LOWELL, Mass.-- Kronos Incorporated today announced financial results, company advancements, and customer successes for Fiscal 2017. Kronos recognized revenue for the year was $1.3 billion. Earnings before interest, tax, depreciation, and amortization (EBITDA) was $390 million1, up nine percent compared to Fiscal 2016.
“What another tremendously exciting year at Kronos. Kronites from every corner of the world continue to amaze and inspire me each and every day,” said Aron Ain, Kronos chief executive officer. “As we enter our 40th year in business, it’s remarkable and near-unprecedented that we remained profitable year-over-year with strong EBITDA growth while aggressively and successfully transitioning the business into a pure SaaS provider. The next phase of Kronos’ history is upon us: Our continued innovations in workforce management and human capital management, commitment to customers and their vertical-specific needs, and exceptionally talented and engaged team of Kronites will take us to our next major milestone as a $2 billion global cloud company.”Kronos Cloud, Shift to SaaS Drive the Business
Kronos, having successfully transitioned to a pure software-as-a-service (SaaS) provider, again delivered exceptional growth in the Kronos Cloud and ended the year with very strong subscription growth in the fourth quarter. Kronos’ annualized run-rate business is now $863 million of annual recurring revenue.
- In Fiscal 2017 alone, Kronos added 4,500 customers to the Kronos Cloud with a mix of net-new deals and customers that migrated from their on-premise instances to the cloud, resulting in more than 24,000 organizations around the globe leveraging a Kronos Cloud solution.
- In the year, 87 percent of new customer bookings came from an array of Kronos Cloud offerings.
- The pace of conversions of long-standing, on-premise customers migrating to SaaS continues to rapidly increase with another record year, as hundreds of existing Kronos on-premise customers migrated to SaaS.
- Significant new $1 million+ Kronos Cloud SaaS deployments included: a world-leading entertainment resort based in the U.S. with more than 70,000 employees; one of the largest pharmaceutical companies in the world and a Fortune 500 company headquartered in the U.S.; a global provider of mission-critical equipment for vital applications in data centers, communications networks, and commercial and industrial environments employing tens of thousands of workers in five countries; one of the world’s largest auto manufacturers; a nationally recognized U.S. integrated healthcare system; a Fortune 1000 diversified industrial company that provides products and services to the energy, chemical, agriculture, transportation, and construction sectors.
Workforce Ready, which combines the power of workforce management, human resources, talent acquisition, talent management, and payroll into one unified cloud platform, had a record year as the company continues to develop and scale its full-suite HCM solution.
- Subscription revenue for the Workforce Ready suite increased 51 percent in Fiscal 2017 as customers large and small increasingly opt for a full-suite solution.
- Significant new Workforce Ready innovations, milestones, and alliances in the year included:
- Two add-on modules – Workforce Ready Talent Acquisition and Workforce Ready Performance Management – further help organizations attract, develop, and retain an engaged workforce.
- Workforce Ready Scheduler optimized scheduling engine automatically assigns employees to shifts while new self-service tools for shift swaps and open shifts help save time for managers and ensure appropriate coverage.
- Kronos celebrated five years of explosive partner network growth and small business success by transforming Kronos SaaShr – which has proven to be the most successful acquisition in company history – into the Kronos Workforce Ready Partner Network.
- Kronos and analytic.li introduced a new suite of analytics dashboards for Workforce Ready to show the impact that workforce talent has on business performance.
- Kronos acquired Datamatics Management Services, Inc. to further extend its comprehensive HCM suite to additional customers.
- Leading analyst firms Gartner, Inc. and International Data Corporation (IDC) both ranked Kronos as a top HCM vendor worldwide based on revenue while HfS Research ranked Kronos a “High Performer” in its Blueprint Guide for Predictive Capabilities in HCM.
- Significant new HCM deals included: one of the world’s largest online retailers of pet supplies; a Roman Catholic diocese located in the eastern U.S.; a premier casino resort in the U.S.; and a global organization for youth development with several locations in northeast Florida.
Kronos strengthened its position as the worldwide leader in workforce management with all-time highs for product bookings in most key vertical segments and geographic regions while the company deepened industry expertise worldwide.
- Kronos had a record year overall for $1 million+ wins, with new fourth quarter customer deals including: one of the world’s largest online retailers; a major package shipping and delivery company serving the U.S. and Canada; a public school district in the U.S. serving more than 40,000 students; and one of the largest law enforcement agencies in the U.S.
- Kronos again claimed the top ranking in Ventana Research’s Value Index for Workforce Management, underscoring its continued focus on innovation.
- Building on the continued success of its global partner infrastructure network, Kronos announced a new cloud collaboration relationship with Oracle HCM.
- Kronos and NGA Human Resources formed a strategic global alliance to simplify the delivery of workforce management, HR, and payroll services to organizations with complex global workforces.
- Specifically for the healthcare industry, Kronos formed a strategic relationship with Press Ganey to facilitate collaboration on behalf of joint customers to participate in research and analysis.
- Deepening its expertise in and demonstrating its commitment to the financial services market, Kronos acquired Financial Management Solutions Inc. (FMSI).
- To add to its significant presence and expertise in the global casino resort industry, Kronos acquired Digital Instinct and its Virtual Roster Product.
Kronos invested more than $182 million on R&D in Fiscal 2017 to deliver next-generation enhancements, features, and functionality.
- New enhancements in the latest version of Workforce TeleStaff further empower first responders to succeed in their mission-critical jobs.
