MRO Software Reports First Quarter Results; MAXIMO License Revenues Increase 21 Percent Year Over Year

CIMdata PLM Industry Summary Online Archive

20 January 2005

Financial News

MRO Software Reports First Quarter Results; MAXIMO License Revenues Increase 21 Percent Year Over Year

MRO Software, Inc., a provider of strategic asset management solutions, announced results for the Company's first quarter of fiscal 2005 ended December 31, 2004.

Total revenues for the first quarter were $47.4 million compared with $44.9 million for the first quarter last year, an increase of 6 percent. On a GAAP basis, the Company reported net income for the first quarter of $3.2 million or $0.12 per diluted share, compared with net income of $1.8 million or $0.07 per diluted share for the same quarter of last year, an increase of 78 percent.

Pro forma net income for the first quarter was $3.6 million, or $0.14 per diluted share compared with pro forma net income of $2.4 million, or $0.10 per diluted share for the same quarter last year, an increase in EPS of 40 percent. Pro forma results are adjusted for the amortization of acquired technology and other intangibles and their related tax effects.

Revenues from software license sales for the first quarter were $14.8 million, compared with $12.2 million for the same quarter last year, an increase of 21 percent. Support and services revenues were $32.5 million for the first quarter, compared with $32.7 million for the same quarter last year, a decrease of 1 percent.

During the first quarter, the Company sold 243 software licenses. Customers across a range of industries and geographies purchased MRO Software products during the quarter including: Archer Daniels Midland, Arizona Public Service Co., Atlantic Copper, BP International Ltd, BAA, Caritas Health Group, CB Richard Ellis, Clark County School District, DaimlerChrysler AG, Dongfeng Cummins Engine Co., Florida Airport Council, Fortum Power & Heat, GE Healthcare, Genesis Power Ltd., Independence Air, INI Steel, Johnson & Johnson Spa Italy, Konica Minolta Opto, Inc., LaFarge Cement UK, Mohegan Sun Casino, NAVSEA Headquarters, Scottish and Southern Energy, Taylor Woodrow Developments Ltd., Texas Municipal Power Agency, US Airforce, Edwards AFB and the US Dept. of State.

The balance sheet as of December 31, 2004 contained $114.7 million in cash and marketable securities and no long-term debt. For the first quarter of fiscal 2005, deferred revenue was $29.1 million, and days sales outstanding (DSO) was 68 days.

"The first quarter results showed continued adoption of our industry solutions and provided us with an excellent start to fiscal 2005," said Chip Drapeau, president and CEO, MRO Software. "We increased our penetration in the utilities, transportation and energy sectors, and added a significant customer for facilities management in the retail space. We remain on target for our release of Maximo Enterprise Suite later this quarter, with all development, marketing, service and support plans on schedule."

"The Company continued its solid financial performance this quarter, with increases in software sales, earnings and cash," said Peter Rice, executive vice president and CFO, MRO Software. "As a result of these continued strong results, the Company is well-positioned for the launch of Maximo Enterprise Suite."

The Company reaffirmed its existing guidance for fiscal 2005, and expects software revenues to grow in the range of 10 to 20 percent above fiscal 2004 results. It is anticipated that operating margins will continue to increase. As a result, the Company expects earnings to increase in the range of 15 to 25 percent over fiscal 2004 results on a pro forma basis. Consistent with prior performance, and due to the timing of the release of the Maximo Enterprise Suite, the Company still expects most of the anticipated revenue growth to occur in the second half of the fiscal year. Due to a strong first fiscal quarter, and given its historical quarterly fluctuations, the Company expects revenues for the second quarter of fiscal 2005 to be in the range of $44 to $46 million, GAAP earnings to be in the range of $0.06 to $0.08 per share, and pro forma earnings to be in the range of $0.08 to $0.10 per share.

Expected results on a pro forma basis are adjusted for the amortization of acquired technology and other intangibles and their related tax effects.

The Company will conduct a conference call to discuss the quarter's results on Thursday, January 20, at 4:30 p.m. EST. A digital recording of the call will be available beginning two hours after the call and will be available through January 27, 2005. To access the replay within the U.S. and Canada, dial (800) 642-1687, international callers should dial (706) 645-9291, all participants should use conference ID: 3244777.

A webcast of the call is available at: http://www.mro.com/investor . A transcript of the call will be promptly archived on the Investor Relations portion of the Company's website, and may be found at: http://www.mro.com/investor .

MRO Software is a provider of strategic asset management solutions. The Company's integrated suite of applications optimizes performance, improves productivity and service levels and enables asset-related sourcing and procurement across the entire spectrum of strategic assets. The Company's asset management solutions allow customers to manage the complete lifecycle of strategic assets including: planning, procurement, deployment, tracking, maintenance and retirement. Using MRO Software's solutions customers improve production reliability, labor efficiency, material optimization, software license compliance, lease management, warranty and service management and provisioning across the asset base.

MRO Software is a global company based in Bedford, Mass., with approximately 900 employees, 10,000 customers and more than 260,000 end-users. The Company markets its products through a direct sales organization in combination with a network of international distributors. MRO Software has sales offices throughout North America, Europe, Asia/Pacific and Latin America. Additional information on MRO Software can be found at http://www.mro.com .

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