EXHIBIT 99
----------
MRO SOFTWARE
FOR IMMEDIATE RELEASE
- ---------------------
INVESTOR CONTACT: MEDIA CONTACT:
Peter Rice Vaughn Harring
(781) 280-6550 (781) 280-6855
peter.rice@mro.com vaughn.harring@mro.com
MRO SOFTWARE REPORTS FOURTH QUARTER
AND FISCAL 2004 RESULTS
GROWTH IN REVENUE, EARNINGS AND CASH BUILDS
FOUNDATION FOR EXPANSION INTO NEW MARKETS
BEDFORD, MASS., NOVEMBER 4, 2004 - MRO Software, Inc. (Nasdaq: MROI), the
leading provider of strategic asset management solutions, today announced
revenues of $49.9 million for the Company's fourth quarter and $185.7 million
for the fiscal year ended September 30, 2004.
Total revenues for the fourth quarter were $49.9 million compared with $46.0
million for the fourth quarter last year an increase of 8 percent. Revenues for
the fiscal year ended September 30, 2004 were $185.7 million, compared with
$176.9 million for the prior year, an increase of 5 percent.
On a GAAP basis, the Company reported net income for the fourth quarter of $4.1
million or $0.16 per diluted share, compared with net income of $2.6 million or
$0.11 per diluted share for the same quarter last year, an increase in EPS of 38
percent. On a GAAP basis for the fiscal year ended September 30, 2004, the
Company reported net income of $10.3 million or $0.40 per diluted share compared
with a net income of $4.9 million, or $0.20 per diluted share for the prior
year, an increase in EPS of 56 percent.
Pro forma net income (see Schedule A) for the fourth quarter was $4.6 million,
or $0.18 per diluted share compared with pro forma net income of $3.3 million or
$0.13 per diluted share for same quarter last year. For fiscal year ended
September 30, 2004, the Company reported pro forma net income of $12.6 million,
or $0.50 per diluted share compared with pro forma net income of $7.9 million,
or $0.32 per diluted share for the prior year. Pro forma results are adjusted
for the amortization of acquired technology and other intangibles and their
related tax effects.
For the fourth quarter, revenues from software license sales were $15.9 million,
compared with $14.2 million for the same quarter last year, an increase of 12
percent. Support and services revenues were $33.9 million for the fourth
quarter, compared with $31.7 million for the same quarter last year, an increase
of 7 percent.
For fiscal year ended September 30, 2004, software revenues were $52.6 million
compared with $49.9 million for the prior year, an increase of 5 percent.
Support and services revenues for the fiscal year ended September 30, 2004, were
$133.1 million compared with $127.0 million for the prior year, an increase of 5
percent.
During the fourth quarter, the Company sold 269 software licenses into a broad
range of industries. Customers that purchased MRO Software solutions during the
quarter included: ABB, AMTRAK, Ames Labs, City of Austin, China National
Offshore Oil Company (CNOOC), Department of Energy, EDS, General Mills, Guinness
Brewing, Honeywell Austria, Jacksonville Electrical Authority, Johnson & Johnson
SpA, Kaiser Aluminum and Chemical, Kuwait Oil Tanker Co., Land Securities
Trillium, Library of Congress, Los Angeles Unified School District, Melbourne
Airport, Port Waratah Coal Services, Talisman Energy, United Gas Derivatives,
University of Kansas, U.S. Navy, and Washington International.
The balance sheet as of September 30, 2004 contained $108.4 million in cash and
marketable securities and no long-term debt. This compares with $94.6 million in
cash and marketable securities as of September 30, 2003, and represents a 15
percent increase year-over-year. For the fourth quarter, deferred revenue was
$30.3 million, and days sales outstanding (DSO) were 66.
"The Company delivered on its earnings and growth projections for the year,"
said Chip Drapeau, president and CEO, MRO Software. "Our industry solutions
continued to be important revenue drivers for the fourth quarter and the fiscal
year. The last two years of solid financial performance has provided the
foundation to launch our next generation asset and service management solution,
Maximo Enterprise Suite. Product development is complete, we are in the final
stages of QA, and early customer feedback has been positive. We are confident
with our plan to launch Maximo Enterprise Suite early in calendar year 2005."
