Software Firm Preaches Gospel Of Location
BY DAVID ISAAC
Tuesday, March 1, 2005
INVESTOR'S BUSINESS DAILY
In universities, geographers bemoan the fact they're often asked to justify funding for what's perceived as an antiquated discipline.
It might help them to mention MapInfo, (MAPS) which makes software designed to help clients find the right locations for new business ventures.
"We think of ourselves as sort of a location intelligent company," Chief Executive Mark Cattini said. "(Location) is often the missing link in business intelligence in general."
As awareness grows about MapInfo, so do its sales. A metric the company uses to help investors understand its business is transactions of $50,000 and over.
In the fiscal first quarter ended in December, MapInfo reported 102 such transactions totaling $10 million in revenue. This compares with 82 transactions totaling $8.4 million in the year-ago quarter.
"That barometer has been strengthening for some time," said analyst Steven Gear of Westminster Securities, which provides banking-related services to MapInfo. "I think it's part of the continued trend of their product acceptance in the marketplace."
More Beef
MapInfo posted fiscal first-quarter sales of $34.7 million, up 21% from the prior year. Earnings gained 50% to 6 cents a share.
The strong results are partly due to MapInfo's acquisition of Southbank Systems, which was accretive to earnings.
Southbank beefs up MapInfo's public sector business in the U.K. and the Asia-Pacific region.
The public sector refers to entities such as municipal government authorities. MapInfo helps them manage roads, bridges, parks and street lights.
The company focuses on three key markets besides the public sector: telecommunications, retail and financial services. MapInfo concentrates on them because location is important to each, Cattini says.
"(For instance,) telecommunications is all about geography," he said. "'Where's my network? Where's my coverage? Where's my competitor's coverage?' It's about relating an asset to customers or an asset to somebody else's assets."
MapInfo also can identify trouble spots on phone networks so telecoms can quickly dispatch crews to fix problems.
And it helps retail chains such as Home Depot (HD) and Gap (GPS) find locations for new stores.
The company's gear even helps with crime analysis, locating areas of high crime within cities. Police departments around the world use MapInfo's products. The list includes the New York City Police Department, which has been a customer for 10 years.
In the case of the NYPD, MapInfo software creates a digital, interactive map with data collected from crime reports.
"You can start asking sophisticated questions about the concentration of crimes around subway stations, parks and certain streets at certain parts of the day," Cattini said.
MapInfo looks to deepen its presence in the four markets in which it operates.
As the company builds a relationship with a customer, it starts offering more services to help that customer solve other issues.
"That's what our strategy really is — customer intimacy," Cattini said. "As we become intimate with our customers . . . they tell us what they require from us. We sit and we listen and we work with our customers."
Full Menu
To make it easier for customers to expand the number of applications MapInfo provides, the company last year introduced Envinsa, an enterprise-wide platform.
When Envinsa is set up in a customer's system to solve one problem, it becomes easy to add capabilities to solve new problems as they arise. MapInfo used to add applications piecemeal, "on an a la carte basis," Westminster's Gear says.
"(Envinsa) could be a very interesting product for them," he said. "It would provide entree to push more products and applications and data from MapInfo through that platform to the customer."
Meanwhile, new opportunities are opening up for MapInfo in the form of wireless devices.
According to a report from JPMorgan Chase, the recent Consumer Electronics Show in Las Vegas revealed "a large number of wireless devices that will enable location technologies in the consumer space."
MapInfo already has inked a deal with Gizmundo Europe, a subsidiary of Private Telematics, to offer capabilities such as map delivery for its Gizmundo handheld device.
Though there's no "apples-to-apples competitor" with MapInfo, Gear says the company competes for technology dollars with many competitors on products and in markets.
Analysts polled by First Call expect the company's fiscal 2005 earnings to rise 61% to 45 cents a share, then move up 31% to 59 cents in fiscal 2006. |
