CIMdata PLM Industry Summary Online Archive
3 March 2010
Financial News
American Software Reports Preliminary Third Quarter of Fiscal Year 2010 Results
American Software, Inc. reported financial results for the third quarter of fiscal year 2010, achieving 36 consecutive quarters of profitability and 26 consecutive quarters of dividend distributions to shareholders.
GAAP net earnings for the quarter ended January 31, 2010 were $1.8 million or $0.07 per fully diluted share, an increase of 138% over the third quarter of fiscal 2009. Adjusted net earnings for the quarter ended January 31, 2010, were $2.0 million or $0.08 per fully diluted share, a 99% increase compared to $1.0 million or $0.04 per fully diluted share for the same period last year. In both periods, adjusted net earnings excluded stock-based compensation expenses and amortization of acquisition-related intangibles. Total revenues for the quarter ended January 31, 2010 were $19.8 million, a decrease of 1% from the third quarter of fiscal 2009. Software license fees for the quarter ended January 31, 2010 were $4.6 million, a decrease of 3% from the third quarter of fiscal 2009. Services and other revenues for the quarter ended January 31, 2010 were basically unchanged from the third quarter of fiscal 2009 at approximately $8.4 million. Maintenance revenues for the quarter ended January 31, 2010 were $6.9 million, a decrease of 1% from the third quarter of fiscal 2009. Operating earnings for the quarter ended January 31, 2010 were $2.8 million, an increase of 30% from the third quarter of fiscal 2009.
GAAP net earnings were approximately $4.4 million or $0.17 per fully diluted share for the nine months ended January 31, 2010, a 136% increase compared to $1.9 million or $0.07 per fully diluted share for the same period last year. Adjusted net earnings year to date as of January 31, 2010, which excludes stock-based compensation expenses, amortization of acquisition-related intangibles, stock-based compensation related to the Logility tender offer and expenses related to the Logility tender offer, were $5.6 million or $0.22 per fully diluted share, compared to $2.4 million or $0.09 per fully diluted share for the same period last year, which excluded stock-based compensation expenses and amortization of acquisition-related intangibles. Total revenues for the nine months ended January 31, 2010 were $56.4 million, a decrease of 5% from the comparable period last year. Software license fees for the nine-month period were $12.3 million, representing a 9% increase compared to the same period last year. Services and other revenues were $23.4 million, a 12% decrease compared to the same period last year. Maintenance revenues were $20.6 million, a 2% decrease from the same period last year. For the nine months ended January 31, 2010, the Company reported operating earnings of approximately $6.0 million, a 10% increase from the same period last year.
The Company is including adjusted net earnings and adjusted net earnings per share in the summary financial information provided with this press release as supplemental information relating to its operating results. This financial information is not in accordance with, or an alternative for, GAAP and may be different from non-GAAP net earnings and non-GAAP per share measures used by other companies. The Company believes that this presentation of adjusted net earnings and adjusted net earnings per share provides useful information to investors regarding certain additional financial and business trends relating to its financial condition and results of operations.
The overall financial condition of the Company remains strong, with no debt and with cash and investments of approximately $53.8 million as of January 31, 2010. This is approximately a $17.3 million decrease when compared to April 30, 2009 and was primarily due to the payment of $12.8 million for the shares of Logility not owned by American Software plus other expenses associated with the Logility tender offer and payment of approximately $6.8 million in dividends year to date. During the third quarter, the Company repurchased 40,400 shares of its common stock for approximately $248,000 under its authorized stock repurchase program.
"The Company delivered its 36th consecutive quarter of profitability and increased net earnings by 138% over the same period last year," stated James C. Edenfield, president and CEO of American Software. "Despite the general market conditions and global economic uncertainty that are impacting capital expenditures, we added 22 new companies to our global customer roster and signed license agreements with customers in 9 countries during the quarter," continued Edenfield. "Our focus is on helping companies leverage their supply chains to create operational, market and brand advantages that drive results in both good and challenging economic environments."
"Our sustained profitability has continued to allow the Company to provide a tangible benefit to our shareholders with a quarterly dividend as well as a share repurchase program," stated Edenfield. "On February 16, 2010 our Board of Directors authorized the Company's next quarterly dividend of $0.09 per common share, which is payable on May 28, 2010 to shareholders of record at the close of business on May 14, 2010. This will mark our 27th consecutive quarter of dividend distributions to shareholders."
Additional highlights for the third quarter of fiscal year 2010 include:
Customers:
•Notable new and existing customers placing orders with the Company in the third quarter include: a.b.m. Canada, Clif Bar & Company, Color Image Apparel, Entergy Service, Evergreen Packaging, FMC Corporation, Handgards, L'Koral, Mohawk Carpet, Nice-Pak Products, PT Linc Logistics, Shiseido Americas, Sportscraft, Summer Infant, Terex Telelect, and Thomas Built Buses.
•During the quarter, software license agreements were signed with customers located in 9 countries including: Australia, Belgium, Cameroon, Canada, China, Ireland, Indonesia, the United Kingdom and the United States, as well as the commonwealth of Puerto Rico.
•Demand Management Inc., a wholly-owned subsidiary of Logility, announced that Certified Transmission, a leading remanufacturer of automotive transmissions, selected Demand Solutions Advanced Planning and Scheduling to increase profits through optimization of Certified Transmission's production scheduling.
•NGC® (New Generation Computing®), a wholly-owned subsidiary of the Company, spoke on the NRF Big Ideas Sessions, "Retail 2010 IT Forecast," sponsored by ARTS (the Association for Retail Technology Standards). In addition to NGC, the panel included executives from ARTS, RIS News, IHL Group, BJ's Wholesale Club, Burlington Coat Factory. NGC contributed key perspectives on product lifecycle management (PLM), global sourcing and CPSIA software priorities for retailers, brand owners and consumer products companies.
•NGC announced that Stony Apparel, a branded and private label manufacturer of girls and junior apparel for some of the nation's largest retailers, is implementing NGC's Global Enterprise software suite, including e-PLM® for product lifecycle management, e-SPS® for global sourcing & visibility, and RedHorse® ERP for EDI, customer order processing, inventory management, shipping and financial accounting. With NGC, Stony Apparel selected a comprehensive solution to support business processes including design, customer service, production and shipping for the hundreds of styles produced each month. Stony Apparel realized benefits in the early stages of the solution rollout including the ability to meet a complex EDI requirement from a Tier 1 retailer.
Products and Technology:
•NGC introduced ARMS (Analytics and Report Management Software), a decision support and information management tool that brings new power to custom reporting, data mining and analytics for NGC's e-PLM, e-SPS, RedHorse and other global enterprise software solutions. ARMS simplifies and centralizes access to the vast amounts of information contained in NGC software solutions. Custom reports and analytic templates that would otherwise take hours to structure can be created and shared in minutes to deliver powerful business insight while saving time and money.
•NGC joined the Association for Retail Technology Standards (ARTS) committee to develop retail PLM standards. ARTS is the division of the National Retail Federation (NRF) that is dedicated to creating open technology standards through collaboration between retailers and technology vendors. As a member of the PLM committee, NGC will work alongside retailers and technology vendors to develop an XML scheme representation for the product development lifecycle. When completed, the ARTS PLM standards will help drive more efficient product development lifecycles, improve communications between retailers and their trading partners, and improve data management. The scope of work includes product quality and testing; product construction; merchandise calendars and hierarchy; color and material management; and labeling, packaging and handling.
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