Key points from earnings conference call:
1. ASPT will be rolling out their CRM Portal product for general availability "within three weeks" - that means the first week of August. The CRM Portal product will interface with Nortel, Lucent, and ASPT switches.
2. Their new customer wins this quarter (I missed the complete list) include Safeway, VodaPhone, Peachtree Software, etc.
3. New partnerships with MSFT, PeopleSoft, Vantive, as we know already.
4. JC is emphatically happy with ASPT's ability to attract quality executives/employees. Employee turnover is within normal bounds for a Silicon Valley company and some of that turnover was attributed to the need to scale the company up for huge growth. He said recent executive hirees are accustomed to working in fast-paced companies with 50-100% growth rates (HINT: maybe that's why ASPT hired them?...)
During the recent transition, I would also imagine, they needed to eliminate some hardware engineers and hire software engineers, which explains some turnover.
5. DSO's went down from 87 in Q1 to 74 in Q2. An excellent indicator. JC did indicate that normal DSO's for an enterprise software company is in 80's plus or minus" and that ASPT will probably hover around that level once the transformation to a software company is complete.
6. Some questions about Y2000 sales slowdown were mitigated by JC's comments that they have good visibility about Q3 going forward and while they are cautious about Y2000 slowdown in sales, he expects moderate revenue growth in the next few quarters. They are striving to have sequential revenue growth during this time (as they were able to do from Q1 to Q2.
7. JC was in fine form and I especially liked Beatriz's initial dialogue. They both presented a very compelling argument for ASPT's future prospects: Essentially no competition as of this time - GCTI notwithstanding, HUGE market potential, more partnerships forthcoming, etc.
8. JC also mentioned that the ASPT User Group meeting was well-attended by about 1,000 customers and partners. The response to the new company direction was excellent. Current customers understand the need for ASPT's CRM Portal product and indicate that it fits into their business model.
In summary, the key is in the conference call, not the earnings press releases. If all goes according to plan, ASPT should be trading somewhere between $25-$100 per share in a year from now. |
