurance.Cashflowsusedinoperatingactivitieswere$2.2millioninfiscal2015.Thiswasmainlytheresultofournetlossafteraddingbackcertainnoncashitems,including$2.2millionofdepreciation,$4.8millioninamortization,and$1.8millionofassetwriteoffsandotherfairvalueadjustments,off

322、setbyanoverallnetuseinotheroperatingassetsandliabilitiesof$0.8million.Changeinoperatingassetsandliabilitieswasdrivenprimarilybyincreasesinaccountsreceivableandprepaidsof$2.5million,offsetbyincreaseinaccountspayableandaccruedexpensesof$1.7million.Cashflowsprovidedbyoperatingactivitieswere$1.4millioni

323、nfiscal2014.Thiswasmainlytheresultofourincomeafteraddingbackcertainnoncashitems,including$10.9millionindepreciation,amortizationwhichincludes$3.2millionofacceleratedamortizationforthesunsettingofourcurrentERPsystem,andstockbasedcompensation.Thisisoffsetbya$7.8millionincreaseinaccountsreceivableanda$

324、2.7millionimpactofthetaxprovisionontaxespayable.Cashflow(usedin)providedbyinvestingactivitiesfromcontinuingoperations.Cashflowsusedininvestingactivitiesinfiscal2016were$21.0million.Thisisprimarilyattributedto$16.1millionindevelopmentofproprietarysoftwareand$4.8millionforpurchaseofpropertyandequipmen

325、t,includinginternalusesoftware.Cashflowsusedininvestingactivitiesinfiscal2015were$21.6million.Thisisprimarilyattributedto$15.8millionofcapitalizedsoftwaredevelopmentcosts,$4.7millionoffixedassetpurchases,$3.8millionfortheacquisitionofdevelopedtechnologyforourrGuestSeatproduct,offsetby$2.0millionand$

326、0.8millionforproceedsfromcompanyownedlifeinsurancepoliciesandsaleoftheUKbusinessunit,respectively.Infiscal2014,the$17.7millionincashflowsprovidedbyinvestingactivitieswereprimarilycomprisedof$35.8millionnetproceedsfromthesaleofRSGandourUKentity,offsetby$1.8millionpaidfortheacquisitionofTMC,$12.2milli

327、onwasusedforthedevelopmentofproprietarysoftwareand$4.0millionfortheenhancementofinternalusesoftwareandthepurchaseofpropertyandequipment.34TableofContentsCashflowusedinfinancingactivitiesfromcontinuingoperations.Infiscal2016,the$0.6millioncashflowsusedinfinancingactivitieswereprimarilycomprisedofther

328、epurchaseofsharestosatisfyemployeetaxwithholdingandtocovertheexercisepriceoftheoptions,andpaymentsoncapitalleaseobligations.Infiscal2015,the$0.4millioncashflowsusedinfinancingactivitieswereprimarilycomprisedoftherepurchaseofsharestosatisfyemployeetaxwithholdingandexercisecostsrelatedtoequityawardsan

329、dpaymentsofcapitalleaseobligations.Infiscal2014,the$0.9millioncashflowsusedinfinancingactivitieswereprimarilycomprisedoftherepurchaseofsharestosatisfyemployeetaxwithholdingandexercisecostsrelatedtoequityawardsandpaymentsofcapitalleaseobligations.InvestmentsInvestmentsinCorporateOwnedLifeInsurancePol

330、iciesAgilysysinvestsincorporateownedlifeinsurancepolicies.Certainofthesecorporateownedlifeinsurancepoliciesareendorsementsplitdollarlifeinsurancearrangements.Weenteredintoanoncancelableseparateagreementwitheachoftheformerexecutivescoveredbythesearrangementswherebywemustmaintainthelifeinsurancepolicy

331、forthespecifiedamountandsplitaportionofthepolicybenefitswiththeformerexecutivesdesignatedbeneficiary.Ourinvestmentincorporateownedlifeinsurancepolicieswasrecordedattheircashsurrendervalue,whichapproximatesfairvalue,atthebalancesheetdate.Duringfiscal2016,werecorded$2.0millionrelatedtotheexpecteddeath

332、benefitduetousonredemptionoftwoofthesepolicieswithinOthercurrentassetsintheConsolidatedBalanceSheets.Theexpectedsplitportionduetheexecutivesdesignatedbeneficiaryof$0.2millionwasrecordedwithinOthercurrentliabilitiesintheConsolidatedBalanceSheets.Thecashsurrendervalueof$0.8millionfortheremainingpolici

333、eswereheldin“Othernoncurrentassets”atthebalancesheetdate.Thepresentvalueoffutureproceedsowedtothoseexecutivesdesignatedbeneficiaryof$0.1million,whichapproximatesfairvalue,wererecordedwithinOthernoncurrentliabilitiesintheConsolidatedBalanceSheetsatthebalancesheetdate.OffBalanceSheetArrangementsWehavenotenteredintoanyoffbalancesheetarrangementsthathavehadorarereasonablylikelytohaveacurrentorfutureef