EXHIBIT 99.1
FOR IMMEDIATE RELEASE
Contact:
Patrick Henn
Vice President, Finance
678.597.7730
phenn@manh.com
MANHATTAN ASSOCIATES ANNOUNCES
FINAL RESULTS FOR THE FIRST QUARTER OF 2003; COMPANY ACHIEVES RECORD
REVENUES OF $46.1 MILLION FOR THE QUARTER
ATLANTA - APRIL 22, 2003 - Manhattan Associates, Inc., (Nasdaq: MANH), the
global leader in providing supply chain execution (SCE) solutions, today
announced final results for the first quarter ended March 31, 2003. These
results are in line with the preliminary results announced April 7, 2003.
KEY QUARTERLY FINANCIAL HIGHLIGHTS FOR MANHATTAN ASSOCIATES INCLUDE:
- Total revenue for the quarter ended March 31, 2003 was a
record $46.1 million, an increase of 9% over the first
quarter of 2002.
- Software and hosting fees for the quarter ended March 31,
2003, were $10.2 million, an increase of 8% over the first
quarter of 2002.
- Services revenue for the quarter ended March 31, 2003 was a
record $30.2 million, an increase of 15% over the first
quarter of 2002. The services' gross margin remained strong
at 58%, which was consistent with the fourth quarter of 2002
and up from 56% in the first quarter of 2002.
- International revenue was 21% of total revenue for the first
quarter of 2003 compared to 17% for the first quarter of
2002.
- Cash from operations for the quarter was $8.3 million, and
total cash and short-term investments were $128.5 million at
March 31, 2003.
Adjusted net income, which excludes the amortization of acquisition-related
intangible assets, net of taxes, was $5.0 million for the quarter, or $0.17 per
fully diluted share, compared to $5.8
million or $0.19 per fully diluted share for the first quarter 2002. GAAP net
income was $4.5 million or $0.15 per fully diluted share.
The Company provides adjusted net income and adjusted net income per
share in the press release as additional information of the Company's operating
results. The measures are in accordance with, or an alternative for, GAAP and
may be different from net income and per share measures used by other
companies. Adjusted net income has been adjusted to exclude the effects of
amortization of acquisition-related intangibles. The Company believes that this
presentation of adjusted net income and adjusted net income per share provides
useful information to investors regarding certain additional financial and
business trends relating to our financial condition and results of operations.
The effective tax rate used in calculating adjusted net income is 35.3%.
"The economic and geopolitical uncertainty had an impact on our
license fee performance this quarter. The overall business, however, remains
very strong with our market leadership position further strengthened," said
Richard Haddrill, Manhattan Associates' president and CEO. "We made excellent
progress on our key growth strategies during the quarter, including product
line expansion, vertical industry expansion and key partnership growth. Moving
forward, we are excited about the next release of software in May, which marks
the industry's first true synchronized release of supply chain execution
functionality."
OTHER KEY QUARTERLY HIGHLIGHTS FOR MANHATTAN ASSOCIATES INCLUDE THE FOLLOWING:
- Signed key new customers in the quarter including Coleman
Cable; Dell Computer Corporation; Gulf States Toyota;
Hastings Entertainment, Inc.; McKesson Corporation; Panalpina
Europe Services AG; The Roman & Littlefield Publishing Group,
Inc.; and United Foods, Inc.
- Expanded our partnership with many existing clients including
Carole Hochman Designs; Innotrac Corporation; Kellwood
Company; Michaels Stores, Inc.; and Supercheap Auto.
- Advanced its leadership position in Radio Frequency
Identification (RFID) technology by joining the Auto-ID
Center at MIT; announcing with Zebra Technologies a plan to
deliver a joint solution for RFID labels; announcing that the
Company will expand its retail compliance guarantee for the
top 100 U.S. retailers to include any new and emerging radio
frequency identification (RFID) standards; and forming a
partnership with Alien Technology and Symbol Technologies to
deliver an RFID-enabled SCE solution.