- The latest version of the Kronos InTouch delivers the most powerful and responsive model of the time clock series and drove yet another record year for hardware bookings, up 24 percent from last year's previous record.
- An enhanced version of the Kronos EZCall automated physician scheduling solution helps healthcare organizations better align physician and clinician schedules with patient care needs.
- The Kronos Paragon implementation methodology is now supported in more than 50 countries.
- For the 17th consecutive year, Omega Management Group Corp. presented Kronos with the NorthFace ScoreBoard AwardSM for delivering exceptional customer service supporting HCM and workforce management solutions.
Kronos has grown to more than 5,300 employees and, with employee engagement at an all-time high of 87 percent, the company earned more than 20 employer of choice accolades worldwide, including:
- CEO Aron Ain was named to Glassdoor’s Highest Rated CEOs list for the second consecutive year in the same month he was honored with the inaugural Ray Stata Leadership and Innovation Award.
- Kronos Chief People Officer David Almeda was named CHRO of the Year by HRO Today.
- Kronos was named one of the 2017 Best Workplaces for Giving Back by Fortune magazine and a Best Workplace for Women.
- Kronos was certified as a great workplace by independent analysts at Great Place to Work® with 96 percent of Kronites saying they have great pride in the company.
- Forbes named Kronos a Best Employer for the 3rd consecutive year.
- The Globe and Mail ranked Kronos the 8th best place to work in all of Canada while the Montreal Gazette honored the company as part of the annual Canada’s Top 100 Employers competition.
- Great Place to Work India again listed Kronos as one of the 50 Best Technology Companies.
- Kronos was named one of the top 20 Best Places to Work in all of Australia.
- The Boston Globe again named Kronos a Top Place to Work in Mass., where the company recently opened a new 500,000 square foot, state-of-the-art global headquarters in Lowell.
- Boston Business Journal listed Kronos as a top-three Best Place to Work for the 3rd year in-a-row and also again named the company one of the Healthiest Employers.
- Kronos celebrated the 5th anniversary of opening its Indianapolis Technology Center of Excellence, a global hub for professional services and software implementation.
In the fourth quarter of Fiscal 2017, Kronos signed agreements with organizations around the world, including: Air Medical Group Holdings Inc., the largest independent provider of emergency air medical services in the world; Arc, a world leader in tableware producing high quality, innovative collections; Arkansas Department of Transportation, the department responsible for managing and maintaining the transportation system in the state of Arkansas; City of Albuquerque, the most populous city in New Mexico; Columbia Public Schools, a public school district in Missouri serving more than 18,000 students in 32 different schools; Community Hospital Anderson, an acute care hospital in Indiana and the only locally owned and operated hospital in Madison County; DAA, which owns and operates Dublin Airport and Cork Airport in Ireland; Inova, a leader in personalized health serving the Washington, D.C. metro area; Masco Corporation, a global leader in the design, manufacture, and distribution of branded home improvement and building products; Medline Industries, the largest privately held manufacturer and distributor of medical supplies, based in the U.S., with offices in 20 countries; MultiCare Health System, a non-profit healthcare organization and the largest community-based, locally governed health care system in the state of Washington; Rogers Corporation, a technology leader in highly engineered materials that power, protect, and connect our world; Smithfield Foods, a leading consumer packaged meats company and the world’s largest pork processor and hog producer; and Warburtons, the largest bakery brand in the U.K.
Supporting Resources
- Connect with Kronos via Facebook, Twitter, LinkedIn, Instagram, and YouTube.
- Take a look at the lighter side of the workforce in our Time Well Spent cartoons.
- Follow The Workforce Institute at Kronos for insight, research, blogs, and podcasts on how organizations can manage today’s modern workforce to drive engagement and performance.
- Learn about the Kronos WorkInspired culture and check out Kronos job openings.
Kronos is a leading provider of workforce management and human capital management cloud solutions. Kronos industry-centric workforce applications are purpose-built for businesses, healthcare providers, educational institutions, and government agencies of all sizes. Tens of thousands of organizations — including half of the Fortune 1000® — and more than 40 million people in over 100 countries use Kronos every day. Visit www.kronos.com. Kronos: Workforce Innovation That Works.
© 2017 Kronos Incorporated. All rights reserved. Kronos, the Kronos logo, Workforce Central, and Workforce Ready are registered trademarks and Workforce Innovation That Works is a trademark of Kronos Incorporated or a related company. See a complete list of Kronos trademarks. All other trademarks, if any, are property of their respective owners.
Footnote 1: All financial information within this press release is presented using non-GAAP financial measures. Kronos believes that non-GAAP measures of financial results provide useful information regarding certain financial and business trends relating to Kronos’ 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 acquisitions and includes timing adjustments related to international product deliveries which management includes when evaluating operating results. Product bookings represent gross product value of product orders and the product equivalent value of SaaS orders. EBITDA consists of GAAP income from operations excluding: (1) share-based compensation expense for stock options and stock awards in accordance with ASC 718 and compensation expenses related to ordinary dividends; (2) amortization of capitalized software development costs; (3) depreciation of property, plant, and equipment; (4) amortization of acquired intangible assets; (5) acquisition-related deferred revenue write-downs and expenses including advisory, legal, accounting, acquired employee-related costs, and integration costs; and (6) unusual costs related to relocation of corporate HQ and certain consulting and financing-related expenses that are excluded from the definition of EBITDA under the terms of the company’s Credit Agreement.
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