EXHIBIT 99.2
PRO FORMA FINANCIAL INFORMATION
Effective January 31, 2002, American Software, Inc. sold its wholly-owned
outsourcing subsidiary, AmQUEST, Inc., to Infocrossing, Inc. in an all cash
transaction valued at approximately $ 20 million, subject to a final working
capital adjustment. The pro forma condensed financial statements of American
Software, Inc. reflecting the disposition and exiting of AmQUEST operations are
shown below. The pro forma condensed consolidated balance sheet of American
Software Inc. is presented as if the transaction had occurred on October 31,
2001. The pro forma condensed consolidated statements of operations of American
Software, Inc. for the year ended April 30, 2001 and the six-month period ended
October 31, 2001 have been presented as if the transaction had occurred on May
1, 2000 and May 1, 2001, respectively. The pro forma financial information has
been prepared in accordance with SEC regulations, but is not necessarily
indicative of what the results of operations or financial condition of the
company would have been had the transaction occurred on the dates indicated.
AMERICAN SOFTWARE, INC.
Pro Forma Condensed Consolidated Balance Sheet
(in thousands except share and per share data)
(Unaudited)
Historical Adjusted
October 31, Pro forma October 31,
2001 adjustments 2001
-------------------- ---------------------- -------------------
ASSETS
Current assets:
Cash and cash equivalents 21,058 (1) 20,000 41,058
Investments - current 11,376 11,376
Accounts receivable 13,209 (2) (1,698) 11,511
Other current assets 3,458 (2) (459) 2,999
-------------------- ---------------------- -------------------
Total current assets 49,101 17,843 66,944
Investments - non current 927 - 927
Property and equipment, net 13,748 (2) (2,799) 10,949
Intangible assets, net 13,631 - 13,631
Other assets 1,833 (2) (544) 1,289
-------------------- ---------------------- -------------------
79,240 14,500 93,740
==================== ====================== ===================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Current portion of obligations under capital leases 1,137 (2) (1,137) -
Accounts payable 2,636 (2) (631) 2,005
Accrued expenses and other current liabilities 7,866 (2) (1,007) 6,859
(3) 800 800
Deferred Revenue 11,605 - 11,605
-------------------- ---------------------- -------------------
Total current liabilities 23,244 (1,975) 21,269
Obligations under capital leases, net of current portion 597 (2) (597) -
Deferred income taxes 1,280 1,280
Minority interest in subsidiaries 3,962 3,962
Shareholders' equity 50,157 (4) 17,072 67,229
-------------------- ---------------------- -------------------
79,240 14,500 93,740
==================== ====================== ===================
Notes:
1) Cash proceeds from the sale.
2) To remove historic carrying value of AmQUEST, Inc.
3) Accruals related to the transaction for investment banking, legal, audit
services and other items.
4) Estimated pre-tax gain resulting from the disposition of AmQUEST, Inc.
No tax effects have been presented since the company will reduce a
valuation allowance on deferred income taxes that will offset the
current income tax expense that would be payable on the gain.
American Software, Inc.
Pro Forma Condensed Consolidated Statements of Operations
(in thousands except share data)
(Unaudited)
Historical
Historical 6 Months
Year Ended Pro forma Pro forma Ended Pro forma Pro forma
04/30/2001 Adjustments 04/30/2001 10/31/2001 Adjustments 10/31/2001
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Revenues:
License fees $ 12,778 $ - $ 12,778 $ 5,987 $ - $ 5,987
Services 52,064 (15,958)(1 36,106 24,342 (8,285)(1 16,057
Maintenance 23,865 0 23,865 11,303 0 11,303
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Total revenues 88,707 (15,958) 72,749 41,632 (8,285) 33,347
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Cost of revenues:
License fees 5,681 0 5,681 2,310 0 2,310
Services 44,289 (17,967)(1 26,322 17,760 (8,397)(1 9,363
Maintenance 5,225 0 5,225 1,704 0 1,704
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Total cost of revenues 55,195 (17,967) 37,228 21,774 (8,397) 13,377
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Gross Margin 33,512 2,009 35,521 19,858 112 19,970
Operating Expenses:
Research and development costs 11,624 (284)(1 11,340 3,847 0 3,847
Marketing and sales expense 22,588 (2,496)(1 20,092 8,206 (1,118)(1 7,088
General and administrative expenses 15,182 (918)(1 14,264 6,559 (268)(1 6,291
Charge for asset impairment 10,458 0 10,458 0 0 0
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Total operating expenses 59,852 (3,698) 56,154 18,612 (1,386) 17,226
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Operating earnings (loss) (26,340) 5,707 (20,633) 1,246 1,498 2,744
Other income:
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Total other income, net (1,342) (232) (1 (1,574) (995) (104)(1 (1,099)
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Earnings (loss) before income taxes (24,998) 5,939 (19,059) 2,241 1,602 3,843
Income tax expense (benefit) (2,418) 0 (2,418) 0 0 0
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Net earnings (loss) $ (22,580) $ 5,939 $ (16,641) $ 2,241 $ 1,602 $ 3,843
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Net earnings (loss) per common and
common equivalent share
Basic $ (0.99) $ (0.73) $ 0.10 $ 0.17
Diluted $ (0.99) $ (0.73) $ 0.10 $ 0.17
Weighted average number of common ===================================================================================
and common equivalent shares
outstanding Basic 22,730 22,730 22,782 22,782
Diluted 22,730 22,730 22,788 22,788
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Notes:
1) To remove historic revenues and expenses of AmQUEST, Inc.