Ross Systems' First Quarter Profit Report; License Growth Drives the Fourth Consecutive Quarter of Positive Earnings
ATLANTA, Nov. 1 /PRNewswire/ -- Ross Systems, Inc. (Nasdaq: ROSS), a leading provider of world-class enterprise management software and e-business solutions for mid-market process manufacturers, announced a profit of $0.4 million or $0.16 per diluted share for its first fiscal quarter, which ended September 30, 2001. The results were in line with preliminary estimates and represent a $4.6 million improvement over the prior year's same quarter.
Revenues for the quarter at $11.2 million declined from $14.2 million in the prior year's same quarter. The revenue decrease was primarily due to the sale of the company's HR/Payroll product on February 28, 2001, in addition to the elimination of low margin third party products and services. The net profit for the quarter of $0.16 per share, compared to a net loss of $4.2 million or $1.74 per share in the prior year's same quarter. EBITDA of $1.8 million for the quarter improved over negative EBITDA of $4.4 million in the prior year's same quarter.
Revenue for the LTM (last twelve months) was $46.5 million. Operating earnings for the same period were $2.8 million while net earnings for the same period were $3.8 million. EBITDA for the LTM was $9.3 million. Excluding non- recurring costs and a gain on the sale of assets, the LTM EBITDA was $7.7 million or $2.91 per share.
Software license revenue this quarter increased 32% from the previous year's same quarter and 12% from the sequential quarter. Consulting services revenue this quarter declined 44% from the previous year's same quarter and 4% from the sequential quarter. Maintenance revenue this quarter declined 23% from the previous year's same quarter and 6% from the sequential quarter. These consulting services and maintenance reductions were primarily due to the sale of the HR Payroll product line as well as rationalization of distribution channels in Europe and reductions in low-margin product and services. These declines were more than offset by the Company's successful profit improvement programs. As previously reported, the Company sold its HR/Payroll product line but retained the right to distribute the HR/Payroll product. This permits the company to focus its resources on its main market verticals while continuing to provide the same rich product function to its customers as a distributor of the HR/Payroll product.
Net cash of $2.8 million this quarter increased $1.7 million over the prior year's same quarter and declined $2.9 million from the sequential quarter. Operating cash flow declined during the period primarily due to reductions in accounts payable. Long-term debt was previously retired and declined from $1.8 million in the prior year's same quarter. Deferred revenues this quarter declined to $11.0 million from $14.7 million in the prior year and reflects the sale of the company's HR/Payroll product. Accounts receivable, at $10.4 million, declined from $15.4 million in the prior year and turnover increased to 77 days from 75 days in the prior year's same quarter.
Ross significantly increased its international business during the quarter with wins across Europe and Asia. Some of the European organizations selecting Ross include Grupo Elior, Naipes Heraclio Fournier, Frigorifics del Ter, Delta Tecnic and Torrecid. Ross' Japanese distributor, System Plaza contributed with wins at Mitsui Oil and Gas and Lion Corporation, one of Japan's largest consumer goods manufacturers. "We are very pleased with the growth and performance of our overseas operations," said Pat Tinley, Chairman and CEO. "We have seen business come from a variety of markets and a good volume of deals." Mr. Tinley added, "This is the fourth consecutive quarter of profitability for Ross; an achievement that our management team is especially proud of."
The company will hold an earnings conference call on Friday, November 2 at 9:00 AM EST to discuss the results for the quarter. Please contact Christine Wienand at 678/259-8651, for the call in number and passcode.
About Ross Systems
Ross Systems Inc. founded in 1972, supplies leading enterprise solutions software designed for process manufacturing companies. The Company offers both the award-winning iRenaissance enterprise resource planning (ERP II) software package, as well as integrated e-business solutions for food, beverage, specialty chemical, biotech/pharmaceutical, paper and metals manufacturers. The Ross Systems family of solutions includes a broad range of applications for advanced planning, supply-chain management (SCM), materials management, financials, manufacturing, maintenance management, transportation management and human resources/payroll. Ross Systems' e-business product family includes digital marketplace applications for Collaboration, Customer Relationship Management (CRM), Sales, Trading Exchanges, Procurement and Employee Services. iRenaissance application modules are renowned for their deep and rich functional fit as well as their short implementation time and cost-effective return on investment.
More than 3,000 companies around the world use Ross Systems solutions on a wide range of popular databases, including Oracle and Microsoft, as well as operating systems including NT and UNIX. Ross Systems has more than 25 offices around the world to serve its customers. Ross Systems Inc., Two Concourse Parkway, Suite 800, Atlanta, Ga. 30328, 770-351-9600, 1-877-ROSS-INC rossinc.com .