- Introduced a formal Independent Software Vendor (ISV)
Certification Program that will provide interface
standardization to Manhattan Associates' industry-leading
supply chain execution solutions and the many third-party
ISVs with whom the Company partners.
- Signed a letter of intent for Siemens Dematic, Material
Handling Automation Division, the logistics equipment
automation leader, to become a reseller of Manhattan
Associates' industry-leading SCE solutions. This proposed
reseller agreement calls for Siemens Dematic to become
Manhattan Associates' preferred partner for material handling
systems, and Siemens Dematic will become Manhattan
Associates' preferred partner for SCE solutions in North,
Central and South America.
In addition, Manhattan Associates announced several changes to the
board of directors. Alan J. Dabbiere resigned from his position as chairman of
the board and as a director, effective on the date of the company's annual
meeting of shareholders, scheduled to occur May 22, 2003. The board of
directors elected John J. Huntz, Jr., who has served as a member of the board
of directors since January 1999, to serve as the chairman of the board
following Mr. Dabbiere's resignation. Mr. Huntz has served as managing director
of Fuqua Ventures, LLC, a private equity investment firm since March 1998. Mr.
Huntz is also a member of the Securities and Exchange Commission Executive
Committee on Capital Formation. The board of directors also nominated Paul
Goodwin for election at the annual meeting. Mr. Goodwin has served as the vice
chairman and chief financial officer of CSX Corporation since April 2000. Prior
to April 2000, Mr. Goodwin served CSX Corporation as its executive vice
president of finance and chief financial officer. Following Mr. Goodwin's
election, a majority of the board of directors will be comprised of independent
directors as defined by current and proposed Nasdaq rules.
"It has been both an honor and a privilege to work with Manhattan
Associates' employees, customers and partners over the past 13 years. I have
been so fortunate to have worked with some of the industry's brightest stars.
Now, it is time to focus on my family and pursue my own personal interests,"
said Alan Dabbiere, Manhattan Associates' founder and chairman of the board.
"With the management team we have in place, I leave this company in excellent
hands with a future that is full of promise."
BUSINESS OUTLOOK FOR 2003
Manhattan Associates currently intends to publish, in each quarterly earnings
release, certain expectations with respect to future financial performance. The
following statements
regarding future financial performance are based on current expectations. These
statements are forward looking. Actual results may differ materially,
especially in the current uncertain economic environment. These statements do
not reflect the potential impact of mergers, acquisitions or other business
combinations that may be completed after the date of this release.
Manhattan Associates will make its earnings release and published
expectations available on its Web site (www.manh.com). Beginning June 15, 2003,
Manhattan Associates will observe a "Quiet Period" during which Manhattan
Associates and its representatives will not comment concerning previously
published financial expectations. Prior to the start of the Quiet Period, the
public can continue to rely on the expectations published in this Business
Outlook section as still being Manhattan Associates' current expectation on
matters covered, unless Manhattan Associates publishes a notice stating
otherwise. The public should not rely on previously published expectations
during the Quiet Period, and Manhattan Associates disclaims any obligation to
update any previously published financial expectations during the Quiet Period.
The Quiet Period will extend until the date when Manhattan Associates' next
quarterly earnings release is published, presently scheduled for the third or
fourth week of July 2003.
For the year ending December 31, 2003, Manhattan Associates currently
expects to achieve adjusted earnings, which excludes the amortization of
acquisition-related intangibles and unusual items, in the range of $0.87 to
$1.01 per fully diluted share. These expectations assume that the current
general economic and capital spending environment will improve modestly over
the balance of the year.
ABOUT MANHATTAN ASSOCIATES, INC.
