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Original Source: FD (FAIR DISCLOSURE) WIRE
. Vincent Klinges, American Software, Inc., CFO . Jim Edenfield, American Software, Inc., President, CEO . Mike Edenfield, American Software, Inc., EVP, President of Logility
For the second consecutive qtr., revenues increased over those obtained in the previous year. 2Q05 total revenues increased 10% to $14.9m vs. $13.5m in 2Q04. The Co.'s financial position remains strong with cash and short-term and long-term investments of approx. $55m at the end of 2Q05 and no debt. Q&A Focus: Expenses, acquisition, cash, and DMI.
A. Key Data From Call 1. 2Q05 Total revenues = $14.9m. 2. 2Q05 Operating income = $810,000. 3. 2Q05 EBITDA = $2m. 4. 2Q05 Net income = $1.5m. 5. 2Q05 EPS = $0.06.
S1. Opening Comments (J.E.) 1. 2Q05 Highlights: 1. For the second consecutive qtr., revenues increased over those obtained in the previous year. 2. However, an unexpected shortfall in license fees hampered the Co.'s earnings comparison. 3. The shortfall occurred in the Co.'s Logility subsidiary, and AMSWA believes that this is a temporary phenomenon. 4. AMSWA is pleased that it recorded its 15th consecutive qtr. of profitability under GAAP.
2. New Generation Computing (NGC): 1. AMSWA continues to sell its new products to new and to existing customers. 2. One of the big wins with a new customer was with WestPoint Stevens, who selected NGC's Web-based sourcing and production system, ESPS, along with the EPDM product data management module to streamline their global sourcing and production. 3. Other significant wins were with Roka Apparel and Gold Toe Brands. 4. Services revenues continued to grow in the Co.'s consulting and staffing business, reflecting to some extent an improving economy.
5. Hopefully, the next step in the slowly improving economy will
include increased expenditures to license small or large
ticket software systems.
S2. Demand Management (M.E.) 1. Overview of Demand Management (DMI):
1. DMI was a privately-held co. based in St. Louis, Missouri,
specializing in supply chain planning software solutions. 2. They were about a $10m a year co. with approx. 30 people. 3. DMI had a significant indirect channel of 23 organizations with approx. 67 people who sell, install, and implement solutions worldwide. 4. DMI's products are marketed under the DS1 brand, and are being used by several thousand users in 70 countries around the world. 5. DMI has over 800 customers paying maintenance on an annual recurring basis. 2. Acquisition of DMI: 1. Logility acquired DMI on 09/29/2004. 2. Benefits to the acquisition:
1. The first two benefits relate to expanding the Co.'s market
coverage. 1. The Co. now can address a broader market segment. 2. Traditionally, Logility has been focused on the upper, mid-tier, and higher end of the market, in terms of the size of the enterprise the Co. sells to. 3. DMI has been focused more on the mid-tier and smaller end of the market. 4. Combined, the Co. now has the …