STATEMENTS IN THIS ANNOUNCEMENT WHICH EXPRESS THAT THE COMPANY "BELIEVES," "ANTICIPATES," "EXPECTS," "PLANS TO..." OR "SHOULD BEGIN TO..." AS WELL AS OTHER STATEMENTS WHICH ARE NOT HISTORICAL FACT, ARE FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. ACTUAL EVENTS OR RESULTS MAY DIFFER MATERIALLY AS A RESULT OF RISKS AND UNCERTAINTIES, INCLUDING QUARTERLY FLUCTUATION OF SOFTWARE PRODUCT LICENSE REVENUE, WEAKENING OF CUSTOMER DEMAND FOR ENTERPRISE SYSTEMS, THE COMPANY'S MAINTENANCE OF A MINIMAL BACKLOG, THE UNCERTAINTY OF DEMAND FOR NEW PRODUCT OFFERINGS AND OTHER RISKS AND UNCERTAINTIES DESCRIBED IN REPORTS FILED BY THE COMPANY WITH THE SEC, INCLUDING THE ANNUAL REPORT ON FORM 10-K FILED FOR THE YEAR ENDED JUNE 30, 2001.
iRenaissance and GEMBASE are registered trademarks of Ross Systems, Inc. Throughout this release, software and hardware products are mentioned by name. In most, if not all, cases, the companies that manufacture the products claim these product names as trademarks. It is not our intention to claim these names or trademarks as our own.
ROSS SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share related data)
Sept 30 June 30
2001 2001
(unaudited) (audited)
ASSETS
Current assets:
Cash and cash equivalents $2,770 $5,716
Accounts receivable, less
allowance
for doubtful accounts and
returns 10,443 10,128
Prepaids and other current assets 1,821 1,874
Total current assets 15,034 17,718
Property and equipment 1,519 1,694
Computer software costs 27,165 27,918
Other assets 3,105 3,132
Total assets $46,823 $50,462
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current installments of debt $4,203 $4,522
Accounts payable 3,279 4,920
Accrued expenses 4,286 4,870
Income taxes payable 367 335
Deferred revenues 11,003 12,711
Total current liabilities 23,138 27,358
Shareholders' equity:
Common stock 26 26
Preferred Stock 2,000 2,000
Additional paid-in capital 87,019 86,977
Accumulated deficit (63,462) (63,876)
Accumulated comprehensive income
(deficit) (1,898) (2,023)
Total shareholders' equity 23,685 23,104
Total liabilities and
shareholders' equity $46,823 $50,462
ROSS SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three months ended
September 30,
2001 2000
Revenues:
Software product licenses $3,180 $2,417
Consulting and other services 2,763 4,967
Maintenance 5,222 6,768
Total revenues 11,165 14,152
Operating expenses:
Costs of software product licenses 396 483
Costs of consulting,
maintenance and other services 2,057 6,518
Sales and marketing 3,437 5,043
Product development 2,757 3,045
General and administrative 1,469 1,537
Provision for uncollectible
accounts 285 552
Amortization of other assets 0 225
Non-recurring costs --- 790
Total operating expenses 10,401 18,193
Operating earnings (loss) 764 (4,041)
Other expenses, net (162) (337)
Income (Loss) before extraordinary
item 602 (4,378)
Income tax expense (benefit) 188 (183)
Net earnings (loss) $414 $(4,195)
Net earnings loss per share
Basic $0.16 $(1.74)
Diluted $0.16 $(1.74)
Shares used in per share computation -
diluted
Basic 2,592 2,412
Diluted 2,626 2,412
ROSS SYSTEMS, INC. AND SUBSIDIARIES
SELECTED UNAUDITED QUARTERLY INFORMATION
(In thousands, except for per share data)
Rolling
12 Month
Total Quarter Ended
Sept. 30 June 30, March 31, Dec. 31,
2001 2001 2001 2000
Total revenues $46,511 $11,165 $11,254 $11,494 $12,598
Total operating expenses $43,735 10,401 10,383 $10,858 12,093
Operating earnings $2,776 764 871 636 505
Net earnings $3,767 $414 $399 $2,787 $167
Net earnings per common share
- diluted $1.43 $0.16 $0.15 $1.09 $0.07
Common and common equivalent
shares used
in computing diluted
earnings per share 2,626 2,626 2,662 2,565 2,334
EBITDA $9,280 $1,772 $1,742 $3,919 $1,848
Cash Earnings $7,899 $1,422 $1,270 $3,697 $1,510
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SOURCE Ross Systems, Inc.
CO: Ross Systems, Inc.
ST: Georgia
IN: CPR MLM STW
SU: ERN CCA
11/01/2001 12:50 EST prnewswire.com |