"The Company is very sound financially," said Peter Rice, executive vice
president and CFO, MRO Software. "We had a strong fourth quarter, and for the
year we met our revenue growth targets, earnings improved by more than 50
percent on a pro forma basis, and 100 percent on a GAAP basis, and we
significantly improved our cash position."
For fiscal year 2005, the Company expects software revenues to grow in the range
of 10 to 20 percent above fiscal 2004 results. It is anticipated that operating
margins will continue to increase. As a result, the Company expects earnings to
increase in the range of 15 to 25 percent over fiscal 2004 results on a pro
forma basis. Consistent with prior performance, and due to the timing of the
release of the Maximo Enterprise Suite, the Company expects most of the
anticipated revenue growth to occur in the second half of the fiscal year.
Specifically, in the first quarter of fiscal 2005 revenues are expected to be in
the range of $45 to $47 million, GAAP earnings to be in the range of $0.08 to
$0.10 per share, and pro forma earnings to be in the range of $0.10 to $0.12 per
share.
Expected results on a pro forma basis are adjusted for the amortization of
acquired technology and other intangibles and their related tax effects (see
Schedule A).
The Company will conduct its regularly scheduled fiscal fourth quarter and year
end 2004 conference call on Thursday, November 4 at 4:30 p.m. EST.
To participate in this call within the U.S. and Canada, dial (866) 259-1024,
international callers should dial (703) 639-1218. A digital recording of the
call will be available beginning two hours after the call and will be available
until November 11, 2004. To access the replay within the U.S. and Canada, dial
(888) 266-2081, international callers should dial (703) 925-2533, all
participants should use conference ID: 581612.
A webcast of the call is available at: www.mro.com/investor. A transcript of the
call will be promptly archived on the Investor Relations portion of the
Company's website, and may be found at: www.mro.com/investor.
ABOUT MRO SOFTWARE, INC.
MRO Software is the leading provider of strategic asset management solutions.
The Company's integrated suite of applications optimizes performance, improves
productivity and service levels and enables asset-related sourcing and
procurement across the entire spectrum of strategic assets.
The Company's asset management solutions allow customers to manage the complete
lifecycle of strategic assets including: planning, procurement, deployment,
tracking, maintenance and retirement. Using MRO Software's solutions customers
improve production reliability, labor efficiency, material optimization,
software license compliance, lease management, warranty and service management
and provisioning across the asset base.
MRO Software (Nasdaq: MROI) is a global company based in Bedford, Mass., with
approximately 900 employees, 10,000 customers and more than 260,000 end-users.
The Company markets its products through a direct sales organization in
combination with a network of international distributors. MRO Software has sales
offices throughout North America, Europe, Asia/Pacific and Latin America.
Additional information on MRO Software can be found at http://www.mro.com.
FORWARD-LOOKING STATEMENTS.
This press release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. The Company's actual results could differ materially from
those set forth in the forward-looking statements. Certain factors that might
cause such a difference include, among other things, difficulties or delays in
the development or deployment of our industry-specific offerings, difficulties
or delays in the development, release or initial customer acceptance of our new
Maximo Enterprise Suite product, and those factors discussed in the Section
entitled "Factors Affecting Future Performance" in our Quarterly Report on Form
10-Q for the quarter ended June 30, 2004.
# # #
MAXIMO(R) and MAXIMO MainControl(R) are registered trademarks, and MRO
SoftwareTM is a trademark, of MRO Software, Inc.
