CIMdata PLM Industry Summary Online Archive
10 June 2004
Financial News
SSA Global Reports Third Quarter Fiscal 2004 Earnings
SSA GlobalT announced financial results for the third quarter ended April 30, 2004.
Total revenue for the third quarter rose to $164.7 million, an increase of 104 percent from $80.8 million in the third quarter of fiscal 2003. Software license revenue was $41.4 million, up 55 percent compared with the third quarter of fiscal 2003. The increase in total revenue and software revenue resulted primarily from the integration of the Baan and EXE product lines. SSA Global acquired Baan and EXE on July 18, 2003 and December 19, 2003, respectively. Software license revenue represented 25 percent of total revenue for the quarter ended April 30, 2004.
Earnings before interest expense, income taxes, depreciation and amortization (EBITDA) for the third quarter was $23.0 million compared to $20.6 million in the prior year quarter. Excluding one-time acquisition integration costs of $6.6 million, EBITDA would have been $29.6 million for the quarter ending April 30, 2004. Net income for the third quarter was $2.1 million compared to $7.9 million in the year ago quarter. Excluding acquisition integration costs, net income would have been $6.2 million for the quarter ended April 30, 2004. As of April 30, 2004, cash and long-term debt were $114.2 million and $226.8 million, respectively. Cash increased by $19.8 million from January 31, 2004 levels.
For the first nine months of fiscal 2004, the company reported $462.4 million in total revenue, an increase of 126 percent from $204.5 million over the comparable period in fiscal year 2003. Software license revenue was $109.4 million, up 70 percent compared to the prior year period. The increase in total revenue and software license revenue was attributable to revenue primarily from strategic acquisitions with the remainder attributable to organic growth.
EBITDA for the nine months ended was $77.1 million compared to $47.5 million in the prior year period. Excluding one-time acquisition integration costs of $14.7 million, EBITDA would have been $91.8 million for the nine months ended April 30, 2004. Net income for the nine months ended April 30, 2004 was $15.7 million compared to $23.1 million in the prior year period. Excluding acquisition integration costs, net income would have been $24.8 million.
During the third quarter, North America delivered 42 percent of total revenue with Europe, Middle East and Africa (EMEA) at 38 percent. The emerging growth markets in Latin America and Asia-Pacific/Japan provided the remaining 20 percent of total revenue.
In the third quarter of fiscal 2004, 546 software license contracts were signed including 25 new SSA Global customers, who purchased core enterprise resource planning (ERP) solutions.
SSA GlobalT is a provider of ERP solutions for manufacturing, services, and public organizations worldwide. In addition to core ERP applications, SSA Global offers a full range of integrated extended solutions including corporate performance management, customer relationship management, product lifecycle management, supply chain management and supplier relationship management. Headquartered in Chicago, SSA Global has 60 locations worldwide and approximately 13,000 customers that represent market-leading companies in over 90 countries use its product offerings. For additional information, visit the SSA Global web site at http://www.ssaglobal.com
SSA GlobalT is the new corporate brand for product lines and subsidiaries of SSA Global Technologies, Inc.
Reasons for Presentation of Non-GAAP Financial Measures
The non-GAAP financial measure presented in the text of this press release, EBITDA, is supplemental financial information to net income to help the reader understand how much of the Company's earnings might be available for debt service (interest and principal payments), and further investments in research and development and acquisitions. We believe EBITDA provides meaningful additional information that enables management to monitor and evaluate our ongoing operating results and trends and provides investors an understanding of operating performance over comparative periods. We also believe EBITDA better reflects the underlying economics of our business and better aligns with the cash flow performance of the Company as measured under GAAP that it does with net income as presented under GAAP, which includes, from time to time, significant non-cash charges, including, but not limited to, amortization expense associated with acquisitions and non-cash stock compensation charges. However, EBITDA is not a measure of performance under GAAP and should not be considered in isolation or as a substitute for net income, cash flows from operations or other income and cash flow statement data prepared in accordance with GAAP, as measures of profitability or liquidity or as indicative of whether cash flows will be sufficient to fund our future cash requirements. Moreover, EBITDA is not a standardized measure and may be calculated in a number of ways. Accordingly, the EBITDA measure provided in this press release might not be comparable to other similarly titled measures provided by other companies. A reconciliation of net income as presented in accordance with GAAP to EBITDA has been provided in the financial statement tables that accompany this press release.
These materials may contain "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Please check SSA Global filings, reports and releases, including SSA Global's registration statement on Form S-1 filed with the Securities and Exchange Commission on June 4, 2004 for further information. SSA Global undertakes no obligation to revise or publicly update these forward-looking statements, whether as a result of new information or otherwise.
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