LOWELL, Mass., & WESTON, Fla.–(BUSINESS WIRE)–UKG (Ultimate Kronos Group), a leading global provider of HCM, payroll, HR service delivery (HRSD), and workforce management solutions, today announced financial results for the second quarter of Fiscal 2021, ending March 31, 2021.
Total revenue for the quarter grew to $798 million, with earnings before interest, tax, depreciation, and amortization (EBITDA) excluding float growing 13% year over year to $206 million. Subscription revenue excluding float grew 12% year over year, attributed to a strong pipeline of new-customer orders — including large enterprises, global multinational organizations, and small and medium-sized businesses across every industry — as well as continued steady increases in longtime customers adding to their UKG product suite.1
“When we became UKG, we promised a growth story as we worked to become one of the world’s greatest people companies with the most innovative HCM and workforce management solutions,” said Aron Ain, chairman and CEO of UKG. “Reflecting on our progress since the merger: UKG hired more than 1,300 people, debuted at #6 on the Fortune and Great Place to Work 100 Best Companies to Work For list, and saw financial results that surpassed our expectations again with 32% growth in bookings year over year, which is amazing.”
“We are exceptionally pleased with our sales momentum, with growth in all categories,” said Chris Todd, president of UKG. “We sold more new business than planned, and the migration of existing customers to our flagship cloud solutions continues to give us opportunities for sales of our full product suite. The result of this strong financial picture is substantial investment in our company, customer experience, and R&D. Positive merger momentum is being felt by our customers, who are reporting a satisfying and supportive partnership, while new customers are achieving transformational results.”
Business Highlights
Hundreds of new and longtime customers around the world placed orders in the second quarter for UKG HR, payroll, talent, workforce management and scheduling, and HRSD, including: a global automotive-technology leader in seating and esystems with more than 70,000 employees — the biggest order ever in Latin America for UKG a 21,000-employee cosmetics and perfume retailer with more than 500 stores across the Americas one of the world’s largest home improvement retailers with hundreds of thousands of employees worldwide one of the largest casino-entertainment operators in the United States with more than 50,000 employees a restaurant holding company with nearly 4,000 franchised or company-operated restaurants worldwide a global bakery manufacturer with more than 170,000 employees one of the largest global mobile-network operators, headquartered in the United Kingdom one of Europe’s largest retailers with more than 250,000 employees globally, headquartered in France In Q2, UKG brought more than 650 customers live on UKG solutions worldwide — including companies based in Africa, Asia, Australia, Central America, Europe, North America, and South America — across a wide variety of industries such as retail, manufacturing, and healthcare. UKG was named a Leader in the Nucleus Research HCM Technology Value Matrix 2021, where the company was positioned with the best functionality in the entire HCM market. UKG received top honors for its products and customer service on influential customer-review sites TrustRadius, G2, and SoftwareReviews. Forrester research demonstrated that an 89% return on investment within just six months is achieved by mid-market enterprises using UKG solutions, according to Forrester’s “The Total Economic Impact of UKG Pro and UKG Dimensions.”2 UKG continues to help all industries digitally transform their organizations, recently announcing that more than 2,500 government agencies rely on UKG solutions to ensure continuity of people operations while creating more meaningful and connected work experiences. UKG ranked #2 on Forbes’ list of America’s Best Large Employers for 2021. UKG scored 100% on the Corporate Equality Index, a top U.S. benchmarking survey and report measuring corporate policies and practices related to lesbian, gay, bisexual, transgender, and queer (LGBTQ) workplace equality, administered by the Human Rights Campaign Foundation, designating UKG as a 2021 Best Place to Work for LGBTQ Equality. “I am thrilled with our success and excited to continue the momentum we’ve experienced with our culture and solutions in the past year,” said Ain. “While it’s been an energizing start in our first year together, we continue to work hard to get better every day. To take UKG where we aspire to be, we must have diverse perspectives, fresh ideas, and a culture of equity and belonging that inspires people to be their best. And that’s why, this month, we welcomed Brian Reaves as our first chief belonging, diversity, and equity officer. Brian will help us continue to build a culture of inclusion that will drive greater innovation, engagement, and business outcomes, which will have a direct impact on helping organizations and their people thrive around the world.”
About UKG
At UKG (Ultimate Kronos Group), our purpose is people. Built from a merger that created one of the largest cloud companies in the world, UKG believes organizations succeed when they focus on their people. As a leading global provider of HCM, payroll, HR service delivery, and workforce management solutions, UKG delivers award-winning Pro, Dimensions, and Ready solutions to help tens of thousands of organizations across geographies and in every industry drive better business outcomes, improve HR effectiveness, streamline the payroll process, and help make work a better, more connected experience for everyone. UKG has 13,000 employees around the globe and is known for an inclusive workplace culture. The company has earned numerous awards for culture, products, and services, including consecutive years on Fortune’s 100 Best Companies to Work For list. To learn more, visit ukg.com.
© 2021 UKG Inc. All rights reserved. For a full list of UKG trademarks, please visit ukg.com/trademarks. All other trademarks, if any, are property of their respective owners. All specifications are subject to change.
Footnote 1: UKG fiscal results are pro forma as though Kronos Incorporated and Ultimate Software were combined for all periods presented. Ultimate Software’s results have also been pro forma to align with the UKG fiscal year calendar, which closes September 30. All financial information within this press release is presented using non-GAAP financial measures and are approximate amounts. UKG believes that non-GAAP measures of financial results provide useful information regarding certain financial and business trends relating to UKG results of operations. Non-GAAP revenue consists of GAAP revenue excluding the effect of the write-down of deferred revenue associated with purchase accounting for certain mergers and acquisitions. EBITDA consists of EBITDA per the definition under the Company’s credit agreement, which excludes items such as: (1) share-based compensation expense for stock options and stock awards in accordance with ASC 718 and compensation expenses related to ordinary dividends; (2) depreciation of property, plant, and equipment; (3) amortization of intangible assets; (4) acquisition-related deferred revenue and prepaid commissions write-downs and expenses including advisory, legal, accounting, acquired employee-related costs, and integration costs, and (5) unusual costs or one-time expenses. For purposes of calculating growth rates, prior years have been restated for acquisitions, dispositions, and pro forma for the combination of Kronos Incorporated and Ultimate Software.
Footnote 2: Forrester Consulting, “The Total Economic Impact Of UKG Pro And UKG Dimensions: Business Benefits And Cost Savings Enabled By UKG Pro And Dimensions,” March 2021.