Hallelujah
Ross Systems Reports Profitable Third Quarter
ATLANTA, April 25 /PRNewswire/ -- Ross Systems, Inc. (Nasdaq: ROSS), a leading provider of world class enterprise management software and e-business solutions for mid-market process manufacturers, today announced financial results for the third quarter of its Fiscal Year 2001, ended March 31, 2001.
Revenues for the quarter of $11.5 million declined from $18.5 million in the same period of the prior year. Operating expenses for the quarter of $10.9 declined from $22.0 million in the prior year. The net profit for the quarter of $2.8 million or $0.11 per diluted share, including a $2.4 million extraordinary gain, compares to a net loss of $3.9 million or $0.16 per basic share in the prior year, which included a $1.1 million non-recurring charge. The results reflect operating earnings of $0.6 million, which improved over the sequential quarter.
For the nine-month period ended March 31, 2001, the company reported that Revenues declined to $38.2 million from $63.6 million in the same period of the prior year, while Operating Expenses declined to $41.1 million from $66.8 million in the prior year. The Net Loss for the nine-month period ended March 31, 2001 was $1.2 million or $0.05 per share, including non-recurring cost of $0.8 million as well as the extraordinary gain of $2.4 million, compared to a loss of $4.6 million or $0.20 per share, including non-recurring cost of $1.1 million.
Software License Revenues increased 24% from the sequential quarter, while the cash position increased by $3.5 million form the prior quarter to $4.2 million. Debt continued to decline, with Short-term debt of $5.3 million compared to $10.1 million at the end of Fiscal Year 2000 and long-term debt of $1.2 million compared to $2.6 million at the end of Fiscal Year 2000.
The Company reported positive cash flow for both the quarter and nine- month period. Earnings Before Interest, Taxes, Depreciation and Amortization, (EBITDA) for the quarter of $3.9 million or $0.15 per share, increased from a negative EBITDA of $4.4 million or $0.19 per share in the prior year same quarter. EBITDA for the nine-month period of $2.2 million or $0.9 per share, increased from a negative EBITDA of $5.2 million or $0.22 per share in the prior year same period.
"The results for the quarter reflect the results of the Company's aggressive actions to return the Company to profitability by focusing on its key markets and superior product functionality, while removing excess costs associated with activities in secondary markets," said Pat Tinley, the Company's CEO. "Not only have we experienced two quarters of profitability but the sequential growth in software license fees is indicative of our activities to resume growth in markets where our products provide compelling economic advantage."
"The sale of the Company's HR/Payroll product line was a win/win for both Ross and NOW Solutions, the acquirer," reported Bob Webster, the Company's EVP. "The transaction gives Ross the right to continue the sale of this excellent product to its Process Manufacturing market, while NOW Solutions, led by the former Ross HR/Payroll management group, intends to expand the market for this very competitive internet-enabled product. In addition, the taxable gain of approximately $4.8 million is to a great extent sheltered by the Company's NOL and provides a strong cash infusion to the Company."
The Company experienced improved sales in its core process manufacturing business in both North America and Europe:
* Multi-national / Multi-site sales increased with the German-based
Kluber Group selecting Ross for three locations, Quebecor, the world's
largest printing company, expanding its license to over 500 users in
Europe and Kerry Ingredients, expanding its license to the Asia /
Pacific area.
* New and existing customers who continued to invest in Ross' solutions
included: Cambrex, Centre Hospitalari, Centre Telecomunicacions,
Cheshire Health Authority, Chesterfield Royal Hospital, Colormatrix,
Diamond Products, East and North Herts, Frank Calandra, Generics, Grupo
Bagues-Masriera, HBOC Essex, Isofix, Metropolitan Washington Airport
Authority, Naipes Heraclio Fournier, Pittsburgh Corning, Recyg, Sumi- Agro, Stryker Biotech and Valenciana De Aluminio.
The Company's European operations continued at profitable levels and are at their highest level of profitability in over five years. This validates the Company's strategy of direct selling in select European countries and utilizing distribution partners in the rest of Europe.
Product Development achieved success in several important areas:
* The Company's family of e-business products continued to gain
acceptance in the marketplace. iRennaisance.connect, the Company's
XML-based web and back-office integration tool began volume shipments.
* The latest release of Gembase, the Company's highly regarded
application development tool provides enhanced performance on
Microsoft's SQL Server database. This allows large customers a choice
to effectively deploy on either the SQL Server or Oracle database.
"We are pleased with our continued progress in transforming our business to a more focused provider of enterprise management software and e-business solutions for mid-market process manufacturers," said Rod Jones, the Company's President. "Activity levels in both North America and Europe are returning to more normal levels as the Y2K slowdown in our industry recedes. As a result, our sales force is experiencing not only higher levels of activity, but accelerating sales cycle times. We expect that the combination of our improved financial performance and world class process manufacturing solutions will result in a significant ramp up of customer decisions for Ross." |