Manhattan Associates, Inc., is the global leader in providing supply chain
execution solutions. We enable operational excellence through real-time
collaboration, execution and optimization. Our solutions leverage
state-of-the-art technologies, innovative practices and our domain expertise to
enhance performance, profitability and competitive advantage. Manhattan
Associates has licensed more than 870 customers representing more than 1,300
facilities worldwide, which include some of the world's leading manufacturers,
distributors and retailers. For more information about Manhattan Associates
telephone 770.955.7070 or visit www.manh.com.
This press release may contain "forward-looking statements" relating to
Manhattan Associates, Inc. Prospective investors are cautioned that any such
forward-looking statements are not guarantees of future performance and involve
risks and uncertainties, and that actual results may differ materially from
those contemplated by such forward-looking statements. Among the important
factors that could cause actual results to differ materially from those
indicated by such forward-looking statements are delays in product development,
undetected software errors, competitive pressures, technical difficulties,
market acceptance, availability of technical personnel, changes in customer
requirements and general economic and geopolitical conditions. Additional
factors are set forth in "Safe Harbor Compliance Statement for Forward-Looking
Statements" included as Exhibit 99.1 to the Company's Annual Report on Form
10-K for the year ended December 31, 2002. Manhattan Associates undertakes no
obligation to update or revise forward-looking statements to reflect changed
assumptions, the occurrence of unanticipated events or changes in future
operating results.
MANHATTAN ASSOCIATES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
Three Months Ended
March 31,
-----------------------------
2003 2002
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(unaudited)
Revenue:
Software and hosting fees ......................... $ 10,159 $ 9,373
Services .......................................... 30,240 26,405
Hardware and other ................................ 5,698 6,365
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Total revenue ................................. 46,097 42,143
Costs and Expenses:
Cost of software and hosting fees ................. 1,123 392
Cost of services .................................. 12,766 11,622
Cost of hardware and other ........................ 4,927 5,320
Research and development .......................... 6,754 4,857
Sales and marketing ............................... 7,572 5,756
General and administrative ........................ 5,734 5,094
Amortization of acquisition-related intangibles ... 763 534
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Total costs and expenses ...................... 39,639 33,575
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Operating income ....................................... 6,458 8,568
Other income, net ...................................... 557 173
-------- --------
Income before income taxes ............................. 7,015 8,741
Income tax provision ................................... 2,475 3,234
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Net income ............................................. $ 4,540 $ 5,507
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Basic net income per share ............................. $ 0.16 $ 0.20
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Diluted net income per share ........................... $ 0.15 $ 0.18
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Weighted average number of shares:
Basic .............................................. 29,079 28,165
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Diluted ............................................ 30,446 31,132
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Reconciliation of Adjusted Net Income:
Net income ............................................. $ 4,540 $ 5,507
Amortization of acquisition-related intangibles ........ 763 534
Income tax effect ...................................... (269) (198)
-------- --------
Adjusted net income .................................... 5,034 5,843
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Adjusted net income per diluted share .................. $ 0.17 $ 0.19
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MANHATTAN ASSOCIATES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
March 31, December 31,
2003 2002
--------- ------------
ASSETS
Current Assets:
Cash and cash equivalents ...................... $ 94,900 $ 64,664
Short-term investments ......................... 33,648 57,193
Accounts receivable, net ....................... 36,445 32,384
Prepaid expenses and other current assets ...... 3,845 3,199
Deferred income taxes .......................... 1,342 1,768
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Total current assets ....................... 170,180 159,208
Property and equipment, net ......................... 12,474 12,352
Intangible and other assets ......................... 47,850 48,636
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Total assets ............................... $230,504 $220,196
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued liabilities ....... $ 16,746 $ 19,047
Current portion of capital lease obligations ... 123 164
Deferred revenue ............................... 20,630 15,318
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Total current liabilities .................. 37,499 34,529
Long-term portion of capital lease obligations ...... 240 240
Deferred income taxes ............................... 100 141
Total shareholders' equity .......................... 192,665 185,286
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Total liabilities and shareholders' equity ..... $230,504 $220,196
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