Manugistics Announces Preliminary Third Quarter Results
4 Dec 2002, 08:44am ET
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ROCKVILLE, Md.--(BUSINESS WIRE)--Dec. 4, 2002--Manugistics Group,
Inc. (Nasdaq:MANU), the leading global provider of Enterprise Profit
Optimization(TM) (EPO) solutions, today announced preliminary results
for its fiscal third quarter ended November 30, 2002. Manugistics
expects to report total revenue of approximately $61 million to $62
million, including software revenue of approximately $14.0 million to
$14.5 million. Based on these estimated revenues, the company expects
to report adjusted loss per diluted share of $.18 to $.20 when it
reports final results on December 19, 2002. The Company had
approximately 70 million weighted average shares outstanding for the
quarter ended November 30, 2002.
Adjusted net loss per share for the quarter ended November 30,
2002 excludes charges associated with amortization of acquired
technology, amortization of intangibles, restructuring and impairment
charges and non-cash stock compensation expense.
"Our financial performance during the third quarter reflects the
continuing difficult sales environment in all geographies. Although
sales activity is up, it is not yet reflected in closure rates as
clients and prospects continue to postpone major capital investments
in application software," said Greg Owens, Manugistics' chairman and
chief executive officer. "The cost reductions that we completed during
the third quarter more closely align expenses with current revenue
levels, which we believe will allow us to post improved operating
performance in our fourth quarter. We are looking forward to starting
our fourth quarter with this lower expense structure and believe that
our market will ultimately rebound due to the critical need for supply
chain and pricing optimization solutions and the value they create."
Business Metrics - Quarter Ended November 30, 2002
-- The company closed 22 significant software license
transactions - software license transactions of $100,000 or
greater - compared to 27 during the quarter ended August 31,
2002. The average selling price for significant software
transactions was approximately $600,000 compared to $614,000
during the quarter ended August 31, 2002.
-- The Company closed three software license transactions of $1
million or greater, compared to four during the quarter ended
August 31, 2002.
-- Software sales within the quarter were strongest in the
following vertical markets: Automotive; Consumer Packaged
Goods; Industrial; Retail and Travel, Transportation &
Hospitality.
-- Significant client wins during the quarter included Alticor,
Eroski S. Coop, Great North Eastern Railroad, Manufacture
Francaise Des Pneumatiques Michelin, Pechiney Plastic
Packaging, Inc., Xerox International Partners, and YUM!
Restaurants (China).
Cost Reductions and Restructuring Charge - Quarter Ended November
30, 2002
-- Employee headcount was approximately 1,225 as of November 30,
2002 compared to 1,387 as of August 31, 2002, or a reduction
of 12 percent, consistent with cost saving initiatives
announced in September 2002.
-- Estimated restructuring charge will be approximately $7
million, including approximately $3 million in severance and
related benefits, $3 million in lease terminations and $1
million in non-cash impairment charges, compared with a range
of $2 million to $4 million previously disclosed. The increase
is due mainly to higher than anticipated charges associated
with reducing remote office space in the U.S. and Europe.
Financial Condition - November 30, 2002
-- Cash, cash equivalents and marketable securities are expected
to be approximately $144 million to $147 million, at November
30, 2002, including restricted cash of approximately $14
million to collateralize outstanding letters of credit under
the company's $20 million credit facility. The company is
currently negotiating with another lender to potentially
eliminate this cash restriction.
-- The remaining purchase price of $27.8 million related to the
first quarter Western Data Systems and Digital Freight
acquisitions was paid in cash during the quarter ended
November 30, 2002. The company's semi-annual interest payment
of $6.25 million on its 5% Subordinated Convertible Debt was
also paid during the quarter.
Preliminary Guidance - Quarter Ending February 28, 2003
The Company is targeting a sequential increase in total revenue
during the quarter ending February 28, 2003, including increased
software revenue. These targeted increases include software revenue
from the Company's multi-year contract to provide software to the
Defense Logistics Agency. Based on this targeted revenue increase and
expected adjusted operating expense of approximately $68 million to
$69 million in the fourth quarter, adjusted net loss per diluted share
is expected to improve significantly compared to the third quarter.
This preliminary guidance will be updated when the company reports its
final results for the quarter ended November 30, 2002 on December 19,
2002.
"It has been difficult to find a bottom to the decreased spending
on application software, but with software license revenue from our
Government contract, we believe we should see improved operating
performance in our fourth quarter," Owens added.
For the quarter ended November 30, 2002, the Company expects to
report an actual loss per diluted share of $.35 to $.37 measured under
generally accepted accounting principles (GAAP). These expected GAAP
results include estimates of amortization of acquired technology and
intangibles of $4.6 million, the previously mentioned restructuring
and impairment charges of $7.0 million and non-cash stock compensation
expense of $800,000.
December 19, 2002 Conference Call Information: Manugistics has
scheduled a simultaneous conference call and audio Web-cast for
Thursday, December 19th at 5:00 PM Eastern Standard Time (EST) to
discuss the company's financial performance for its third quarter of
fiscal 2003 in more detail. Interested parties may listen to the
Web-cast by going to manugistics.com.
A recording of the call will be available from 7:00 PM EST
December 19th, 2002 through 7:00 PM EST December 23rd, 2002. To listen
to the recording, callers within North America may call 800-633-8284.
Callers outside North America may call 402-977-9140. Callers to the
recording will be required to enter the access number for this call,
which is 21070081. In addition, a recording of the Web-cast will be
archived at manugistics.com from 7:00 PM EST December
19th, 2002 through 7:00 PM EST December 23rd, 2002. |