MRO SOFTWARE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
THREE MONTHS ENDED TWELVE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
----------------------------- -----------------------------
2004 2003 2004 2003
------------ ------------ ------------ ------------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
Revenues:
Software $ 15,925 $ 14,219 $ 52,583 $ 49,904
Support and services 33,940 31,747 133,106 126,973
------------ ------------ ------------ ------------
Total revenues 49,865 45,966 185,689 176,877
------------ ------------ ------------ ------------
Cost of revenues:
Software 1,335 1,669 4,739 4,938
Support and services 15,004 14,515 60,144 58,618
Amortization of acquired technology 519 844 2,404 3,376
------------ ------------ ------------ ------------
Total cost of revenues 16,858 17,028 67,287 66,932
------------ ------------ ------------ ------------
Gross profit 33,007 28,938 118,402 109,945
Operating expenses:
Sales and marketing 15,276 13,352 56,762 59,117
Product development 7,388 6,820 28,492 26,476
General and administrative 4,705 4,584 17,839 17,702
Amortization of other intangibles 92 204 666 908
------------ ------------ ------------ ------------
Total operating expenses 27,461 24,960 103,759 104,203
------------ ------------ ------------ ------------
Income from operations 5,546 3,978 14,643 5,742
Interest income 497 215 1,258 811
Other income, net 298 11 6 1,161
------------ ------------ ------------ ------------
Income before income taxes 6,341 4,204 15,907 7,714
Provision for income taxes 2,240 1,568 5,567 2,844
------------ ------------ ------------ ------------
Net income $ 4,101 $ 2,636 $ 10,340 $ 4,870
============ ============ ============ ============
Net income per share, basic $ 0.16 $ 0.11 $ 0.41 $ 0.20
------------ ------------ ------------ ------------
Net income per share, diluted $ 0.16 $ 0.11 $ 0.40 $ 0.20
------------ ------------ ------------ ------------
Shares used to calculate net income per share
Basic 24,947 24,548 24,811 24,429
Diluted 25,090 24,985 25,290 24,653
MRO SOFTWARE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
PRO FORMA, AS ADJUSTED
SCHEDULE A
(UNAUDITED)
THREE MONTHS ENDED TWELVE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
----------------------------- -----------------------------
2004 2003 2004 2003
------------ ------------ ------------ ------------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
GAAP net income $ 4,101 $ 2,636 $ 10,340 $ 4,870
Pro forma adjustments
Amortization of other intangibles 92 204 666 908
Amortization of acquired technology 519 844 2,404 3,376
Related tax effects (156) (350) (844) (1,277)
------------ ------------ ------------ ------------
Total pro forma adjustments 455 698 2,226 3,007
Pro forma net income, as adjusted $ 4,556 $ 3,334 $ 12,566 $ 7,877
------------ ------------ ------------ ------------
Pro forma diluted net income per share,
as adjusted $ 0.18 $ 0.13 $ 0.50 $ 0.32
------------ ------------ ------------ ------------
Shares used to calculate pro forma net
income per share, as adjusted 25,090 24,985 25,290 24,653
NOTE:
In this press release, the Company announced its earnings per share (EPS)
on a GAAP and pro forma basis. Pro forma net income for fiscal year 2004
and 2003 is adjusted to exclude the amortization of acquired technology and
other intangibles and their related tax effects.
Management believes that such pro forma EPS is useful to investors, first
because it is important for investors to receive information in a form that
is consistent with the Company's past practice, and second because the
Company's amortization of acquired technology and other intangibles is
substantially fixed, and is relatively large in comparison with the
absolute value of the Company's operating income. The Company believes that
by focusing on the impact of expenses that are to a greater extent subject
to control by the Company's management, pro forma EPS provides investors
with a more direct perspective on the performance of the Company and its
management.
MRO SOFTWARE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
SEPTEMBER 30, SEPTEMBER 30,
2004 2003
------------ ------------
(in thousands) ASSETS
Cash and cash equivalents $ 56,982 $ 73,662
Marketable securities 2,227 1,102
Accounts receivable, net 36,636 28,833
Other current assets 6,542 6,419
------------ ------------
TOTAL CURRENT ASSETS 102,387 110,016
------------ ------------
Marketable securities 49,198 19,809
Property and equipment, net 7,227 8,239
Intangible assets, net 52,309 53,910
Other assets 11,600 13,287
------------ ------------
TOTAL ASSETS $ 222,721 $ 205,261
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $ 28,778 $ 27,966
Deferred revenue 29,373 28,734
------------ ------------
TOTAL CURRENT LIABILITIES 58,151 56,700
------------ ------------
Other long term liabilities 3,435 2,049
------------ ------------
TOTAL LIABILITIES 61,586 58,749
------------ ------------
STOCKHOLDERS' EQUITY 161,135 146,512
------------ ------------
TOTAL LIABILITIES &
STOCKHOLDERS' EQUITY $ 222,721 $ 205,261
============ ============
# # #